DoD awards Boeing $150M for SSN Launch and Recovery #3, a sole-source R&D contract
Contract Overview
Contract Amount: $15,007,780 ($15.0M)
Contractor: THE Boeing Company
Awarding Agency: Department of Defense
Start Date: 2007-01-31
End Date: 2013-04-30
Contract Duration: 2,281 days
Daily Burn Rate: $6.6K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: COST PLUS AWARD FEE
Sector: Defense
Official Description: SSN LAUNCH AND RECOVERY #3
Place of Performance
Location: HUNTINGTON BEACH, ORANGE County, CALIFORNIA, 92647
Plain-Language Summary
Department of Defense obligated $15.0 million to THE BOEING COMPANY for work described as: SSN LAUNCH AND RECOVERY #3 Key points: 1. Significant R&D investment in a critical defense capability. 2. Sole-source award to Boeing raises questions about competition and price discovery. 3. Long contract duration (2007-2013) suggests complex, evolving requirements. 4. High contract value indicates substantial program scope and potential taxpayer exposure.
Value Assessment
Rating: questionable
The contract type is Cost Plus Award Fee, which can incentivize performance but also lead to cost overruns if not managed tightly. Without comparable contracts, assessing the value for money is difficult, especially given the sole-source nature.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was not competed, indicating a sole-source award to The Boeing Company. This limits price discovery and may result in higher costs for taxpayers compared to a competitive procurement.
Taxpayer Impact: The lack of competition for a $150M contract raises concerns about potential overspending and inefficient use of taxpayer funds.
Public Impact
Ensures continued development of critical national security assets. Potential for technological advancements in submarine launch and recovery systems. Taxpayers fund extensive R&D without guaranteed competitive pricing.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Lack of competition
- Cost-plus contract type
- Long contract duration
- Sole-source award
Positive Signals
- Supports critical defense capabilities
- Potential for technological innovation
Sector Analysis
This contract falls under Research and Development in Physical, Engineering, and Life Sciences (NAICS 541710). Defense R&D spending is a significant portion of the federal budget, often characterized by long development cycles and high costs.
Small Business Impact
The data indicates this contract was awarded to The Boeing Company, a large aerospace corporation. There is no indication of small business participation in this specific award.
Oversight & Accountability
The contract was managed by the Defense Contract Management Agency. Oversight would focus on cost control, performance milestones, and ensuring adherence to the award fee structure.
Related Government Programs
- Research and Development in the Physical, Engineering, and Life Sciences
- Department of Defense Contracting
- Defense Contract Management Agency Programs
Risk Flags
- Sole-source award limits competition.
- Cost-plus contract type carries inherent cost risk.
- Long contract duration may indicate scope creep or evolving requirements.
- Lack of small business participation.
- High dollar value warrants close scrutiny.
Tags
research-and-development-in-the-physical, department-of-defense, ca, definitive-contract, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $15.0 million to THE BOEING COMPANY. SSN LAUNCH AND RECOVERY #3
Who is the contractor on this award?
The obligated recipient is THE BOEING 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 $15.0 million.
What is the period of performance?
Start: 2007-01-31. End: 2013-04-30.
What was the justification for the sole-source award, and were alternatives explored?
Sole-source awards are typically justified when only one responsible source can provide the required supplies or services. For this SSN Launch and Recovery #3 contract, the justification would likely stem from unique capabilities or proprietary technology held by Boeing. Exploring alternatives would involve market research to determine if other companies could meet the stringent requirements, which may have been deemed infeasible or prohibitively expensive.
How effectively were costs controlled under the Cost Plus Award Fee structure for this long-term R&D project?
Cost control under a Cost Plus Award Fee (CPAF) contract for a long-term R&D project like this is challenging. While the award fee mechanism incentivizes performance, the 'cost-plus' element means the government pays incurred costs plus a fee. Effective oversight by the Defense Contract Management Agency would be crucial to scrutinize costs, ensure they are reasonable and allocable, and that the award fee criteria were objectively met, preventing excessive spending.
What tangible technological advancements or operational capabilities resulted from this $150M R&D investment?
Assessing the tangible outcomes requires reviewing program documentation, technical reports, and operational deployment records. The $150M investment was intended to advance capabilities in submarine launch and recovery. Specific results could include improved system reliability, enhanced safety features, increased operational efficiency, or the development of new technologies directly applicable to naval operations. Without access to these detailed program outcomes, the precise return on investment remains unclear.
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: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Solicitation ID: N0002407R6302
Offers Received: 1
Pricing Type: COST PLUS AWARD FEE (R)
Evaluated Preference: NONE
Contractor Details
Address: 3370 E MIRALOMA AVE, ANAHEIM, CA, 92806
Business Categories: Category Business, Not Designated a Small Business
Financial Breakdown
Contract Ceiling: $15,296,338
Exercised Options: $15,296,338
Current Obligation: $15,007,780
Contract Characteristics
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Cost or Pricing Data: NO
Timeline
Start Date: 2007-01-31
Current End Date: 2013-04-30
Potential End Date: 2013-04-30 00:00:00
Last Modified: 2022-09-02
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