DoD's $22M R&D contract with Analex Corporation shows concerning value and limited competition

Contract Overview

Contract Amount: $22,087,489 ($22.1M)

Contractor: Analex Corporation

Awarding Agency: Department of Defense

Start Date: 2017-04-07

End Date: 2021-09-30

Contract Duration: 1,637 days

Daily Burn Rate: $13.5K/day

Competition Type: NOT COMPETED

Pricing Type: COST PLUS FIXED FEE

Sector: R&D

Official Description: IGF::OT::IGF PR 57-4036-17

Place of Performance

Location: HERNDON, FAIRFAX County, VIRGINIA, 20170

State: Virginia Government Spending

Plain-Language Summary

Department of Defense obligated $22.1 million to ANALEX CORPORATION for work described as: IGF::OT::IGF PR 57-4036-17 Key points: 1. The contract's value proposition appears questionable given the lack of competitive bidding. 2. Limited competition raises concerns about potential overpricing and reduced innovation. 3. The contract's duration and cost-plus structure may present cost control risks. 4. Performance context is limited due to the R&D nature and lack of public detail. 5. This contract falls within the broader Research and Development sector for the Navy. 6. The absence of small business set-asides warrants further investigation into subcontracting opportunities.

Value Assessment

Rating: questionable

Benchmarking the value of this $22 million R&D contract is challenging without comparable sole-source awards. The Cost Plus Fixed Fee (CPFF) contract type, while common for R&D, can lead to cost overruns if not managed tightly. The lack of competition suggests that the government may not have secured the best possible price or value. Further analysis of the contractor's historical performance and pricing on similar contracts would be needed to definitively assess value for money.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning it was not competed. This significantly limits the opportunity for price discovery and potentially reduces the incentive for the contractor to offer the most competitive pricing. The justification for a sole-source award would typically involve unique capabilities or a lack of available alternatives, but this information is not provided. The absence of multiple bidders means taxpayers did not benefit from a competitive process.

Taxpayer Impact: Sole-source awards mean taxpayers may have paid a premium compared to a competitively bid contract. Without competition, there's less pressure on the contractor to minimize costs, potentially leading to less efficient use of taxpayer funds.

Public Impact

The primary beneficiaries are the research and development activities undertaken by the Department of the Navy. The contract supports advanced research in physical, engineering, and life sciences, excluding biotechnology. The geographic impact is primarily within Virginia, where the contractor is located. Workforce implications include employment for specialized researchers and technical staff at Analex Corporation.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may lead to higher costs for taxpayers.
Cost-plus contract type can incentivize spending rather than cost savings.
Limited transparency on the justification for sole-source award.
Potential for scope creep in R&D projects without clear performance metrics.

Positive Signals

Contract supports critical research and development for national security.
Analex Corporation may possess unique expertise required for the specific R&D tasks.
Fixed fee component provides some level of cost certainty for the government.

Sector Analysis

This contract falls under the broad Research and Development (R&D) sector, specifically within NAICS code 541712. This sector is characterized by innovation and the pursuit of new knowledge and applications. The Department of Defense is a major investor in R&D, seeking technological superiority. Comparable spending benchmarks are difficult to establish for sole-source R&D due to its specialized nature, but the overall DoD R&D budget runs into billions annually.

Small Business Impact

This contract was not competed and there is no indication of small business set-asides. Consequently, there are no direct subcontracting opportunities mandated for small businesses through this award. The impact on the small business ecosystem is neutral to negative, as opportunities that might have been available in a competitive bidding process were not realized.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of the Navy's contracting and program management offices. As a sole-source award, the justification and terms would be subject to review. Transparency is limited due to the lack of public competition details. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

Department of Defense Research and Development Programs
Navy Science and Technology Initiatives
Advanced Technology Development Contracts
Cost-Plus Fixed Fee Contracts

Risk Flags

Sole-source award lacks competitive justification.
Cost-plus contract type poses risk of cost overruns.
Limited transparency on contractor selection and pricing.
No small business subcontracting requirements identified.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $22.1 million to ANALEX CORPORATION. IGF::OT::IGF PR 57-4036-17

Who is the contractor on this award?

The obligated recipient is ANALEX 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 $22.1 million.

What is the period of performance?

Start: 2017-04-07. End: 2021-09-30.

What is Analex Corporation's track record with the federal government, particularly on R&D contracts?

Analex Corporation has a history of federal contracting, primarily with the Department of Defense. While specific details on their R&D performance are not readily available from this data alone, their engagement with the Navy suggests a level of established capability. A deeper dive into contract databases like FPDS-NG or SAM.gov would be necessary to assess their past performance ratings, any past performance issues, and the types of R&D projects they have successfully completed. Understanding their performance on previous Cost Plus Fixed Fee contracts would also be crucial for evaluating their reliability and efficiency in managing project costs and delivering results.

How does the $22 million value of this contract compare to similar R&D efforts within the Department of the Navy?

Direct comparison of this $22 million sole-source R&D contract to similar efforts within the Department of the Navy is challenging without more specific information on the research area and scope. However, R&D contracts can vary significantly in value, from small, targeted studies to large, multi-year programs. Given that this is a sole-source award, it is difficult to ascertain if the $22 million represents a competitive market price. The Navy invests billions in R&D annually, so this figure might be within the typical range for specific research endeavors, but the lack of competition prevents a definitive value assessment against market alternatives.

What are the primary risks associated with a Cost Plus Fixed Fee (CPFF) contract for R&D, especially when competed sole-source?

The primary risk with a CPFF contract, particularly when awarded sole-source, is the potential for cost overruns and reduced contractor efficiency. In a CPFF structure, the contractor is reimbursed for allowable costs plus a fixed fee representing profit. This can incentivize the contractor to incur higher costs, as their profit margin remains constant regardless of the total expenditure. When awarded sole-source, the government lacks the leverage of competition to drive down costs or ensure the most efficient methods are employed. This necessitates robust government oversight to monitor costs, ensure compliance with contract terms, and prevent scope creep, which can further inflate expenses without commensurate benefit.

What specific R&D areas does NAICS code 541712 cover, and how does this contract align with DoD priorities?

NAICS code 541712, 'Research and Development in the Physical, Engineering, and Life Sciences (except Biotechnology),' encompasses a wide array of scientific and technical research. This includes fields like physics, chemistry, materials science, aerospace engineering, environmental science, and various medical research areas (excluding direct biotech applications). Contracts under this code typically aim to advance fundamental knowledge, develop new technologies, or improve existing systems. For the Department of Defense, such R&D is critical for maintaining technological superiority, developing next-generation defense systems, enhancing soldier capabilities, and addressing emerging threats. This contract likely aligns with specific DoD priorities related to national security, defense modernization, or scientific advancement in areas relevant to military operations.

What are the implications of this contract being awarded as 'NOT COMPETED' for taxpayer value?

Awarding a contract as 'NOT COMPETED' (sole-source) generally has negative implications for taxpayer value. Without competition, the government loses the opportunity to leverage market forces to obtain the best possible price and terms. Contractors may not feel the same pressure to innovate or operate efficiently when they are the only option. This can lead to higher costs than would be achieved in a competitive environment. While sole-source awards are sometimes necessary due to unique capabilities or urgent needs, they require strong justification and rigorous oversight to ensure that taxpayers are not overpaying and that the government is receiving fair value for its investment.

What is the significance of the contract award type being 'DELIVERY ORDER' under a larger contract vehicle?

The 'DELIVERY ORDER' designation indicates that this award is a task order issued under a previously established indefinite-delivery, indefinite-quantity (IDIQ) contract or a similar type of contract vehicle. This means that the foundational contract terms, including pricing structures, period of performance, and general scope, were likely negotiated earlier, potentially through a competitive process. However, the specific value and scope of this particular delivery order ($22 million) were determined separately. If the parent IDIQ contract was competitively awarded, it could offer some assurance of overall value. But if this specific delivery order was also sole-sourced or if the parent contract had limited competition, concerns about value for this specific task remain.

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: 14295 PARK MEADOW DR STE 500, 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: $22,087,534

Exercised Options: $22,087,534

Current Obligation: $22,087,489

Actual Outlays: $275,956

Subaward Activity

Number of Subawards: 12

Total Subaward Amount: $40,761,472

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: N0017313D2010

IDV Type: IDC

Timeline