DoD's $11.16M contract for labor services awarded to Scientific Research Corporation, with a 5-year term

Contract Overview

Contract Amount: $11,160,761 ($11.2M)

Contractor: Scientific Research Corporation

Awarding Agency: Department of Defense

Start Date: 2024-03-04

End Date: 2029-03-03

Contract Duration: 1,825 days

Daily Burn Rate: $6.1K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: COST PLUS FIXED FEE

Sector: R&D

Official Description: LPD 29-31 - LABOR

Place of Performance

Location: NORTH CHARLESTON, CHARLESTON County, SOUTH CAROLINA, 29405

State: South Carolina Government Spending

Plain-Language Summary

Department of Defense obligated $11.2 million to SCIENTIFIC RESEARCH CORPORATION for work described as: LPD 29-31 - LABOR Key points: 1. The contract value represents a significant investment in specialized labor for scientific research and development. 2. Competition dynamics for this contract are crucial for ensuring fair pricing and access to top-tier expertise. 3. Performance risk indicators will be closely monitored given the long-term nature and complexity of R&D services. 4. This award positions Scientific Research Corporation as a key provider within the Department of the Navy's research ecosystem. 5. The fixed-fee structure aims to provide cost certainty while incentivizing efficient service delivery.

Value Assessment

Rating: good

The contract's value of $11.16 million over five years suggests a substantial investment in specialized labor. Benchmarking against similar contracts for engineering and scientific services within the Department of Defense is necessary for a precise value-for-money assessment. The Cost Plus Fixed Fee (CPFF) pricing structure, while common for R&D, requires careful oversight to ensure costs remain reasonable and the fixed fee adequately compensates the contractor for their efforts without excessive profit.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that multiple qualified bidders had the opportunity to submit proposals. The presence of two bidders suggests a moderate level of competition. While more bidders could potentially drive prices lower, two bidders still provide a basis for price discovery and comparison, allowing the agency to select the most advantageous offer.

Taxpayer Impact: Full and open competition, even with two bidders, is generally favorable for taxpayers as it encourages competitive pricing and allows the government to select the best value offer, potentially saving taxpayer dollars compared to sole-source awards.

Public Impact

The primary beneficiaries are the Department of the Navy and its research initiatives, which will receive essential labor support. Services delivered will likely encompass specialized scientific and engineering expertise crucial for advancing defense technologies. The geographic impact is centered around the contractor's operations and the Navy facilities where the labor will be applied. Workforce implications include the creation or sustainment of skilled jobs in scientific and engineering fields.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns in Cost Plus Fixed Fee contracts if not managed diligently.
Ensuring the fixed fee remains appropriate throughout the contract lifecycle.
Maintaining consistent quality of specialized labor over the five-year period.

Positive Signals

Awarded through full and open competition, suggesting a competitive process.
Contractor has a track record with the government, implying familiarity with federal contracting requirements.
Clear contract duration and defined scope of work provide predictability.

Sector Analysis

This contract falls within the Engineering Services sector, a critical component of the broader Scientific Research and Development (R&D) industry. The R&D sector is characterized by innovation, specialized expertise, and often long project timelines. Government spending in this area is vital for national security and technological advancement. Comparable spending benchmarks would involve analyzing other DoD contracts for similar engineering and labor support services, particularly those awarded under full and open competition.

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 or specific impacts on the small business ecosystem stemming from a set-aside provision. The primary focus of this award is on securing specialized labor, and small businesses would need to compete directly or seek subcontracting opportunities with the prime contractor if applicable.

Oversight & Accountability

Oversight for this contract will likely be managed by the Department of the Navy's contracting and program management offices. Accountability measures will be embedded in the contract's performance standards and reporting requirements. Transparency is facilitated through the Federal Procurement Data System (FPDS), where contract awards are publicly reported. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse.

Related Government Programs

Department of Defense Research and Development Contracts
Engineering Services Contracts
Scientific Labor Support Services
Navy R&D Procurement

Risk Flags

Long contract duration (5 years) may increase risk of scope creep or changing requirements.
Cost Plus Fixed Fee structure requires diligent government oversight to manage costs effectively.
Potential for key personnel turnover over the contract's lifespan.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $11.2 million to SCIENTIFIC RESEARCH CORPORATION. LPD 29-31 - LABOR

Who is the contractor on this award?

The obligated recipient is SCIENTIFIC RESEARCH CORPORATION.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $11.2 million.

What is the period of performance?

Start: 2024-03-04. End: 2029-03-03.

What is the historical spending pattern of the Department of the Navy on engineering and labor services similar to this contract?

Analyzing historical spending patterns for the Department of the Navy on engineering and labor services requires examining FPDS data over several fiscal years. This would involve filtering for contracts with similar NAICS codes (e.g., 541330 - Engineering Services) and contract types (e.g., Cost Plus Fixed Fee). The goal is to identify trends in contract values, durations, and the number of bidders. For instance, if the Navy consistently awards multi-million dollar, multi-year contracts for specialized labor through full and open competition, it suggests a stable demand and a mature market. Conversely, a significant increase or decrease in spending could indicate shifts in strategic priorities or budget allocations. Understanding these patterns helps contextualize the current $11.16 million award and assess whether it aligns with historical investment levels or represents a notable deviation.

How does the Cost Plus Fixed Fee (CPFF) structure typically perform in R&D contracts within the DoD?

The Cost Plus Fixed Fee (CPFF) contract structure is frequently employed in Research and Development (R&D) endeavors within the Department of Defense (DoD) due to the inherent uncertainties in R&D projects. In a CPFF contract, the contractor is reimbursed for all allowable costs incurred, plus a predetermined fixed fee representing profit. This structure incentivizes the contractor to control costs, as the fee remains constant regardless of the final cost. However, effective oversight is crucial to prevent cost overruns and ensure that the fixed fee is appropriate for the scope of work and associated risks. Performance metrics and regular cost reviews are essential to manage CPFF contracts effectively and ensure value for taxpayer money. When managed well, CPFF can facilitate innovation by allowing flexibility while providing a degree of cost certainty.

What is Scientific Research Corporation's track record with federal contracts, particularly within the Department of Defense?

To assess Scientific Research Corporation's track record, a review of their past federal contract awards is necessary. This would involve querying databases like FPDS to identify previous contracts awarded to the company, noting the agencies involved (especially the Department of Defense and Department of the Navy), contract values, types, and performance history. Key indicators include the number of contracts awarded, their duration, and whether they were completed successfully and on time. A history of successful contract completions, positive performance reviews, and a diverse portfolio of work within the DoD would suggest reliability and capability. Conversely, a history of contract disputes, performance issues, or frequent modifications might raise concerns about their ability to execute this new $11.16 million award effectively.

What are the potential risks associated with a 5-year contract for specialized labor in the R&D sector?

A 5-year contract for specialized labor in the R&D sector carries several potential risks. Firstly, the rapidly evolving nature of R&D means that the specific skills and technologies required may change significantly over the contract's lifespan, potentially leading to obsolescence or the need for costly modifications. Secondly, there's a risk of 'key personnel' turnover within the contractor organization, which could disrupt project continuity and knowledge transfer. Thirdly, long-term Cost Plus Fixed Fee (CPFF) contracts require sustained vigilance from the government to ensure costs remain controlled and the fixed fee remains fair. Finally, market conditions and labor rates can fluctuate over five years, potentially impacting the initial cost estimates and the contractor's ability to retain qualified personnel at the agreed-upon rates. Proactive risk mitigation strategies, such as regular performance reviews and flexible contract clauses, are essential.

How does the 'Engineering Services' (NAICS 541330) market compare in size and scope to other sectors where the DoD procures services?

The Engineering Services market (NAICS 541330) is a substantial segment of the broader professional services industry and a critical area for Department of Defense (DoD) procurement. The DoD relies heavily on engineering services for design, development, testing, and sustainment of complex weapon systems, infrastructure, and technological advancements. Compared to sectors like IT services or general administrative support, engineering services often involve higher technical complexity, longer project cycles, and specialized expertise, leading to higher average contract values. The market size is significant, with numerous firms ranging from large defense contractors to specialized engineering consultancies. The DoD's annual spending in this category often runs into billions of dollars, reflecting its foundational role in maintaining military readiness and pursuing technological superiority.

Industry Classification

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

Product/Service Code: TECHNICAL REPRESENTATIVE SVCS. › TECHNICAL REPRESENTATIVE SERVICES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: N0003922R1002

Offers Received: 2

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Address: 2300 WINDY RIDGE PKWY, ATLANTA, GA, 30339

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Manufacturer of Goods, Not Designated a Small Business, Special Designations, Subchapter S Corporation, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $19,200,897

Exercised Options: $19,200,897

Current Obligation: $11,160,761

Subaward Activity

Number of Subawards: 13

Total Subaward Amount: $3,710,720

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: N0003923D1003

IDV Type: IDC

Timeline