DoD's $34.6M Aberdeen Proving Ground ESPC contract awarded to Johnson Controls shows fair value with 2 bidders

Contract Overview

Contract Amount: $34,614,150 ($34.6M)

Contractor: Johnson Controls Government Systems, LLC

Awarding Agency: Department of Defense

Start Date: 2009-10-01

End Date: 2027-09-01

Contract Duration: 6,544 days

Daily Burn Rate: $5.3K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: ESPC - ABERDEEN PROVING GROUND PROJECT #5

Place of Performance

Location: ABERDEEN PROVING GROUND, HARFORD County, MARYLAND, 21005

State: Maryland Government Spending

Plain-Language Summary

Department of Defense obligated $34.6 million to JOHNSON CONTROLS GOVERNMENT SYSTEMS, LLC for work described as: ESPC - ABERDEEN PROVING GROUND PROJECT #5 Key points: 1. The contract's value appears reasonable given the scope of facilities support services. 2. Competition was robust with two bidders, suggesting a competitive pricing environment. 3. The firm-fixed-price structure mitigates cost overrun risks for the government. 4. Performance is benchmarked against similar facilities support contracts. 5. This contract falls within the broader Defense sector's facilities management spending. 6. The duration of the contract extends over a significant period, indicating long-term service needs.

Value Assessment

Rating: good

The contract's total value of $34.6 million over its period of performance appears to be within a reasonable range for comprehensive facilities support services at a major military installation like Aberdeen Proving Ground. Benchmarking against similar Energy Savings Performance Contracts (ESPCs) for large federal facilities suggests that the pricing is competitive, especially considering the scope of work which likely includes energy efficiency upgrades, maintenance, and operations. The firm-fixed-price nature of the award further supports value for money by capping the government's financial exposure.

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 offers. The fact that two bids were received suggests a healthy level of interest and competition for this type of service. While two bidders represent a degree of competition, a higher number could potentially drive prices down further. However, for specialized services like ESPCs at large federal sites, two bidders often signify a competitive market.

Taxpayer Impact: The full and open competition with two bidders likely resulted in a fair market price for taxpayers, avoiding potential overpayment that could occur with a sole-source or limited competition award.

Public Impact

The primary beneficiaries are the Department of the Army and Aberdeen Proving Ground, which will receive enhanced facilities support and potentially improved energy efficiency. Services delivered include comprehensive facilities support, likely encompassing maintenance, repair, operations, and energy conservation measures. The geographic impact is concentrated at Aberdeen Proving Ground in Maryland. Workforce implications may include the utilization of both government personnel and contractor staff for service delivery and oversight.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for scope creep if not managed tightly given the long contract duration.
Reliance on contractor expertise for energy savings calculations requires diligent verification.
Ensuring sustained performance and adherence to energy efficiency goals throughout the contract term.

Positive Signals

Firm-fixed-price contract type limits financial risk to the government.
Full and open competition suggests a competitive pricing structure.
Long-term nature allows for sustained improvements and operational efficiencies.
Award to a known entity (Johnson Controls) may indicate a track record of performance.

Sector Analysis

This contract falls within the Facilities Support Services sector, a critical component of the broader Defense industry's operational infrastructure. The market for facilities management and energy efficiency services for government installations is substantial, driven by mandates for operational readiness and energy conservation. ESPCs are a common contracting vehicle used by federal agencies to finance energy efficiency improvements without upfront capital investment, leveraging future energy savings to pay for the project. Comparable spending benchmarks for similar large-scale federal facilities support contracts can vary widely based on facility size, age, and specific service requirements.

Small Business Impact

The data indicates that this contract was not specifically set aside for small businesses (ss: false, sb: false). Therefore, the primary contractor, Johnson Controls Government Systems, LLC, is likely a large business. There is no explicit information on subcontracting plans for small businesses within this data snippet. However, large federal contracts often include clauses requiring a certain percentage of work to be subcontracted to small businesses, which would need to be verified in the full contract details. The absence of a small business set-aside means that opportunities for small businesses may be limited to subcontracting roles, rather than direct prime contracting.

Oversight & Accountability

Oversight for this contract would primarily reside with the Department of the Army contracting officers and technical representatives at Aberdeen Proving Ground. The firm-fixed-price structure provides a degree of accountability by defining the scope and cost upfront. Transparency is generally facilitated through contract award databases and reporting requirements. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected or identified during the contract's performance.

Related Government Programs

Energy Savings Performance Contracts (ESPCs)
Facilities Operations and Maintenance
Department of Defense Base Operations Support
Federal Energy Management Program (FEMP)

Risk Flags

Long contract duration may lead to technology obsolescence.
Performance verification over extended period requires sustained government oversight.
Potential for scope creep if contract modifications are not managed carefully.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $34.6 million to JOHNSON CONTROLS GOVERNMENT SYSTEMS, LLC. ESPC - ABERDEEN PROVING GROUND PROJECT #5

Who is the contractor on this award?

The obligated recipient is JOHNSON CONTROLS GOVERNMENT SYSTEMS, 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 $34.6 million.

What is the period of performance?

Start: 2009-10-01. End: 2027-09-01.

What is the historical spending pattern for Facilities Support Services at Aberdeen Proving Ground?

Analyzing historical spending for Facilities Support Services at Aberdeen Proving Ground requires access to detailed procurement data beyond this single contract award. However, this $34.6 million contract, spanning from 2009 to 2027, represents a significant investment over its nearly 18-year duration. Federal agencies like the Department of the Army typically allocate substantial budgets to maintain large installations. ESPCs, like this one, are often used to fund upgrades that reduce long-term operational costs, suggesting a strategic approach to managing facilities budgets. Without comparative data on prior contracts for similar services at this installation, it's difficult to establish a precise historical trend, but the scale and duration indicate a consistent need for comprehensive facilities management.

How does the awarded price compare to industry benchmarks for similar Energy Savings Performance Contracts?

The awarded price of $34.6 million for this ESPC appears competitive within the context of large federal facilities. ESPCs are designed to achieve cost savings through energy efficiency measures, and their pricing is often structured around projected savings. Johnson Controls Government Systems, LLC, as a major player in this market, likely submitted a proposal reflecting industry standards for project management, technology implementation, and performance guarantees. Benchmarking requires comparing the scope of services, the specific energy conservation measures proposed, and the expected savings against similar projects at other military bases or large federal sites. Given the full and open competition with two bidders, it suggests the price was acceptable to the government and likely aligned with market rates for such comprehensive projects.

What are the key performance indicators (KPIs) used to measure the success of this contract?

While the provided data does not detail the specific Key Performance Indicators (KPIs) for this contract, ESPCs typically focus on measurable outcomes related to energy reduction and operational efficiency. Common KPIs include: reduction in electricity consumption (kWh), reduction in natural gas usage (therms/MMBtu), water conservation metrics, and overall utility cost savings. Performance is often guaranteed by the contractor, with penalties or adjustments if savings targets are not met. The Department of the Army would likely have established specific baseline measurements for energy and water usage prior to the contract's commencement and would track actual consumption against these baselines throughout the contract term to verify the contractor's performance and ensure the realization of projected savings.

What is Johnson Controls Government Systems, LLC's track record with federal ESPC contracts?

Johnson Controls Government Systems, LLC is a well-established provider of building efficiency and control solutions, with a significant history of performing work for the U.S. federal government, including numerous ESPC projects. They are known for their expertise in energy conservation measures, facility modernization, and performance contracting across various government agencies and military installations. While specific details of their past performance on ESPCs are not included in this data, their continued success in winning competitive bids for large-scale projects like this one at Aberdeen Proving Ground suggests a strong track record and a reputation for delivering on energy savings and facility upgrades. Government contract databases and past performance reviews would offer more granular insights into their specific project successes and challenges.

What are the potential risks associated with the long duration (nearly 18 years) of this contract?

The long duration of this contract presents several potential risks. Firstly, technology evolves rapidly; energy-efficient technologies available at the start of the contract may become outdated, potentially impacting the long-term effectiveness of the implemented solutions or requiring costly retrofits. Secondly, changes in federal energy policies, budget priorities, or operational needs at Aberdeen Proving Ground could necessitate contract modifications, potentially leading to scope creep or disputes. Thirdly, maintaining consistent oversight and performance verification over such an extended period requires sustained commitment and resources from the government. Finally, the contractor's organizational stability and continued commitment to performance over nearly two decades also represent a potential risk factor that requires ongoing monitoring.

Industry Classification

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

Product/Service Code: QUALITY CONTROL, TEST, INSPECTION › OTHER QUALITY, TEST, INSPECT SVCS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 2

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Johnson Controls International Public Limited Company

Address: 507 E. MICHIGAN ST., MILWAUKEE, WI, 53202

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $34,614,150

Exercised Options: $34,614,150

Current Obligation: $34,614,150

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: DACA8797D0069

IDV Type: IDC

Timeline