DoD's $18.5M architectural services contract awarded to CH2M HILL, INC. shows potential value concerns

Contract Overview

Contract Amount: $18,506,059 ($18.5M)

Contractor: CH2M Hill, Inc.

Awarding Agency: Department of Defense

Start Date: 2006-02-28

End Date: 2008-05-30

Contract Duration: 822 days

Daily Burn Rate: $22.5K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 81

Pricing Type: TIME AND MATERIALS

Sector: Construction

Place of Performance

Location: BUZZARDS BAY, BARNSTABLE County, MASSACHUSETTS, 02542

State: Massachusetts Government Spending

Plain-Language Summary

Department of Defense obligated $18.5 million to CH2M HILL, INC. for work described as: Key points: 1. Contract value appears high relative to duration and scope. 2. Limited competition may have impacted pricing. 3. Contract type (Time and Materials) can pose cost control risks. 4. Performance period was relatively short for the awarded amount. 5. Services fall under architectural design, a common but critical sector. 6. No small business set-aside was utilized.

Value Assessment

Rating: fair

The contract's total value of $18.5 million over approximately 2.2 years (822 days) suggests a significant monthly expenditure. Without specific deliverables or comparable project data, it's difficult to definitively benchmark value. However, the Time and Materials (T&M) contract type, coupled with a substantial award amount, warrants scrutiny for potential cost overruns if not managed closely. The number of bids (81) is high, which typically indicates competitive pricing, but the final award value needs further analysis against industry standards for architectural services.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, which is a positive indicator for market-driven pricing. The high number of bids (81) suggests a robust interest from potential offerors, theoretically leading to competitive proposals. However, the final award value relative to the scope and duration needs to be assessed to confirm if this competition translated into optimal value for the government.

Taxpayer Impact: A high number of bidders in a full and open competition generally benefits taxpayers by driving down prices through competitive pressure, ensuring the government receives fair market value for services rendered.

Public Impact

The Department of the Air Force benefits from architectural design services to support its infrastructure and facilities. This contract likely supported the design of specific military installations or projects. The geographic impact is tied to the location of the Air Force facilities requiring architectural services. The contract supports the architecture and engineering workforce, including designers, drafters, and project managers.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Time and Materials contract type can lead to cost escalation if not closely monitored.
The total award amount of $18.5M for a 2.2-year duration requires careful performance and cost tracking.
Lack of specific performance metrics or deliverables makes value assessment challenging.

Positive Signals

Awarded under full and open competition, indicating broad market access.
A high number of bids (81) suggests significant market interest and potential for competitive pricing.
The contractor, CH2M HILL, INC., is a known entity in engineering and construction services.

Sector Analysis

This contract falls within the Architectural Services sector, a subset of the broader Architecture, Engineering, and Construction (AEC) industry. The AEC market is substantial, with significant government spending allocated annually for design and construction services supporting federal infrastructure. Benchmarking this contract's value would require comparing its per-diem rates or project-specific costs against similar architectural design contracts awarded by the Department of Defense or other federal agencies for comparable facility types and complexities.

Small Business Impact

The data indicates this contract was not set aside for small businesses (ss: false, sb: false). This suggests that the competition was open to all qualified contractors, including large businesses. While this maximizes the pool of potential bidders, it means that opportunities for small business participation through direct award or subcontracting might be limited unless specifically mandated or pursued by the prime contractor.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of the Air Force's contracting and program management offices. Accountability measures would be defined in the contract's terms and conditions, including performance standards and payment schedules. Transparency is generally facilitated through contract award databases like FPDS, though detailed performance reports are often internal. Inspector General (IG) jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

Military Construction
Facility Design Services
Architectural and Engineering Services
Department of Defense Contracts
Air Force Base Support Contracts

Risk Flags

Potential for cost overruns due to T&M contract type.
Value for money requires further scrutiny given contract type and duration.
Lack of specific performance details limits comprehensive assessment.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $18.5 million to CH2M HILL, INC.. See the official description on USAspending.

Who is the contractor on this award?

The obligated recipient is CH2M HILL, 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 $18.5 million.

What is the period of performance?

Start: 2006-02-28. End: 2008-05-30.

What was the specific scope of architectural services provided under this contract?

The provided data indicates the contract (ID: DO) was for architectural services (NAICS 541310) awarded to CH2M HILL, INC. by the Department of the Air Force. However, the specific scope of work, such as the type of facilities designed (e.g., administrative buildings, hangars, specialized military structures), the phase of design (e.g., schematic design, design development, construction documents), and the geographic location of the projects, is not detailed in the summary data. Further investigation into the contract's statement of work would be necessary to understand the precise services rendered and their complexity.

How does the awarded amount of $18.5 million compare to similar architectural services contracts for the Department of Defense?

Benchmarking the $18.5 million award requires comparing it against contracts with similar scopes, durations, and complexity within the Department of Defense (DoD). The contract duration was approximately 2.2 years (822 days). Without knowing the specific deliverables, comparing this total value directly is challenging. However, if this represents design services for a single large facility or multiple smaller projects, the value could be within a typical range. If it covered routine or minor design tasks, it might be considered high. Analysis of average contract values for similar architectural services within the Air Force or DoD, considering factors like facility type and project scale, would provide a more accurate comparison.

What are the potential risks associated with a Time and Materials (T&M) contract of this magnitude?

Time and Materials (T&M) contracts, like the one awarded here, carry inherent risks, particularly for larger sums like $18.5 million. The primary risk is cost escalation, as the government pays for the labor hours and materials used rather than a fixed price. If not managed diligently with strict oversight on labor hours, rates, and material costs, the final expenditure can significantly exceed initial estimates. This contract type is generally used when the scope of work cannot be clearly defined at the outset. For architectural services, this might apply to early-stage design or projects with evolving requirements, but it necessitates robust monitoring by the contracting officer's representative (COR) to ensure efficiency and prevent contractor inefficiencies from driving up costs.

What does the high number of bids (81) signify for this contract's value and competition?

The fact that 81 bids were received for this contract, awarded under full and open competition, is a strong positive signal regarding the level of market interest and the perceived accessibility of the opportunity. A large number of bidders typically indicates a healthy competitive environment, which theoretically should drive down prices and encourage innovative solutions. For taxpayers, this suggests that the government likely received proposals from a wide array of qualified firms, increasing the probability that the selected offer represented good value. However, the ultimate measure of value is the final award price relative to the scope and quality of services delivered, which requires further analysis beyond just the number of bids.

What is the historical spending pattern for architectural services by the Department of the Air Force?

Historical spending data for architectural services by the Department of the Air Force (and the DoD broadly) reveals consistent and substantial investment in design and engineering capabilities. Annual spending in this category often runs into billions of dollars, supporting a wide range of projects from new base construction to renovations and specialized facility upgrades. Contracts like this one, valued at $18.5 million, represent a segment of that larger spending picture. Analyzing historical trends would show the typical contract sizes, durations, and the prevalence of different contract types (e.g., fixed-price vs. T&M) used for architectural services, helping to contextualize the specific award in question.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Architectural, Engineering, and Related Services › Architectural Services

Product/Service Code: ARCHITECT/ENGINEER SERVICES › ARCH-ENG SVCS - GENERAL

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 81

Pricing Type: TIME AND MATERIALS (Y)

Evaluated Preference: NONE

Contractor Details

Parent Company: CH2M Hill Companies, Ltd. (UEI: 027620574)

Address: 9193 S JAMAICA STREET, ENGLEWOOD, CO, 06

Business Categories: Category Business, Not Designated a Small Business

Contract Characteristics

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: F4162403D8595

IDV Type: IDC

Timeline