Forest Service Spends $75.6M on Exclusive Helicopter Use for Wildland Firefighting

Contract Overview

Contract Amount: $75,591,975 ($75.6M)

Contractor: Erickson Incorporated

Awarding Agency: Department of Agriculture

Start Date: 2008-06-06

End Date: 2012-04-30

Contract Duration: 1,424 days

Daily Burn Rate: $53.1K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 32

Pricing Type: FIXED PRICE WITH ECONOMIC PRICE ADJUSTMENT

Sector: Transportation

Official Description: EXCLUSIVE USE HELICOPTER FOR WILDLAND FIRE SERVICES

Place of Performance

Location: CENTRAL POINT, JACKSON County, OREGON, 97502

State: Oregon Government Spending

Plain-Language Summary

Department of Agriculture obligated $75.6 million to ERICKSON INCORPORATED for work described as: EXCLUSIVE USE HELICOPTER FOR WILDLAND FIRE SERVICES Key points: 1. High cost for exclusive use of specialized aircraft. 2. Limited competition due to specific requirements. 3. Potential risk of price escalation with economic price adjustment. 4. Sector: Transportation (Air Charter)

Value Assessment

Rating: questionable

The contract price of $75.6M over 4 years for exclusive helicopter use appears high, especially considering the fixed-price nature with economic adjustments. Benchmarking against similar exclusive-use contracts for specialized aircraft is difficult without more data, but the cost per year is substantial.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

The contract was awarded under 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES,' indicating a limited competition. This method likely resulted in less price discovery and potentially higher costs compared to a truly open competition.

Taxpayer Impact: Taxpayers bear the cost of a potentially inflated price due to limited competition for essential wildland firefighting resources.

Public Impact

Ensures dedicated aerial support for critical wildland fire suppression efforts. Potential for higher costs due to exclusive use and limited competition. Economic price adjustment clause could increase final cost to taxpayers. Dependence on a single provider for specialized aerial firefighting capabilities.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

High contract value for exclusive use.
Limited competition cited.
Economic price adjustment clause.

Positive Signals

Dedicated resource for critical service.
Long-term contract provides stability.

Sector Analysis

The Forest Service operates in the transportation and emergency services sector, utilizing specialized aircraft for critical missions. Spending benchmarks for exclusive-use firefighting helicopters are not readily available but are expected to be high due to unique operational demands and aircraft.

Small Business Impact

The contract data indicates the awardee is Erickson Incorporated, a large business. There is no indication that small businesses were involved as prime contractors or significant subcontractors in this specific award.

Oversight & Accountability

The contract was awarded in 2008 and expired in 2012, suggesting it has undergone review and renewal cycles. However, the limited competition aspect warrants scrutiny regarding the justification for excluding other sources.

Related Government Programs

Nonscheduled Chartered Freight Air Transportation
Department of Agriculture Contracting
Forest Service Programs

Risk Flags

High contract value.
Limited competition.
Economic price adjustment.
Exclusive use may reduce flexibility.
Potential for vendor lock-in.

Frequently Asked Questions

What is this federal contract paying for?

Department of Agriculture awarded $75.6 million to ERICKSON INCORPORATED. EXCLUSIVE USE HELICOPTER FOR WILDLAND FIRE SERVICES

Who is the contractor on this award?

The obligated recipient is ERICKSON INCORPORATED.

Which agency awarded this contract?

Awarding agency: Department of Agriculture (Forest Service).

What is the total obligated amount?

The obligated amount is $75.6 million.

What is the period of performance?

Start: 2008-06-06. End: 2012-04-30.

What was the specific justification for excluding other sources in the competition for this exclusive-use helicopter contract?

The justification for excluding other sources would typically involve demonstrating that only a specific contractor or a limited number of contractors possess the unique capabilities, equipment, or certifications required for the specialized service. For exclusive-use firefighting helicopters, this might relate to aircraft type, payload capacity, operational range, or specific modifications for fire suppression.

How did the economic price adjustment clause impact the final cost of the contract compared to initial projections?

The economic price adjustment (EPA) clause allows for changes in contract price based on fluctuations in specific economic factors, such as labor rates, fuel costs, or material prices. Without the final contract value and the specific indices used for adjustment, it's impossible to quantify the exact impact. However, EPAs generally aim to protect contractors from unforeseen cost increases, potentially leading to higher final prices for the government.

What is the cost-effectiveness of exclusive-use contracts for essential services like wildland firefighting compared to on-demand or shared resources?

Exclusive-use contracts guarantee availability but often come at a premium price. Cost-effectiveness depends on the frequency and criticality of the service. For wildland firefighting, where immediate and consistent aerial support is vital during peak seasons, an exclusive-use contract might be deemed cost-effective if the risk of service unavailability outweighs the higher cost compared to less reliable, on-demand options.

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: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: AG-024B-C-08-9003

Offers Received: 32

Pricing Type: FIXED PRICE WITH ECONOMIC PRICE ADJUSTMENT (K)

Evaluated Preference: NONE

Contractor Details

Address: 3100 WILLOW SPRINGS RD, MEDFORD, OR, 02

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Manufacturer of Goods, Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $75,591,975

Exercised Options: $75,591,975

Current Obligation: $75,591,975

Timeline