DoD awards Raytheon $15.1M for R&D, raising questions on value and competition
Contract Overview
Contract Amount: $15,108,865 ($15.1M)
Contractor: Raytheon Company
Awarding Agency: Department of Defense
Start Date: 2002-10-31
End Date: 2011-11-30
Contract Duration: 3,317 days
Daily Burn Rate: $4.6K/day
Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES
Number of Offers Received: 1
Pricing Type: COST PLUS FIXED FEE
Sector: R&D
Place of Performance
Location: MCKINNEY, COLLIN County, TEXAS, 75071
State: Texas Government Spending
Plain-Language Summary
Department of Defense obligated $15.1 million to RAYTHEON COMPANY for work described as: Key points: 1. Significant contract value of $15.1M for R&D services. 2. Competition method raises concerns about price discovery. 3. Potential risks associated with cost-plus contract type. 4. Spending falls within the broad R&D sector.
Value Assessment
Rating: questionable
The $15.1M award to Raytheon for R&D lacks clear benchmarks for comparison. Without detailed cost breakdowns or comparable contracts, assessing the value for money is difficult. The cost-plus fixed fee structure can incentivize higher spending.
Cost Per Unit: N/A
Competition Analysis
Competition Level: limited
The contract was awarded under 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES,' indicating a limited competition. This method may have restricted the pool of potential bidders, potentially impacting price discovery and leading to less competitive pricing.
Taxpayer Impact: The limited competition and cost-plus structure suggest taxpayers may not have received the best possible price for these R&D services.
Public Impact
Taxpayers funded extensive research and development activities. The contract duration of over 9 years suggests long-term investment. The specific R&D outcomes and their public benefit are not detailed.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Limited competition
- Cost-plus contract type
- Lack of clear value assessment
Positive Signals
- Awarded to a major defense contractor
- Supports R&D activities
Sector Analysis
This contract falls under Research and Development in the Physical, Engineering, and Life Sciences (NAICS 541710). Spending in this sector is crucial for innovation but can be complex to manage due to its inherent uncertainty and long-term nature.
Small Business Impact
The contract was awarded to Raytheon Company, a large prime contractor. There is no indication that small businesses were significantly involved as subcontractors or partners in this specific award.
Oversight & Accountability
The contract was managed by the Defense Contract Management Agency. Further oversight details regarding performance monitoring, cost controls, and compliance are not provided in the data.
Related Government Programs
- Research and Development in the Physical, Engineering, and Life Sciences
- Department of Defense Contracting
- Defense Contract Management Agency Programs
Risk Flags
- Potential for cost overruns due to CPFF structure.
- Limited competition may have inflated prices.
- Lack of transparency on specific R&D deliverables.
- Long contract duration without clear performance metrics.
Tags
research-and-development-in-the-physical, department-of-defense, tx, dca, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $15.1 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 (Defense Contract Management Agency).
What is the total obligated amount?
The obligated amount is $15.1 million.
What is the period of performance?
Start: 2002-10-31. End: 2011-11-30.
What specific R&D objectives were pursued under this contract, and what were the measurable outcomes?
The provided data does not specify the exact research and development objectives or the measurable outcomes achieved. Understanding the nature of the R&D, such as advancements in materials science, engineering processes, or life sciences applications, is crucial for evaluating the contract's true value and impact beyond the financial outlay.
How did the 'exclusion of sources' in the competition process impact the final negotiated price?
The 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES' clause suggests that while the competition was intended to be open, certain sources were deliberately excluded. This limitation could have reduced competitive pressure, potentially leading to a higher price than if all capable sources had been allowed to bid. A detailed analysis of the excluded sources and the justification would be needed.
What mechanisms were in place to control costs and ensure efficiency under the Cost Plus Fixed Fee (CPFF) structure?
The CPFF contract type carries inherent risks of cost overruns as the contractor is reimbursed for allowable costs plus a fixed fee. Effective oversight would require stringent monitoring of expenditures, clear definition of allowable costs, and robust negotiation of the fixed fee to ensure contractor efficiency and prevent unnecessary spending by 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: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES
Solicitation Procedures: BASIC RESEARCH
Offers Received: 1
Pricing Type: COST PLUS FIXED FEE (U)
Contractor Details
Address: 2501 W UNIVERSITY DRIVE M, MC KINNEY, TX, 03
Business Categories: Category Business, Not Designated a Small Business
Financial Breakdown
Contract Ceiling: $43,479,534
Exercised Options: $1,330,000
Current Obligation: $15,108,865
Contract Characteristics
Cost or Pricing Data: NO
Timeline
Start Date: 2002-10-31
Current End Date: 2011-11-30
Potential End Date: 2011-11-30 00:00:00
Last Modified: 2010-11-30
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