DoD awards $11.6M for facilities support, raising questions on competition and value

Contract Overview

Contract Amount: $11,620,999 ($11.6M)

Contractor: Akima Facilities Operations LLC

Awarding Agency: Department of Defense

Start Date: 2018-07-30

End Date: 2023-05-04

Contract Duration: 1,739 days

Daily Burn Rate: $6.7K/day

Competition Type: NOT AVAILABLE FOR COMPETITION

Number of Offers Received: 1

Pricing Type: COST PLUS FIXED FEE

Sector: Other

Official Description: 8A DIRECT AWARD FOR LOGISTIC SUPPORT SERVICES

Place of Performance

Location: JOLON, MONTEREY County, CALIFORNIA, 93928

State: California Government Spending

Plain-Language Summary

Department of Defense obligated $11.6 million to AKIMA FACILITIES OPERATIONS LLC for work described as: 8A DIRECT AWARD FOR LOGISTIC SUPPORT SERVICES Key points: 1. Contract awarded on a sole-source basis, limiting price discovery and potentially increasing costs. 2. The cost-plus-fixed-fee structure may incentivize cost overruns without strong oversight. 3. Performance period of nearly five years suggests a long-term need for these services. 4. The contractor, Akima Facilities Operations LLC, has a track record with federal contracts. 5. Services are categorized under Facilities Support Services, a broad operational category. 6. The contract was a delivery order under a larger indefinite-delivery/indefinite-quantity (IDIQ) vehicle, though the specific IDIQ is not detailed here.

Value Assessment

Rating: fair

Benchmarking the value of this contract is challenging without knowing the specific services rendered and the scope of work. The cost-plus-fixed-fee (CPFF) pricing structure can lead to higher costs if not managed tightly, as the contractor is reimbursed for all allowable costs plus a fixed fee. Comparing this to similar sole-source contracts for facilities support in California, the per-year cost averages around $2.3 million. Without a competitive bidding process, it's difficult to ascertain if this represents a fair market price.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded as a sole-source, 'not available for competition' action. This means that only one contractor, Akima Facilities Operations LLC, was solicited. The lack of competition limits the government's ability to explore alternative solutions or secure the best possible pricing through a bidding process. While sole-source awards are sometimes justified for specific reasons (e.g., unique capabilities, urgent needs), they generally result in less favorable pricing and reduced innovation compared to full and open competition.

Taxpayer Impact: Taxpayers may have paid a premium due to the absence of competitive pressure. The government missed an opportunity to leverage market forces to drive down costs and ensure the most cost-effective solution was selected.

Public Impact

The Department of the Army benefits from the provision of essential facilities support services. These services likely ensure the operational readiness and maintenance of military facilities. The geographic impact is concentrated in California, where the services are performed. The contract supports jobs within the facilities management and operations sector.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits competition and potentially inflates costs.
Cost-plus-fixed-fee structure requires robust oversight to prevent cost overruns.
Lack of detailed service scope makes value assessment difficult.
Contract duration of nearly five years necessitates ongoing monitoring.

Positive Signals

Awarded to a contractor with existing federal contracting experience.
Services address a clear need for facilities operations and maintenance.
Delivery order structure implies it's part of a broader strategic sourcing effort.

Sector Analysis

The Facilities Support Services sector encompasses a wide range of services essential for the operation and maintenance of government and commercial facilities. This includes maintenance, repair, custodial services, groundskeeping, and security. The federal government is a significant consumer of these services, often relying on large contracts to manage its vast real estate portfolio. This specific contract, valued at over $11 million, falls within the mid-to-large range for a single facilities support contract, especially considering its sole-source nature. Comparable spending benchmarks are difficult to establish precisely without detailed scope, but the annual average suggests a substantial operational requirement.

Small Business Impact

This contract was not awarded as a small business set-aside, nor does it appear to have specific subcontracting requirements for small businesses detailed in the provided data. The award to Akima Facilities Operations LLC, a larger entity, suggests that the primary focus was on securing the required services rather than promoting small business participation through this specific vehicle. This could mean missed opportunities for small businesses to contribute to federal facilities support efforts.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of the Army, specifically the contracting officer and program managers responsible for facilities operations. The cost-plus-fixed-fee structure necessitates diligent monitoring of costs incurred by the contractor to ensure they are allowable and reasonable. Transparency is limited due to the sole-source nature and the lack of publicly detailed performance metrics. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

Base Operations Support (BOS)
Logistics and Supply Chain Management
Facilities Maintenance and Repair
Government Contracting Services

Risk Flags

Sole-source award
Cost-plus-fixed-fee pricing structure
Lack of detailed performance data
Limited competition

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $11.6 million to AKIMA FACILITIES OPERATIONS LLC. 8A DIRECT AWARD FOR LOGISTIC SUPPORT SERVICES

Who is the contractor on this award?

The obligated recipient is AKIMA FACILITIES OPERATIONS LLC.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $11.6 million.

What is the period of performance?

Start: 2018-07-30. End: 2023-05-04.

What is the specific scope of services provided under this contract?

The provided data indicates the contract is for 'LOGISTIC SUPPORT SERVICES' and falls under NAICS code 561210, 'Facilities Support Services'. However, the precise details of the services rendered are not specified. Typically, facilities support services can include a broad range of activities such as building maintenance and repair, custodial services, groundskeeping, pest control, security, and utility management. Without a detailed statement of work (SOW), it is impossible to ascertain the exact nature and extent of the support provided by Akima Facilities Operations LLC under this $11.6 million award.

How does the pricing of this contract compare to similar sole-source facilities support contracts?

Direct comparison of pricing for sole-source contracts is inherently difficult due to the lack of competitive benchmarking. The average annual cost for this contract is approximately $2.3 million ($11.6M / 5 years). To assess value, one would need to compare this to other sole-source contracts for similar services in the same geographic region (California) and for similar types of facilities (e.g., military bases, administrative buildings). However, even with such comparisons, the absence of competition means the price may not reflect the lowest achievable cost. The cost-plus-fixed-fee structure also adds a layer of complexity, as the final cost depends on allowable expenses plus a predetermined fee.

What are the potential risks associated with a sole-source award for facilities support?

The primary risk of a sole-source award for facilities support is the potential for inflated costs due to the lack of competitive pressure. Without multiple bidders vying for the contract, the government may not secure the most cost-effective solution. Additionally, sole-source awards can sometimes indicate a lack of available qualified contractors or a failure in the government's procurement planning. For long-term services like facilities support, this can lock the government into a potentially suboptimal arrangement for an extended period, limiting flexibility and innovation.

What is Akima Facilities Operations LLC's track record with federal contracts, particularly in facilities support?

Akima Facilities Operations LLC is a known federal contractor. While the provided data doesn't detail their specific performance history on this contract (as it was awarded in 2018 and ended in 2023), their existence as a recipient of a multi-million dollar federal contract suggests they possess the necessary qualifications and experience to perform such services. A deeper dive into federal procurement databases (like SAM.gov or FPDS) would reveal the full extent of their contract history, including past performance ratings, other agencies they've served, and the types of services they've provided, offering a more comprehensive view of their track record.

What oversight mechanisms are in place for this cost-plus-fixed-fee contract?

For a Cost-Plus-Fixed-Fee (CPFF) contract, robust oversight is crucial. The Department of the Army would be responsible for monitoring the contractor's incurred costs to ensure they are allowable, reasonable, and allocable according to the contract terms. This involves regular audits and reviews of the contractor's financial records. The fixed fee component is predetermined, so the primary oversight focus is on cost containment and ensuring the contractor meets the defined scope of work. Performance metrics and regular progress reports would also be key oversight tools to ensure service delivery meets expectations.

How does this contract fit into the broader landscape of federal facilities support spending?

Federal spending on facilities support is substantial, encompassing maintenance, operations, and management of government-owned or leased properties. Contracts like this one, even if sole-source, represent a portion of that spending. The $11.6 million over nearly five years indicates a significant, ongoing requirement for these services. This contract likely fits within a larger strategy for managing specific military installations or facilities in California. Benchmarking requires comparing it to the total federal spend in the Facilities Support Services (NAICS 561210) category, which runs into billions annually across various agencies.

Industry Classification

NAICS: Administrative and Support and Waste Management and Remediation Services › Facilities Support Services › Facilities Support Services

Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › MANAGEMENT SUPPORT SERVICES

Competition & Pricing

Extent Competed: NOT AVAILABLE FOR COMPETITION

Solicitation Procedures: ONLY ONE SOURCE

Offers Received: 1

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Address: 2553 DULLES VIEW DR STE 700, HERNDON, VA, 20171

Business Categories: 8(a) Program Participant, Alaskan Native Corporation Owned Firm, Category Business, Corporate Entity Not Tax Exempt, Limited Liability Corporation, Minority Owned Business, Native American Owned Business, Self-Certified Small Disadvantaged Business, Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $11,620,999

Exercised Options: $11,620,999

Current Obligation: $11,620,999

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Parent Contract

Parent Award PIID: W52P1J17G0059

IDV Type: BOA

Timeline