Defense Logistics Agency awards $1.8B contract for fuel storage buildings, with a 10-year duration

Contract Overview

Contract Amount: $18,096,707 ($18.1M)

Contractor: LB & B Associates Inc

Awarding Agency: Department of Defense

Start Date: 2001-10-01

End Date: 2012-03-31

Contract Duration: 3,834 days

Daily Burn Rate: $4.7K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 10

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: 200504!006118!97AS!SP0600!DEFENSE ENERGY SUPPORT CENTER !SP060001D5115 !A!N! !Y! !P00018!20050111!20050930!793374034!793374034!793374034!N!L B & B ASSOCIATES INC !9891 BROKENLAND PKWY !COLUMBIA !MD!21046!24500!001!32!FALLON NAS !CHURCHILL !NEVADA !+000000007136!N!N!000000000000!X173!LEASE/FUEL STORAGE BUILDINGS !S1 !SERVICES !000 !* !484220!E! !3!A!S!C! ! !20200930!B! ! !A! !A!U!J!2!010!B! !C!N!Z! ! !N!C!N! ! ! !C!D!A!A!000!A!C!N! ! ! ! ! ! !0001! !

Place of Performance

Location: FALLON, CHURCHILL County, NEVADA, 89496

State: Nevada Government Spending

Plain-Language Summary

Department of Defense obligated $18.1 million to LB & B ASSOCIATES INC for work described as: 200504!006118!97AS!SP0600!DEFENSE ENERGY SUPPORT CENTER !SP060001D5115 !A!N! !Y! !P00018!20050111!20050930!793374034!793374034!793374034!N!L B & B ASSOCIATES INC !9891 BROKENLAND PKWY !COLUMBIA !MD!21046!24500!001!32!FALLON NAS !CHUR… Key points: 1. Contract value of $1.8B over 10 years suggests significant investment in critical infrastructure. 2. Full and open competition indicates a potentially competitive bidding process, which can drive better pricing. 3. The contract's long duration may present risks related to changing technological needs or market conditions. 4. Performance context is tied to Fallon NAS, highlighting a specific operational requirement. 5. Sector positioning within Defense Logistics Agency points to a focus on supply chain and support services. 6. The contract's value and duration suggest a substantial commitment to facility maintenance and readiness.

Value Assessment

Rating: good

The contract value of $1.8 billion over 10 years for fuel storage buildings is substantial. Benchmarking this against similar infrastructure projects within the Department of Defense is challenging without more specific cost breakdowns. However, the firm fixed-price nature of the contract suggests that the contractor bears the risk of cost overruns, which can be a positive indicator for value if the scope is well-defined. The duration implies a long-term need for these facilities.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, suggesting that multiple bidders were likely considered. This level of competition is generally favorable for price discovery and can lead to more competitive pricing for the government. The number of bidders (10) further supports the notion of a robust competitive environment for this significant contract.

Taxpayer Impact: Full and open competition with 10 bidders is a positive sign for taxpayers, as it increases the likelihood of securing services at a fair market price and reduces the risk of inflated costs due to limited options.

Public Impact

The primary beneficiaries are the Department of Defense and its personnel, ensuring the availability of essential fuel storage facilities. Services delivered include the construction, maintenance, or leasing of fuel storage buildings, critical for military operations. Geographic impact is centered around Fallon NAS in Nevada, supporting its operational readiness. Workforce implications may include jobs in construction, facility management, and related support services, both for the prime contractor and potentially for subcontractors.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Long-term contract duration (10 years) could lead to vendor lock-in or reduced flexibility if needs change.
Firm fixed-price contracts can sometimes incentivize cost-cutting that might impact quality if not closely monitored.
Reliance on a single large contract for such a critical asset might pose a risk if the contractor faces financial or operational difficulties.

Positive Signals

Full and open competition with 10 bidders suggests a healthy market and potential for competitive pricing.
The firm fixed-price contract structure shifts cost overrun risk to the contractor.
The contract's long duration indicates a stable, long-term requirement, providing predictability for both the agency and the contractor.

Sector Analysis

This contract falls within the Defense sector, specifically related to logistics and infrastructure support. The market for defense logistics and facility management is substantial, with significant government spending allocated annually. This contract represents a large portion of spending for fuel storage infrastructure at a specific naval installation, fitting within the broader trend of maintaining and upgrading military facilities to ensure operational readiness.

Small Business Impact

The data indicates this contract was not specifically set aside for small businesses, and the prime contractor, LB & B ASSOCIATES INC, is likely a larger entity given the contract value. There is no explicit information on subcontracting plans for small businesses within this data. The impact on the small business ecosystem would depend on whether LB & B Associates Inc. actively seeks small business subcontractors for specialized services or supplies.

Oversight & Accountability

Oversight for this contract would typically be managed by the Defense Logistics Agency (DLA) contracting officers and program managers. Accountability measures would be embedded in the contract's performance work statement and reporting requirements. Transparency is facilitated through contract award databases like FPDS. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Defense Logistics Agency Contracts
Naval Facilities Engineering Command Contracts
Fuel Storage and Distribution Infrastructure
Base Operations Support Contracts
Department of Defense Real Property Management

Risk Flags

Long contract duration may increase risk of obsolescence or changing requirements.
Firm fixed-price contracts can sometimes lead to quality compromises if not managed carefully.
Dependence on a single large contract for critical infrastructure.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $18.1 million to LB & B ASSOCIATES INC. 200504!006118!97AS!SP0600!DEFENSE ENERGY SUPPORT CENTER !SP060001D5115 !A!N! !Y! !P00018!20050111!20050930!793374034!793374034!793374034!N!L B & B ASSOCIATES INC !9891 BROKENLAND PKWY !COLUMBIA !MD!21046!24500!001!32!FALLON NAS !CHURCHILL !NEVADA !+000000007136!N!N!000000000000!X173!LEASE/FUEL STORAGE BUILDINGS !S1 !SERVICES !000 !* !484220!E! !3!A!S!C! ! !202

Who is the contractor on this award?

The obligated recipient is LB & B ASSOCIATES INC.

Which agency awarded this contract?

Awarding agency: Department of Defense (Defense Logistics Agency).

What is the total obligated amount?

The obligated amount is $18.1 million.

What is the period of performance?

Start: 2001-10-01. End: 2012-03-31.

What is the historical spending pattern for fuel storage building contracts by the Defense Logistics Agency?

Analyzing historical spending for fuel storage building contracts by the Defense Logistics Agency (DLA) requires examining contract databases over several fiscal years. While this specific contract awarded in 2001 for $1.8 billion is a significant data point, understanding the broader pattern involves looking at the frequency, value, and duration of similar awards. DLA's spending in this area is driven by the need to maintain and upgrade critical fuel infrastructure across various military installations. Trends might show an increase in spending due to aging facilities, new environmental regulations, or evolving fuel types. Comparing the average contract value and duration over time can reveal whether this $1.8 billion award is an outlier or representative of larger, long-term investments in fuel storage capabilities. Factors such as full and open competition versus sole-source awards also influence spending patterns and overall cost-effectiveness.

How does the per-unit cost of this contract compare to similar fuel storage building projects?

Determining the per-unit cost for this $1.8 billion contract is challenging without a detailed breakdown of what constitutes a 'unit' (e.g., per gallon of storage capacity, per building, per square foot). However, if we assume the contract covers a significant number of buildings or a large storage capacity, the average cost per unit would need to be benchmarked against industry standards and comparable government contracts. For instance, if the contract is for building construction, costs could be compared to per-square-foot construction rates for industrial facilities in Nevada. If it involves leasing, it would be compared to market rental rates for similar storage. Given the firm fixed-price nature and full competition, the DLA likely aimed for competitive per-unit pricing. However, without specific metrics like storage volume or building specifications, a precise comparison to market rates or similar contracts remains difficult.

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

Key Performance Indicators (KPIs) for a contract involving fuel storage buildings would typically focus on reliability, safety, compliance, and cost-effectiveness. For LB & B ASSOCIATES INC, success would likely be measured by the operational availability of the storage facilities, adherence to strict safety and environmental regulations (e.g., spill prevention, emissions control), timely completion of any construction or maintenance tasks, and maintaining the facilities within the agreed-upon budget. Performance metrics might include uptime percentages for storage systems, number of safety incidents (ideally zero), compliance audit results, and responsiveness to maintenance requests. The government would monitor these KPIs through regular reporting, site inspections, and performance reviews to ensure the contractor is meeting the terms of the firm fixed-price contract and fulfilling the critical mission requirements for fuel storage at Fallon NAS.

What is the track record of LB & B ASSOCIATES INC with similar large-scale defense infrastructure contracts?

Evaluating the track record of LB & B ASSOCIATES INC for similar large-scale defense infrastructure contracts is crucial for assessing their capability to manage a $1.8 billion, 10-year agreement. Information on their past performance, including the size and complexity of previous projects, their on-time and on-budget delivery history, and any past performance issues or disputes, would be essential. While this data indicates they were awarded this significant contract, a deeper dive into their portfolio would reveal if they have successfully executed comparable projects in terms of scale, technical requirements (e.g., hazardous material storage), and duration. Positive past performance on similar contracts would increase confidence in their ability to meet the requirements of this fuel storage facility agreement, whereas a history of challenges might raise concerns about execution risk.

What are the potential risks associated with the 10-year duration of this contract?

The 10-year duration of this $1.8 billion contract for fuel storage buildings presents several potential risks. Firstly, technological advancements in fuel storage or monitoring could render the contracted facilities or systems outdated before the contract term ends, leading to reduced efficiency or the need for costly modifications. Secondly, environmental regulations are subject to change, and the facilities may need to be upgraded to meet new standards, potentially incurring unforeseen costs. Thirdly, the long-term nature could lead to 'vendor lock-in,' making it difficult and expensive to switch providers or adopt new solutions if LB & B ASSOCIATES INC's performance declines or market alternatives become significantly more advantageous. Finally, the extended period increases the exposure to economic fluctuations, potential contractor financial instability, or shifts in military operational requirements that might alter the need for these specific facilities.

How does this contract align with the broader strategic goals of the Defense Logistics Agency?

This contract aligns with the Defense Logistics Agency's (DLA) strategic goals by ensuring the reliable and secure storage of fuel, which is a critical enabler for military operations worldwide. DLA's mission includes providing logistics support to the armed forces, and maintaining robust fuel infrastructure is fundamental to this. By awarding a long-term contract for fuel storage buildings at Fallon NAS, DLA is investing in the necessary infrastructure to support readiness and operational capability. This ensures that fuel is available when and where needed, supporting training exercises and deployments. The focus on a specific installation like Fallon NAS suggests a targeted approach to bolstering regional or specific operational support, contributing to the overall resilience and effectiveness of the defense supply chain.

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 10

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 9891 BROKEN LAND PARKWAY,, COLUMBIA, MD, 03

Business Categories: Category Business, Not Designated a Small Business

Contract Characteristics

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: SP060001D5115

IDV Type: IDC

Timeline