The Unique Role and Value of FFRDCS Like MIT Lincoln Laboratory in the Government-Industry Innovation Ecosystem
In 1951, MIT began operating what is today known as the MIT Lincoln Laboratory Federally Funded Research and Development Center (FFRDC). FFRDCs like MIT Lincoln Laboratory are unique entities that have a deep and long term record of making meaningful contributions to the national defense. These contributions derive directly from two distinguishing characteristics of FFRDCs: 1) they have a long term special relationship with the U.S. government; and 2) they operate free from conflicts of interest and commercial profit motive. The combination of these characteristics enables the cost effective development and delivery of disruptive technologies to the government (and at government direction, transfer of this technology to private industry), thereby reducing the risk and cost of U.S. government acquisitions.
Although the term FFRDC was not conceived until 1967, the federal government’s practice of partnering with non-profit contractors — and, particularly, universities — to meet the nation’s urgent research and development (R&D) needs traces its origins to World War II. Federal and university leaders, led by Vannevar Bush, who in 1941 headed the Office of Scientific Research and Development (OSRD), recognized the critical importance of arraying the scientific expertise and talent found at universities against the most complex national security technological problems. During World War II, Bush (a former MIT Vice President and Dean of the MIT School of Engineering) would oversee R&D collaborations resulting in the Manhattan Project, the invention of the proximity fuse, the creation of advanced medical treatments, the perfection of guided missiles, and the development of air defense radar.
After World War II, the success of the OSRD’s efforts and the national R&D capabilities that it helped advance ensured the partnership between the federal government and external sources of R&D expertise would continue. Indeed, after the development of radar air defenses at MIT’s Radiation Laboratory, related work would continue to the present day, including at MIT Lincoln Laboratory — a direct descendent of the MIT Radar Laboratory. Currently, twelve federal agencies sponsor a total of forty-six FFRDCs. The Department of Defense alone sponsors ten, including MIT Lincoln Laboratory. Of these ten Defense FFRDCs, MIT Lincoln Laboratory is the largest of only three that specialize in R&D and rapid prototyping.
Today’s FFRDCs operate solely in the U.S. government’s interest and are a reservoir of unique scientific and technological expertise and capabilities in discrete research areas specified by their government sponsors.[1] At MIT Lincoln Laboratory, these areas include air, missile, and maritime defense; homeland protection and air traffic control; cyber security; advanced communication systems, rapid prototyping; microelectronics; space systems and technology; and reconnaissance and tactical systems.
Unlike commercial enterprises, FFRDCs operate in the public interest with objectivity and independence. Rigorous federal oversight and tailored contractual provisions ensure that FFRDCs remain free of personal and organizational conflicts of interest. Accordingly, FFRDCs provide full and open disclosure of their fiscal and ethical affairs to their sponsoring and contracting agencies, which for MIT Lincoln Laboratory are the Office of the Secretary of Defense and the U.S. Air Force, respectively.[2] Furthermore, FFRDCs are prohibited from competing commercially with private industry, for example by mass-producing products.[3]
Due to their special, long term relationship with federal sponsors, and in order to discharge their responsibilities on behalf of their sponsoring agency, FFRDCs are granted special access to government and supplier data — including sensitive national security information, proprietary commercial data, and other government resources — beyond that which is common for commercial federal contractors.[4] The combination of the special access and the conflict-free operating environment permit FFRDCs to provide the government with expertly informed, impartial, and trusted evaluations of commercial industry technologies and contract proposals.
The collective effect of these attributes also substantially diminishes the risks inherent in the development and mass procurement of new technologies. For example, DoD’s R&D FFRDCs (like MIT Lincoln Laboratory) operate at the Level 2 to 3 Technology Readiness Levels where high-risk, high-reward research and development occurs and, in parallel, where acquisition risk reduction occurs. Reliance upon FFRDCs like MIT Lincoln Laboratory permits the cost and schedule benchmarks for a new technology to be mapped before full-rate procurement occurs. In this way, early prototyping informs DoD’s initial cost estimates and design thresholds, while also providing DoD with transparency unique to FFRDCs and ensuring government ownership of intellectual property and reference designs.
Critically, the federal government receives unlimited data rights in the research and development it funds at MIT Lincoln Laboratory.[5] The government may transfer these data rights to commercial industry at its sole discretion, reducing overall developments costs. This is particularly useful in the context of open architectures developed by FFRDCs. An open architecture enables multiple commercial contractors to compete for a federal award on an equal basis, without locking the federal government into a costly, privately developed, and proprietary data architecture.
Title 10 U.S.C. Section 2304(c)(3) authorizes an exception to full and open competition in order for the government to establish or maintain an essential engineering, research, or development capability to be provided by an educational or other nonprofit institution or a Federally Funded Research and Development Center. Thus, when the U.S. government determines that its acquisition needs will be best and most efficiently served by an open architecture or full governmental ownership of a technology’s underlying data rights; or when non-biased, independent research or analysis are required, the government may award work directly to an FFRDC even if a commercial contractor could potentially undertake the same work.[6] In instances like these, it is important to emphasize that the prohibition against FFRDCs competing commercially does not tie the government’s hands when its acquisition planning process determines that the services of an FFRDC offer critical benefits to the government. Moreover, the applicable FAR provision has never been interpreted to require the government to award a program to a commercial contractor even in a circumstance where an FFRDC offers a better, more effective solution.[7]
By virtue of their unique attributes, FFRDCs occupy a vitally important position in the U.S. government’s acquisition of advanced technology. With a long term special relationship, strict conflict of interest avoidance, no profit motive, and unparalleled access to classified and proprietary information, FFRDCs like MIT Lincoln Laboratory provide unbiased and deep expertise to the U.S. government.
[1] 48 C.F.R. § 35.017-1 (Federal Acquisition Regulation (FAR) section 35.017-1).
[2] FAR 35.017-4(a)-(c).
[3] FAR 35.017(a)(2).
[4] FAR 35.017(a)(2).
[5] FAR 35.011(a)-(b).
[6] FAR 6.302-3; 35.017-3(a)-(b).
[7] FAR 35.017(a)(2); FAR 35.008(a).