What? No competition for a $415M Navy contract?
I’m sure this is the kind of contract that makes my friend Stan Soloway and his team over at the Professional Services Council see red.
On Friday, the Navy awarded a $415 million contract to Penn State’s Applied Research Laboratory for research and engineering work.
Three things bug me about this contract:
What they are buying. The five-year contract is for staff hours – two million hours over five years for research, engineering and test and evaluation for navigation systems, thermal propulsion concepts for undersea vehicles, something called propulsors, and defense communications systems.
It bothers me because this is work that any number of private sector companies could do; plus, they are buying it by the hour.
The size and length of the contract. The Defense Department announcement says that there is an option on this contract for five more years and nearly two million more staff hours. This would bring the value of the contract to $853.3 million. Nothing is obligate or guaranteed on this contract, so why make it so big with an option for more?
What bugs me the most. This six-word sentence toward the end of the announcement: This contract was not competitively procured.
I’m not as opposed as PSC and other industry groups to contract money going to universities and federally funded research and development centers, instead of private sector contracts. But not to compete a contract of this size?
Penn State is a fine school. I’m sure there is great research going on there, but why not pit them against any other university with equivalent facilities and let the best school win?
Maybe the government could have gotten those 2 million staff hours for less than the $201-an-hour rate Penn State will charge the Navy.
The lack of competition is appalling for a contract this size, particularly when the government is facing sequestration and a weak economy. The Navy should know better.
Posted by Nick Wakeman on Sep 10, 2012 at 11:22 AM