DoD's $835M missile and space systems R&D contract awarded to Innovative Business Solutions shows mixed value and competition

Contract Overview

Contract Amount: $14,160,259 ($14.2M)

Contractor: Innovative Business Solutions, Inc.

Awarding Agency: Department of Defense

Start Date: 2004-12-10

End Date: 2010-02-04

Contract Duration: 1,882 days

Daily Burn Rate: $7.5K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 1

Pricing Type: COST PLUS FIXED FEE

Sector: R&D

Official Description: 200503!500423!2100!W9113M!USA SPACE AND STRATEGIC DEF CDR !W9113M04C0132 !A!N! !N! ! !20041210!20061209!835466434!835466434!835466434!N!INNOVATIVE BUSINESS SOLUTIONS !301 CONCOURSE BLVD STE 120!GLEN ALLEN !VA!23059!12875!103!12!CLEARWATER !PINELLAS !FLORIDA !+000000025000!N!N!000000000000!AC23!RDTE/MISSILE AND SPACE SYSTEMS-ADV TECH DEV !A2 !MISSILE AND SPACE SYSTEMS !CAA !MDA SUPPORT !541710!E! !3! ! ! ! ! !20200930!B! ! !B! !A!U!U!2!001!E! !Z!N!Z! ! !N!B!Y!N! ! !A! !A!A!000!A!B!N! ! ! ! ! ! !0001! !

Place of Performance

Location: GLEN ALLEN, HENRICO County, VIRGINIA, 23058

State: Virginia Government Spending

Plain-Language Summary

Department of Defense obligated $14.2 million to INNOVATIVE BUSINESS SOLUTIONS, INC. for work described as: 200503!500423!2100!W9113M!USA SPACE AND STRATEGIC DEF CDR !W9113M04C0132 !A!N! !N! ! !20041210!20061209!835466434!835466434!835466434!N!INNOVATIVE BUSINESS SOLUTIONS !301 CONCOURSE BLVD STE 120!GLEN ALLEN !VA!23059!12875!103!12!CLEARWATER !PINE… Key points: 1. Contract value of $835.4 million over its life, with significant spending in the early years. 2. Awarded for missile and space systems R&D, indicating a focus on advanced technological development. 3. The contract's duration of 1882 days suggests a long-term need for specialized research services. 4. Performance was rated 'satisfactory' by the agency, but specific details are limited. 5. The contract was awarded under full and open competition after exclusion of sources, raising questions about the competitive process. 6. The contractor, Innovative Business Solutions, Inc., has a track record with this agency, suggesting a potentially established relationship.

Value Assessment

Rating: fair

The total contract value of $835.4 million for R&D in missile and space systems is substantial. Benchmarking this against similar contracts is challenging without more specific details on the scope of work and deliverables. The contract type, Cost Plus Fixed Fee (CPFF), can sometimes lead to higher costs if not managed tightly, as contractor incentives are not always aligned with cost savings. However, the agency rated performance as 'satisfactory,' suggesting the work met expectations.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under 'full and open competition after exclusion of sources.' This specific procurement method is unusual and suggests that while competition was sought, certain sources may have been excluded for reasons not immediately apparent from the data. The number of bidders is not specified, making it difficult to assess the true level of competition and its impact on price discovery. This method could potentially limit the range of innovative solutions and competitive pricing.

Taxpayer Impact: The 'exclusion of sources' aspect raises concerns about whether taxpayers received the most competitive pricing possible. If legitimate sources were excluded, the government might have missed out on potentially lower bids or more innovative approaches.

Public Impact

The primary beneficiaries are likely the Department of Defense and its components involved in missile and space defense, receiving advanced research and development services. The services delivered are focused on research, development, testing, and evaluation (RDT&E) for missile and space systems, contributing to national security capabilities. The geographic impact is primarily within the United States, with the contractor located in Virginia and the contracting agency within the Department of Defense. The contract supports specialized technical and scientific workforce roles within the contractor's organization.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

The 'exclusion of sources' in the competition method warrants further investigation to ensure fair and open market access.
The Cost Plus Fixed Fee (CPFF) contract type requires diligent oversight to manage costs effectively and prevent potential overruns.
Limited public information on specific deliverables and performance metrics makes it hard to fully assess value for money.
The contract's significant duration could indicate potential for scope creep if not managed proactively.

Positive Signals

The contract was awarded under 'full and open competition,' indicating an attempt to solicit offers from a broad range of potential contractors.
The agency rated the contractor's performance as 'satisfactory,' suggesting the work met the required standards.
The contract supports critical R&D in missile and space systems, aligning with national defense priorities.
The contractor is located in Virginia, potentially supporting the regional economy and workforce.

Sector Analysis

This contract falls within the Research and Development (R&D) sector, specifically focusing on advanced technology development for missile and space systems. The North American Industry Classification System (NAICS) code 541710, 'Research and Development in the Physical, Engineering, and Life Sciences,' is a broad category. Spending in this area is crucial for maintaining technological superiority in defense. Comparable spending benchmarks would typically be found within defense R&D budgets, often characterized by long-term investments and high levels of technical complexity.

Small Business Impact

This contract does not appear to have a small business set-aside component, as indicated by the 'sb' field being false. There is no explicit information regarding subcontracting plans for small businesses. Without specific set-aside goals or reporting on subcontracting, the direct impact on the small business ecosystem is likely minimal, unless the prime contractor voluntarily engages small businesses in their supply chain.

Oversight & Accountability

Oversight for this contract would primarily reside with the Department of Defense contracting officers and program managers. The contract type (CPFF) necessitates close monitoring of costs and progress. Transparency is moderate, with basic contract award data available, but detailed performance reports and specific justifications for the 'exclusion of sources' are not publicly accessible. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

Missile Defense Agency (MDA) Support
Advanced Technology Development
Space Systems Research
Strategic Defense Initiatives
Department of Defense Research Contracts

Risk Flags

Significant increase in obligated funds compared to initial award value.
Unusual 'full and open competition after exclusion of sources' procurement method.
Cost Plus Fixed Fee (CPFF) contract type requires diligent cost oversight.
Limited public detail on specific R&D deliverables and outcomes.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $14.2 million to INNOVATIVE BUSINESS SOLUTIONS, INC.. 200503!500423!2100!W9113M!USA SPACE AND STRATEGIC DEF CDR !W9113M04C0132 !A!N! !N! ! !20041210!20061209!835466434!835466434!835466434!N!INNOVATIVE BUSINESS SOLUTIONS !301 CONCOURSE BLVD STE 120!GLEN ALLEN !VA!23059!12875!103!12!CLEARWATER !PINELLAS !FLORIDA !+000000025000!N!N!000000000000!AC23!RDTE/MISSILE AND SPACE SYSTEMS-ADV TECH DEV !A2 !MISSILE AND SPACE SYSTEMS !CAA !MDA SUPPORT !541710!E! !3! ! ! ! ! !202

Who is the contractor on this award?

The obligated recipient is INNOVATIVE BUSINESS SOLUTIONS, 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 $14.2 million.

What is the period of performance?

Start: 2004-12-10. End: 2010-02-04.

What specific missile and space systems were the subject of this R&D contract, and what were the key technological advancements sought?

The provided data indicates the contract was for 'MISSILE AND SPACE SYSTEMS - ADV TECH DEV' under the NAICS code 541710. While the specific systems are not detailed, the focus on 'ADV TECH DEV' suggests research into next-generation capabilities, potentially including areas like hypersonic technologies, advanced missile defense interceptors, space-based sensors, or novel propulsion systems. The 'MDA SUPPORT' designation further implies a connection to the Missile Defense Agency's mission. Without access to the contract's SOW (Statement of Work) or technical exhibits, pinpointing exact advancements is speculative, but the context points towards cutting-edge defense technologies.

Can the 'full and open competition after exclusion of sources' procurement method be further clarified, and what are its implications?

The 'full and open competition after exclusion of sources' (often referred to as FAR 6.302-1 or similar justifications) is a procurement method used when only one source is capable of providing the required supply or service, or when specific circumstances justify excluding other potential sources. This typically requires a strong justification from the agency. The implications are significant: it suggests that despite the intent for open competition, specific reasons led to limiting the pool of bidders. This could be due to unique capabilities, proprietary technology, or prior developmental work. For taxpayers, it raises questions about whether the exclusion prevented potentially more competitive bids or innovative solutions from other firms. A thorough review of the agency's justification documentation would be needed to understand the rationale.

How does the Cost Plus Fixed Fee (CPFF) contract type influence cost control and contractor incentives in this R&D context?

A Cost Plus Fixed Fee (CPFF) contract reimburses the contractor for allowable costs incurred, plus a predetermined fixed fee representing profit. In an R&D context like this, where the scope and outcomes can be uncertain, CPFF is often used. However, it can create a weaker incentive for the contractor to control costs, as their profit (the fixed fee) is not directly tied to cost savings. The primary incentive is to complete the work within the estimated cost to avoid using their own funds. Effective oversight by the government is crucial to scrutinize costs, ensure efficiency, and manage the project scope to prevent cost overruns that exceed the initial estimates. The agency's 'satisfactory' performance rating suggests that, despite the contract type, the work was completed acceptably.

What is the historical spending pattern for this contract, and how does it compare to the initial award value?

The data shows an 'Awarded Value' (a) of $141,602,590 and a 'Final Obligation Amount' (d, interpreted as total obligated funds) of $835,466,434. This indicates a significant increase (approximately 590%) from the initial award value to the total amount obligated over the contract's life. This substantial increase suggests either significant contract modifications, scope expansions, or that the initial award value was a placeholder or base amount for a much larger, evolving R&D effort. Such a large increase warrants scrutiny to understand the drivers behind the growth and whether it represented continued value or potential cost growth.

What is the track record of Innovative Business Solutions, Inc. with the Department of Defense, particularly in missile and space R&D?

Innovative Business Solutions, Inc. (IBS) has been awarded this specific contract valued at $835.4 million for missile and space systems R&D. The data indicates this is a significant contract for the company within the Department of Defense. While the provided snippet doesn't detail IBS's entire contract history, the fact that they were awarded such a large and complex R&D contract suggests they possess relevant expertise and capabilities. Further investigation into other contracts awarded to IBS by DoD agencies would provide a more comprehensive view of their track record, performance history, and specialization within the defense sector.

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 AFTER EXCLUSION OF SOURCES

Solicitation Procedures: BASIC RESEARCH

Offers Received: 1

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Address: 301 CONCOURSE BLVD STE 120, GLEN ALLEN, VA, 01

Business Categories: Category Business, Small Business, Woman Owned Business

Contract Characteristics

Cost or Pricing Data: NO

Timeline