DoD's $15.8M construction contract with TOLTEST, INC. awarded under full and open competition

Contract Overview

Contract Amount: $15,797,638 ($15.8M)

Contractor: Toltest, Inc.

Awarding Agency: Department of Defense

Start Date: 2006-09-01

End Date: 2009-04-28

Contract Duration: 970 days

Daily Burn Rate: $16.3K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 4

Pricing Type: COST PLUS FIXED FEE

Sector: Construction

Plain-Language Summary

Department of Defense obligated $15.8 million to TOLTEST, INC. for work described as: Key points: 1. Contract awarded for construction services, indicating a need for infrastructure development or maintenance. 2. The contract was competed fully and openly, suggesting a competitive bidding process. 3. Awarded to TOLTEST, INC., a contractor with a significant federal contract history. 4. The contract duration of 970 days (approx. 2.6 years) suggests a medium-term project. 5. The contract type (Cost Plus Fixed Fee) can lead to cost overruns if not managed carefully. 6. No small business set-aside was utilized, potentially limiting opportunities for smaller firms.

Value Assessment

Rating: fair

Benchmarking the value of this $15.8 million construction contract is challenging without specific project details or comparable contract data. However, the Cost Plus Fixed Fee (CPFF) contract type, while offering flexibility, carries inherent risks of cost escalation. The fixed fee component provides some cost certainty for the contractor, but the government bears the majority of the cost risk. Without knowing the scope of work, it's difficult to assess if the final price represents good value for the services rendered. Further analysis would require comparing the final cost to similar construction projects of comparable complexity and scale within the Department of Defense.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under 'Full and Open Competition,' indicating that all responsible sources were permitted to submit a bid. The presence of 4 bids suggests a moderate level of competition for this construction project. While multiple bidders are positive, the exact number (4) doesn't necessarily guarantee the most competitive pricing without further context on the bidding landscape for this specific type of construction service within the Department of Defense.

Taxpayer Impact: A full and open competition generally benefits taxpayers by encouraging multiple companies to bid, which can drive down prices and improve the quality of services offered.

Public Impact

The primary beneficiaries are the Department of Defense, receiving construction services for its facilities. The services delivered include commercial and institutional building construction, likely for military bases or related infrastructure. The geographic impact is concentrated where the construction project is located, presumably on a DoD installation. Workforce implications include employment opportunities for construction workers and related trades during the contract period.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost Plus Fixed Fee contract type introduces potential for cost overruns.
Limited competition (4 bidders) may not have yielded the lowest possible price.
Lack of small business set-aside might exclude smaller, specialized construction firms.
Contract duration is substantial, requiring sustained oversight.

Positive Signals

Awarded through full and open competition, allowing broad market participation.
Contractor TOLTEST, INC. has experience with federal contracts.
Clear contract end date provides a defined project timeline.

Sector Analysis

This contract falls within the Construction sector, specifically Commercial and Institutional Building Construction. The federal government is a significant consumer of construction services, with spending often driven by infrastructure needs, base modernization, and facility maintenance. The Department of Defense, in particular, has substantial real property assets requiring ongoing construction and renovation. Benchmarking this $15.8 million contract would involve comparing it to other DoD construction projects of similar scope and complexity, as well as broader federal construction spending trends.

Small Business Impact

This contract was not awarded as a small business set-aside, nor does it appear to have specific subcontracting goals mentioned in the provided data. This means that opportunities for small businesses to directly participate as the prime contractor were not prioritized for this specific award. While TOLTEST, INC. may engage small businesses as subcontractors, the absence of a set-aside suggests a missed opportunity to specifically foster small business growth in this particular procurement.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of the Air Force, a component of the Department of Defense. Mechanisms likely include contract administration, performance monitoring, and financial oversight to ensure compliance with the Cost Plus Fixed Fee terms. Transparency is generally facilitated through contract award databases like FPDS. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse related to the contract.

Related Government Programs

Department of Defense Construction Contracts
Military Base Infrastructure Projects
Commercial Building Construction Services
Federal Facilities Maintenance and Renovation

Risk Flags

Cost Plus Fixed Fee contract type carries inherent cost overrun risk.
Moderate competition level (4 bidders) may not have resulted in the lowest possible price.
Lack of small business set-aside limits direct opportunities for small contractors.
Contract awarded in 2006, requiring analysis of potentially dated pricing and scope.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $15.8 million to TOLTEST, INC.. See the official description on USAspending.

Who is the contractor on this award?

The obligated recipient is TOLTEST, INC..

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Air Force).

What is the total obligated amount?

The obligated amount is $15.8 million.

What is the period of performance?

Start: 2006-09-01. End: 2009-04-28.

What is the track record of TOLTEST, INC. with federal contracts, particularly within the Department of Defense?

TOLTEST, INC. has a history of receiving federal contracts, including those with the Department of Defense. Analyzing their past performance, including contract values, types, and successful completion rates, is crucial for assessing their reliability on this $15.8 million construction project. A review of their contract history would reveal if they have successfully managed similar Cost Plus Fixed Fee contracts and if they have a pattern of cost overruns or performance issues. Understanding their experience with construction projects of comparable scale and complexity within military environments would provide further insight into their capabilities and potential risks associated with this award.

How does the $15.8 million value of this contract compare to similar construction projects awarded by the Department of Defense?

Without specific details on the scope and nature of the construction work, a direct comparison of the $15.8 million value is difficult. However, this amount falls within a common range for significant construction projects, such as building new facilities, major renovations, or infrastructure upgrades on military installations. To provide a more precise benchmark, one would need to identify comparable DoD construction contracts awarded around the same period (2006-2009) for projects of similar size, complexity (e.g., type of building, specialized requirements), and geographic location. Analyzing the cost per square foot or cost per unit for similar projects would offer a more granular assessment of value.

What are the primary risks associated with a Cost Plus Fixed Fee (CPFF) contract type for this construction project?

The primary risk with a CPFF contract is that the government bears the majority of the cost risk. While the contractor's profit is fixed, they are reimbursed for all allowable costs. This can incentivize less cost-conscious behavior from the contractor, potentially leading to cost overruns if not rigorously managed and overseen. For this $15.8 million project, the Department of the Air Force must ensure robust cost tracking, auditing, and change order management processes are in place to prevent the final cost from significantly exceeding the initial estimate. The fixed fee itself is not subject to change, but the 'cost' portion can escalate.

What does the level of competition (4 bidders) imply about the potential for price discovery and overall value for taxpayers?

Having 4 bidders for this construction contract suggests a moderate level of competition. While more than a sole-source or limited competition scenario, it's not an exceptionally high number that might indicate intense market pressure. This level of competition likely allowed for some price discovery, meaning the bids were probably influenced by market rates and competitor offerings. However, to truly assess value for taxpayers, one would need to analyze the bid spread – the difference between the highest and lowest bids. A wide spread could indicate that some bidders were less competitive or that there were significant differences in proposed approaches or costs. Without this data, it's reasonable to assume a fair, but not necessarily the most aggressive, price was achieved.

How has federal spending on commercial and institutional building construction evolved since this contract was awarded in 2006?

Federal spending on commercial and institutional building construction has likely fluctuated significantly since 2006, influenced by economic conditions, national security priorities, and infrastructure initiatives. Post-2008 recession, federal stimulus spending may have temporarily boosted construction outlays. More recently, increased focus on modernizing federal facilities, cybersecurity upgrades, and resilience projects could be driving current spending. To provide a precise trend, one would need to examine historical federal procurement data specifically for NAICS code 236220 (Commercial and Institutional Building Construction) across all agencies, looking at annual obligations and contract awards over the past 15+ years.

What are the potential implications of awarding this contract to a single large entity (TOLTEST, INC.) versus a small business?

Awarding a $15.8 million contract like this to a large entity like TOLTEST, INC. means the prime contract value goes to a company with established resources and potentially broader capabilities. This can ensure project execution capacity. However, it also means that the direct economic benefit and opportunity for developing prime contracting experience are concentrated within that large firm. If this contract had been set aside for small businesses, the funds would have flowed to smaller companies, potentially fostering their growth, increasing competition in the long run, and distributing economic impact more widely. The current structure prioritizes perceived capability and capacity over small business development for this specific award.

Industry Classification

NAICS: Construction › Nonresidential Building Construction › Commercial and Institutional Building Construction

Product/Service Code: CONSTRUCT OF STRUCTURES/FACILITIES › CONSTRUCTION OF BUILDINGS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 4

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Parent Company: Lakeshore Toltest Corporation (UEI: 962400151)

Address: 1480 FORD ST, MAUMEE, OH, 09

Business Categories: Category Business, Not Designated a Small Business

Parent Contract

Parent Award PIID: FA890306D8519

IDV Type: IDC

Timeline