Penn State's $14.2M R&D contract with DoD's Missile Defense Agency for physical sciences research

Contract Overview

Contract Amount: $14,248,805 ($14.2M)

Contractor: THE Pennsylvania State University

Awarding Agency: Department of Defense

Start Date: 2007-10-01

End Date: 2012-03-31

Contract Duration: 1,643 days

Daily Burn Rate: $8.7K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: COST PLUS FIXED FEE

Sector: R&D

Official Description: RESEARCH AND DEVELOPMENT

Place of Performance

Location: UNIVERSITY PARK, CENTRE County, PENNSYLVANIA, 16802

State: Pennsylvania Government Spending

Plain-Language Summary

Department of Defense obligated $14.2 million to THE PENNSYLVANIA STATE UNIVERSITY for work described as: RESEARCH AND DEVELOPMENT Key points: 1. Contract awarded to a single academic institution, suggesting specialized research capabilities. 2. Focus on physical sciences R&D aligns with critical defense technology development needs. 3. Long contract duration of over 4 years indicates a sustained research effort. 4. Cost-plus-fixed-fee structure may incentivize efficient resource utilization within defined scope. 5. Awarded under full and open competition, implying a broad search for qualified entities. 6. Potential for follow-on research or technology transition given the R&D nature.

Value Assessment

Rating: good

This contract's value of $14.2 million for over four years of R&D appears reasonable for a large-scale research project undertaken by a major university. Benchmarking against similar large-scale defense R&D contracts awarded to academic institutions suggests this falls within a typical spending range for complex scientific endeavors. The cost-plus-fixed-fee (CPFF) pricing structure, while common for R&D, requires careful monitoring to ensure costs remain controlled and the fixed fee is justified by the scope and risk.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that the Missile Defense Agency sought proposals from all responsible sources. While the specific number of bidders is not provided, this approach generally fosters a competitive environment, potentially leading to better pricing and innovative solutions. The selection of a single entity, The Pennsylvania State University, suggests they offered the most advantageous proposal based on technical merit, cost, and other evaluation factors.

Taxpayer Impact: Full and open competition is beneficial for taxpayers as it maximizes the pool of potential offerors, increasing the likelihood of receiving competitive pricing and high-quality research outcomes, thereby ensuring efficient use of public funds.

Public Impact

Benefits the Department of Defense by advancing research in physical sciences relevant to missile defense. Delivers advanced research findings and potential technological innovations. Primarily impacts the scientific research community and potentially the defense technology sector. Supports specialized research roles within The Pennsylvania State University, potentially involving faculty and graduate students.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns inherent in cost-plus contracts if not rigorously managed.
Scope creep could increase the total contract value beyond initial estimates.
Ensuring the research directly translates into actionable defense capabilities requires clear performance metrics.

Positive Signals

Award to a reputable academic institution with a strong research track record.
Full and open competition suggests a thorough evaluation process.
Long-term nature of the contract allows for in-depth research and development.
Focus on a critical defense area (missile defense) indicates strategic importance.

Sector Analysis

This contract falls within the Research and Development sector, specifically focusing on physical sciences. The market for defense-related R&D is substantial, with agencies like the Missile Defense Agency consistently investing in cutting-edge technologies. Academic institutions are frequent recipients of such contracts due to their specialized expertise and research infrastructure. Comparable spending benchmarks for large-scale, multi-year R&D projects at major universities often range in the millions to tens of millions of dollars, depending on the complexity and duration.

Small Business Impact

This contract does not appear to have a small business set-aside component, as it was awarded to a large academic institution. There is no explicit information regarding subcontracting plans for small businesses. The focus on specialized R&D may limit opportunities for broad subcontracting, though specific components or services could potentially be sourced from small businesses if deemed necessary and cost-effective.

Oversight & Accountability

Oversight for this contract would typically be managed by the Missile Defense Agency's contracting and technical personnel. Performance reviews, financial audits, and milestone tracking are standard oversight mechanisms for cost-plus-fixed-fee contracts. Transparency is generally maintained through contract reporting requirements, though detailed research findings may be subject to classification or proprietary considerations. Inspector General involvement would be triggered by allegations of fraud, waste, or abuse.

Related Government Programs

Missile Defense Agency Research Programs
Department of Defense Basic Research Initiatives
University Research Grants
Advanced Technology Development Contracts

Risk Flags

Cost-plus contract requires diligent oversight to manage expenditures.
Research and Development contracts can have uncertain outcomes and timelines.
Potential for intellectual property disputes or challenges in technology transition.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $14.2 million to THE PENNSYLVANIA STATE UNIVERSITY. RESEARCH AND DEVELOPMENT

Who is the contractor on this award?

The obligated recipient is THE PENNSYLVANIA STATE UNIVERSITY.

Which agency awarded this contract?

Awarding agency: Department of Defense (Missile Defense Agency).

What is the total obligated amount?

The obligated amount is $14.2 million.

What is the period of performance?

Start: 2007-10-01. End: 2012-03-31.

What is the specific research focus within physical sciences for this contract?

The provided data indicates the contract falls under NAICS code 541712, 'Research and Development in the Physical, Engineering, and Life Sciences (except Biotechnology).' While the specific research focus within physical sciences isn't detailed, it is for the Missile Defense Agency (MDA). This suggests the research likely pertains to areas critical for missile defense systems, such as advanced materials, sensor technologies, propulsion systems, aerodynamics, or related physics principles. The MDA's mission is to develop and deploy systems to protect the United States from ballistic and cruise missile threats, so the R&D would align with these strategic objectives.

How does the $14.2 million cost compare to similar R&D contracts awarded to universities by the DoD?

The $14.2 million total award for a contract spanning over four years (October 2007 to March 2012) places it as a significant, but not exceptionally large, R&D award for a major university. The Department of Defense awards numerous R&D contracts to academic institutions annually, with values ranging from hundreds of thousands to tens of millions of dollars. Contracts focused on fundamental or applied research in specialized areas like missile defense often command higher values due to the complexity and required expertise. Without knowing the specific research scope, it's difficult to provide a precise benchmark, but this amount is consistent with substantial, multi-year research efforts undertaken by leading research universities for defense applications.

What are the primary risks associated with a Cost Plus Fixed Fee (CPFF) contract for R&D?

The primary risks associated with a Cost Plus Fixed Fee (CPFF) contract for R&D involve potential cost overruns and the contractor's incentive to control costs. While the government agrees to pay all allowable costs incurred by the contractor, the fixed fee provides a ceiling on the contractor's profit. If costs escalate significantly beyond initial projections, the contractor may face reduced profit margins, potentially impacting morale or effort. Conversely, the government bears the risk of cost increases. For the government, effective oversight is crucial to ensure that costs are reasonable and allocable to the contract and that the fixed fee remains appropriate for the work performed and the risks assumed by the contractor.

What is the track record of The Pennsylvania State University in securing DoD research contracts?

The Pennsylvania State University (Penn State) has a long and established history of securing significant research funding from the Department of Defense and other federal agencies. As a major research university, Penn State actively participates in defense-related research across various disciplines, including engineering, physical sciences, and materials science. They have consistently ranked among the top universities for federal R&D expenditures. Their involvement in defense research often includes work on advanced technologies, materials, and systems critical to national security, making them a frequent and reliable partner for DoD research initiatives.

How might the 'full and open competition' impact the quality and cost of the research?

Awarding this contract under 'full and open competition' suggests that the Missile Defense Agency solicited proposals from a wide range of potential offerors, including various research institutions and potentially private companies. This broad solicitation increases the likelihood of identifying the most capable and cost-effective provider for the specific research needs. Competition generally drives down prices and encourages innovation as bidders strive to present the most compelling technical approach and value proposition. For taxpayers, this process aims to ensure that the government secures high-quality research at a fair and reasonable price by leveraging the expertise and capabilities available across the research landscape.

What is the typical duration for similar large-scale R&D contracts in the defense sector?

Large-scale Research and Development (R&D) contracts, particularly those involving fundamental or applied scientific research for defense applications, often have durations ranging from one to five years. The duration is typically dictated by the complexity of the research objectives, the phased nature of scientific discovery, and the need for sustained effort to achieve meaningful results. Contracts like this one, spanning over four years (1643 days), are common for ambitious R&D projects that require significant time for experimentation, analysis, and potential iteration. Shorter durations might be suitable for more targeted development tasks, while longer periods allow for deeper exploration and potential breakthroughs.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Scientific Research and Development Services › Research and Development in the Physical, Engineering, and Life Sciences (except Biotechnology)

Product/Service Code: RESEARCH AND DEVELOPMENT › C – National Defense R&D Services

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: BASIC RESEARCH

Offers Received: 1

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Address: 408 OLD MAIN, UNIVERSITY PARK, PA, 16802

Business Categories: Category Business, Educational Institution, Higher Education, Nonprofit Organization, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $21,914,853

Exercised Options: $18,314,882

Current Obligation: $14,248,805

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline