DoD's $17.6M contract for engineering services to Dynamics Technology, Inc. awarded by ONR

Contract Overview

Contract Amount: $17,588,740 ($17.6M)

Contractor: Raytheon Applied Signal Technology, Inc.

Awarding Agency: Department of Defense

Start Date: 2003-12-12

End Date: 2009-02-20

Contract Duration: 1,897 days

Daily Burn Rate: $9.3K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 1

Pricing Type: COST PLUS FIXED FEE

Sector: Defense

Official Description: 200403!000528!1700!E612A !OFFICE OF NAVAL RESEARCH, HEADQU!N0001403C0476 !A!N! !N! ! !20031212!20081211!081116725!081116725!081116725!N!DYNAMICS TECHNOLOGY, INC !21311 HAWTHORNE BLVD , SUI!TORRANCE !CA!90503!80000!037!06!TORRANCE !LOS ANGELES !CALIFORNIA!+000000100000!N!N!000000000000!AD93!RDTE/OTHER DEFENSE-ADV TECH DEV !A7 !ELECTRONICS AND COMMUNICATION EQUIP !000 !* !541330!E! !3! ! ! ! ! !99990909!B! ! !A! !A!N!U!2!001!E! !Z!Y!Z! ! !N!B!N!N! ! !A! !A!A!00 !A!B!N! ! ! ! ! ! !0001! !

Place of Performance

Location: TORRANCE, LOS ANGELES County, CALIFORNIA, 90502

State: California Government Spending

Plain-Language Summary

Department of Defense obligated $17.6 million to RAYTHEON APPLIED SIGNAL TECHNOLOGY, INC. for work described as: 200403!000528!1700!E612A !OFFICE OF NAVAL RESEARCH, HEADQU!N0001403C0476 !A!N! !N! ! !20031212!20081211!081116725!081116725!081116725!N!DYNAMICS TECHNOLOGY, INC !21311 HAWTHORNE BLVD , SUI!TORRANCE !CA!90503!80000!037!06!TORRANCE !LOS … Key points: 1. Contract value of $17.6M for engineering services indicates a significant investment in defense technology development. 2. The award to Dynamics Technology, Inc. suggests a focus on specialized electronic and communication equipment expertise. 3. A long contract duration of 1897 days implies a need for sustained research and development efforts. 4. The 'RDTE/OTHER DEFENSE-ADV TECH DEV' classification points to cutting-edge research with potential for future military applications. 5. The 'COST PLUS FIXED FEE' contract type suggests a balance between incentivizing contractor efficiency and managing project costs. 6. The exclusion of sources in the competition type warrants further investigation into the rationale behind limited bidding.

Value Assessment

Rating: fair

The contract value of $17.6 million for engineering services appears to be within a reasonable range for advanced defense research and development projects. However, without specific benchmarks for comparable 'RDTE/OTHER DEFENSE-ADV TECH DEV' contracts or detailed cost breakdowns, a precise value-for-money assessment is challenging. The 'COST PLUS FIXED FEE' structure can sometimes lead to higher overall costs compared to fixed-price contracts if not managed tightly, but it is often necessary for R&D where scope can be uncertain. Further analysis of the contractor's performance and final costs against initial estimates would be beneficial.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

The contract was awarded under 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES,' indicating that while the competition was intended to be open, certain sources were excluded. This suggests a potentially limited pool of bidders, which could impact price discovery and potentially lead to higher costs for the government compared to a truly open competition. The specific reasons for excluding sources are not detailed in the provided data, making it difficult to fully assess the impact on competition.

Taxpayer Impact: The limited competition may mean taxpayers did not benefit from the most competitive pricing available. The exclusion of potential bidders could have resulted in a higher final award price than might have been achieved in a broader competition.

Public Impact

The primary beneficiaries are likely the Department of Defense and its various branches, which will receive advanced engineering services and potentially new technologies. The services delivered are related to 'ELECTRONICS AND COMMUNICATION EQUIP' and 'RDTE/OTHER DEFENSE-ADV TECH DEV,' suggesting advancements in military communication and technology. The geographic impact is centered around the contractor's location in Torrance, California, and the awarding agency's operations. Workforce implications include employment opportunities for engineers and technical staff at Dynamics Technology, Inc. and potentially its subcontractors.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Limited competition raises concerns about potential price inflation and reduced innovation.
The 'exclusion of sources' requires clarification to ensure fair market access and taxpayer value.
Cost-plus contract types can present risks of cost overruns if not rigorously monitored.

Positive Signals

Award to an established entity like Dynamics Technology, Inc. suggests a level of trust and proven capability.
The focus on advanced R&D indicates investment in future defense capabilities.
A long contract duration suggests a commitment to developing and integrating complex technologies.

Sector Analysis

This contract falls within the Engineering Services sector, specifically supporting defense-related research, development, testing, and evaluation (RDTE). The North American Industry Classification System (NAICS) code 541330 (Engineering Services) is a broad category, but this award highlights a niche within defense technology. Comparable spending in this sector often involves significant investments in specialized R&D, with contract values varying widely based on project scope and technological complexity. The defense sector's RDTE spending is a substantial portion of the overall federal budget, reflecting ongoing needs for technological superiority.

Small Business Impact

The data indicates that this contract was not set aside for small businesses (ss: false, sb: false). Therefore, there are no direct subcontracting implications for small businesses stemming from a set-aside provision. However, the prime contractor, Dynamics Technology, Inc., may still engage small businesses as subcontractors, depending on their own procurement practices and the nature of the services required. Without specific subcontracting plans or data, the direct impact on the small business ecosystem remains unclear.

Oversight & Accountability

Oversight for this contract would typically be managed by the Defense Contract Management Agency (DCMA), as indicated by the 'sa' field. Accountability measures would be embedded within the contract's terms and conditions, including performance metrics, reporting requirements, and payment schedules tied to milestones. Transparency is generally facilitated through contract databases like FPDS, where basic award information is made public. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse related to the contract.

Related Government Programs

Defense Research and Development
Electronics and Communication Equipment Procurement
Naval Research Programs
Advanced Technology Development Contracts

Risk Flags

Limited competition raises concerns about price fairness.
Cost-plus contract type requires diligent oversight to manage potential cost overruns.
Exclusion of sources needs justification to ensure fair market access.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $17.6 million to RAYTHEON APPLIED SIGNAL TECHNOLOGY, INC.. 200403!000528!1700!E612A !OFFICE OF NAVAL RESEARCH, HEADQU!N0001403C0476 !A!N! !N! ! !20031212!20081211!081116725!081116725!081116725!N!DYNAMICS TECHNOLOGY, INC !21311 HAWTHORNE BLVD , SUI!TORRANCE !CA!90503!80000!037!06!TORRANCE !LOS ANGELES !CALIFORNIA!+000000100000!N!N!000000000000!AD93!RDTE/OTHER DEFENSE-ADV TECH DEV !A7 !ELECTRONICS AND COMMUNICATION EQUIP !000 !* !541330!E! !3! ! ! ! ! !999

Who is the contractor on this award?

The obligated recipient is RAYTHEON APPLIED SIGNAL TECHNOLOGY, INC..

Which agency awarded this contract?

Awarding agency: Department of Defense (Defense Contract Management Agency).

What is the total obligated amount?

The obligated amount is $17.6 million.

What is the period of performance?

Start: 2003-12-12. End: 2009-02-20.

What is the track record of Dynamics Technology, Inc. in performing similar defense R&D contracts?

Dynamics Technology, Inc. has a history of securing defense contracts, particularly in areas related to electronics, communications, and advanced technology development. While this specific contract is for a substantial amount ($17.6M) and duration (approx. 5 years), their portfolio likely includes other projects of varying scales. A deeper dive into their past performance ratings, any past performance issues or awards, and their financial stability would provide a clearer picture of their capability to execute this particular contract successfully. Analyzing their success rate on cost-plus contracts specifically would also be informative, as these types require careful management to avoid overruns.

How does the $17.6M contract value compare to similar 'RDTE/OTHER DEFENSE-ADV TECH DEV' contracts?

The $17.6 million value for this contract, classified under 'RDTE/OTHER DEFENSE-ADV TECH DEV' and awarded by the Office of Naval Research (ONR), is a significant but not extraordinary sum for advanced defense research. Contracts in this category can range from a few million to hundreds of millions of dollars, depending on the technological scope, duration, and number of performers. For instance, major platform development or system integration projects would command much higher values. However, for specialized R&D focused on specific electronic or communication equipment advancements, $17.6M represents a substantial investment, suggesting a project of considerable complexity and potential impact.

What are the primary risks associated with a 'COST PLUS FIXED FEE' contract for advanced R&D?

The primary risks associated with a 'COST PLUS FIXED FEE' (CPFF) contract, especially in advanced R&D, revolve around cost control and contractor incentive. For the government, the risk is that the contractor may not be sufficiently motivated to control costs, as the fee is fixed regardless of the actual expenses incurred (within contract limits). This can lead to cost overruns if the contractor's actual costs exceed initial estimates. For the contractor, the risk lies in underestimating the costs, which could erode their profit margin if they cannot complete the work within the estimated cost base while still delivering the required scope. Effective oversight and robust cost accounting are crucial to mitigate these risks.

What does the 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES' designation imply for taxpayer value?

The designation 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES' implies a complex procurement process. While it aims for broad competition, the explicit exclusion of certain sources suggests that only a subset of potential offerors were considered. This can limit the diversity of technical approaches and potentially reduce the competitive pressure on pricing. If the excluded sources were capable and could have offered a more competitive bid, then taxpayers may not have received the best possible value. Understanding the justification for excluding specific sources is critical to assessing whether this limitation compromised the government's ability to secure optimal pricing and innovation.

How does the contract's focus on 'ELECTRONICS AND COMMUNICATION EQUIP' align with current defense priorities?

The contract's focus on 'ELECTRONICS AND COMMUNICATION EQUIP' aligns strongly with current defense priorities. Modern warfare increasingly relies on secure, advanced, and resilient communication networks, electronic warfare capabilities, and sophisticated sensor systems. Investments in these areas are crucial for maintaining information superiority, enabling joint operations, and countering evolving threats. The 'RDTE/OTHER DEFENSE-ADV TECH DEV' classification further indicates that this contract is aimed at developing next-generation technologies in this domain, ensuring that military forces have access to cutting-edge capabilities to meet future challenges.

What is the significance of the 1897-day duration for this engineering services contract?

A duration of 1897 days, approximately five years, for an engineering services contract in the defense R&D sector signifies a long-term commitment to a specific technological development or research objective. Such extended periods are typical for complex projects that require extensive research, design, prototyping, testing, and potential refinement. This duration suggests that the Office of Naval Research anticipates a lengthy development cycle for the targeted 'ELECTRONICS AND COMMUNICATION EQUIP' or related advanced technologies. It also implies a need for sustained effort and potentially evolving requirements over the contract's life.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Architectural, Engineering, and Related Services › Engineering Services

Product/Service Code: RESEARCH AND DEVELOPMENT › DEFENSE (OTHER) R&D

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)

Evaluated Preference: NONE

Contractor Details

Parent Company: Raytheon Company (UEI: 001339159)

Address: 2000 E EL SEGUNDO BLVD, EL SEGUNDO, CA, 90245

Business Categories: Category Business, Small Business, Special Designations, U.S.-Owned Business

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: YES

Timeline