DoD's CIRCM Program awarded BAE Systems $49.4M for R&D, facing potential cost overruns

Contract Overview

Contract Amount: $49,424,268 ($49.4M)

Contractor: BAE Systems Information and Electronic Systems Integration Inc.

Awarding Agency: Department of Defense

Start Date: 2012-01-31

End Date: 2015-03-14

Contract Duration: 1,138 days

Daily Burn Rate: $43.4K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 5

Pricing Type: COST PLUS FIXED FEE

Sector: R&D

Official Description: CIRCM PROGRAM TD

Place of Performance

Location: NASHUA, HILLSBOROUGH County, NEW HAMPSHIRE, 03060

State: New Hampshire Government Spending

Plain-Language Summary

Department of Defense obligated $49.4 million to BAE SYSTEMS INFORMATION AND ELECTRONIC SYSTEMS INTEGRATION INC. for work described as: CIRCM PROGRAM TD Key points: 1. Contract awarded for research and development in physical, engineering, and life sciences. 2. BAE Systems, a major defense contractor, secured this definitive contract. 3. The contract duration was 1138 days, spanning from January 2012 to March 2015. 4. The contract type was Cost Plus Fixed Fee, indicating potential for cost escalation. 5. The contract was awarded under full and open competition. 6. The North American Industry Classification System (NAICS) code is 541712. 7. The contract was not set aside for small businesses. 8. The contract was awarded by the Department of Defense.

Value Assessment

Rating: questionable

Benchmarking the value for this specific contract is challenging due to its R&D nature and historical data. However, the Cost Plus Fixed Fee (CPFF) contract type inherently carries a higher risk of cost overruns compared to fixed-price contracts. Without detailed cost breakdowns and performance metrics, it's difficult to definitively assess value for money. The reported obligated amount of $49.4M needs to be compared against the actual deliverables and their effectiveness to determine if it represented a fair price for the research outcomes.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, suggesting that multiple vendors had the opportunity to bid. The presence of 5 bids indicates a reasonable level of competition for this R&D effort. This competitive process should theoretically lead to more favorable pricing and better selection of the most capable contractor.

Taxpayer Impact: A competitive award process generally benefits taxpayers by driving down costs and ensuring the government receives the best value for its investment through a selection of the most qualified offeror.

Public Impact

The primary beneficiaries are the Department of Defense, which receives advancements in physical, engineering, and life sciences research. The services delivered are research and development activities, contributing to technological innovation. The geographic impact is primarily within New Hampshire, where the contractor is located. Workforce implications include employment for researchers, engineers, and support staff at BAE Systems.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost Plus Fixed Fee contracts can lead to cost overruns if not managed tightly.
R&D contracts inherently have a higher degree of uncertainty regarding outcomes and final costs.
Limited public information on specific deliverables makes it hard to assess performance against cost.

Positive Signals

Awarded under full and open competition, suggesting a robust selection process.
BAE Systems is a large, established defense contractor with significant experience.
The contract aimed to advance critical research and development for the DoD.

Sector Analysis

This contract falls within the Research and Development in the Physical, Engineering, and Life Sciences sector, specifically NAICS code 541712. This sector is characterized by innovation and the pursuit of new technologies. Spending in this area by the Department of Defense is crucial for maintaining technological superiority. Comparable spending benchmarks would typically involve other large-scale R&D contracts awarded to major defense contractors for similar scientific endeavors.

Small Business Impact

This contract was not set aside for small businesses, and there is no indication of subcontracting requirements for small businesses in the provided data. Therefore, the direct impact on the small business ecosystem is likely minimal, with the primary award going to a large prime contractor.

Oversight & Accountability

Oversight for this contract would have been managed by the Defense Contract Management Agency (DCMA). Accountability measures would involve tracking costs, progress against research milestones, and adherence to contract terms. Transparency is generally limited for specific R&D contracts due to proprietary information and national security considerations, though contract awards and basic details are publicly available.

Related Government Programs

Department of Defense Research and Development Programs
Advanced Technology Development Contracts
BAE Systems Defense Contracts

Risk Flags

Cost Plus Fixed Fee contract type increases risk of cost overruns.
R&D contracts have inherent uncertainty in outcomes and final costs.
Limited public detail on specific deliverables hinders performance assessment.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $49.4 million to BAE SYSTEMS INFORMATION AND ELECTRONIC SYSTEMS INTEGRATION INC.. CIRCM PROGRAM TD

Who is the contractor on this award?

The obligated recipient is BAE SYSTEMS INFORMATION AND ELECTRONIC SYSTEMS INTEGRATION INC..

Which agency awarded this contract?

Awarding agency: Department of Defense (Defense Contract Management Agency).

What is the total obligated amount?

The obligated amount is $49.4 million.

What is the period of performance?

Start: 2012-01-31. End: 2015-03-14.

What was the specific research objective of the CIRCM Program contract awarded to BAE Systems?

The provided data indicates the contract was for 'Research and Development in the Physical, Engineering, and Life Sciences (except Biotechnology)' under the CIRCM PROGRAM TD. While the specific technical objectives are not detailed, CIRCM typically refers to Countermeasure systems, suggesting the research likely focused on developing or improving technologies related to electronic warfare, infrared countermeasures, or other defensive systems for military platforms. The 'TD' designation might refer to a specific phase or type of technical directive within the program. Further investigation into DoD R&D program descriptions would be needed for precise details.

How does the Cost Plus Fixed Fee (CPFF) contract type influence the risk of cost overruns for this R&D contract?

The Cost Plus Fixed Fee (CPFF) contract type means the contractor is reimbursed for all allowable costs incurred, plus a predetermined fixed fee representing profit. This structure inherently carries a higher risk of cost overruns compared to fixed-price contracts, especially for R&D where the scope and effort can be uncertain. If the actual costs exceed initial estimates, the government bears the additional expense, while the contractor's fee remains fixed. Effective oversight and rigorous cost tracking are crucial to mitigate these risks and ensure the government does not overpay for the research outcomes achieved.

What is the significance of the NAICS code 541712 for this contract?

The North American Industry Classification System (NAICS) code 541712 signifies 'Research and Development in the Physical, Engineering, and Life Sciences (except Biotechnology)'. This classification indicates that the contract's primary purpose was to conduct scientific research and experimental development in fields such as physics, chemistry, engineering disciplines, and various life sciences, excluding the specific area of biotechnology. For this DoD contract, it suggests the research likely involved developing new materials, advanced engineering solutions, or scientific principles applicable to defense technologies.

What does the 'br': 43431 value represent in the context of this contract?

The value 'br': 43431 likely represents the 'Base' or 'Base Award' amount in dollars, which is a portion of the total contract value that was obligated at the time of award or is considered the baseline funding. The total obligated amount ('a') is $49,424,268.26. The difference between the total obligated amount and the base award could represent exercised options, modifications, or additional funding that was added to the contract after its initial award. Understanding the relationship between the base award and the total obligated amount provides insight into the contract's growth and flexibility.

How does the contract duration of 1138 days compare to typical R&D contracts of similar scope?

A duration of 1138 days, approximately 3.1 years, is a substantial period for a research and development contract. R&D projects, particularly those involving complex scientific inquiry or the development of novel technologies, often require extended timelines to achieve meaningful results. This duration suggests that the CIRCM Program R&D effort was likely a multi-faceted project requiring significant investigation, experimentation, and potentially iterative development cycles. Without specific benchmarks for CIRCM-related R&D, it's difficult to definitively state if it's longer or shorter than average, but it indicates a commitment to a long-term research objective.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Scientific Research and Development Services › Research and Development in the Physical, Engineering, and Life Sciences (except Biotechnology)

Product/Service Code: COMM/DETECT/COHERENT RADIATION

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 5

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Parent Company: Compagnie DE Developpement DE L'eau S.A.

Address: 65 SPIT BROOK RD, NASHUA, NH, 03060

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Foreign-Owned and U.S.-Incorporated Business, Manufacturer of Goods, Not Designated a Small Business, Special Designations

Financial Breakdown

Contract Ceiling: $49,424,268

Exercised Options: $49,424,268

Current Obligation: $49,424,268

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline