Agriculture leases aircraft for $8M to support aerial supervision, with a 3-year term

Contract Overview

Contract Amount: $8,012,667 ($8.0M)

Contractor: Tenax Aerospace LLC

Awarding Agency: Department of Agriculture

Start Date: 2024-01-01

End Date: 2026-12-31

Contract Duration: 1,095 days

Daily Burn Rate: $7.3K/day

Competition Type: FULL AND OPEN COMPETITION

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: NATIONAL AERIAL SUPERVISION MODULE (ASM) DRY LEASE AIRCRAFT

Place of Performance

Location: RIDGELAND, MADISON County, MISSISSIPPI, 39157

State: Mississippi Government Spending

Plain-Language Summary

Department of Agriculture obligated $8.0 million to TENAX AEROSPACE LLC for work described as: NATIONAL AERIAL SUPERVISION MODULE (ASM) DRY LEASE AIRCRAFT Key points: 1. Leasing aircraft offers flexibility and potentially lower upfront costs compared to purchasing. 2. The contract was awarded through full and open competition, suggesting a competitive bidding process. 3. A firm-fixed-price contract type helps manage cost certainty for the government. 4. The duration of the lease is 1095 days, aligning with typical operational needs. 5. The specific service code (532411) indicates a focus on equipment rental and leasing. 6. The contract is not set aside for small businesses, implying larger contractors were eligible.

Value Assessment

Rating: good

The contract value of $8.01 million for a 3-year aircraft lease appears reasonable, especially considering it was awarded under full and open competition. Benchmarking against similar aerial supervision or aircraft leasing contracts would provide a more precise value-for-money assessment. The firm-fixed-price structure is a positive indicator for cost control. Without specific details on aircraft type, hours, and included services, a definitive value comparison is challenging, but the overall price point seems within a plausible range for specialized aviation services.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded through full and open competition, indicating that all responsible sources were permitted to submit bids. The data does not specify the number of bidders, but this procurement method generally fosters a competitive environment, which can lead to better pricing and service offerings for the government. The absence of limitations suggests the Forest Service sought the best available solution from the broadest possible market.

Taxpayer Impact: Full and open competition is beneficial for taxpayers as it increases the likelihood of obtaining competitive pricing and encourages a wider range of qualified vendors to participate, potentially driving down costs and improving service quality.

Public Impact

The primary beneficiaries are the US Forest Service, which will utilize the aircraft for aerial supervision, likely for wildfire detection, monitoring, or other land management activities. The services delivered include the lease of specialized aircraft, providing essential aerial support for the agency's operations. The geographic impact is likely focused on areas managed by the Forest Service, potentially across various regions depending on operational needs. This contract supports the aviation sector and potentially the workforce employed by the contractor, Tenax Aerospace LLC.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for increased operational costs if market rates for similar leases rise significantly during the contract term.
Dependence on a single contractor for critical aerial supervision capabilities could pose a risk if performance issues arise.
The specific capabilities and availability of the leased aircraft need to be closely monitored to ensure they meet evolving operational demands.

Positive Signals

The use of a firm-fixed-price contract provides cost certainty for the government.
Awarding through full and open competition suggests a robust selection process aimed at securing value.
The contract duration aligns with the operational needs for aerial supervision, providing sustained support.

Sector Analysis

The aviation services sector is a critical component of government operations, particularly for agencies like the Forest Service that require aerial support for land management, firefighting, and surveillance. This contract falls under the broader category of transportation equipment rental and leasing. The market for specialized aircraft leasing is competitive, with various providers offering tailored solutions. The $8 million expenditure represents a significant investment in maintaining essential operational capabilities, fitting within the typical spending patterns for such services in the federal government.

Small Business Impact

This contract was not set aside for small businesses, as indicated by `sb: false`. This suggests that the procurement was open to all eligible offerors, including large businesses. While there is no direct small business set-aside, the prime contractor, Tenax Aerospace LLC, may engage small businesses as subcontractors to fulfill certain aspects of the contract, though this is not explicitly detailed in the provided data. The absence of a set-aside means the primary focus was on securing the best overall offer from the market.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of Agriculture's Forest Service contracting officers and program managers. They are responsible for monitoring contractor performance, ensuring compliance with contract terms, and verifying that the leased aircraft meet all specified requirements. Transparency is facilitated through federal contract databases where award details are published. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse related to the contract.

Related Government Programs

Wildfire Management Support Services
Aerial Surveillance Contracts
Government Aircraft Leasing
Forestry and Land Management Equipment

Risk Flags

Potential for increased operational burden due to dry lease agreement.
Dependence on contractor for aircraft availability and condition.
Need for robust internal management of leased asset and crew.

Frequently Asked Questions

What is this federal contract paying for?

Department of Agriculture awarded $8.0 million to TENAX AEROSPACE LLC. NATIONAL AERIAL SUPERVISION MODULE (ASM) DRY LEASE AIRCRAFT

Who is the contractor on this award?

The obligated recipient is TENAX AEROSPACE LLC.

Which agency awarded this contract?

Awarding agency: Department of Agriculture (Forest Service).

What is the total obligated amount?

The obligated amount is $8.0 million.

What is the period of performance?

Start: 2024-01-01. End: 2026-12-31.

What is the specific type of aircraft being leased and its key performance characteristics?

The provided data does not specify the exact type of aircraft being leased under the NATIONAL AERIAL SUPERVISION MODULE (ASM) DRY LEASE AIRCRAFT contract. 'Dry lease' typically means the aircraft is leased without a crew or maintenance included, implying the Forest Service will provide these. Key performance characteristics such as speed, range, payload capacity, and sensor integration capabilities would be critical for aerial supervision tasks like wildfire detection and monitoring. Understanding these details is essential for a comprehensive assessment of the aircraft's suitability and the overall value proposition of the lease.

How does the lease cost compare to purchasing or leasing similar aircraft from other providers?

Benchmarking the $8.01 million lease cost against market rates for similar aircraft requires detailed specifications. A dry lease for a 3-year term (1095 days) for an aircraft suitable for aerial supervision could range significantly based on the aircraft's age, model, and capabilities. If this lease is for a specialized, high-performance aircraft, the price might be competitive. However, if it's for a more common type, further investigation into the number of bidders and their proposed prices during the full and open competition would be necessary to ascertain if this represents excellent value for money compared to alternatives or outright purchase.

What are the specific aerial supervision tasks this aircraft will be used for?

The contract title, 'NATIONAL AERIAL SUPERVISION MODULE (ASM) DRY LEASE AIRCRAFT,' suggests the primary use is for aerial supervision. This likely encompasses tasks critical to the Forest Service's mission, such as wildfire detection and monitoring, assessing fire progression, identifying potential ignition sources, and potentially supporting post-fire analysis. It could also include general land management oversight, environmental monitoring, or law enforcement support in remote areas. The 'ASM' designation might refer to a specific program or system the aircraft is intended to support.

What is Tenax Aerospace LLC's track record with similar government contracts?

Tenax Aerospace LLC has a history of performing government aviation contracts. A deeper analysis would involve reviewing their past performance evaluations, contract history, and any reported issues or successes on similar federal awards. Understanding their experience with dry aircraft leases, specialized aerial supervision missions, and their overall safety and reliability record would provide crucial context for assessing the risk associated with this current contract and the contractor's capability to meet the Forest Service's needs effectively.

What are the potential risks associated with a dry lease agreement for aerial supervision?

A primary risk of a dry lease is the government's responsibility for all operational aspects, including maintenance, crew, insurance, and regulatory compliance. This shifts the burden of ensuring airworthiness and operational readiness entirely to the Forest Service. If the agency lacks the internal expertise or resources for comprehensive aircraft management, it could lead to delays, increased costs, or safety incidents. Furthermore, securing qualified pilots and maintenance personnel can be challenging and costly, impacting the overall effectiveness and efficiency of the aerial supervision mission.

How does this contract's value compare to the Forest Service's overall budget for aviation assets?

The $8.01 million allocated for this aircraft lease represents a portion of the Forest Service's broader aviation budget, which funds a diverse fleet of aircraft for firefighting, reconnaissance, and logistical support. To assess its significance, this figure should be compared against historical spending on similar leases or aircraft acquisitions and the total annual budget for aviation operations. Understanding this context helps determine if the investment is proportionate to the agency's needs and priorities within its overall financial framework.

Industry Classification

NAICS: Real Estate and Rental and Leasing › Commercial and Industrial Machinery and Equipment Rental and Leasing › Commercial Air, Rail, and Water Transportation Equipment Rental and Leasing

Product/Service Code: NATURAL RESOURCES MANAGEMENT › NATURAL RESOURCE CONSERVERVAT SVCS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: 1202SA23R9101

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 400 W PARKWAY PL, RIDGELAND, MS, 39157

Business Categories: Category Business, Limited Liability Corporation, Partnership or Limited Liability Partnership, Self-Certified Small Disadvantaged Business, Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $13,566,210

Exercised Options: $8,018,390

Current Obligation: $8,012,667

Actual Outlays: $4,696,080

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: 1202SA23T9450

IDV Type: IDC

Timeline