DoD awards $9.8M R&D contract to University of Texas for FLS systems, raising value questions

Contract Overview

Contract Amount: $9,800,000 ($9.8M)

Contractor: University of Texas AT Austin

Awarding Agency: Department of Defense

Start Date: 2022-06-16

End Date: 2026-06-30

Contract Duration: 1,475 days

Daily Burn Rate: $6.6K/day

Competition Type: NOT COMPETED

Pricing Type: COST PLUS FIXED FEE

Sector: R&D

Official Description: FLS SYSTEMS FOR OPERATIONAL TESTING

Place of Performance

Location: AUSTIN, TRAVIS County, TEXAS, 78713

State: Texas Government Spending

Plain-Language Summary

Department of Defense obligated $9.8 million to UNIVERSITY OF TEXAS AT AUSTIN for work described as: FLS SYSTEMS FOR OPERATIONAL TESTING Key points: 1. Contract awarded on a sole-source basis, limiting price competition and potentially increasing costs. 2. Research and Development focus in physical sciences suggests high innovation potential but also inherent risks. 3. Long contract duration of nearly four years may indicate complex project scope or phased development. 4. The specific nature of 'FLS systems' is not detailed, making direct performance benchmarking difficult. 5. Awarded by the Department of the Navy, indicating a specific defense-related research need. 6. The contract type (Cost Plus Fixed Fee) can incentivize cost overruns if not closely monitored.

Value Assessment

Rating: questionable

The contract's value of $9.8 million for R&D in physical sciences is difficult to benchmark without more specific details on the 'FLS systems' and the expected deliverables. The sole-source nature of the award means there's no direct comparison to other bids. The Cost Plus Fixed Fee structure, while common in R&D, carries a risk of cost escalation if not managed tightly, potentially impacting overall value for money.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning the Department of the Navy did not solicit bids from multiple vendors. This approach is typically used when a specific entity possesses unique capabilities or intellectual property essential for the project. However, the lack of competition limits the government's ability to secure the best possible price and may reduce the incentive for the contractor to optimize costs.

Taxpayer Impact: Sole-source awards mean taxpayers do not benefit from competitive bidding, potentially leading to higher prices than if multiple firms had vied for the contract. This can reduce the overall efficiency of federal spending.

Public Impact

The primary beneficiary is the University of Texas at Austin, which will receive funding for its research capabilities. The contract aims to advance the development of 'FLS systems,' likely for defense applications, enhancing operational capabilities. The geographic impact is concentrated in Texas, where the university is located, potentially supporting local research infrastructure. The contract may indirectly support research personnel and students at the university, contributing to the scientific workforce.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits competitive pressure on pricing.
Cost Plus Fixed Fee contract type can lead to cost overruns if not managed stringently.
Lack of detailed project scope makes it hard to assess performance metrics and value.
The specific nature of 'FLS systems' is unclear, posing a risk of misaligned research objectives.

Positive Signals

Award to a reputable university suggests strong research capabilities.
Focus on R&D indicates investment in future technological advancements.
Long-term contract allows for sustained effort on a complex research problem.

Sector Analysis

This contract falls within the Research and Development sector, specifically focusing on physical, engineering, and life sciences. The market for defense-related R&D is substantial, with significant government investment aimed at maintaining technological superiority. Universities are key players in this ecosystem, often possessing specialized expertise and facilities. Benchmarking is challenging due to the unique nature of R&D and the specific 'FLS systems' being developed.

Small Business Impact

This contract does not appear to involve small business set-asides, as it was awarded directly to a large research institution. There is no indication of subcontracting requirements for small businesses within the provided data. The focus on a sole-source award to a university suggests that the primary objective was leveraging specialized academic research capabilities rather than fostering small business participation.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of the Navy's contracting and program management offices. The Cost Plus Fixed Fee structure necessitates rigorous financial oversight to ensure costs are reasonable and allocable to the contract. Transparency may be limited due to the sole-source nature and the proprietary aspects of R&D. Inspector General jurisdiction would apply if any fraud, waste, or abuse is suspected.

Related Government Programs

Department of Defense Research and Development Contracts
University Research Grants and Contracts
Naval Systems Development Programs
Physical Sciences Research Funding

Risk Flags

Sole-source award may limit competition and increase costs.
Cost Plus Fixed Fee contract type carries risk of cost overruns.
Lack of detailed project scope hinders performance assessment.
Unclear nature of 'FLS systems' poses R&D alignment risk.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $9.8 million to UNIVERSITY OF TEXAS AT AUSTIN. FLS SYSTEMS FOR OPERATIONAL TESTING

Who is the contractor on this award?

The obligated recipient is UNIVERSITY OF TEXAS AT AUSTIN.

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Navy).

What is the total obligated amount?

The obligated amount is $9.8 million.

What is the period of performance?

Start: 2022-06-16. End: 2026-06-30.

What is the specific nature and intended application of the 'FLS systems' being developed under this contract?

The provided data does not specify the exact nature or intended application of the 'FLS systems.' The contract falls under NAICS code 541712, 'Research and Development in the Physical, Engineering, and Life Sciences (except Biotechnology),' and is awarded by the Department of the Navy. This suggests the systems are likely related to defense operations, potentially involving areas like simulation, testing, or advanced equipment for naval forces. Without further details, it is difficult to ascertain the precise technological advancements or operational benefits expected from these systems.

How does the $9.8 million contract value compare to similar R&D efforts in physical sciences for defense applications?

Direct comparison of the $9.8 million contract value is challenging without knowing the specific scope and deliverables of the 'FLS systems.' However, R&D contracts for specialized defense technologies can range widely, from a few million to hundreds of millions of dollars, depending on complexity, duration, and innovation level. Given this is a sole-source award to a university for research, the value might be considered reasonable if it reflects the unique expertise and the long-term nature of the research. A competitive bidding process would typically provide a clearer benchmark for value.

What are the primary risks associated with a sole-source, Cost Plus Fixed Fee contract for R&D?

The primary risks associated with this contract structure are twofold. Firstly, the sole-source nature eliminates competitive pressure, potentially leading to a higher price than could be achieved through bidding. The government may not be getting the best value for its money. Secondly, the Cost Plus Fixed Fee (CPFF) contract type, while common in R&D where costs can be uncertain, incentivizes the contractor to incur costs to achieve the fixed fee. If not rigorously monitored, this can lead to cost overruns and a deviation from the initially estimated budget, impacting overall program affordability and taxpayer return.

What is the track record of the University of Texas at Austin in securing and executing similar government R&D contracts?

The University of Texas at Austin is a major research institution with a significant history of receiving federal funding, including contracts and grants from various government agencies, particularly in STEM fields. While specific details on their track record with 'FLS systems' or similar defense R&D are not provided in this data snippet, their status as a leading university suggests a substantial capacity for managing complex research projects. Their ability to secure this sole-source award implies they possess unique qualifications or prior engagement relevant to the Department of the Navy's needs.

What are the potential performance metrics or milestones for this contract, and how will success be measured?

The provided data does not include specific performance metrics or milestones for this contract. For R&D contracts, especially those awarded on a sole-source basis, performance is often measured against the achievement of research objectives, successful development of prototypes or technologies, and adherence to project timelines and budgets. The CPFF structure typically involves regular progress reports and reviews where the contractor demonstrates advancements. The Department of the Navy would be responsible for defining and monitoring these metrics to ensure the research progresses as intended and meets the program's goals.

How does this contract fit into the broader spending patterns of the Department of the Navy for Research and Development?

This $9.8 million contract represents a small fraction of the Department of the Navy's overall R&D budget, which typically runs into billions of dollars annually. The Navy invests heavily in R&D across numerous areas, including advanced materials, C4ISR systems, naval platforms, and cybersecurity. Contracts like this, focused on specific physical science R&D, are crucial for maintaining technological superiority and addressing future operational challenges. Its sole-source nature suggests it addresses a highly specialized or urgent need not readily met by other sources.

Industry Classification

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

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

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Address: 10000 BURNET RD, AUSTIN, TX, 78758

Business Categories: Category Business, Educational Institution, Government, Higher Education, U.S. National Government, Nonprofit Organization, Not Designated a Small Business, Higher Education (Public), U.S. Regional/State Government

Financial Breakdown

Contract Ceiling: $9,800,000

Exercised Options: $9,800,000

Current Obligation: $9,800,000

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: N0002417D6421

IDV Type: IDC

Timeline