DoD's Army FFRDC Core Projects contract awarded to RAND Corporation for $31.14M, with a 2-year duration

Contract Overview

Contract Amount: $31,144,000 ($31.1M)

Contractor: THE Rand Corporation

Awarding Agency: Department of Defense

Start Date: 2024-10-01

End Date: 2026-09-30

Contract Duration: 729 days

Daily Burn Rate: $42.7K/day

Competition Type: NOT COMPETED

Pricing Type: COST PLUS FIXED FEE

Sector: R&D

Official Description: DEPARTMENT OF DEFENSE - ARMY RAND ARROYO FEDERALLY FUNDED RESEARCH AND DEVELOPMENT CENTER (FFRDC) CORE PROJECTS FOR FISCAL YEAR (FY)25

Place of Performance

Location: SANTA MONICA, LOS ANGELES County, CALIFORNIA, 90401

State: California Government Spending

Plain-Language Summary

Department of Defense obligated $31.1 million to THE RAND CORPORATION for work described as: DEPARTMENT OF DEFENSE - ARMY RAND ARROYO FEDERALLY FUNDED RESEARCH AND DEVELOPMENT CENTER (FFRDC) CORE PROJECTS FOR FISCAL YEAR (FY)25 Key points: 1. Contract supports core research and development projects for the Army. 2. RAND Corporation, a known FFRDC, brings specialized expertise. 3. The contract type is Cost Plus Fixed Fee, which can lead to cost overruns if not managed carefully. 4. The duration of 729 days suggests a focused scope of work. 5. This contract is a continuation of ongoing support for the Army's research needs. 6. The value is significant but should be benchmarked against similar FFRDC support contracts.

Value Assessment

Rating: good

The contract value of $31.14 million for two years of core project support for an FFRDC is within a reasonable range for specialized research and development services. While specific benchmarks for FFRDC core support are not readily available, the RAND Corporation's established role and the nature of FFRDC work suggest this pricing is likely competitive for the expertise provided. The Cost Plus Fixed Fee (CPFF) contract type, while common for R&D, necessitates careful oversight to ensure costs remain aligned with the value delivered.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis to the RAND Corporation, which operates as a Federally Funded Research and Development Center (FFRDC). FFRDCs are typically established with specific research missions and are often awarded contracts on a sole-source basis due to their unique capabilities, independence, and long-term strategic relationships with government agencies. This approach ensures continuity of research and access to specialized expertise.

Taxpayer Impact: Sole-source awards to FFRDCs like RAND are generally accepted as a necessary mechanism for accessing unique, long-term research capabilities. While it bypasses traditional competition, the established nature and mission of FFRDCs are intended to provide significant value and strategic advantage to the government, justifying the lack of a competitive bidding process.

Public Impact

The primary beneficiaries are the Department of the Army and its research and development initiatives. The contract will deliver critical research insights and technical services to support Army modernization and strategic objectives. The geographic impact is national, as research findings can influence policy and operations across the Army. Workforce implications include continued employment for researchers and technical staff at RAND Corporation.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost Plus Fixed Fee (CPFF) contract type can incentivize cost growth if not rigorously managed.
Sole-source award limits opportunities for other research institutions to compete for this funding.
Reliance on a single FFRDC may limit the diversity of perspectives in research outcomes.

Positive Signals

RAND Corporation is a well-established FFRDC with a proven track record in supporting government research.
The contract ensures continuity of critical research support for the Army's long-term strategic goals.
FFRDC designation implies a level of independence and objectivity in research findings.

Sector Analysis

This contract falls within the Professional, Scientific, and Technical Services sector, specifically focusing on research and development. The market for FFRDC services is specialized, with a limited number of entities capable of fulfilling such roles. The RAND Corporation is a prominent player in this space, providing essential analytical and research support to various government agencies. Comparable spending benchmarks would involve other FFRDC contracts supporting defense research and development, which often represent significant, long-term investments.

Small Business Impact

This contract does not appear to have specific small business set-aside provisions. As a sole-source award to an FFRDC, the primary focus is on the unique capabilities of the RAND Corporation. Subcontracting opportunities for small businesses would depend on RAND's internal procurement practices and the specific needs of the research projects, but are not a primary driver of this award.

Oversight & Accountability

Oversight for this contract will likely be managed by the Department of the Army, with specific program managers responsible for monitoring progress, costs, and deliverables. As an FFRDC, RAND operates under specific government oversight frameworks designed to ensure objectivity and adherence to its charter. Transparency is typically maintained through regular reporting requirements and program reviews. The Inspector General's office for the Department of Defense would have jurisdiction for audits and investigations if any issues arise.

Related Government Programs

Department of Defense Research, Development, Test, and Evaluation
Federally Funded Research and Development Centers (FFRDCs)
Army Science and Technology Programs
RAND Arroyo Center Core Projects

Risk Flags

Sole-source award
Cost Plus Fixed Fee contract type
Reliance on a single FFRDC

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $31.1 million to THE RAND CORPORATION. DEPARTMENT OF DEFENSE - ARMY RAND ARROYO FEDERALLY FUNDED RESEARCH AND DEVELOPMENT CENTER (FFRDC) CORE PROJECTS FOR FISCAL YEAR (FY)25

Who is the contractor on this award?

The obligated recipient is THE RAND CORPORATION.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $31.1 million.

What is the period of performance?

Start: 2024-10-01. End: 2026-09-30.

What is the historical spending trend for RAND Corporation's FFRDC core projects with the Army?

Historical spending data for RAND Corporation's FFRDC core projects with the Army indicates a consistent and significant level of investment over multiple fiscal years. While the exact figures fluctuate based on program priorities and budget allocations, the trend generally shows sustained funding to support RAND's role as a strategic research partner. For instance, in recent years, annual funding has often been in the tens of millions of dollars, reflecting the ongoing need for RAND's specialized analytical capabilities in areas such as defense strategy, force modernization, and operational analysis. This particular FY25 award of $31.14 million aligns with this historical pattern, suggesting a stable, long-term relationship and a predictable demand for RAND's services.

How does the Cost Plus Fixed Fee (CPFF) contract type typically perform in R&D settings like this?

The Cost Plus Fixed Fee (CPFF) contract type is commonly used for research and development (R&D) efforts where the scope of work can be uncertain or evolve. In this structure, the contractor (RAND Corporation) is reimbursed for all allowable costs incurred, plus a predetermined fixed fee representing profit. While CPFF provides flexibility for R&D projects that may encounter unforeseen challenges or require adjustments, it also carries a risk of cost overruns if not managed diligently. Effective oversight by the government is crucial to ensure that costs remain reasonable and that the fixed fee adequately compensates the contractor for the effort without incentivizing excessive spending. Benchmarking against similar CPFF R&D contracts can help assess the reasonableness of the fee and overall cost structure.

What are the key performance indicators (KPIs) expected for this contract?

Key performance indicators (KPIs) for this contract, supporting RAND Corporation's FFRDC core projects for the Army, would likely focus on the quality, timeliness, and impact of the research and analysis delivered. Specific KPIs might include adherence to project timelines and milestones, the clarity and rigor of research methodologies, the relevance and actionable nature of findings and recommendations, and the successful delivery of required reports and briefings. Given the nature of FFRDC work, KPIs may also encompass the objectivity and independence of the research, as well as the contractor's responsiveness to evolving Army requirements. The ultimate measure of success would be the extent to which the delivered research contributes to informed decision-making and improved outcomes for the Department of the Army.

What is the strategic importance of the RAND Corporation as an FFRDC for the Army?

The RAND Corporation serves as a critical Federally Funded Research and Development Center (FFRDC) for the Department of the Army, providing a unique and invaluable strategic resource. Its FFRDC status ensures a long-term, objective, and independent research capability, free from the conflicts of interest that might arise with for-profit contractors. For the Army, RAND offers deep expertise in a wide array of defense-related issues, including strategic planning, force structure analysis, technological assessments, and policy development. This contract for core projects ensures continued access to RAND's analytical prowess, enabling the Army to tackle complex, forward-looking challenges, inform major acquisition decisions, and develop innovative solutions to maintain its technological and operational edge in a rapidly changing global security environment.

Are there any specific risks associated with relying on a sole-source FFRDC for core research needs?

While sole-source awards to FFRDCs like RAND are standard practice due to their specialized nature, there are inherent risks. One primary risk is the potential for complacency or a lack of innovative challenge that can sometimes arise in a non-competitive environment. Without the pressure of competing against other research institutions, there's a theoretical risk that the FFRDC might not continuously push the boundaries of its research methodologies or explore novel approaches as vigorously as it might under competitive pressure. Additionally, the government's reliance on a single entity for critical research can create a dependency, making it challenging to pivot or access alternative expertise quickly if the FFRDC's capabilities become misaligned with evolving national security needs. Robust government oversight and clear performance expectations are essential to mitigate these risks.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Other Professional, Scientific, and Technical Services › All Other Professional, Scientific, and Technical Services

Product/Service Code: SPECIAL STUDIES/ANALYSIS, NOT R&D › SPECIAL STUDIES - NOT R and D

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: W91CRB21R0047

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Address: 1776 MAIN ST, SANTA MONICA, CA, 90401

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

Financial Breakdown

Contract Ceiling: $38,122,000

Exercised Options: $38,122,000

Current Obligation: $31,144,000

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: W91CRB21D0025

IDV Type: IDC

Timeline