RAND Corporation awarded $5.7M contract for professional services, extending to September 2026

Contract Overview

Contract Amount: $5,700,000 ($5.7M)

Contractor: THE Rand Corporation

Awarding Agency: Department of Defense

Start Date: 2025-12-15

End Date: 2026-09-14

Contract Duration: 273 days

Daily Burn Rate: $20.9K/day

Competition Type: NOT COMPETED

Pricing Type: COST PLUS FIXED FEE

Sector: Other

Official Description: CORE WORK - OPTION ORDERING PERIOD FY26

Place of Performance

Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20310

State: District of Columbia Government Spending

Plain-Language Summary

Department of Defense obligated $5.7 million to THE RAND CORPORATION for work described as: CORE WORK - OPTION ORDERING PERIOD FY26 Key points: 1. Contract value represents a modest portion of overall defense spending, suggesting a focused scope. 2. Sole-source award indicates potential limitations in market competition for these specific services. 3. Cost-plus-fixed-fee structure may incentivize cost escalation if not closely monitored. 4. The duration of the contract suggests a need for sustained expertise in the supported area. 5. RAND Corporation's established presence in research and analysis likely underpins this award.

Value Assessment

Rating: fair

The contract value of $5.7 million for a 9-month period is difficult to benchmark without specific service details. However, given RAND Corporation's typical engagement in complex research and analysis, this amount may be reasonable for specialized expertise. The cost-plus-fixed-fee (CPFF) pricing structure requires careful oversight to ensure value for money, as it can lead to higher costs if not managed effectively. Compared to other large-scale defense contracts, this appears to be a focused engagement rather than a broad acquisition.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning the Department of the Army did not conduct a competitive bidding process. This typically occurs when a specific contractor possesses unique capabilities, proprietary information, or when urgency precludes a full competition. The lack of competition means that price discovery through market forces was not utilized, potentially leading to a higher price than if multiple bids were solicited.

Taxpayer Impact: For taxpayers, a sole-source award means there is less assurance that the government secured the best possible price. Robust justification and oversight are critical to ensure the awarded price is fair and reasonable.

Public Impact

The Department of the Army benefits from specialized research and analytical support. Services delivered likely contribute to informed decision-making within the defense sector. The primary geographic impact is within the District of Columbia, where RAND's services will be utilized. Workforce implications are minimal, as this contract likely leverages existing RAND expertise rather than creating new jobs.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits competitive pressure on pricing.
Cost-plus-fixed-fee structure requires diligent cost control and oversight.
Lack of detailed service description makes independent value assessment challenging.

Positive Signals

Award to RAND Corporation, a well-established research institution, suggests access to high-quality expertise.
Contract duration indicates a recognized need for ongoing support.
Clear end and start dates provide predictability for program planning.

Sector Analysis

The professional, scientific, and technical services sector is vast, encompassing a wide range of specialized expertise. Within the defense industry, such services are critical for research, development, analysis, and program management. The North American Industry Classification System (NAICS) code 541990, 'All Other Professional, Scientific, and Technical Services,' suggests a broad category. Spending in this area often supports strategic planning, policy development, and complex problem-solving, with contracts ranging from small, specialized engagements to large, multi-year programs.

Small Business Impact

This contract does not appear to have a small business set-aside component, as indicated by 'sb': false. Furthermore, the 'co' field lists 'THE RAND CORPORATION,' a large research organization, suggesting it is the primary contractor. There is no explicit information regarding subcontracting plans for small businesses. Therefore, the direct impact on the small business ecosystem from this specific award is likely minimal, unless RAND Corporation voluntarily engages small businesses as subcontractors.

Oversight & Accountability

Oversight for this contract will be managed by the Department of the Army, likely through a contracting officer and potentially program managers. As a sole-source award, the justification for the procurement and the reasonableness of the price will be key areas of scrutiny. Transparency regarding the specific services rendered and the associated costs will be important for accountability. While no specific Inspector General (IG) jurisdiction is mentioned, the DoD IG would have oversight authority over defense spending.

Related Government Programs

Department of Defense Research and Development
Army Professional and Technical Services
RAND Corporation Research Contracts
Sole-Source Service Contracts

Risk Flags

Sole-source award
Cost-plus-fixed-fee pricing structure
Lack of detailed service description

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $5.7 million to THE RAND CORPORATION. CORE WORK - OPTION ORDERING PERIOD FY26

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 $5.7 million.

What is the period of performance?

Start: 2025-12-15. End: 2026-09-14.

What specific services will The RAND Corporation provide under this contract?

The provided data indicates the contract falls under NAICS code 541990, 'All Other Professional, Scientific, and Technical Services.' While the contract title mentions 'CORE WORK - OPTION ORDERING PERIOD FY26,' specific details about the services are not included. Typically, RAND Corporation provides a wide array of services including policy analysis, research, systems engineering, and strategic planning. Given the Department of the Army as the agency, these services could range from support for military operations, strategic assessments, technological research, or program evaluation. Further details would be necessary to ascertain the precise nature of the core work being performed.

How does the $5.7 million contract value compare to RAND Corporation's typical contract values with the Department of Defense?

Without access to historical contract data for The RAND Corporation specifically with the Department of the Army, a direct comparison is challenging. However, RAND is known for undertaking significant research and analysis projects, often valued in the millions of dollars. This $5.7 million award for a period of approximately 9 months (December 15, 2025, to September 14, 2026) appears to be a substantial, but not exceptionally large, engagement for a sole-source provider of specialized services. Larger, multi-year research initiatives or program management contracts could potentially exceed this value significantly. This specific award likely represents a defined scope of work within a broader program or a continuation of existing analytical support.

What are the primary risks associated with a sole-source, cost-plus-fixed-fee contract of this nature?

The primary risks associated with this sole-source, cost-plus-fixed-fee (CPFF) contract are twofold. Firstly, the sole-source nature eliminates competitive pressure, potentially leading to a less favorable price than could be achieved through a competitive bidding process. The government relies heavily on the contractor's proposed costs and the agency's negotiation skills to ensure fairness. Secondly, the CPFF structure, while providing flexibility, carries the risk of cost overruns. The contractor is reimbursed for allowable costs plus a predetermined fixed fee. If costs escalate beyond initial estimates, the total contract value could increase, impacting the overall budget. Effective oversight, detailed cost tracking, and clear performance metrics are crucial to mitigate these risks.

What is the historical spending pattern for 'All Other Professional, Scientific, and Technical Services' within the Department of the Army?

Historical spending patterns for NAICS code 541990 ('All Other Professional, Scientific, and Technical Services') within the Department of the Army are substantial and varied. This category encompasses a broad range of services, making it difficult to pinpoint exact trends without granular data. However, agencies like the Army consistently procure such services to support diverse functions, including research, analysis, consulting, and specialized technical support. Spending in this area often fluctuates based on strategic priorities, research initiatives, and the need for external expertise. Analyzing historical data would reveal significant annual outlays, with specific contract awards varying widely in value and duration based on the unique requirements of each procurement.

What is the significance of the contract type 'COST PLUS FIXED FEE' for this service?

The 'COST PLUS FIXED FEE' (CPFF) contract type is significant because it defines the financial relationship and risk allocation between the government and the contractor. In a CPFF contract, the government agrees to pay the contractor for all allowable costs incurred during the performance of the contract, plus a fixed amount representing the contractor's profit. This fee is negotiated at the outset and generally does not change, regardless of the final cost of the work. This structure is often used when the scope of work is not precisely defined at the time of award, or when there is uncertainty about the costs involved, such as in research and development or complex services. For the government, the risk is that costs could exceed initial estimates, leading to a higher total expenditure. For the contractor, the fixed fee provides a predictable profit margin, but they bear the risk if actual costs significantly exceed projections without a corresponding increase in the fee.

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

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: $5,700,000

Exercised Options: $5,700,000

Current Obligation: $5,700,000

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