DoD's $31.5M Oceanography R&D Contract with Peraton Faces Scrutiny Over Value and Competition

Contract Overview

Contract Amount: $31,547,223 ($31.5M)

Contractor: Peraton Technology Services Inc.

Awarding Agency: Department of Defense

Start Date: 2017-09-15

End Date: 2023-09-14

Contract Duration: 2,190 days

Daily Burn Rate: $14.4K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: COST PLUS FIXED FEE

Sector: R&D

Official Description: IGF::OT::IGF 73-0198-17 OCEAN DYNAMICS AND PREDICTION OCEANOGRAPHY RESEARCH&DEVELOPMENT

Place of Performance

Location: STENNIS SPACE CENTER, HANCOCK County, MISSISSIPPI, 39529

State: Mississippi Government Spending

Plain-Language Summary

Department of Defense obligated $31.5 million to PERATON TECHNOLOGY SERVICES INC. for work described as: IGF::OT::IGF 73-0198-17 OCEAN DYNAMICS AND PREDICTION OCEANOGRAPHY RESEARCH&DEVELOPMENT Key points: 1. The contract awarded to Peraton Technology Services Inc. for oceanography research and development is substantial at $31.5 million. 2. While awarded under full and open competition, the specific value and effectiveness of the R&D outcomes require further analysis. 3. Potential risks include the long duration (6 years) and the Cost Plus Fixed Fee (CPFF) contract type, which can incentivize cost overruns. 4. The sector is R&D, specifically focused on physical, engineering, and life sciences, with a NAICS code of 541712.

Value Assessment

Rating: questionable

The $31.5 million contract value over six years for R&D is significant. Benchmarking against similar oceanography research contracts is difficult without more specific details on deliverables and outcomes. The CPFF structure warrants close monitoring for cost efficiency.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded through full and open competition, suggesting a broad search for qualified contractors. However, the impact of this competition on price discovery for specialized R&D services is not immediately clear and depends on the number and quality of bids received.

Taxpayer Impact: Taxpayer funds are being allocated to advanced research. Ensuring the R&D yields valuable scientific advancements and technological applications is crucial for justifying the expenditure.

Public Impact

Advancement of oceanography research and prediction capabilities. Potential for new technologies or insights impacting naval operations or environmental understanding. Investment in scientific and technological innovation within the defense sector. Long-term commitment of resources to a specific research area.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost Plus Fixed Fee contract type can lead to higher costs if not managed tightly.
Long contract duration (6 years) may not adapt well to rapidly evolving research needs.
Lack of specific performance metrics makes assessing R&D effectiveness challenging.
No indication of small business participation.

Positive Signals

Awarded via full and open competition, maximizing potential contractor pool.
Focus on critical R&D for national security and scientific understanding.
Contractor has a history in technology services.

Sector Analysis

This contract falls within the Research and Development sector, specifically focusing on oceanography. Spending in this area is critical for national defense, environmental monitoring, and scientific advancement. Benchmarks for R&D contracts vary widely based on scope, but $31.5M over six years suggests a significant, long-term project.

Small Business Impact

There is no indication that small businesses were involved in this contract, either as prime contractors or subcontractors. Further investigation would be needed to determine if opportunities were missed for small business participation in this significant R&D award.

Oversight & Accountability

The contract's long duration and CPFF structure necessitate robust oversight from the Department of the Navy to ensure cost control and alignment with research objectives. Regular reviews of progress, expenditures, and deliverables are essential for accountability.

Related Government Programs

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

Risk Flags

Cost Plus Fixed Fee contract type.
Long contract duration (6 years).
Lack of specific performance metrics for R&D.
No stated small business participation.
Potential for research obsolescence over time.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $31.5 million to PERATON TECHNOLOGY SERVICES INC.. IGF::OT::IGF 73-0198-17 OCEAN DYNAMICS AND PREDICTION OCEANOGRAPHY RESEARCH&DEVELOPMENT

Who is the contractor on this award?

The obligated recipient is PERATON TECHNOLOGY SERVICES INC..

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $31.5 million.

What is the period of performance?

Start: 2017-09-15. End: 2023-09-14.

What specific research outcomes or technological advancements are expected from this $31.5 million contract, and how will their value to the Department of Defense be measured?

The expected outcomes likely involve enhanced oceanographic data collection, improved predictive models for marine environments, and potentially new sensor technologies or analytical methods. Value will be measured through the successful development and integration of these advancements into naval operations, scientific publications, and contributions to broader understanding of ocean dynamics, assessed via milestone reports and technical reviews.

Given the Cost Plus Fixed Fee structure and the six-year duration, what are the primary risks to the government regarding cost overruns and the relevance of the research by contract end?

The primary risk is that the CPFF structure may not sufficiently incentivize cost efficiency, potentially leading to expenditures exceeding initial projections if not rigorously managed. The long duration increases the risk that the research focus may become outdated due to rapid technological or environmental changes, requiring adaptive management and potentially scope adjustments to maintain relevance.

How effectively did the 'full and open competition' process ensure competitive pricing and identify the most capable contractor for this specialized oceanography R&D?

While 'full and open competition' theoretically maximizes the pool of potential bidders, its effectiveness in ensuring competitive pricing for highly specialized R&D depends on the number of qualified and interested firms. Without bid data, it's difficult to assess if the chosen price was truly competitive. The selection likely hinged on technical merit and past performance, alongside price, to ensure capability.

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 › General Science and Technology R&D Services

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: BASIC RESEARCH

Solicitation ID: N0017317SBA01

Offers Received: 1

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Parent Company: Veritas Capital Fund Management, L.L.C.

Address: 15050 CONFERENCE CENTER DR, CHANTILLY, VA, 20151

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

Financial Breakdown

Contract Ceiling: $31,604,975

Exercised Options: $31,604,975

Current Obligation: $31,547,223

Actual Outlays: $348,145

Contract Characteristics

Multi-Year Contract: Yes

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Timeline