SRC INC Awarded $10.6M for R&D Services, Reflecting Strong Competition and Sector Positioning

Contract Overview

Contract Amount: $10,642,833 ($10.6M)

Contractor: SRC Inc

Awarding Agency: Department of Defense

Start Date: 2005-06-06

End Date: 2007-10-30

Contract Duration: 876 days

Daily Burn Rate: $12.1K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: COST PLUS FIXED FEE

Sector: R&D

Place of Performance

Location: SYRACUSE, ONONDAGA County, NEW YORK, 13212

State: New York Government Spending

Plain-Language Summary

Department of Defense obligated $10.6 million to SRC INC for work described as: Key points: 1. Value for money appears reasonable given the R&D nature and competitive award. 2. Strong competition dynamics suggest effective price discovery for specialized R&D. 3. Risk indicators are moderate, typical for complex research and development projects. 4. Performance context is limited without specific project milestones, but contract duration is substantial. 5. Sector positioning is within the specialized R&D services niche, a critical area for defense innovation.

Value Assessment

Rating: good

The contract value of $10.6 million for a two-year R&D effort is within a reasonable range for specialized research services. Benchmarking against similar R&D contracts is challenging due to the unique nature of such work, but the competitive award process suggests a fair market price was achieved. The Cost Plus Fixed Fee (CPFF) structure incentivizes cost control while allowing for flexibility in research scope.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that multiple qualified bidders had the opportunity to submit proposals. The presence of two bidders suggests a healthy level of competition for this specialized R&D requirement. This competitive environment is crucial for ensuring that the government receives the best value and innovative solutions at a fair price.

Taxpayer Impact: The robust competition for this contract is beneficial for taxpayers, as it likely drove down costs and encouraged innovative approaches from the bidders.

Public Impact

Benefits the Department of Defense by advancing research and development capabilities. Delivers specialized research services crucial for technological advancement. Geographic impact is primarily within New York, where SRC INC is headquartered. Workforce implications include employment for highly skilled researchers and engineers.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns inherent in CPFF contracts if not closely monitored.
Scope creep in R&D projects can lead to increased costs and extended timelines.
Dependence on a single contractor for specialized R&D could pose future supply chain risks.

Positive Signals

Awarded through full and open competition, indicating a competitive market.
Contractor has a track record, suggesting experience in delivering R&D services.
Fixed fee component provides some cost certainty for the government.

Sector Analysis

The Research and Development in the Physical, Engineering, and Life Sciences sector (NAICS 541710) is a critical area for government innovation, particularly within defense. This contract fits within the broader landscape of federal R&D spending, which aims to foster technological superiority and address national security challenges. Comparable spending benchmarks are difficult to establish precisely due to the bespoke nature of R&D, but the overall federal investment in this sector is substantial.

Small Business Impact

There is no indication that this contract included a small business set-aside. Given the specialized nature of the R&D services, it is likely that larger, more established firms with specific expertise were best positioned to compete. Subcontracting opportunities for small businesses may exist, but are not explicitly detailed in the award information.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and program managers within the Department of the Army. Accountability measures are embedded in the CPFF contract structure, requiring detailed reporting and justification of costs. Transparency is facilitated through contract award databases, though specific project details may be sensitive.

Related Government Programs

Department of Defense Research and Development Contracts
Advanced Technology Development Programs
Scientific and Technical Services Contracts

Risk Flags

Cost Overrun Risk
Scope Creep Potential
Technical Feasibility Uncertainty

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $10.6 million to SRC INC. See the official description on USAspending.

Who is the contractor on this award?

The obligated recipient is SRC INC.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $10.6 million.

What is the period of performance?

Start: 2005-06-06. End: 2007-10-30.

What is SRC INC's track record with federal R&D contracts?

SRC INC has a history of performing research and development services for the federal government, including the Department of Defense. Their experience often spans areas like sensor systems, advanced electronics, and information technology. Analyzing their past performance on similar Cost Plus Fixed Fee (CPFF) contracts would provide insight into their ability to manage costs and deliver on complex R&D objectives. A review of contract close-out data and any performance reviews would be necessary to fully assess their track record. However, the fact that they were awarded this contract through full and open competition suggests they met the government's requirements and demonstrated capability.

How does the $10.6 million award compare to similar R&D contracts?

Directly comparing the $10.6 million award to 'similar' R&D contracts is challenging due to the highly specialized and often unique nature of research and development projects. R&D contracts can vary significantly in scope, complexity, duration, and the specific scientific or engineering disciplines involved. However, within the context of defense R&D, this award appears to be a moderate-sized contract. Benchmarking would ideally involve looking at contracts for similar research areas (e.g., sensor technology, signal processing) awarded by the Department of Defense or other agencies over the past few years. Without access to a detailed database of comparable R&D efforts, a precise value-for-money assessment is difficult, but the competitive award process provides some assurance of fair pricing.

What are the primary risks associated with this Cost Plus Fixed Fee (CPFF) contract?

The primary risks associated with a CPFF contract, like this one awarded to SRC INC, revolve around cost control and potential scope creep. While the fixed fee provides a defined profit margin for the contractor, the 'cost plus' portion means the government bears the risk of actual costs incurred. If research efforts prove more complex or time-consuming than initially anticipated, costs can escalate. Effective oversight is crucial to ensure that all costs are reasonable, allocable, and allowable. Additionally, R&D projects inherently carry technical risks; the research may not yield the desired outcomes, or unforeseen technical challenges could arise, impacting the project's timeline and ultimate success. Contractor performance monitoring and clear communication channels are vital to mitigate these risks.

How effective is the 'full and open competition' strategy for specialized R&D procurements?

The 'full and open competition' strategy is generally considered the most effective approach for specialized R&D procurements when feasible. It maximizes the pool of potential offerors, increasing the likelihood of discovering innovative solutions and achieving competitive pricing. For R&D, this approach allows the government to solicit a wide range of technical approaches and capabilities. The presence of multiple bidders, as seen with SRC INC's award, indicates that the market can support such competition. However, the effectiveness is contingent on the clarity of the government's requirements and the ability of diverse contractors to understand and respond to them. In highly niche R&D areas, the number of capable bidders might be limited, potentially reducing the competitive intensity.

What are the implications of the contract duration (876 days) for R&D outcomes?

The contract duration of 876 days (approximately 2.4 years) is a significant factor for R&D outcomes. This timeframe suggests a project of substantial scope, allowing for in-depth research, experimentation, and potential iteration. Shorter contracts might be suitable for focused investigations, but longer durations are often necessary for complex R&D where breakthroughs are not guaranteed and require sustained effort. This extended period allows the research team, led by SRC INC, to delve deeper into the problem space, develop and test prototypes, and refine methodologies. It also provides a more stable environment for the research team, potentially leading to better knowledge retention and project continuity compared to shorter, more fragmented efforts.

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 › C – National Defense R&D Services

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 2

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Address: 6225 RUNNING RIDGE RD, NORTH SYRACUSE, NY, 13212

Business Categories: Category Business, Not Designated a Small Business

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline