Forest Service awards $22.5M for exclusive use airtanker services, raising value-for-money questions

Contract Overview

Contract Amount: $22,474,144 ($22.5M)

Contractor: Coulson Aviation (USA), Inc.

Awarding Agency: Department of Agriculture

Start Date: 2024-05-17

End Date: 2025-12-31

Contract Duration: 593 days

Daily Burn Rate: $37.9K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 5

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: COULSON - AIRTANKER MATCO 2023 EXCLUSIVE USE TASK ORDER 160 DAY MAP

Place of Performance

Location: BOISE, ADA County, IDAHO, 83705

State: Idaho Government Spending

Plain-Language Summary

Department of Agriculture obligated $22.5 million to COULSON AVIATION (USA), INC. for work described as: COULSON - AIRTANKER MATCO 2023 EXCLUSIVE USE TASK ORDER 160 DAY MAP Key points: 1. The contract's duration and exclusive use model may limit flexibility and potentially increase costs compared to on-demand services. 2. Competition was full and open after exclusion of sources, suggesting a deliberate procurement strategy that may have impacted bidder pool. 3. The firm-fixed-price structure shifts risk to the contractor, but the overall value needs benchmarking against similar exclusive-use agreements. 4. Performance context is critical; the effectiveness of this specific airtanker in wildfire suppression will determine true value. 5. This contract falls within the broader category of aviation support services for federal agencies, particularly those involved in land management.

Value Assessment

Rating: fair

The awarded amount of $22.5 million for a 593-day period (approximately 1.6 years) for exclusive use of an airtanker requires careful benchmarking. While firm-fixed-price contracts offer cost certainty, the 'exclusive use' nature means the government pays for availability, not just usage. Without data on utilization rates or comparable exclusive-use contracts for similar aircraft types and service levels, assessing the value for money is challenging. It's essential to compare this to the cost of on-demand services or other exclusive-use agreements to determine if this represents a competitive price for guaranteed availability.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under 'Full and Open Competition After Exclusion of Sources.' This specific designation suggests that while the competition was intended to be broad, certain sources may have been excluded prior to the solicitation, potentially narrowing the field of eligible bidders. The presence of 5 bidders indicates a degree of competition, but the 'exclusion of sources' clause warrants further investigation to understand its impact on the competitive landscape and potential price discovery.

Taxpayer Impact: The competitive process, even with exclusions, aimed to secure the best value for taxpayers. The number of bidders suggests that multiple companies were interested and capable, which generally supports competitive pricing. However, the specifics of the exclusion could have influenced the final price achieved.

Public Impact

The primary beneficiaries are the Department of Agriculture's Forest Service and other federal or state agencies requiring aerial firefighting capabilities. The service delivered is the availability of a dedicated airtanker for wildfire suppression and other emergency response missions. The geographic impact is likely focused on regions prone to wildfires, particularly within the Forest Service's operational areas, with Idaho noted as the state of performance. Workforce implications include the pilots, ground crews, and support personnel required to operate and maintain the airtanker.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for underutilization of the exclusive-use asset, leading to higher per-hour costs if not fully deployed.
The 'exclusion of sources' in the competition method could limit the diversity of bidders and potentially impact price competitiveness.
Reliance on a single exclusive-use asset may pose risks if maintenance issues or unforeseen events ground the aircraft.
The firm-fixed-price nature, while providing cost certainty, might not be the most economical if actual usage is low.

Positive Signals

Firm-fixed-price contract shifts cost overrun risk to the contractor.
Exclusive use guarantees availability during critical periods, which is crucial for wildfire suppression.
The contract was awarded through a competitive process, indicating multiple interested parties.
The duration of the contract provides a stable period for service delivery.

Sector Analysis

This contract falls within the aviation services sector, specifically focusing on specialized aerial support for government operations. The market for large airtankers is relatively concentrated, with a limited number of operators capable of meeting stringent federal requirements. Spending in this area is often driven by seasonal needs, such as wildfire seasons, and the government's strategy for maintaining aerial firefighting readiness. Comparable benchmarks would involve analyzing other exclusive-use contracts for similar aircraft or on-demand charter rates for firefighting aircraft.

Small Business Impact

There is no indication that this contract includes a small business set-aside. Given the specialized nature and high cost of exclusive-use airtanker services, it is unlikely that small businesses would be primary contractors for this type of award. Subcontracting opportunities for small businesses might exist in areas such as maintenance, logistics, or support services, but this would depend on the prime contractor's strategy.

Oversight & Accountability

Oversight for this contract would primarily reside with the U.S. Forest Service contracting officers and program managers. Accountability measures are embedded in the contract's performance work statement, requiring the contractor to meet specific availability and operational standards. Transparency is facilitated through contract databases like FPDS, where basic award information is publicly available. Inspector General jurisdiction would apply if any allegations of fraud, waste, or abuse arise.

Related Government Programs

Wildfire Suppression Services
Aviation Support Contracts
Department of Agriculture Procurement
Forest Service Operations
Emergency Response Aircraft

Risk Flags

Potential for limited competition due to 'exclusion of sources' clause.
Risk of underutilization of exclusive-use asset.
Dependence on a single asset for critical service.
Need for detailed benchmarking of value-for-money.

Frequently Asked Questions

What is this federal contract paying for?

Department of Agriculture awarded $22.5 million to COULSON AVIATION (USA), INC.. COULSON - AIRTANKER MATCO 2023 EXCLUSIVE USE TASK ORDER 160 DAY MAP

Who is the contractor on this award?

The obligated recipient is COULSON AVIATION (USA), INC..

Which agency awarded this contract?

Awarding agency: Department of Agriculture (Forest Service).

What is the total obligated amount?

The obligated amount is $22.5 million.

What is the period of performance?

Start: 2024-05-17. End: 2025-12-31.

What is the historical spending pattern for exclusive use airtanker contracts by the Forest Service?

Historical spending on exclusive use airtanker contracts by the Forest Service has varied significantly year-to-year, largely influenced by wildfire activity and strategic decisions regarding fleet readiness. The Forest Service has historically utilized a mix of exclusive-use contracts (guaranteeing availability) and call-when-needed (on-demand) contracts. Exclusive-use contracts provide cost certainty and guaranteed availability, which is critical during peak fire seasons, but can be more expensive if the aircraft is not fully utilized. On-demand contracts offer flexibility and potentially lower costs if demand is low, but risk availability during high-demand periods. Analyzing past awards reveals trends in contract duration, aircraft types, and total obligated amounts, often showing spikes in spending during severe fire years. For instance, in years with extensive wildfire seasons, the agency may increase its reliance on exclusive-use assets to ensure immediate response capabilities, leading to higher aggregate spending in that category. Conversely, leaner fire seasons might see a reduction in exclusive-use commitments.

How does the cost per operational hour for this exclusive use contract compare to industry benchmarks for similar aircraft?

Determining the precise cost per operational hour for this specific contract requires detailed utilization data, which is not publicly available. However, we can make an informed comparison based on the total award amount and contract duration. The contract is valued at $22,474,144.33 over 593 days (approximately 19.77 months or 1.65 years). If we assume a standard operational year of 200-250 flight days for such assets, the daily rate is roughly $1,136,778. If the aircraft operates for, say, 220 days a year, the annual cost is approximately $13,577,000, leading to an approximate operational cost of $61,713 per day or $3,085 per hour (assuming 20 hours of operation per day, which is high but reflects availability). Industry benchmarks for exclusive-use large airtankers can range widely, from $20,000 to $50,000+ per hour, depending on the aircraft type, age, modifications, and specific service inclusions (e.g., maintenance, crew, insurance). The calculated rate here seems low if interpreted as a per-hour operating cost, suggesting the $22.5M is primarily for guaranteed availability rather than direct flight hours. A more appropriate comparison would be the daily availability cost, which needs to be benchmarked against similar exclusive-use agreements.

What are the potential risks associated with relying on a single exclusive-use airtanker for a 593-day period?

Relying on a single exclusive-use airtanker for an extended period of 593 days presents several potential risks. Firstly, there is the risk of 'grounding' due to mechanical failure, unscheduled maintenance, or accidents. If this primary asset becomes unavailable, the Forest Service may face significant delays in response or need to scramble for alternative, potentially more expensive, on-demand resources, which might not be readily available during peak demand. Secondly, the 'exclusive use' model means the government pays for the aircraft's availability regardless of actual flight hours. If wildfire activity is low during portions of the contract period, the government might be paying a premium for an asset that is not being fully utilized, representing a potential inefficiency or poor value for money. Thirdly, the specific capabilities of this single airtanker might not be optimal for all types of fires or terrains encountered, limiting tactical flexibility. Finally, the contractor might face personnel or logistical challenges over such a long duration, potentially impacting operational readiness.

How does the 'Full and Open Competition After Exclusion of Sources' procurement method impact the overall cost-effectiveness?

The 'Full and Open Competition After Exclusion of Sources' (F&O CAES) method is a nuanced approach to procurement. It aims to achieve the benefits of full and open competition while acknowledging that certain sources might be excluded for specific, justifiable reasons (e.g., national security, proprietary technology, or prior performance issues). The impact on cost-effectiveness is twofold. On one hand, by allowing multiple bidders (in this case, five), it fosters price competition, which generally drives down costs and improves value for taxpayers. On the other hand, the 'exclusion of sources' element means the potential bidder pool is smaller than in a truly unrestricted full and open competition. If the excluded sources represent significant market players or offer unique capabilities, their absence could potentially reduce the intensity of competition and lead to a higher-than-optimal price. The effectiveness of F&O CAES hinges on the justification for exclusions; if exclusions are minimal and well-reasoned, it can yield competitive prices. If exclusions are broad or arbitrary, it could inadvertently limit competition and increase costs.

What is the typical performance track record of Coulson Aviation (USA), Inc. in similar federal contracts?

Coulson Aviation (USA), Inc. is a known provider of aerial firefighting and aviation services, including large airtankers, to various government agencies. Their track record with federal contracts, particularly with entities like the U.S. Forest Service and other land management agencies, generally involves the operation and maintenance of specialized aircraft. Performance reviews and past contract data (available through sources like the Federal Procurement Data System - FPDS) would provide specific insights into their on-time delivery, safety record, aircraft availability, and responsiveness to mission requirements. Companies in this sector often have a history of both successful operations and occasional challenges related to aircraft maintenance, regulatory compliance, or operational incidents, which are inherent risks in high-stakes aviation. A detailed review of their past performance ratings, any contract disputes, or corrective actions would be necessary for a comprehensive assessment of their reliability and capability for this specific task order.

Industry Classification

NAICS: Transportation and Warehousing › Nonscheduled Air Transportation › Nonscheduled Chartered Freight Air Transportation

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

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: FS-AT23-EU-01

Offers Received: 5

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 1200 NW NAITO PKWY STE 200, PORTLAND, OR, 97209

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Foreign Owned, Foreign-Owned and U.S.-Incorporated Business, Small Business, Special Designations

Financial Breakdown

Contract Ceiling: $57,206,294

Exercised Options: $23,669,974

Current Obligation: $22,474,144

Actual Outlays: $22,398,685

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: 1202SA23T9103

IDV Type: IDC

Timeline