DoD awards $16.7M R&D contract to Frontier Technology Inc. for labor support services

Contract Overview

Contract Amount: $16,696,523 ($16.7M)

Contractor: Frontier Technology Inc

Awarding Agency: Department of Defense

Start Date: 2022-03-25

End Date: 2027-03-24

Contract Duration: 1,825 days

Daily Burn Rate: $9.1K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: COST PLUS FIXED FEE

Sector: R&D

Official Description: SBIR PHASE III LABOR SUPPORT SERVICES

Place of Performance

Location: VIRGINIA BEACH, NORFOLK CITY County, VIRGINIA, 23455

State: Virginia Government Spending

Plain-Language Summary

Department of Defense obligated $16.7 million to FRONTIER TECHNOLOGY INC for work described as: SBIR PHASE III LABOR SUPPORT SERVICES Key points: 1. Contract awarded on a cost-plus-fixed-fee basis, which can lead to cost overruns if not managed carefully. 2. The contract duration of 5 years (1825 days) suggests a long-term need for these specialized services. 3. The North American Industry Classification System (NAICS) code 541715 indicates a focus on physical, engineering, and life sciences research. 4. This contract represents a small portion of the overall Department of Defense R&D spending. 5. The absence of a small business set-aside raises questions about opportunities for smaller innovative firms. 6. The contract's value is moderate within the context of large federal R&D procurements.

Value Assessment

Rating: fair

The contract's value of $16.7 million over five years for labor support services in R&D appears reasonable on the surface. However, without specific details on the labor categories, hours, and rates, a precise value-for-money assessment is challenging. Comparing this to similar R&D labor support contracts within the Department of the Navy or other agencies would provide better benchmarking. The cost-plus-fixed-fee structure necessitates close oversight to ensure costs remain controlled and aligned with the fixed fee.

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 typically occurs when a specific contractor possesses unique capabilities, proprietary technology, or has demonstrated exceptional performance on prior related work. The lack of competition means that price discovery through market forces was not utilized, potentially leading to higher costs than if multiple bids were solicited.

Taxpayer Impact: Sole-source awards limit opportunities for other businesses to compete for federal dollars and can reduce the government's ability to secure the best possible pricing through competitive bidding.

Public Impact

The primary beneficiaries are the Department of Defense and its research initiatives, which receive specialized labor support. Services delivered include essential personnel to support research and development activities in physical, engineering, and life sciences. The geographic impact is likely concentrated around the Navy's research facilities, primarily in Virginia. Workforce implications include the employment of skilled labor in R&D support roles, contributing to the scientific and technical workforce.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may result in suboptimal pricing.
Cost-plus-fixed-fee contracts require robust oversight to prevent cost escalation.
Sole-source awards limit opportunities for small and diverse businesses.
The specific nature of 'labor support services' could be broad, requiring clear performance metrics.

Positive Signals

Award to an incumbent or specialized provider suggests continuity of critical R&D support.
Long-term contract (5 years) indicates a stable and ongoing requirement for these services.
Focus on R&D aligns with national security and technological advancement goals.

Sector Analysis

The contract falls within the Research and Development sector, specifically NAICS code 541715, which covers a broad range of scientific research and experimental development services. This sector is characterized by innovation, specialized expertise, and often long development cycles. Federal spending in R&D is crucial for technological advancement and national security. Comparable spending benchmarks would involve analyzing other R&D contracts awarded by the Department of Defense and other federal agencies for similar labor support or scientific services.

Small Business Impact

This contract was not set aside for small businesses, and the contractor, Frontier Technology Inc., is not explicitly identified as a small business in the provided data. The lack of a small business set-aside means that opportunities for small businesses to directly participate in this specific contract are limited. However, it is possible that Frontier Technology Inc. may engage small businesses as subcontractors, depending on the scope of work and their subcontracting plans.

Oversight & Accountability

Oversight for this contract will primarily reside with the Department of the Navy contracting officers and program managers. They are responsible for monitoring contractor performance, ensuring compliance with contract terms, and managing payments. The cost-plus-fixed-fee structure necessitates rigorous financial oversight to track expenditures and ensure the fixed fee is justified. Transparency may be limited due to the sole-source nature and the proprietary aspects of R&D, but contract awards and basic details are typically available through federal procurement databases.

Related Government Programs

Department of Defense Research and Development Contracts
Navy Scientific and Technical Support Services
SBIR Phase III Contracts (if applicable)
Cost-Plus-Fixed-Fee Contracts
Federal R&D Spending

Risk Flags

Sole-source award lacks competitive pricing pressure.
Cost-plus-fixed-fee structure requires diligent cost oversight.
Limited public information on contractor's specific performance history.
Potential for cost overruns if not managed effectively.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $16.7 million to FRONTIER TECHNOLOGY INC. SBIR PHASE III LABOR SUPPORT SERVICES

Who is the contractor on this award?

The obligated recipient is FRONTIER TECHNOLOGY 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 $16.7 million.

What is the period of performance?

Start: 2022-03-25. End: 2027-03-24.

What specific types of labor support are being provided under this contract, and what are the key skill sets required?

The provided data indicates 'SBIR PHASE III LABOR SUPPORT SERVICES' under NAICS code 541715 (Research and Development in the Physical, Engineering, and Life Sciences). While the specific labor categories are not detailed, this suggests the need for personnel with expertise in scientific research, engineering, technical support, and potentially project management within these fields. This could include scientists, engineers, technicians, research assistants, and analysts. The 'SBIR Phase III' designation implies that this contract likely builds upon prior Small Business Innovation Research (SBIR) efforts, suggesting a focus on commercializing technologies developed under earlier phases. Therefore, the labor support may involve activities related to further development, testing, integration, and demonstration of these technologies.

How does the $16.7 million contract value compare to similar R&D labor support contracts awarded by the Department of the Navy?

Benchmarking this $16.7 million contract requires access to a broader dataset of Department of the Navy (DoN) R&D labor support contracts. However, as a five-year contract, the average annual value is approximately $3.34 million. This is a moderate-sized award within the DoN's extensive R&D portfolio. Larger contracts in this space can reach tens or hundreds of millions of dollars, often involving broader scope or more extensive research programs. Smaller contracts might focus on very specific technical tasks or shorter durations. Without direct comparative data on similar labor support services, it's difficult to definitively state if this represents excellent or questionable value, but it falls within a common range for specialized, long-term support.

What are the potential risks associated with a sole-source, cost-plus-fixed-fee contract for R&D labor support?

The primary risks associated with this contract structure are twofold. Firstly, the sole-source nature means the government did not benefit from competitive bidding, potentially leading to a higher price than could have been achieved through competition. This reduces the government's leverage in price negotiation. Secondly, the cost-plus-fixed-fee (CPFF) pricing structure carries inherent risks of cost escalation. While the 'fixed fee' provides some predictability, the 'cost-plus' element means the contractor is reimbursed for allowable costs incurred. If costs exceed initial estimates, the total contract value could increase, especially if the fixed fee is a significant portion of the total. Robust government oversight is crucial to scrutinize costs, ensure efficiency, and prevent scope creep that could inflate expenses.

What is Frontier Technology Inc.'s track record with the Department of Defense, particularly in R&D and SBIR Phase III contracts?

Information on Frontier Technology Inc.'s specific track record with the Department of Defense (DoD) and in SBIR Phase III contracts is not detailed in the provided data. However, the award of a sole-source contract, especially for R&D labor support, often suggests a pre-existing relationship or demonstrated capability. To assess their track record thoroughly, one would need to examine their past performance evaluations (e.g., Contractor Performance Assessment Reporting System - CPARS), previous contract awards from the DoD, and any history of successful SBIR Phase I and II projects that logically precede a Phase III award. A positive history of delivering on time, within budget, and meeting technical requirements would mitigate concerns about awarding them this contract without competition.

How does this contract align with the Department of the Navy's broader R&D objectives and spending patterns?

This contract aligns with the Department of the Navy's (DoN) ongoing commitment to research and development across physical, engineering, and life sciences. The specific NAICS code 541715 indicates support for foundational and applied research aimed at technological advancement. The 'SBIR Phase III' designation suggests a focus on transitioning innovative technologies, often developed by small businesses in earlier phases, towards practical application and potential commercialization. This aligns with the DoN's strategy to leverage innovation for maintaining a technological edge. Analyzing historical DoN R&D spending patterns would reveal the proportion allocated to this specific area and whether this contract represents a continuation, expansion, or new initiative within their R&D portfolio.

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: SUPPORT SVCS (PROF, ADMIN, MGMT) › PROFESSIONAL SERVICES

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: N6426722R0001

Offers Received: 1

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Address: 4141 COLONEL GLENN HWY STE 140, BEAVERCREEK, OH, 45431

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

Financial Breakdown

Contract Ceiling: $22,453,758

Exercised Options: $17,936,262

Current Obligation: $16,696,523

Actual Outlays: $5,637,436

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Timeline