DoD's $22M R&D contract awarded to Kratos SRE, Inc. for unspecified physical sciences research

Contract Overview

Contract Amount: $22,018,741 ($22.0M)

Contractor: Kratos SRE, Inc.

Awarding Agency: Department of Defense

Start Date: 2023-07-01

End Date: 2026-06-30

Contract Duration: 1,095 days

Daily Burn Rate: $20.1K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: COST PLUS FIXED FEE

Sector: R&D

Official Description: HOLDING SLIN FOR CLIN 0003

Place of Performance

Location: BIRMINGHAM, JEFFERSON County, ALABAMA, 35211

State: Alabama Government Spending

Plain-Language Summary

Department of Defense obligated $22.0 million to KRATOS SRE, INC. for work described as: HOLDING SLIN FOR CLIN 0003 Key points: 1. Contract awarded on a sole-source basis, limiting price competition and potentially increasing costs. 2. Research and Development focus in physical sciences suggests potential for innovation but also inherent uncertainty. 3. Long contract duration of 1095 days indicates a significant, ongoing research effort. 4. The contract's value of over $22 million warrants scrutiny for cost-effectiveness and alignment with strategic goals. 5. Lack of detailed service description makes performance assessment challenging. 6. Awarded to a single vendor, raising questions about market availability and alternative solutions.

Value Assessment

Rating: questionable

Benchmarking the value of this Cost Plus Fixed Fee contract is difficult without specific deliverables or performance metrics. The $22 million price tag for R&D in physical sciences is substantial, and the lack of competition means there's no direct market comparison to assess if this represents a fair price. The fixed fee component provides some cost control for the government, but the overall cost-plus nature means the government bears the risk of cost overruns.

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 among multiple vendors. This approach is typically used when only one vendor possesses the unique capabilities or technology required for the project. However, it bypasses the competitive process, which can lead to higher prices and reduced innovation.

Taxpayer Impact: The lack of competition means taxpayers may not be receiving the best possible price for the research services. Without competing bids, there is less pressure on the contractor to offer cost savings.

Public Impact

The primary beneficiary is Kratos SRE, Inc., which receives a significant contract award. The services delivered are in Research and Development within the physical, engineering, and life sciences, though specific applications are not detailed. The geographic impact is limited to Alabama, where the contractor is located. Workforce implications include potential job creation or utilization within Kratos SRE, Inc. and its supply chain.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits competitive pressure on pricing.
Lack of detailed service description hinders performance monitoring.
Cost-plus contract structure shifts cost overrun risk to the government.
Unspecified R&D outcomes make value assessment difficult.

Positive Signals

Award to a single, potentially specialized vendor may indicate unique capabilities.
Fixed fee component provides some cost predictability.
Long-term contract allows for sustained research effort.

Sector Analysis

This contract falls under the Research and Development sector, specifically focusing on physical sciences. The federal government is a major investor in R&D, with significant spending allocated to defense, energy, and health research. The NAICS code 541715 covers a broad range of scientific research and development services. Comparable spending benchmarks are difficult to establish without knowing the specific research area, but R&D contracts can range from millions to billions of dollars.

Small Business Impact

The data indicates this contract was not set aside for small businesses (ss: false, sb: false). As a sole-source award of over $22 million, it is unlikely that significant subcontracting opportunities for small businesses will be mandated or readily available unless Kratos SRE, Inc. proactively seeks them. This contract does not appear to directly support the small business ecosystem.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of the Navy's contracting and program management offices. As a Cost Plus Fixed Fee contract, financial oversight will be crucial to monitor expenditures against the fixed fee and ensure compliance with cost principles. Transparency is limited due to the sole-source nature and lack of public detail on the specific research objectives and outcomes.

Related Government Programs

Department of Defense Research and Development Programs
Navy Science and Technology Initiatives
Physical Sciences Research Grants
Advanced Technology Development Contracts

Risk Flags

Sole-source award limits competition.
Lack of detailed scope hinders performance assessment.
Cost-plus contract structure carries inherent cost risk.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $22.0 million to KRATOS SRE, INC.. HOLDING SLIN FOR CLIN 0003

Who is the contractor on this award?

The obligated recipient is KRATOS SRE, 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 $22.0 million.

What is the period of performance?

Start: 2023-07-01. End: 2026-06-30.

What specific research objectives are being pursued under this contract, and how do they align with the Department of the Navy's strategic priorities?

The provided data does not specify the exact research objectives for this $22 million contract awarded to Kratos SRE, Inc. The NAICS code 541715 indicates 'Research and Development in the Physical, Engineering, and Life Sciences (except Nanotechnology and Biotechnology),' which is a broad category. To assess alignment with strategic priorities, one would need access to the contract's statement of work or program documentation. Typically, such R&D efforts are intended to advance technological capabilities, address emerging threats, or explore novel scientific principles relevant to national defense. Without this detail, it's impossible to confirm the strategic relevance or potential impact of the research.

What is Kratos SRE, Inc.'s track record in performing similar sole-source R&D contracts for the Department of Defense?

Information regarding Kratos SRE, Inc.'s specific track record with similar sole-source R&D contracts for the Department of Defense is not detailed in the provided data. A comprehensive assessment would require reviewing past performance evaluations, contract histories, and any publicly available reports on their previous work. Given this is a sole-source award, it implies Kratos SRE, Inc. likely possesses unique qualifications or proprietary technology. However, without further data, it's difficult to gauge their historical success rate, cost control capabilities, or adherence to schedules on comparable projects. Further investigation into their contract history and client feedback would be necessary.

How does the $22 million contract value compare to other R&D contracts in physical sciences awarded by the Department of the Navy or other DoD branches?

The $22 million contract value for R&D in physical sciences is a substantial investment. To benchmark this, one would need to compare it against a portfolio of similar contracts. For instance, the Department of Defense awards numerous R&D contracts annually, with values varying widely based on scope and duration. Contracts for basic research might be smaller, while those for advanced development or system prototyping could easily exceed tens or hundreds of millions. Without knowing the specific sub-field of physical sciences and the deliverables, a precise comparison is challenging. However, $22 million suggests a significant, multi-year research effort rather than a small exploratory study.

What are the key performance indicators (KPIs) and milestones for this contract, and how will they be used to measure success?

The provided data does not include specific Key Performance Indicators (KPIs) or milestones for this contract. For a Cost Plus Fixed Fee R&D contract, success is typically measured against the achievement of defined research objectives, technical milestones, and adherence to a project schedule. The 'fixed fee' component implies that Kratos SRE, Inc. is incentivized to complete the work within agreed-upon parameters, but the 'cost-plus' nature means the government bears the direct costs. A thorough review of the contract's statement of work, delivery schedules, and technical review points would be necessary to understand how performance will be evaluated and success determined.

What is the historical spending pattern for this specific type of R&D within the Department of the Navy, and does this contract represent an increase or decrease?

The provided data does not offer historical spending patterns for this specific type of R&D within the Department of the Navy. To analyze this, one would need access to historical contract databases or budget reports that track spending by NAICS code (541715 in this case) and agency. Understanding past investments in similar physical sciences R&D would help determine if this $22 million award is consistent with previous funding levels, represents a strategic shift in investment, or is an anomaly. Without this historical context, it's difficult to assess trends or justify the current spending level relative to past efforts.

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

Solicitation ID: N0017823R4400

Offers Received: 1

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Address: 10680 TREENA ST STE 600, SAN DIEGO, CA, 92131

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

Financial Breakdown

Contract Ceiling: $46,706,190

Exercised Options: $27,069,468

Current Obligation: $22,018,741

Subaward Activity

Number of Subawards: 2

Total Subaward Amount: $90,116

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Timeline