NASA's $37M JPL contract for R&D in physical sciences saw no competition, raising value questions
Contract Overview
Contract Amount: $36,997,386 ($37.0M)
Contractor: California Institute of Technology
Awarding Agency: National Aeronautics and Space Administration
Start Date: 2003-09-30
End Date: 2012-09-30
Contract Duration: 3,288 days
Daily Burn Rate: $11.3K/day
Competition Type: NOT COMPETED
Number of Offers Received: 51
Pricing Type: COST PLUS AWARD FEE
Sector: R&D
Official Description: PHASE C/D/E TES-SIPS
Place of Performance
Location: PASADENA, LOS ANGELES County, CALIFORNIA, 91125
Plain-Language Summary
National Aeronautics and Space Administration obligated $37.0 million to CALIFORNIA INSTITUTE OF TECHNOLOGY for work described as: PHASE C/D/E TES-SIPS Key points: 1. The contract's value proposition is unclear due to the lack of competitive bidding. 2. Sole-source procurement limits price discovery and potentially inflates costs. 3. The long duration and cost-plus award fee structure may present cost control risks. 4. Performance context is limited without comparative data from other R&D efforts. 5. This contract falls within the broad R&D sector, specifically focusing on physical sciences. 6. The absence of small business set-asides suggests limited direct impact on that ecosystem.
Value Assessment
Rating: questionable
Benchmarking the value of this contract is challenging due to its sole-source nature and the specialized R&D focus. The Cost Plus Award Fee (CPAF) structure, while common for complex R&D, can lead to higher costs if award criteria are not rigorously managed. Without competitive bids, it's difficult to ascertain if the $37 million price tag represents a fair market value for the services rendered. The contract's duration (nearly 9 years) also adds to the uncertainty regarding long-term cost-effectiveness.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was procured on a sole-source basis, meaning only one vendor, the California Institute of Technology (Caltech), was considered. This approach bypasses the competitive bidding process, which typically involves multiple vendors submitting proposals. While sole-source contracts can be justified for unique capabilities or urgent needs, they limit the government's ability to leverage market competition to drive down prices and ensure the best value.
Taxpayer Impact: Taxpayers may have paid a premium for this contract due to the absence of competition. Without competing offers, there's no market pressure to ensure the lowest possible price for the research and development services.
Public Impact
The primary beneficiary is NASA's Jet Propulsion Laboratory (JPL), operated by Caltech, which received funding for critical research and development. Services delivered include advanced research and development in physical, engineering, and life sciences, contributing to scientific advancement. The geographic impact is primarily within California, where JPL is located, but the scientific outcomes have national and global implications. Workforce implications include the employment of highly skilled scientists, engineers, and support staff at JPL.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source procurement limits price discovery and potentially leads to higher costs for taxpayers.
- The Cost Plus Award Fee (CPAF) structure requires robust oversight to ensure award criteria are met without excessive cost escalation.
- The long contract duration (over 9 years) increases the risk of cost overruns and scope creep if not managed diligently.
- Lack of competition makes it difficult to benchmark performance and value against alternative providers.
- The specialized nature of the R&D may limit the pool of potential competitors, but a sole-source justification should be robust.
Positive Signals
- The contract is with the California Institute of Technology, a highly reputable institution with a strong track record in aerospace and scientific research.
- The research and development focus addresses critical scientific and technological advancements for NASA's missions.
- The Cost Plus Award Fee structure incentivizes performance, provided the award criteria are well-defined and monitored.
- The contract supports a vital national asset (JPL) in conducting cutting-edge scientific research.
Sector Analysis
This contract falls within the Research and Development (R&D) sector, specifically focusing on physical, engineering, and life sciences. This sector is characterized by innovation, long development cycles, and often specialized expertise. Government spending in R&D is crucial for technological advancement and national security. Comparable spending benchmarks are difficult to establish for highly specialized, sole-source R&D contracts, as they are often tailored to unique institutional capabilities and project requirements.
Small Business Impact
This contract does not appear to have involved small business set-asides, as indicated by the 'sb': false flag. The sole-source nature of the procurement further suggests that opportunities for small businesses to participate as prime contractors were not pursued. Subcontracting opportunities for small businesses may exist but are not explicitly detailed in the provided data. The overall impact on the small business ecosystem for this specific contract is likely minimal.
Oversight & Accountability
Oversight for this contract would primarily fall under NASA's contracting and program management offices. The Cost Plus Award Fee (CPAF) structure necessitates careful monitoring of performance metrics and cost expenditures to ensure the contractor meets objectives and stays within budget. Transparency is generally maintained through contract reporting requirements, though specific details of oversight activities are not provided. The Inspector General's office for NASA would have jurisdiction for audits and investigations if any concerns regarding fraud, waste, or abuse arise.
Related Government Programs
- NASA Research and Development Contracts
- Jet Propulsion Laboratory (JPL) Funding
- Cost Plus Award Fee Contracts
- Sole Source Procurements
- Physical Sciences Research
Risk Flags
- Sole Source Procurement
- Potential for Cost Overruns (CPAF)
- Long Contract Duration Risks
- Lack of Competitive Benchmarking
Tags
nasa, jet-propulsion-laboratory, caltech, research-and-development, physical-sciences, engineering-sciences, life-sciences, sole-source, cost-plus-award-fee, california, delivery-order, long-term-contract
Frequently Asked Questions
What is this federal contract paying for?
National Aeronautics and Space Administration awarded $37.0 million to CALIFORNIA INSTITUTE OF TECHNOLOGY. PHASE C/D/E TES-SIPS
Who is the contractor on this award?
The obligated recipient is CALIFORNIA INSTITUTE OF TECHNOLOGY.
Which agency awarded this contract?
Awarding agency: National Aeronautics and Space Administration (National Aeronautics and Space Administration).
What is the total obligated amount?
The obligated amount is $37.0 million.
What is the period of performance?
Start: 2003-09-30. End: 2012-09-30.
What is the specific nature of the 'PHASE C/D/E TES-SIPS' research conducted under this contract?
The provided data abbreviates the description as 'PHASE C/D/E TES-SIPS'. While 'Phase C/D/E' typically refers to later stages of system development or project execution in aerospace and engineering (e.g., Preliminary Design, Detailed Design, Production/Operations), the 'TES-SIPS' acronym is not standard. It likely refers to a specific technical or scientific initiative within the Jet Propulsion Laboratory (JPL) related to the California Institute of Technology's research portfolio. Without further context or documentation, the precise scientific or engineering domain of TES-SIPS remains unclear, but it falls under the broader umbrella of physical, engineering, and life sciences R&D funded by NASA.
How does the Cost Plus Award Fee (CPAF) structure typically function in R&D contracts, and what are its implications for cost control?
A Cost Plus Award Fee (CPAF) contract reimburses the contractor for allowable costs incurred, plus a fee that consists of a fixed base amount and an award amount. The award amount is determined by the government based on the contractor's performance against pre-defined criteria. For R&D contracts, CPAF is often used when the scope is not fully defined or when innovation and performance quality are paramount. The implication for cost control is that while costs are reimbursed, the award fee incentivizes the contractor to meet or exceed performance targets. However, effective cost control relies heavily on the government's ability to establish clear, measurable performance metrics and objectively evaluate the contractor's achievement of these metrics. Poorly defined criteria or subjective evaluations can lead to inflated costs as contractors may prioritize achieving the award fee over strict cost efficiency.
Given the sole-source nature, what justification did NASA provide for not competing this contract?
The provided data indicates the contract was 'NOT COMPETED' and lists the contracting agency as 'National Aeronautics and Space Administration' (NASA) with the awarding agency also being NASA. However, the specific justification for this sole-source determination is not included in the dataset. Typically, sole-source procurements require a formal justification, such as the unique capability of the contractor, urgency of the need, or when only one responsible source exists. For a contract awarded to the California Institute of Technology (Caltech) for work likely related to the Jet Propulsion Laboratory (JPL), justifications often center on Caltech's unique management and operational role at JPL, which NASA has historically relied upon. A formal Justification for Other than Full and Open Competition (JOFOC) would have been required and should be publicly accessible.
What is the historical spending pattern for similar R&D contracts managed by NASA or JPL?
Historical spending patterns for NASA and JPL's R&D contracts vary significantly based on mission objectives, technological focus, and contract types. NASA's overall R&D budget fluctuates annually, allocated across numerous projects and centers. JPL, managed by Caltech, undertakes a wide range of planetary science, astrophysics, and Earth science missions, each requiring substantial R&D investment. Contracts can range from small, specialized research grants to multi-billion dollar spacecraft development programs. Analyzing historical spending requires segmenting data by research area (e.g., astrophysics vs. Earth science), contract vehicle (e.g., cost-plus vs. fixed-price), and duration. Without specific comparative data points for 'PHASE C/D/E TES-SIPS' or similar sole-source R&D efforts, it's difficult to establish a precise historical spending benchmark for this particular contract. However, NASA's commitment to R&D is substantial, often involving long-term, high-value engagements.
What are the potential risks associated with a contract duration of over 9 years (3288 days)?
A contract duration exceeding nine years presents several potential risks. Firstly, **scope creep** is a significant concern; as research progresses, the objectives or methodologies might evolve, potentially leading to expanded work not originally envisioned, which could increase costs. Secondly, **technological obsolescence** is a risk, especially in fast-moving R&D fields, where the initial technological assumptions might become outdated before the project concludes. Thirdly, **cost escalation** due to inflation, changing labor rates, or unforeseen material costs over such a long period can impact the total expenditure. Fourthly, **contractor performance degradation** is possible; motivation or focus might wane over extended periods without strong, consistent oversight and performance management. Finally, **loss of institutional knowledge** if key personnel leave the project over its long lifespan can hinder progress. NASA's oversight mechanisms must be robust to mitigate these risks throughout the contract's term.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Scientific Research and Development Services › Research and Development in the Physical, Engineering, and Life Sciences
Product/Service Code: RESEARCH AND DEVELOPMENT › Space R&D Services
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Offers Received: 51
Pricing Type: COST PLUS AWARD FEE (R)
Evaluated Preference: NONE
Contractor Details
Address: 4800 OAK GROVE DR, PASADENA, CA, 91109
Business Categories: Category Business, Government, U.S. National Government, Not Designated a Small Business
Financial Breakdown
Contract Ceiling: $38,253,484
Exercised Options: $38,253,484
Current Obligation: $36,997,386
Contract Characteristics
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Parent Contract
Parent Award PIID: NAS703001
IDV Type: IDC
Timeline
Start Date: 2003-09-30
Current End Date: 2012-09-30
Potential End Date: 2012-09-30 00:00:00
Last Modified: 2020-10-27
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