DoD's $801.5M Undersea Warfare R&D Contract Awarded to Penn State

Contract Overview

Contract Amount: $8,015,000 ($8.0M)

Contractor: THE Pennsylvania State University

Awarding Agency: Department of Defense

Start Date: 2023-03-23

End Date: 2026-03-22

Contract Duration: 1,095 days

Daily Burn Rate: $7.3K/day

Competition Type: NOT COMPETED

Pricing Type: COST PLUS FIXED FEE

Sector: R&D

Official Description: ADVANCED DEVELOPMENT AND ANALYSIS FOR UNDERSEA WAREFARE IV

Place of Performance

Location: UNIVERSITY PARK, CENTRE County, PENNSYLVANIA, 16802

State: Pennsylvania Government Spending

Plain-Language Summary

Department of Defense obligated $8.0 million to THE PENNSYLVANIA STATE UNIVERSITY for work described as: ADVANCED DEVELOPMENT AND ANALYSIS FOR UNDERSEA WAREFARE IV Key points: 1. Significant investment in advanced undersea warfare capabilities. 2. Sole-source award to a single academic institution raises questions about competition. 3. Potential for high-value research but requires careful oversight. 4. Focus on R&D in a critical defense sector.

Value Assessment

Rating: questionable

The contract value of $801.5 million over three years is substantial. Without competitive bidding, it's difficult to assess if this represents fair market value or if alternative solutions could be procured at a lower cost.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning only one vendor was considered. This significantly limits price discovery and may prevent the government from obtaining the best possible pricing through competition.

Taxpayer Impact: The lack of competition could lead to higher costs for taxpayers compared to a competitively awarded contract.

Public Impact

Enhances national security through advanced undersea technology. Supports critical research and development in a specialized field. Potential for technological breakthroughs with long-term defense implications.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits competition and price discovery.
High contract value requires robust oversight.
Potential for cost overruns in R&D contracts.

Positive Signals

Addresses critical national security needs.
Leverages specialized expertise of a leading research institution.

Sector Analysis

This contract falls under Research and Development in Physical, Engineering, and Life Sciences. Spending in this sector is crucial for maintaining technological superiority, but often involves higher risk and less predictable outcomes than other sectors.

Small Business Impact

The contract was awarded to The Pennsylvania State University, a large research institution. There is no indication of subcontracting opportunities for small businesses in the provided data.

Oversight & Accountability

Given the sole-source nature and significant value, robust oversight is essential to ensure the contractor is meeting milestones, managing costs effectively, and delivering on the research objectives.

Related Government Programs

Research and Development in the Physical, Engineering, and Life Sciences (except Nanotechnology and Biotechnology)
Department of Defense Contracting
Department of the Navy Programs

Risk Flags

Sole-source award
High contract value
Cost Plus Fixed Fee contract type
R&D focus with inherent uncertainty

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $8.0 million to THE PENNSYLVANIA STATE UNIVERSITY. ADVANCED DEVELOPMENT AND ANALYSIS FOR UNDERSEA WAREFARE IV

Who is the contractor on this award?

The obligated recipient is THE PENNSYLVANIA STATE UNIVERSITY.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $8.0 million.

What is the period of performance?

Start: 2023-03-23. End: 2026-03-22.

What is the justification for the sole-source award, and what steps were taken to ensure the best value was obtained?

The justification for a sole-source award typically involves unique capabilities or circumstances where only one source can fulfill the requirement. For this contract, the Department of Defense would need to provide specific documentation detailing why The Pennsylvania State University was the only viable option. Without this information, it's difficult to assess if alternative sources were adequately explored or if the government secured the best possible value.

How will the effectiveness of the R&D be measured, and what are the key performance indicators?

Effectiveness in R&D contracts is often measured by achieving specific research milestones, developing prototypes, or demonstrating technological advancements. Key performance indicators (KPIs) should be clearly defined in the contract, such as successful completion of research phases, validation of new technologies, or contribution to future system development. Regular technical reviews and progress reports are crucial for monitoring and ensuring the R&D stays on track.

What is the risk of cost overruns, and what mitigation strategies are in place?

Cost Plus Fixed Fee (CPFF) contracts, especially for R&D, carry inherent risks of cost overruns due to the unpredictable nature of research. Mitigation strategies include strong government oversight, detailed cost tracking, regular performance reviews, and clearly defined scope limitations. The government should actively manage the contract to ensure costs remain within the fixed fee parameters and that any deviations are justified and approved.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Scientific Research and Development Services › Research and Development in the Physical, Engineering, and Life Sciences (except Nanotechnology and 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: 201 OLD MAIN, UNIVERSITY PARK, PA, 16802

Business Categories: Category Business, Corporate Entity Tax Exempt, Educational Institution, Higher Education, Nonprofit Organization, Not Designated a Small Business, Higher Education (Public), Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $9,942,126

Exercised Options: $9,942,126

Current Obligation: $8,015,000

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: N0002418D6401

IDV Type: IDC

Timeline