Department of Defense awards $269M contract to The MITRE Corporation for engineering services

Contract Overview

Contract Amount: $269,112,478 ($269.1M)

Contractor: THE Mitre Corporation

Awarding Agency: Department of Defense

Start Date: 2003-11-19

End Date: 2006-06-30

Contract Duration: 954 days

Daily Burn Rate: $282.1K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: COST NO FEE

Sector: Other

Official Description: 200402!000464!2100!W15P7T!USA COMMUNICATIONS-ELECTRONICS !W15P7T04CD001 !A!N! !Y! ! !20031119!20080930!040540304!040540304!007872690!N!THE MITRE CORPORATION !7515 COLSHIRE DRIVE !MCLEAN !VA!22102!48376!059!51!MCLEAN !FAIRFAX !VIRGINIA !+000017246867!N!N!000000000000!R414!SYSTEMS ENGINEERING SERVICES !A7 !ELECTRONICS AND COMMUNICATION EQUIP !000 !* !541330!E! !3! ! ! ! ! !99990909!B! ! !N!Z!D!N!S!1!001!N!3A!Z!Y!Z! ! !N!Z!N! ! ! ! ! !A!A!000!A!C!N! ! ! !Y! ! !0001! !

Place of Performance

Location: MC LEAN, FAIRFAX County, VIRGINIA, 22102

State: Virginia Government Spending

Plain-Language Summary

Department of Defense obligated $269.1 million to THE MITRE CORPORATION for work described as: 200402!000464!2100!W15P7T!USA COMMUNICATIONS-ELECTRONICS !W15P7T04CD001 !A!N! !Y! ! !20031119!20080930!040540304!040540304!007872690!N!THE MITRE CORPORATION !7515 COLSHIRE DRIVE !MCLEAN !VA!22102!48376!059!51!MCLEAN !FAIR… Key points: 1. Contract awarded on a sole-source basis, raising questions about potential cost efficiencies. 2. Long contract duration of 954 days suggests a significant, ongoing need for services. 3. The contract's value of $269M positions it as a substantial investment in engineering support. 4. Services procured fall under engineering, a critical but broad category with varying market rates. 5. The absence of competition may limit opportunities for innovative solutions or cost reductions. 6. MITRE Corporation's established presence suggests a track record, but also potential for vendor lock-in.

Value Assessment

Rating: fair

The contract value of $269,112,477.74 for engineering services is substantial. Without specific details on the scope of work and deliverables, it is difficult to benchmark against similar contracts. However, the 'COST NO FEE' contract type, while sometimes used for specific research or development, can lead to less price transparency compared to fixed-price contracts. The lack of competition further complicates a direct value-for-money assessment.

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 a specific contractor possesses unique capabilities or when urgency precludes a competitive process. The absence of competition means there were no other bidders, and the government did not leverage the price discovery mechanisms inherent in a competitive bidding environment.

Taxpayer Impact: Sole-source awards can potentially lead to higher costs for taxpayers as there is no competitive pressure to drive down prices. It also limits the opportunity to explore a wider range of solutions and potentially more cost-effective options from other qualified vendors.

Public Impact

The primary beneficiary of this contract is the Department of Defense, specifically the Army, which will receive critical engineering services. These services are essential for supporting complex defense systems and ensuring operational readiness. The contract's geographic impact is centered in Virginia, where The MITRE Corporation is headquartered. While not directly creating new jobs, the contract supports the existing workforce of The MITRE Corporation and its potential subcontractors.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits price competition and potential cost savings for taxpayers.
Contract type 'COST NO FEE' may offer less transparency on actual costs incurred by the contractor.
Long contract duration could indicate a lack of flexibility or potential for scope creep without rigorous oversight.

Positive Signals

The MITRE Corporation is a well-established entity with significant experience in systems engineering.
Awarding to a known entity can ensure continuity of critical services.
The contract supports essential defense engineering functions, contributing to national security.

Sector Analysis

The engineering services sector is a vital component of the broader professional services market, supporting government and private industry with specialized technical expertise. This contract falls under the 'Engineering Services' NAICS code (541330). The federal government is a significant consumer of these services, particularly within the defense and aerospace industries, where complex systems require continuous design, development, and maintenance support. Benchmarking this contract's value is challenging without detailed scope, but it represents a substantial investment within this sector.

Small Business Impact

This contract was not competed and there is no indication of a small business set-aside. Therefore, it is unlikely to have direct subcontracting opportunities for small businesses unless The MITRE Corporation voluntarily includes them in its supply chain. The lack of a set-aside means small businesses did not have a formal opportunity to compete for this specific award, potentially limiting their access to this large federal contract.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of the Army's contracting and program management offices. As a sole-source award, the justification for the procurement and the contractor's performance would be subject to review. Transparency may be limited due to the non-competitive nature, but contract performance reports and financial audits would be standard oversight mechanisms. The Inspector General's office could also investigate if any improprieties are suspected.

Related Government Programs

Systems Engineering Services
Research and Development Support Services
Defense Information Technology Contracting
Professional and Management Support Services

Risk Flags

Sole-source award may limit cost savings.
Contract type 'COST NO FEE' can reduce contractor incentive for cost control.
Lack of competition may hinder innovation and broader market engagement.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $269.1 million to THE MITRE CORPORATION. 200402!000464!2100!W15P7T!USA COMMUNICATIONS-ELECTRONICS !W15P7T04CD001 !A!N! !Y! ! !20031119!20080930!040540304!040540304!007872690!N!THE MITRE CORPORATION !7515 COLSHIRE DRIVE !MCLEAN !VA!22102!48376!059!51!MCLEAN !FAIRFAX !VIRGINIA !+000017246867!N!N!000000000000!R414!SYSTEMS ENGINEERING SERVICES !A7 !ELECTRONICS AND COMMUNICATION EQUIP !000 !* !541330!E! !3! ! ! ! ! !999

Who is the contractor on this award?

The obligated recipient is THE MITRE CORPORATION.

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Army).

What is the total obligated amount?

The obligated amount is $269.1 million.

What is the period of performance?

Start: 2003-11-19. End: 2006-06-30.

What is the specific scope of engineering services provided under this contract?

The provided data indicates the contract is for 'SYSTEMS ENGINEERING SERVICES' under NAICS code 541330. However, the precise details of the scope of work, deliverables, and specific engineering disciplines involved are not available in the abbreviated data. Systems engineering is a broad field encompassing the design, integration, and management of complex systems over their life cycles. This could include areas like requirements analysis, system architecture, technical management, and verification and validation. Without a detailed statement of work, it's difficult to ascertain the full extent of services rendered.

How does the 'COST NO FEE' contract type impact contractor incentives and government oversight?

The 'COST NO FEE' (CNF) contract type is unusual and typically reserved for specific circumstances, often involving non-profit organizations or certain types of research and development where costs are difficult to estimate upfront and the government assumes the financial risk. In a CNF contract, the contractor is reimbursed for allowable costs but does not receive a fee or profit. This can reduce the contractor's incentive to control costs, as their profit is not directly tied to efficiency. For the government, it necessitates rigorous oversight to ensure that costs incurred are reasonable, allocable, and necessary for the contract's performance. It also means the government bears the full financial risk if costs exceed initial estimates.

What is the historical spending pattern for similar engineering services contracts awarded by the Department of the Army?

Historical spending on engineering services by the Department of the Army is substantial, reflecting the complexity and scale of its operations. While specific data for comparable 'COST NO FEE' sole-source contracts for systems engineering is not provided, the Army frequently procures engineering support through various contract types, including cost-plus-award-fee, fixed-price, and time-and-materials. Annual spending on engineering and technical services across the DoD often runs into billions of dollars. Analyzing past awards for similar scope and complexity, especially those with sole-source justifications, would be necessary to contextualize the $269M award and assess if it aligns with historical trends or represents an outlier.

What is The MITRE Corporation's track record with the federal government, particularly the Department of Defense?

The MITRE Corporation has a long and extensive track record of working with the federal government, particularly the Department of Defense. As a federally funded research and development center (FFRDC), MITRE operates in the public interest, providing objective analysis and engineering solutions. They are known for their work in areas such as systems engineering, cybersecurity, and command and control systems. Their history with the DoD is characterized by numerous contracts and task orders across various agencies, often involving complex, high-level technical challenges. This specific contract builds upon that established relationship, leveraging their recognized expertise.

Are there any performance risks associated with this sole-source 'COST NO FEE' contract?

Yes, there are inherent performance risks associated with a sole-source 'COST NO FEE' contract. The lack of competition removes the pressure to offer competitive pricing and potentially innovative solutions, which could lead to suboptimal value. The 'COST NO FEE' structure, while reimbursing the contractor for expenses, does not provide a direct profit incentive for cost efficiency, potentially leading to higher overall costs for the government. Furthermore, without a competitive benchmark, assessing whether the contractor is performing optimally and delivering the best possible value can be challenging. Robust government oversight is critical to mitigate these risks and ensure the contract objectives are met effectively and efficiently.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Architectural, Engineering, and Related Services › Engineering Services

Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › PROFESSIONAL SERVICES

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Offers Received: 1

Pricing Type: COST NO FEE (S)

Evaluated Preference: NONE

Contractor Details

Address: 7515 COLSHIRE DRIVE, MCLEAN, VA, 90

Business Categories: Category Business, Nonprofit Organization, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Contract Characteristics

Cost or Pricing Data: YES

Timeline