DoD Spends $11.7M on Reentry System Nose Tip R&D with Intermat, Raising Questions on Competition and Value
Contract Overview
Contract Amount: $11,665,024 ($11.7M)
Contractor: Intermat
Awarding Agency: Department of Defense
Start Date: 2008-01-22
End Date: 2013-08-31
Contract Duration: 2,048 days
Daily Burn Rate: $5.7K/day
Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES
Number of Offers Received: 1
Pricing Type: COST PLUS FIXED FEE
Sector: R&D
Official Description: RESEARCH & DEVELOPMENT FOR SHAPE STABLE NOSE TIP MATERIALS FOR USE IN THE REENTRY SYSTEMS APPLICABLE PROGRAM
Place of Performance
Location: BIDDEFORD, YORK County, MAINE, 04005
State: Maine Government Spending
Plain-Language Summary
Department of Defense obligated $11.7 million to INTERMAT for work described as: RESEARCH & DEVELOPMENT FOR SHAPE STABLE NOSE TIP MATERIALS FOR USE IN THE REENTRY SYSTEMS APPLICABLE PROGRAM Key points: 1. Spending focuses on advanced materials for missile reentry systems. 2. Competition was limited after excluding sources, potentially impacting price discovery. 3. The contract's cost-plus-fixed-fee structure warrants scrutiny for cost control. 4. Small business participation is not indicated, suggesting a focus on large contractors.
Value Assessment
Rating: questionable
The $11.7M contract value for R&D in specialized materials is significant. Without benchmarks for similar niche R&D contracts, assessing its value is difficult. The cost-plus-fixed-fee structure can incentivize cost overruns if not managed tightly.
Cost Per Unit: N/A
Competition Analysis
Competition Level: limited
The contract was awarded under 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES,' indicating a restricted bidding process. This method limits the pool of potential bidders and may lead to higher prices than a truly open competition.
Taxpayer Impact: The limited competition and cost-plus-fixed-fee structure raise concerns about whether taxpayers received the best possible value for this significant investment.
Public Impact
Taxpayer funds are directed towards advanced defense technology development. The specific application in reentry systems suggests a focus on national security. The long contract duration (2008-2013) indicates a sustained investment in this technology.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Limited competition after source exclusion
- Cost-plus-fixed-fee contract type
- Lack of small business participation
Positive Signals
- Addresses critical defense technology need
- Long-term investment in R&D
Sector Analysis
This contract falls within the Research & Development sector, specifically focusing on advanced materials for aerospace and defense applications. Spending benchmarks in this highly specialized R&D area are difficult to establish due to unique technological requirements and limited market players.
Small Business Impact
The data indicates that small businesses were not involved in this contract (ss=false, sb=false). This suggests the contract was awarded to a large business or a consortium primarily composed of large entities, potentially limiting opportunities for smaller innovative firms.
Oversight & Accountability
The contract was managed by the Defense Contract Management Agency (DCMA), which is responsible for ensuring contractor performance and compliance. However, the specifics of oversight for this cost-plus-fixed-fee contract are not detailed, leaving room for potential cost inefficiencies.
Related Government Programs
- Other Guided Missile and Space Vehicle Parts and Auxiliary Equipment Manufacturing
- Department of Defense Contracting
- Defense Contract Management Agency Programs
Risk Flags
- Limited competition raises price concerns.
- Cost-plus-fixed-fee structure may lack cost control incentives.
- No indication of small business participation.
- Lack of transparency on specific R&D outcomes.
- Long contract duration without clear performance metrics.
Tags
other-guided-missile-and-space-vehicle-p, department-of-defense, me, definitive-contract, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $11.7 million to INTERMAT. RESEARCH & DEVELOPMENT FOR SHAPE STABLE NOSE TIP MATERIALS FOR USE IN THE REENTRY SYSTEMS APPLICABLE PROGRAM
Who is the contractor on this award?
The obligated recipient is INTERMAT.
Which agency awarded this contract?
Awarding agency: Department of Defense (Defense Contract Management Agency).
What is the total obligated amount?
The obligated amount is $11.7 million.
What is the period of performance?
Start: 2008-01-22. End: 2013-08-31.
What specific technical advancements were achieved through this $11.7M R&D investment, and how do they compare to industry standards or alternative solutions?
The contract aimed to develop shape-stable nose tip materials for reentry systems. Without detailed technical reports or independent assessments, it's challenging to quantify the specific advancements. A thorough review would compare the achieved material properties (e.g., thermal resistance, structural integrity) against the initial objectives and alternative materials developed concurrently or subsequently in the public or private sector.
Given the 'limited competition after exclusion of sources,' what was the justification for excluding other potential bidders, and how was fair market price determined?
The justification for excluding sources typically involves factors like unique capabilities, proprietary technology, or national security concerns. However, 'limited competition' inherently restricts price discovery. A detailed justification should be on file, and the agency should have employed robust price analysis techniques, potentially including should-cost analyses or comparison to similar, albeit limited, procurements to ensure a fair price.
How effectively did the Cost Plus Fixed Fee (CPFF) structure incentivize Intermat to control costs while ensuring the quality and timely delivery of the nose tip materials?
CPFF contracts aim to provide the contractor with a fixed profit margin regardless of the final cost. While this can incentivize completion, it may reduce the contractor's motivation to minimize costs, as increased expenses still result in the same profit. Effective oversight by the DCMA would be crucial to monitor costs, prevent overruns, and ensure the contractor exercised due diligence in managing project expenses.
Industry Classification
NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Other Guided Missile and Space Vehicle Parts and Auxiliary Equipment Manufacturing
Product/Service Code: RESEARCH AND DEVELOPMENT › C – National Defense R&D Services
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Solicitation ID: N0017807R3039
Offers Received: 1
Pricing Type: COST PLUS FIXED FEE (U)
Evaluated Preference: NONE
Contractor Details
Parent Company: Edgewater Capital Partners, L.P. (UEI: 058291399)
Address: 389 HILL ST, BIDDEFORD, ME, 04005
Business Categories: Category Business, Small Business
Financial Breakdown
Contract Ceiling: $12,177,959
Exercised Options: $12,177,959
Current Obligation: $11,665,024
Contract Characteristics
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Cost or Pricing Data: YES
Timeline
Start Date: 2008-01-22
Current End Date: 2013-08-31
Potential End Date: 2013-08-31 00:00:00
Last Modified: 2018-12-10
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