DoD awards $2M R&D contract to Applied Research Associates for physical science research

Contract Overview

Contract Amount: $2,047,114 ($2.0M)

Contractor: Applied Research Associates, Inc.

Awarding Agency: Department of Defense

Start Date: 2023-08-15

End Date: 2026-02-14

Contract Duration: 914 days

Daily Burn Rate: $2.2K/day

Competition Type: FULL AND OPEN COMPETITION

Pricing Type: COST PLUS FIXED FEE

Sector: R&D

Official Description: BASE YEAR --

Place of Performance

Location: ALBUQUERQUE, BERNALILLO County, NEW MEXICO, 87110

State: New Mexico Government Spending

Plain-Language Summary

Department of Defense obligated $2.0 million to APPLIED RESEARCH ASSOCIATES, INC. for work described as: BASE YEAR -- Key points: 1. Contract awarded through full and open competition, suggesting a competitive bidding process. 2. The contract is for research and development in physical sciences, a critical area for defense innovation. 3. The base year value is approximately $2 million, with a duration of 914 days. 4. The contractor, Applied Research Associates, Inc., has secured this award from the Department of the Army. 5. The contract type is Cost Plus Fixed Fee, which can incentivize cost control but requires careful oversight. 6. The North American Industry Classification System (NAICS) code 541715 indicates a focus on physical, engineering, and life sciences research.

Value Assessment

Rating: fair

The base year value of $2.05 million for R&D services appears within a reasonable range for specialized research contracts. However, without specific benchmarks for this particular type of physical science research or detailed cost breakdowns, a precise value-for-money assessment is challenging. The Cost Plus Fixed Fee (CPFF) contract type means the government reimburses allowable costs plus a fixed fee, which can lead to higher overall costs if not managed effectively. Benchmarking against similar R&D contracts for comparable scientific endeavors would be necessary for a more definitive evaluation.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit bids. The specific number of bidders is not provided, but this method generally fosters a competitive environment, which can lead to better pricing and innovation. The open competition suggests the government sought the best value from a wide pool of potential contractors.

Taxpayer Impact: Full and open competition is generally favorable for taxpayers as it increases the likelihood of obtaining competitive pricing and innovative solutions, maximizing the return on investment for federal funds.

Public Impact

The primary beneficiaries are the Department of Defense and potentially the broader scientific community through advancements in physical sciences. The contract will deliver research and development services in areas related to physical, engineering, and life sciences. The geographic impact is primarily linked to the contractor's location in New Mexico, though research outcomes can have national implications. Workforce implications include employment opportunities for scientists, engineers, and support staff at Applied Research Associates, Inc.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost Plus Fixed Fee (CPFF) contract type requires diligent oversight to ensure costs remain reasonable and the fixed fee is justified.
Limited information on the specific research objectives makes it difficult to assess the potential for cost overruns or scope creep.
The duration of the contract (914 days) necessitates ongoing monitoring to ensure progress aligns with objectives and budget.

Positive Signals

Awarded through full and open competition, indicating a robust and fair bidding process.
Contractor is Applied Research Associates, Inc., a known entity in the research and development sector.
The contract focuses on critical R&D in physical sciences, supporting defense modernization and technological advancement.

Sector Analysis

This contract falls within the Research and Development (R&D) sector, specifically focusing on physical sciences. The R&D sector is crucial for national security, technological innovation, and economic growth. Government spending in this area often supports fundamental research, applied research, and development of new technologies. Comparable spending benchmarks would depend heavily on the specific sub-discipline of physical science being researched, but federal R&D spending across all agencies is in the tens of billions annually.

Small Business Impact

The data indicates that small business participation (ss and sb flags) is not a primary focus for this specific contract award, as both flags are false. There is no explicit small business set-aside mentioned. Therefore, the direct impact on small businesses through this contract is likely minimal unless Applied Research Associates, Inc. engages in subcontracting with small businesses, which is not detailed in the provided information.

Oversight & Accountability

Oversight for this Cost Plus Fixed Fee contract will likely be managed by the Department of the Army contracting and technical officers. Accountability measures would involve regular progress reports, cost tracking, and performance reviews. Transparency is facilitated through contract databases like FPDS, where basic award information is publicly available. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse.

Related Government Programs

Department of Defense Research and Development Programs
Army Science and Technology Investments
Physical Sciences Research Initiatives
Applied Research Contracts

Risk Flags

Cost Plus Fixed Fee contract type requires robust oversight.
Limited detail on specific research objectives could lead to scope creep.
Number of bidders not specified, impacting full assessment of competition effectiveness.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $2.0 million to APPLIED RESEARCH ASSOCIATES, INC.. BASE YEAR --

Who is the contractor on this award?

The obligated recipient is APPLIED RESEARCH ASSOCIATES, 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 $2.0 million.

What is the period of performance?

Start: 2023-08-15. End: 2026-02-14.

What is the track record of Applied Research Associates, Inc. in securing and performing on federal R&D contracts?

Applied Research Associates, Inc. (ARA) has a history of securing federal contracts, particularly within the Department of Defense and other research-intensive agencies. Their expertise often lies in areas such as aerospace, defense systems, and advanced materials. Analyzing ARA's past performance on similar Cost Plus Fixed Fee (CPFF) contracts would provide insight into their ability to manage costs effectively and deliver research outcomes within budget and schedule. A review of past contract awards and performance evaluations, where available, would indicate their reliability and technical proficiency in executing complex R&D projects. Their success in winning competitive bids suggests a strong capability to meet government requirements.

How does the $2.05 million base year value compare to similar R&D contracts in the physical sciences?

The $2.05 million base year value for this physical sciences R&D contract is a moderate-sized award. Federal R&D contracts can range from tens of thousands for small, specialized studies to hundreds of millions or even billions for large-scale, multi-year programs. For applied research in specific physical science domains, a $2 million base year is not uncommon, especially for initial phases or focused investigations. However, without knowing the precise sub-field of physical science, the specific research objectives, and the duration of the base year (914 days), a direct comparison is difficult. Benchmarking against contracts with similar NAICS codes (541715) and contract types (CPFF) awarded by the Department of the Army or other defense agencies would provide a more accurate context for assessing whether this value is competitive and appropriate.

What are the primary risks associated with a Cost Plus Fixed Fee (CPFF) contract for R&D?

The primary risks associated with a Cost Plus Fixed Fee (CPFF) contract for R&D revolve around cost control and contractor incentive. While the fixed fee provides a ceiling for the contractor's profit, the government bears the risk of cost overruns, as it reimburses all allowable costs. This can lead to higher-than-expected total contract values if the contractor is not diligent in managing expenses. For R&D, where the scope and outcomes can be uncertain, there's a risk that costs escalate due to unforeseen technical challenges or scope creep. Effective oversight, detailed cost monitoring, and clear definition of allowable costs are crucial to mitigate these risks and ensure the government receives good value. Contractor efficiency can sometimes be lower compared to fixed-price contracts, as the primary incentive is to incur allowable costs to complete the work, rather than to minimize them.

How effective are R&D contracts in driving innovation within the Department of Defense?

R&D contracts are a cornerstone of innovation within the Department of Defense (DoD), enabling the acquisition of cutting-edge technologies and scientific advancements necessary for maintaining military superiority. These contracts allow the DoD to leverage the expertise and resources of the private sector and academic institutions, fostering a collaborative ecosystem for innovation. By funding research in areas like artificial intelligence, cybersecurity, advanced materials, and hypersonics, R&D contracts directly contribute to the development of next-generation capabilities. The effectiveness is measured by the successful transition of research outcomes into operational systems and the ability to stay ahead of potential adversaries. However, challenges remain in efficiently managing the R&D pipeline, ensuring timely delivery, and translating basic research into practical applications.

What are the historical spending patterns for NAICS code 541715 (Research and Development in the Physical, Engineering, and Life Sciences) by the Department of the Army?

Historical spending patterns for NAICS code 541715 by the Department of the Army typically show significant investment across various research domains within the physical, engineering, and life sciences. The Army consistently allocates substantial funds to R&D to support its modernization efforts, encompassing areas from materials science and robotics to advanced computing and biomedical research. Spending in this category often fluctuates based on strategic priorities, emerging threats, and budget allocations. Over the past decade, there has been a notable trend towards increased investment in areas like AI, autonomous systems, and directed energy. Analyzing historical data reveals a pattern of sustained, significant investment, with specific focus areas evolving over time to address evolving defense needs and technological opportunities.

Industry Classification

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

Product/Service Code: RESEARCH AND DEVELOPMENT › General Science and Technology R&D Services

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Address: 4300 SAN MATEO BLVD NE, ALBUQUERQUE, NM, 87110

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, Subchapter S Corporation, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $5,700,000

Exercised Options: $3,258,004

Current Obligation: $2,047,114

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: W911NF23D0003

IDV Type: IDC

Timeline