DoD awards $8.9M R&D contract to Penn State for physical, engineering, and life sciences research

Contract Overview

Contract Amount: $8,925,245 ($8.9M)

Contractor: THE Pennsylvania State University

Awarding Agency: Department of Defense

Start Date: 2024-11-26

End Date: 2026-12-16

Contract Duration: 750 days

Daily Burn Rate: $11.9K/day

Competition Type: NOT COMPETED

Pricing Type: COST PLUS FIXED FEE

Sector: R&D

Official Description: CPFF PROJECTS

Place of Performance

Location: UNIVERSITY PARK, CENTRE County, PENNSYLVANIA, 16802

State: Pennsylvania Government Spending

Plain-Language Summary

Department of Defense obligated $8.9 million to THE PENNSYLVANIA STATE UNIVERSITY for work described as: CPFF PROJECTS Key points: 1. Contract awarded on a cost-plus-fixed-fee basis, indicating potential for cost overruns. 2. Research area is broad, encompassing physical, engineering, and life sciences, requiring careful performance monitoring. 3. Sole-source award limits competitive pressure, potentially impacting price efficiency. 4. Contract duration of 750 days suggests a significant research undertaking. 5. No small business set-aside, raising questions about opportunities for smaller research institutions. 6. The contract is a delivery order, implying it's part of a larger, potentially pre-existing agreement.

Value Assessment

Rating: questionable

The contract's cost-plus-fixed-fee structure requires close oversight to ensure costs remain reasonable. Without comparable sole-source awards for similar research scope and duration, benchmarking value is difficult. The fixed fee component provides some cost certainty, but the overall cost efficiency is contingent on effective management and efficient execution of the research tasks by Penn State.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning it was not competed among multiple offerors. This approach is typically used when a specific contractor possesses unique capabilities or when circumstances preclude full and open competition. The lack of competition means there was no direct price comparison through bidding, potentially leading to a higher price than if multiple firms had competed.

Taxpayer Impact: Sole-source awards limit opportunities for other qualified entities to secure federal funding and can reduce the government's ability to negotiate the best possible price due to the absence of competitive pressure.

Public Impact

The Pennsylvania State University is the primary beneficiary, receiving funding for research activities. The contract supports research and development in physical, engineering, and life sciences, potentially leading to advancements in these fields. The geographic impact is primarily within Pennsylvania, where the research is likely to be conducted. The contract may involve researchers, technicians, and support staff at Penn State, impacting the local workforce.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may lead to suboptimal pricing.
Cost-plus-fixed-fee structure necessitates robust cost monitoring to prevent overruns.
Broad research scope could lead to scope creep if not tightly managed.
Limited transparency due to sole-source nature.

Positive Signals

Leverages established research capabilities of a major university.
Fixed fee provides some cost predictability for the government.
Supports critical R&D in key scientific and engineering domains.

Sector Analysis

This contract falls within the Research and Development sector, specifically focusing on physical, engineering, and life sciences. This is a broad category that supports innovation and technological advancement across various government missions. Federal spending in R&D is crucial for maintaining a technological edge and addressing complex societal challenges. Comparable spending benchmarks are difficult to establish without a more defined research objective, but university-led R&D contracts are common across many federal agencies.

Small Business Impact

The contract was not set aside for small businesses, and there is no indication of subcontracting requirements for small businesses. This means that opportunities for small, specialized research firms to participate in this specific award are limited. The focus on a large university suggests the contract is designed to leverage significant institutional research infrastructure and expertise, which may not be readily available to smaller entities.

Oversight & Accountability

Oversight will likely be managed by the awarding agency (Department of Defense) through contract officers and technical representatives. Accountability measures will be tied to the achievement of research milestones and deliverables outlined in the contract. Transparency may be limited due to the sole-source nature and the proprietary aspects often associated with R&D. Inspector General jurisdiction would apply if any fraud, waste, or abuse is suspected.

Related Government Programs

Department of Defense Research and Development Programs
University Research Grants
Physical Sciences Research Contracts
Engineering Research Contracts
Life Sciences Research Contracts

Risk Flags

Sole-source award limits competitive pricing.
Cost-plus-fixed-fee structure requires diligent cost oversight.
Broad R&D scope may present management challenges.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $8.9 million to THE PENNSYLVANIA STATE UNIVERSITY. CPFF PROJECTS

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 (Washington Headquarters Services).

What is the total obligated amount?

The obligated amount is $8.9 million.

What is the period of performance?

Start: 2024-11-26. End: 2026-12-16.

What is the specific research objective and expected outcome of this contract?

The provided data indicates the contract is for 'Research and Development in the Physical, Engineering, and Life Sciences (except Nanotechnology and Biotechnology)' under NAICS code 541715. However, the specific research objective, detailed scope of work, and expected outcomes are not detailed in the provided data. Typically, such contracts aim to advance scientific knowledge, develop new technologies, or solve specific technical challenges relevant to the Department of Defense's mission. The exact deliverables, research milestones, and final reports would be specified in the contract's statement of work, which is not available here. Further inquiry would be needed to ascertain the precise nature of the R&D being pursued.

How does the fixed fee component compare to typical R&D contracts of this nature?

The data provided indicates a 'COST PLUS FIXED FEE' (CPFF) contract type. In a CPFF contract, the contractor is reimbursed for all allowable costs incurred, plus a fixed amount of profit (the fixed fee). The fixed fee is negotiated at the outset and does not change regardless of the final cost. For R&D contracts, especially those involving significant uncertainty or exploration, a CPFF structure can be appropriate as it incentivizes the contractor to control costs while allowing for flexibility in research direction. Benchmarking the fixed fee against similar sole-source R&D contracts awarded by the DoD to large universities would be necessary to assess its reasonableness. Without that comparative data, it's difficult to definitively state if it's high or low, but the fixed nature of the fee provides a degree of cost predictability for the government compared to other cost-reimbursement types.

What are the potential risks associated with a sole-source award for R&D?

Sole-source awards for Research and Development (R&D) carry several potential risks. Primarily, the absence of competition can lead to a lack of price pressure, potentially resulting in a higher cost to the government than if the contract had been competed. There's also a risk that the government may not be accessing the most innovative solutions or the best available talent if other qualified entities were not given an opportunity to bid. Furthermore, sole-source awards can sometimes raise concerns about fairness and equal opportunity for other potential contractors. In R&D, the inherent uncertainty means that the initial justification for a sole-source award must be robust, and ongoing oversight is critical to ensure the chosen contractor is performing effectively and efficiently towards the stated research goals.

What is the historical spending pattern with The Pennsylvania State University for similar R&D services?

To assess historical spending patterns with The Pennsylvania State University for similar R&D services, one would need to access federal procurement databases (like USASpending.gov or FPDS) and filter for contracts awarded to this institution under relevant NAICS codes (such as 541715) and contract types (like CPFF). This analysis would reveal the volume, value, and nature of previous R&D contracts. Understanding this history can provide context for the current award, indicating whether Penn State is a frequent or significant recipient of DoD R&D funding, and whether this award represents a continuation or expansion of prior work. Without direct access to this historical data, it's impossible to provide specific figures or trends.

How is the performance of R&D activities typically monitored under a CPFF contract?

Performance monitoring for R&D activities under a Cost-Plus-Fixed-Fee (CPFF) contract typically involves a multi-faceted approach. The government appoints a Contracting Officer's Representative (COR) or Technical Point of Contact (TPOC) who is responsible for overseeing the technical aspects of the work. This involves regular progress reviews, milestone tracking, analysis of interim research reports, and ensuring adherence to the Statement of Work (SOW). For CPFF contracts, particular attention is paid to cost tracking to ensure that expenditures align with the approved budget and that the fixed fee is earned appropriately. The COR will verify that the research is progressing as planned and that the contractor is making diligent efforts to achieve the research objectives within the agreed-upon cost and timeline.

Industry Classification

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

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

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: HQ003424R0066

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Address: 201 OLD MAIN, UNIVERSITY PARK, PA, 16802

Business Categories: Category Business, Corporate Entity Tax Exempt, Educational Institution, Higher Education, Nonprofit Organization, Not Designated a Small Business, Higher Education (Public), Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $22,572,880

Exercised Options: $22,572,880

Current Obligation: $8,925,245

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: HQ003424D0022

IDV Type: IDC

Timeline