Department of Defense awarded $23.7M for R&D services, with a significant portion for Alcoa Inc

Contract Overview

Contract Amount: $23,696,958 ($23.7M)

Contractor: Arconic Defense Inc.

Awarding Agency: Department of Defense

Start Date: 2005-08-22

End Date: 2013-09-12

Contract Duration: 2,943 days

Daily Burn Rate: $8.1K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: COST PLUS FIXED FEE

Sector: R&D

Official Description: 200511!008295!2100!W56HZV!TACOM - WARREN !W56HZV05C0493 !A!N! !Y! ! !20050822!20080822!004393138!004393138!001339472!N!ALCOA INC !100 TECHNICAL DRIVE !ALCOA CENTER !PA!15069!00668!129!42!ALCOA CENTER !WESTMORELAND !PENN !+000001209757!N!N!000000000000!AZ11!RDTE/OTHER RESEARCH & DEVELOPMENT-BASIC RESEARCH !S1 !SERVICES !000 !* !541710!E! !3! ! ! ! ! !20200930!B! ! !B! !D!N!U!1!001!N!1A!Z!Y!Z! ! !N!C!N! ! ! !A!A!A!A!000!A!C!N! ! ! ! ! ! !0001! !

Place of Performance

Location: NEW KENSINGTON, WESTMORELAND County, PENNSYLVANIA, 15069

State: Pennsylvania Government Spending

Plain-Language Summary

Department of Defense obligated $23.7 million to ARCONIC DEFENSE INC. for work described as: 200511!008295!2100!W56HZV!TACOM - WARREN !W56HZV05C0493 !A!N! !Y! ! !20050822!20080822!004393138!004393138!001339472!N!ALCOA INC !100 TECHNICAL DRIVE !ALCOA CENTER !PA!15069!00668!129!42!ALCOA CENTER !WEST… Key points: 1. Contract awarded to Alcoa Inc. for Research and Development in Physical, Engineering, and Life Sciences. 2. The contract was not competed, raising questions about potential cost efficiencies and market-driven pricing. 3. A substantial portion of the contract value is linked to Alcoa Inc., a known entity in materials science. 4. The contract duration spans over 8 years, indicating a long-term need for the services provided. 5. The 'Research and Development' category suggests investment in innovation and future capabilities for the Department of Defense. 6. The contract's value of $23.7 million warrants scrutiny for its alignment with R&D objectives and potential return on investment.

Value Assessment

Rating: fair

The contract value of $23.7 million for over 8 years of R&D services appears substantial. Benchmarking this against similar R&D contracts is challenging without more specific details on the scope of work. However, the lack of competition suggests that the pricing may not have been subjected to the most rigorous market testing, potentially leading to a less optimal value for money compared to a fully competed contract. Further analysis would require understanding the specific deliverables and the uniqueness of the research conducted.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was not competed, indicating a sole-source award. This approach is typically used when only one source can provide the required goods or services, or in cases of urgent need. The lack of competition means that the government did not benefit from multiple bids, which could have driven down prices or spurred innovation through diverse approaches. The rationale for not competing this award needs further investigation to ensure it was justified.

Taxpayer Impact: For taxpayers, a sole-source award means there is a higher risk of paying a premium for the services, as competitive pressures that normally ensure fair pricing were absent.

Public Impact

The Department of Defense benefits from specialized research and development services, potentially leading to advancements in materials science or engineering. The contract supports innovation within the defense sector, contributing to the development of new technologies or improved existing ones. The geographic impact is primarily within Pennsylvania, where Alcoa Inc. is headquartered, suggesting potential local economic benefits. Workforce implications include employment for researchers, scientists, and support staff involved in the R&D activities.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may lead to higher costs for taxpayers.
The long contract duration could indicate a lack of flexibility if research needs change.
Specific R&D outcomes and their impact are not detailed, making it hard to assess success.
The sole-source nature raises concerns about whether alternative, potentially more cost-effective solutions were overlooked.

Positive Signals

Contract supports critical Research and Development for the Department of Defense.
Long-term engagement suggests a sustained need and commitment to the research area.
Award to Alcoa Inc. leverages established expertise in materials science and engineering.

Sector Analysis

This contract falls within the Research and Development sector, specifically focusing on physical, engineering, and life sciences. This is a critical area for defense modernization, involving significant investment in innovation. The market for specialized R&D services is often characterized by high barriers to entry due to intellectual property, specialized facilities, and expertise. Comparable spending benchmarks would depend heavily on the specific nature of the research, but overall federal R&D spending is in the tens of billions annually.

Small Business Impact

There is no indication of small business set-asides or subcontracting requirements in the provided data. This contract, awarded to Alcoa Inc., suggests a focus on large, established entities with specialized capabilities. The absence of small business participation could mean missed opportunities for smaller innovative firms to contribute to defense R&D and potentially limit the broader impact on the small business ecosystem in this specific research area.

Oversight & Accountability

Oversight mechanisms for this contract would typically involve program managers within the Department of the Army, contract officers, and potentially the Inspector General's office for audits and investigations. Transparency is limited by the sole-source nature and the proprietary aspects of R&D. Accountability would be tied to the achievement of research milestones and deliverables outlined in the contract.

Related Government Programs

Department of Defense Research and Development Programs
Army Research Laboratory Contracts
Materials Science Research
Advanced Engineering Services

Risk Flags

Sole-source award lacks competitive pricing pressure.
Contract duration is lengthy, potentially reducing flexibility.
Specific R&D deliverables and outcomes are not detailed.
Potential for cost overruns due to lack of competition.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $23.7 million to ARCONIC DEFENSE INC.. 200511!008295!2100!W56HZV!TACOM - WARREN !W56HZV05C0493 !A!N! !Y! ! !20050822!20080822!004393138!004393138!001339472!N!ALCOA INC !100 TECHNICAL DRIVE !ALCOA CENTER !PA!15069!00668!129!42!ALCOA CENTER !WESTMORELAND !PENN !+000001209757!N!N!000000000000!AZ11!RDTE/OTHER RESEARCH & DEVELOPMENT-BASIC RESEARCH !S1 !SERVICES !000 !* !541710!E! !3! ! ! ! ! !202

Who is the contractor on this award?

The obligated recipient is ARCONIC DEFENSE 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 $23.7 million.

What is the period of performance?

Start: 2005-08-22. End: 2013-09-12.

What specific research and development activities were undertaken under this contract?

The provided data indicates the contract was for 'Research and Development in the Physical, Engineering, and Life Sciences' (NAICS code 541710). However, the specific nature of the R&D activities is not detailed. Typically, such contracts could encompass a wide range of work, from basic scientific research to applied research and experimental development. Given the award to Alcoa Inc., a company known for materials science, it is plausible that the research involved advanced materials, alloys, or manufacturing processes relevant to defense applications. Without further documentation, the precise scope remains unspecified, making it difficult to assess the direct impact or relevance of the research outcomes.

How does the contract value compare to similar R&D efforts within the Department of Defense?

Comparing the $23.7 million contract value to similar R&D efforts is challenging without knowing the specific research domain and deliverables. The Department of Defense invests billions annually in R&D across various scientific and engineering fields. However, for a single contract spanning over eight years, this amount is significant but not extraordinary, especially for specialized research. The lack of competition is a key factor; if this were a competed contract, the price might have been lower. Benchmarking would require identifying contracts with similar scope, duration, and technological focus, which are not readily available in the provided data.

What are the potential risks associated with awarding this R&D contract on a sole-source basis?

The primary risk of a sole-source R&D contract is the potential for inflated costs due to the absence of competitive bidding. Without competing offers, the government may not achieve the best possible price. Another risk is that the chosen contractor might not be the most innovative or capable in the long run, as alternatives were not explored. Furthermore, sole-source awards can sometimes indicate a lack of strategic planning or market research, potentially leading to reliance on a single vendor for critical capabilities. This can also stifle innovation from other potential sources.

What is Alcoa Inc.'s track record with government R&D contracts?

Alcoa Inc. (and its subsequent entities like Arconic Defense Inc.) has a history of working with government agencies, including the Department of Defense, on materials science and engineering projects. Their expertise in advanced materials, such as high-strength alloys and composites, makes them a logical choice for defense-related R&D. While specific details of past R&D contract performance are not provided here, their established presence in the aerospace and defense supply chain suggests a capacity to handle complex research requirements. However, a thorough assessment would involve reviewing past performance evaluations and contract histories.

What are the historical spending patterns for R&D in physical, engineering, and life sciences by the Department of the Army?

The Department of the Army, like other branches of the DoD, consistently allocates substantial funding towards R&D in physical, engineering, and life sciences. Historical spending data reveals a multi-billion dollar annual investment in these areas, driven by the need for technological superiority. This spending supports a wide array of research, from basic science exploration to the development of next-generation weapon systems, communication technologies, and soldier protection. The specific contract in question represents a small fraction of the Army's overall R&D budget, but it highlights a continued commitment to advancing capabilities through scientific and engineering innovation.

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 › OTHER RESEARCH/DEVELOPMENT

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Offers Received: 1

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Parent Company: Alcoa Extrusions, Inc. (UEI: 001339472)

Address: 7TH ST RD RT 780 100 TECH, NEW KENSINGTON, PA, 14

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

Contract Characteristics

Cost or Pricing Data: YES

Timeline