DoD's $132M R&D Contract with Raytheon Company: A Deep Dive into Value and Competition
Contract Overview
Contract Amount: $132,231,451 ($132.2M)
Contractor: Raytheon Company
Awarding Agency: Department of Defense
Start Date: 2006-04-07
End Date: 2010-10-31
Contract Duration: 1,668 days
Daily Burn Rate: $79.3K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: COST PLUS AWARD FEE
Sector: R&D
Place of Performance
Location: WOBURN, MIDDLESEX County, MASSACHUSETTS, 01801
Plain-Language Summary
Department of Defense obligated $132.2 million to RAYTHEON COMPANY for work described as: Key points: 1. Significant investment in R&D for missile defense, indicating a focus on advanced technological capabilities. 2. Sole-source award to Raytheon suggests a lack of readily available alternatives or specialized expertise. 3. Potential for cost overruns given the 'Cost Plus Award Fee' contract type. 4. The contract duration of over 4 years highlights a long-term commitment to this specific research area.
Value Assessment
Rating: fair
The 'Cost Plus Award Fee' structure can incentivize performance but also carries inherent risks of cost escalation. Benchmarking against similar R&D contracts is difficult without more granular cost data.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
The contract was not competed, which limits price discovery and potentially leads to higher costs. This approach is often justified when a specific contractor possesses unique capabilities or intellectual property.
Taxpayer Impact: Taxpayer funds are committed without the benefit of competitive bidding, potentially resulting in a less optimal price for the services rendered.
Public Impact
Advancement in missile defense technology could enhance national security. Potential for job creation within Raytheon and its subcontractors. Long-term investment in a critical defense capability. Lack of competition may limit innovation spurred by market forces.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award limits competition.
- Cost-plus contract type carries risk of overruns.
- Lack of transparency in pricing due to non-competitive nature.
Positive Signals
- Addresses critical national security need.
- Leverages specialized expertise of a major defense contractor.
- Potential for significant technological advancement.
Sector Analysis
This contract falls under Research and Development in Physical, Engineering, and Life Sciences, a sector critical for technological advancement in defense. Spending benchmarks for sole-source R&D contracts can vary widely based on complexity and criticality.
Small Business Impact
No indication of small business participation is provided in the data. Sole-source contracts often bypass opportunities for small businesses to compete for prime contracts.
Oversight & Accountability
The 'Cost Plus Award Fee' structure requires robust oversight to ensure performance targets are met and costs are reasonable. The Department of Defense and Missile Defense Agency are responsible for monitoring contract execution.
Related Government Programs
- Research and Development in the Physical, Engineering, and Life Sciences
- Department of Defense Contracting
- Missile Defense Agency Programs
Risk Flags
- Lack of competition may lead to inflated costs.
- Cost-plus contract type is susceptible to cost overruns.
- Limited transparency on pricing and performance metrics.
- Potential for vendor lock-in due to specialized nature of R&D.
Tags
research-and-development-in-the-physical, department-of-defense, ma, definitive-contract, 100m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $132.2 million to RAYTHEON COMPANY. See the official description on USAspending.
Who is the contractor on this award?
The obligated recipient is RAYTHEON COMPANY.
Which agency awarded this contract?
Awarding agency: Department of Defense (Missile Defense Agency).
What is the total obligated amount?
The obligated amount is $132.2 million.
What is the period of performance?
Start: 2006-04-07. End: 2010-10-31.
What specific technological advancements were achieved under this contract, and how do they compare to the initial objectives?
The contract aimed at advancing missile defense capabilities. A thorough review of program reports and technical assessments would be needed to determine the specific advancements made and their alignment with the initial objectives. This would involve evaluating whether the R&D yielded novel technologies, improved existing systems, or met critical performance milestones as defined in the contract.
What was the justification for awarding this contract on a sole-source basis, and were alternative solutions considered?
Sole-source awards are typically justified when a specific contractor possesses unique capabilities, proprietary technology, or is the only source capable of meeting the requirement. The justification would likely detail why competition was not feasible or advantageous, and whether any market research was conducted to identify potential alternative sources or solutions before proceeding with a sole-source negotiation.
How did the final costs compare to the initial estimates, and what was the impact of the award fee structure on the total expenditure?
Analyzing the final expenditure against initial cost estimates and understanding the distribution of the award fee would reveal the cost-effectiveness. If costs significantly exceeded estimates or the award fee was substantial, it would indicate potential inefficiencies or challenges in managing the contract, impacting the overall value for taxpayers.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Scientific Research and Development Services › Research and Development in the Physical, Engineering, and Life Sciences
Product/Service Code: RESEARCH AND DEVELOPMENT › C – National Defense R&D Services
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Offers Received: 1
Pricing Type: COST PLUS AWARD FEE (R)
Evaluated Preference: NONE
Contractor Details
Address: 225 PRESIDENTIAL WAY, WOBURN, MA, 01801
Business Categories: Category Business, Not Designated a Small Business
Contract Characteristics
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Cost or Pricing Data: NO
Timeline
Start Date: 2006-04-07
Current End Date: 2010-10-31
Potential End Date: 2010-10-31 00:00:00
Last Modified: 2016-08-29
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