Department of Defense awarded $11.6M for R&D in physical sciences, with a cost-plus-fixed-fee contract

Contract Overview

Contract Amount: $12,011,096 ($12.0M)

Contractor: DRS Power Technology, Inc.

Awarding Agency: Department of Defense

Start Date: 2004-05-05

End Date: 2009-06-29

Contract Duration: 1,881 days

Daily Burn Rate: $6.4K/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

Official Description: 200408!001360!1700!E612A !OFFICE OF NAVAL RESEARCH, HEADQU!N0001404C0047 !A!N! !N! ! !20040505!20070131!116226080!116226080!116226080!N!DRS ELECTRIC POWER TECHNOLOGIE!2 FOX RD !HUDSON !MA!01749!31575!017!25!HUDSON !MIDDLESEX !MASS !+000003178993!N!N!000000000000!AD92!RDTE/OTHER DEFENSE-APPLIED RESEARCH !S1 !SERVICES !000 !* !541710!E! !3! ! ! ! ! !99990909!B! ! !A! !A!N!U!2!001!E! !Z!Y!Z! ! !N!C!N! ! ! !A!A!A!A!000!A!C!N! ! ! ! ! ! !0001! !

Place of Performance

Location: HUDSON, MIDDLESEX County, MASSACHUSETTS, 01749

State: Massachusetts Government Spending

Plain-Language Summary

Department of Defense obligated $12.0 million to DRS POWER TECHNOLOGY, INC. for work described as: 200408!001360!1700!E612A !OFFICE OF NAVAL RESEARCH, HEADQU!N0001404C0047 !A!N! !N! ! !20040505!20070131!116226080!116226080!116226080!N!DRS ELECTRIC POWER TECHNOLOGIE!2 FOX RD !HUDSON !MA!01749!31575!017!25!HUDSON !MIDD… Key points: 1. Contract awarded for research and development in physical, engineering, and life sciences. 2. The contract type is Cost Plus Fixed Fee, indicating potential for cost overruns. 3. Awarded by the Office of Naval Research, suggesting a focus on naval applications. 4. The contract duration was 1881 days, spanning over 5 years. 5. The contractor, DRS Power Technology, Inc., has a track record with this agency. 6. The North American Industry Classification System (NAICS) code is 541710, for R&D in physical sciences.

Value Assessment

Rating: fair

The contract value of $11.6 million for over five years of R&D services appears reasonable given the nature of research and development. However, without specific benchmarks for comparable R&D projects in physical sciences, a precise value-for-money assessment is challenging. The Cost Plus Fixed Fee (CPFF) contract type can sometimes lead to higher costs than fixed-price contracts if not managed carefully, but it is often necessary for research where scope and costs are uncertain.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

This contract was awarded under 'Full and Open Competition After Exclusion of Sources.' This suggests that while competition was sought, certain sources were excluded, potentially limiting the breadth of competition. The specific reasons for exclusion are not detailed, but it implies a more targeted procurement than a completely open process. The number of bidders is not specified, making it difficult to fully assess the competitive landscape.

Taxpayer Impact: The limited competition may have resulted in a higher price for taxpayers compared to a scenario with broader participation from all potential offerors.

Public Impact

The Office of Naval Research benefits from advancements in physical, engineering, and life sciences research. The contract supports the development of new technologies and scientific understanding. The geographic impact is primarily within Massachusetts, where the contractor is located. The contract likely supports a specialized workforce in scientific research and development.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost Plus Fixed Fee structure can lead to cost overruns if not closely monitored.
Limited competition may have impacted price discovery and potentially increased costs for the government.
The specific R&D outcomes and their direct applicability to naval needs are not detailed, posing a risk of misaligned research efforts.

Positive Signals

Awarded by a reputable agency (Office of Naval Research) for R&D, indicating a strategic investment.
The contractor has a history with the agency, suggesting a level of established working relationship.
The contract duration of over 5 years allows for sustained research and development efforts.

Sector Analysis

This contract falls within the Research and Development sector, specifically NAICS code 541710 (Research and Development in the Physical, Engineering, and Life Sciences). This sector is characterized by innovation and the pursuit of new knowledge and technologies. Federal spending in this area is crucial for national security, economic competitiveness, and scientific advancement. Comparable spending benchmarks would typically involve analyzing other R&D contracts awarded by defense agencies for similar scientific disciplines.

Small Business Impact

The data indicates 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. The primary contractor, DRS Power Technology, Inc., is likely a large business, and any subcontracting would depend on their internal procurement strategies and the specific needs of the R&D project.

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 Cost Plus Fixed Fee contract terms, requiring the contractor to justify costs and report on research progress. Transparency is generally facilitated through contract databases like FPDS, though detailed R&D reports may be sensitive.

Related Government Programs

Naval Research Programs
Defense Applied Research
Physical Sciences R&D
Engineering R&D
Life Sciences R&D

Risk Flags

Cost Plus Fixed Fee contract type carries inherent risk of cost overruns.
Limited competition may have reduced price discovery.
Specific R&D outcomes and their direct applicability are not detailed, posing a potential misalignment risk.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $12.0 million to DRS POWER TECHNOLOGY, INC.. 200408!001360!1700!E612A !OFFICE OF NAVAL RESEARCH, HEADQU!N0001404C0047 !A!N! !N! ! !20040505!20070131!116226080!116226080!116226080!N!DRS ELECTRIC POWER TECHNOLOGIE!2 FOX RD !HUDSON !MA!01749!31575!017!25!HUDSON !MIDDLESEX !MASS !+000003178993!N!N!000000000000!AD92!RDTE/OTHER DEFENSE-APPLIED RESEARCH !S1 !SERVICES !000 !* !541710!E! !3! ! ! ! ! !999

Who is the contractor on this award?

The obligated recipient is DRS POWER 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 $12.0 million.

What is the period of performance?

Start: 2004-05-05. End: 2009-06-29.

What is the track record of DRS Power Technology, Inc. with the Office of Naval Research?

The provided data indicates that DRS Power Technology, Inc. (co: DRS POWER TECHNOLOGY, INC.) was awarded this contract (N0001404C0047) by the Office of Naval Research (OFFICE OF NAVAL RESEARCH, HEADQU). The contract duration was substantial, from May 5, 2004, to January 31, 2007 (original end date), with a final completion date extending to June 29, 2009. The total award amount was $11,622,608.00. While this specific award shows a significant engagement, a comprehensive track record assessment would require examining all past and present contracts between DRS Power Technology, Inc. and the Office of Naval Research, including performance reviews, any disputes, and the overall value and scope of their prior work together. This single data point suggests a capacity to handle large R&D contracts for the agency.

How does the $11.6 million award compare to similar R&D contracts in physical sciences?

Comparing the $11.6 million award for R&D in physical sciences requires context regarding the specific research area, duration, and scope. Contracts in this field can vary widely. For instance, basic research efforts might be smaller, while advanced development projects with significant hardware components could be much larger. The duration of this contract (over 5 years) suggests a substantial, long-term research effort. To benchmark effectively, one would need to identify other contracts awarded by the Department of Defense or similar agencies (like NSF or DOE) for R&D in physical sciences with comparable timelines and objectives. Without such comparative data, it's difficult to definitively state if $11.6 million represents a high, low, or average value. However, for a multi-year R&D initiative, it falls within a plausible range for specialized scientific endeavors.

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

The primary risk associated with a Cost Plus Fixed Fee (CPFF) contract, like the one awarded to DRS Power Technology, Inc., is the potential for cost overruns. In a CPFF structure, the contractor is reimbursed for all allowable costs incurred, plus a predetermined fixed fee representing profit. If the contractor's actual costs exceed initial estimates, the government bears the burden of these increased expenses. This can be particularly risky in R&D where the scope of work and the associated costs are often uncertain and subject to unforeseen challenges. Effective oversight, detailed cost tracking, and robust negotiation of the fixed fee are crucial to mitigate this risk. The government must ensure that the contractor exercises due diligence in controlling costs, as their profit (the fixed fee) is not directly tied to cost savings.

How effective is 'Full and Open Competition After Exclusion of Sources' in ensuring value for taxpayers?

The effectiveness of 'Full and Open Competition After Exclusion of Sources' in ensuring value for taxpayers is nuanced. While it represents a form of competition, the 'exclusion of sources' inherently limits the pool of potential bidders. This limitation can reduce the downward pressure on prices that might occur in a truly unrestricted competition. The value for taxpayers depends heavily on the justification for excluding certain sources. If the exclusions are based on legitimate technical requirements, security concerns, or specific capabilities that only a few entities possess, then the competition, though limited, might still yield a fair price. However, if sources are excluded without strong justification, it could lead to less competitive pricing and potentially higher costs for the government, thereby diminishing taxpayer value. Robust justification and transparency around the exclusion criteria are key.

What are the implications of the NAICS code 541710 for this contract's scope and potential outcomes?

The North American Industry Classification System (NAICS) code 541710 signifies 'Research and Development in the Physical, Engineering, and Life Sciences.' This broad classification indicates that the contract likely involves scientific investigation, experimentation, and the development of new knowledge or technologies within these domains. For this specific contract awarded to DRS Power Technology, Inc. by the Office of Naval Research, it suggests the R&D efforts could span areas such as materials science, electronics, energy systems, propulsion, or other engineering and scientific fields relevant to naval applications. The outcomes could range from theoretical advancements and prototypes to feasibility studies and proof-of-concept demonstrations. The broadness of the code means the specific focus could be highly specialized, requiring expert analysis of the contract's statement of work to understand the precise R&D objectives and expected deliverables.

What does the contract's duration of 1881 days imply about the nature of the R&D?

A contract duration of 1881 days, which is approximately 5 years and 2 months, implies that the research and development effort undertaken was substantial and likely involved long-term objectives. Short-term R&D projects are typically completed within months, whereas projects spanning multiple years often involve fundamental research, complex experimentation, technology maturation, or the development of intricate systems. For the Office of Naval Research, such a duration suggests an investment in potentially groundbreaking or foundational scientific and engineering advancements that require sustained effort and iterative development. It also indicates a level of confidence from the agency in the contractor's ability to manage and execute a project over an extended period, and that the anticipated outcomes were not expected to be realized quickly.

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 › 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)

Contractor Details

Parent Company: Leonardo SPA (UEI: 428869465)

Address: 2 FOX RD, HUDSON, MA, 03

Business Categories: Category Business, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Contract Characteristics

Cost or Pricing Data: YES

Timeline