DoD's $39M Battelle Memorial Institute contract for CBRN detection and decontamination support shows questionable value and limited competition

Contract Overview

Contract Amount: $39,164,042 ($39.2M)

Contractor: Battelle Memorial Institute

Awarding Agency: Department of Defense

Start Date: 2014-12-23

End Date: 2017-01-31

Contract Duration: 770 days

Daily Burn Rate: $50.9K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: COST PLUS INCENTIVE FEE

Sector: Defense

Official Description: IGF::OT::IGF, CHEMICAL BIOLOGICAL RADIOLOGICAL NUCLEAR, DETECTION, RECONNAISSANCE, PROTECTION AND DECONTAMINATION SYSTEMS CONTRACTOR LOGISTICS SUPPORT SERVICES

Place of Performance

Location: COLUMBUS, FRANKLIN County, OHIO, 43201

State: Ohio Government Spending

Plain-Language Summary

Department of Defense obligated $39.2 million to BATTELLE MEMORIAL INSTITUTE for work described as: IGF::OT::IGF, CHEMICAL BIOLOGICAL RADIOLOGICAL NUCLEAR, DETECTION, RECONNAISSANCE, PROTECTION AND DECONTAMINATION SYSTEMS CONTRACTOR LOGISTICS SUPPORT SERVICES Key points: 1. The contract's value proposition is unclear given the lack of competitive bidding and the cost-plus incentive fee structure. 2. Limited competition raises concerns about potential overpricing and reduced innovation. 3. The contractor, Battelle Memorial Institute, has a significant track record, but performance context for this specific contract is not readily available. 4. This contract falls within the broader Defense sector, specifically supporting Chemical, Biological, Radiological, Nuclear (CBRN) defense capabilities. 5. The contract's duration and cost-plus structure warrant scrutiny for efficiency and effectiveness. 6. Oversight mechanisms and transparency surrounding this sole-source award need further examination.

Value Assessment

Rating: questionable

The contract's value is difficult to assess without competitive benchmarks. The Cost Plus Incentive Fee (CPIF) structure, while incentivizing cost reduction, can also lead to higher initial costs compared to fixed-price contracts. The total award of over $39 million over approximately two years suggests a substantial investment. Without comparable contracts or detailed cost breakdowns, it's challenging to definitively state if this represents good value for money. The lack of competition further complicates a robust value assessment.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning there was no open competition. This significantly limits the government's ability to leverage market forces to achieve the best possible pricing and service. While sole-source awards can be justified in specific circumstances (e.g., unique capabilities), the absence of competition here raises questions about whether alternative solutions or contractors were adequately considered. The lack of bidders means no direct price comparison or negotiation leverage was exercised.

Taxpayer Impact: Taxpayers may have paid a premium due to the lack of competitive pressure. Without a bidding process, there's a reduced likelihood of securing the most cost-effective solution, potentially leading to inefficient use of public funds.

Public Impact

The primary beneficiaries are the Department of Defense and its personnel, who receive critical support for CBRN defense capabilities. The services delivered include contractor logistics support for detection, reconnaissance, protection, and decontamination systems. The geographic impact is likely focused on military installations and operational areas where CBRN threats are a concern. Workforce implications may involve specialized technical support personnel employed by Battelle Memorial Institute.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may lead to higher costs for taxpayers.
Cost-plus contract type can incentivize spending rather than cost savings.
Limited transparency on performance metrics and specific deliverables.
Sole-source award raises questions about the justification and potential alternatives.

Positive Signals

Contractor possesses specialized expertise in CBRN defense systems.
Contract aims to ensure readiness and operational capability for critical defense missions.
Long-term relationship with a single contractor can foster deep institutional knowledge.

Sector Analysis

This contract operates within the Defense Industrial Base, specifically focusing on niche capabilities related to Chemical, Biological, Radiological, and Nuclear (CBRN) defense. The market for such specialized logistics and support services is relatively concentrated, often involving a limited number of highly technical firms. The total federal spending on CBRN defense systems and support is significant, but individual contracts like this represent specific components of a larger strategic effort. Benchmarking is difficult due to the specialized nature and sole-source award.

Small Business Impact

This contract does not appear to have a small business set-aside component, as indicated by 'sb': false. Furthermore, there is no explicit mention of subcontracting goals for small businesses. This suggests that the primary contractor, Battelle Memorial Institute, is likely performing the majority of the work internally. Consequently, the direct impact on the small business ecosystem for this specific contract is likely minimal, with limited opportunities for small business participation.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of the Army's contracting and program management offices. The Inspector General (IG) for the Department of Defense would have jurisdiction to investigate any potential fraud, waste, or abuse. Transparency is assessed as fair, given it's a government contract, but specific performance metrics and detailed cost justifications are not publicly detailed. Accountability relies on contract clauses and reporting requirements, which are not fully accessible.

Related Government Programs

CBRN Defense Systems
Military Logistics Support
Department of Defense Contractor Logistics Support
Chemical and Biological Defense Program

Risk Flags

Sole-source award lacks competitive justification.
Cost-plus contract type may lead to higher costs.
Limited public data on performance metrics and value for money.
Potential for reduced innovation due to lack of competition.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $39.2 million to BATTELLE MEMORIAL INSTITUTE. IGF::OT::IGF, CHEMICAL BIOLOGICAL RADIOLOGICAL NUCLEAR, DETECTION, RECONNAISSANCE, PROTECTION AND DECONTAMINATION SYSTEMS CONTRACTOR LOGISTICS SUPPORT SERVICES

Who is the contractor on this award?

The obligated recipient is BATTELLE MEMORIAL INSTITUTE.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $39.2 million.

What is the period of performance?

Start: 2014-12-23. End: 2017-01-31.

What is Battelle Memorial Institute's track record with similar Department of Defense contracts, particularly in CBRN logistics?

Battelle Memorial Institute has a long history of supporting government agencies, including the Department of Defense, with research, development, and logistics services. They are known for their expertise in areas such as chemical and biological defense, materials science, and national security. While specific details on past CBRN logistics contracts are not provided in this data, their overall profile suggests a capacity to handle complex technical support requirements. A deeper dive into their contract history with the DoD would reveal the scale, duration, and performance outcomes of previous engagements, providing a more robust picture of their reliability in this domain.

How does the Cost Plus Incentive Fee (CPIF) structure compare to other contract types for similar CBRN support services?

The Cost Plus Incentive Fee (CPIF) contract type allows the contractor to incur costs up to a ceiling, with the final negotiated total cost being based on meeting certain performance incentives. This differs from fixed-price contracts, where the price is set regardless of costs incurred, and cost-reimbursement contracts, which cover allowable costs without a strong incentive for cost control. For specialized services like CBRN logistics, where requirements can be complex and subject to change, CPIF can offer flexibility. However, it also carries a risk of higher costs compared to fixed-price contracts if incentives are not well-defined or if the cost ceiling is too high. Benchmarking against fixed-price or other cost-reimbursement contracts for similar services would be necessary to determine if CPIF provided optimal value here.

What are the specific performance metrics and incentives outlined in this contract, and how were they achieved?

The provided data does not include specific performance metrics or the details of the incentive structure within this Cost Plus Incentive Fee (CPIF) contract. Typically, CPIF contracts define target costs, target profit, and incentive formulas that adjust the final profit based on cost savings or overruns relative to the target. Performance incentives might relate to delivery timelines, system readiness, or response times for support. Without access to the contract's Statement of Work (SOW) and the detailed terms and conditions, it is impossible to assess how well Battelle Memorial Institute met these specific objectives or how the incentive fee ultimately impacted the total cost.

Given the sole-source nature, what was the justification for not competing this requirement?

Sole-source contract awards are typically justified when only one responsible source is capable of providing the required supplies or services. This can occur due to unique capabilities, proprietary technology, urgent and compelling needs where competition is not feasible, or when a previous contract was awarded competitively and the follow-on work is a logical extension. For this contract supporting CBRN detection, reconnaissance, protection, and decontamination systems, the justification might stem from Battelle Memorial Institute's unique expertise, proprietary knowledge of specific systems, or a critical need for continuity of support that precluded a lengthy competitive process. A formal Justification for Other Than Full and Open Competition (JOFOC) would typically document this rationale.

How does the total spending of $39.16 million on this contract compare to historical spending on CBRN contractor logistics support?

The total award of $39.16 million over approximately two years (770 days) for CBRN contractor logistics support provides a data point for this specific service. To contextualize this historically, one would need to examine prior years' spending by the Department of Defense (and specifically the Department of the Army) on similar CBRN logistics support contracts. This would involve searching contract databases for awards to Battelle Memorial Institute and other contractors performing comparable services. Analyzing trends in spending, contract values, and the number of competitive versus sole-source awards in this niche area would reveal whether this $39 million figure represents an increase, decrease, or stable level of investment in CBRN support capabilities.

Industry Classification

NAICS: Other Services (except Public Administration) › Electronic and Precision Equipment Repair and Maintenance › Other Electronic and Precision Equipment Repair and Maintenance

Product/Service Code: MAINT, REPAIR, REBUILD EQUIPMENT › MAINT, REPAIR, REBUILD OF EQUIPMENT

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: W911SR14R0006

Offers Received: 1

Pricing Type: COST PLUS INCENTIVE FEE (V)

Evaluated Preference: NONE

Contractor Details

Address: 505 KING AVENUE, COLUMBUS, OH, 43201

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

Financial Breakdown

Contract Ceiling: $44,558,237

Exercised Options: $39,180,769

Current Obligation: $39,164,042

Subaward Activity

Number of Subawards: 29

Total Subaward Amount: $86,229,992

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: YES

Timeline