NASA's $2.06B Aerojet Rocketdyne Contract for R&D: A Look at Value and Competition
Contract Overview
Contract Amount: $2,057,069,644 ($2.1B)
Contractor: Aerojet Rocketdyne of DE, Inc
Awarding Agency: National Aeronautics and Space Administration
Start Date: 2006-06-02
End Date: 2020-09-30
Contract Duration: 5,234 days
Daily Burn Rate: $393.0K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: COST PLUS AWARD FEE
Sector: R&D
Official Description: LETTER CONTRACT TO INITIATE DDT&E AND LONG LEAD PURCHASES
Place of Performance
Location: WEST HILLS, LOS ANGELES County, CALIFORNIA, 91307
Plain-Language Summary
National Aeronautics and Space Administration obligated $2.06 billion to AEROJET ROCKETDYNE OF DE, INC for work described as: LETTER CONTRACT TO INITIATE DDT&E AND LONG LEAD PURCHASES Key points: 1. Significant investment in research and development for advanced propulsion systems. 2. Sole-source award raises questions about price discovery and potential cost overruns. 3. Long contract duration (5234 days) suggests complex, multi-year development. 4. Lack of small business participation noted.
Value Assessment
Rating: questionable
The contract type (Cost Plus Award Fee) can incentivize performance but also carries inherent risk of cost escalation without strong oversight. Benchmarking is difficult without detailed cost breakdowns.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
The sole-source nature of this award limits competitive pressure, potentially leading to higher costs than if multiple vendors were considered. The agency relied on a single source for critical R&D.
Taxpayer Impact: Taxpayer funds are committed without the benefit of competitive bidding, increasing the risk of paying a premium for the research and development services.
Public Impact
Advancement of critical space exploration and defense technologies. Potential for job creation within the aerospace sector. Long-term commitment of federal resources to a single contractor.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Cost-plus contract type
- Lack of small business participation
Positive Signals
- Supports critical R&D
- Long-term project duration
Sector Analysis
This contract falls under Research and Development in Physical, Engineering, and Life Sciences. Spending in this sector is crucial for technological advancement but requires careful oversight due to its often speculative nature and long timelines.
Small Business Impact
The contract data indicates no small business participation. This suggests opportunities for small businesses in this specific R&D area may be limited or were not pursued in this procurement.
Oversight & Accountability
The long duration and cost-plus nature of this contract necessitate robust oversight from NASA to ensure funds are used efficiently and objectives are met. Award fees should be tied to clear performance metrics.
Related Government Programs
- Research and Development in the Physical, Engineering, and Life Sciences
- National Aeronautics and Space Administration Contracting
- National Aeronautics and Space Administration Programs
Risk Flags
- Sole-source award limits competition.
- Cost-plus contract type increases cost risk.
- Long contract duration (5234 days) requires sustained oversight.
- No small business participation.
- Lack of detailed cost breakdown for benchmarking.
Tags
research-and-development-in-the-physical, national-aeronautics-and-space-administr, ca, definitive-contract, billion-dollar
Frequently Asked Questions
What is this federal contract paying for?
National Aeronautics and Space Administration awarded $2.06 billion to AEROJET ROCKETDYNE OF DE, INC. LETTER CONTRACT TO INITIATE DDT&E AND LONG LEAD PURCHASES
Who is the contractor on this award?
The obligated recipient is AEROJET ROCKETDYNE OF DE, INC.
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 $2.06 billion.
What is the period of performance?
Start: 2006-06-02. End: 2020-09-30.
What specific technological advancements are expected from this $2.06B R&D investment, and how will their success be measured?
The contract aims to initiate DDT&E (Design, Development, Test, and Evaluation) and long-lead purchases, likely for advanced propulsion systems. Success measurement would typically involve milestones related to prototype development, testing outcomes, and performance metrics against defined requirements. NASA's oversight would focus on achieving these technical objectives within the awarded fee structure.
Given the sole-source award, what mechanisms are in place to mitigate the risk of cost overruns and ensure fair pricing?
As a sole-source contract, NASA relies on negotiation and potentially independent cost estimates to establish a fair price. The Cost Plus Award Fee structure incentivizes performance but requires stringent monitoring of expenditures and achievement of milestones. Regular audits and reviews are critical to manage cost risks.
How does this significant R&D expenditure align with NASA's broader strategic goals and contribute to overall mission effectiveness?
This contract likely supports NASA's strategic objectives in areas such as deep space exploration, satellite technology, or launch capabilities. The R&D investment aims to develop next-generation technologies that enhance mission performance, reduce costs, or enable entirely new scientific endeavors, ultimately contributing to the agency's long-term effectiveness.
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 › Community and Regional Development R&D Services
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Offers Received: 1
Pricing Type: COST PLUS AWARD FEE (R)
Evaluated Preference: NONE
Contractor Details
Parent Company: L3harris Technologies, Inc
Address: 8900 DESOTO AVE, CANOGA PARK, CA, 91304
Business Categories: Category Business, Not Designated a Small Business
Financial Breakdown
Contract Ceiling: $2,074,005,182
Exercised Options: $2,074,005,182
Current Obligation: $2,057,069,644
Actual Outlays: $1,110,293
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Timeline
Start Date: 2006-06-02
Current End Date: 2020-09-30
Potential End Date: 2020-09-30 00:00:00
Last Modified: 2024-08-28
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