Forest Service awards $125.7M contract for exclusive large fire support helicopter services

Contract Overview

Contract Amount: $125,711,146 ($125.7M)

Contractor: Helicopter Transport Services, LLC

Awarding Agency: Department of Agriculture

Start Date: 2012-04-10

End Date: 2016-04-30

Contract Duration: 1,481 days

Daily Burn Rate: $84.9K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 18

Pricing Type: FIXED PRICE WITH ECONOMIC PRICE ADJUSTMENT

Sector: Other

Official Description: CRITICAL FUNCTIONS - NATIONAL EXCLUSIVE USE LARGE FIRE SUPPORT HELICOPTER SERVICES FOR WILDLAND FIREFIGHTING.

Place of Performance

Location: WILMINGTON, NEW CASTLE County, DELAWARE, 19808

State: Delaware Government Spending

Plain-Language Summary

Department of Agriculture obligated $125.7 million to HELICOPTER TRANSPORT SERVICES, LLC for work described as: CRITICAL FUNCTIONS - NATIONAL EXCLUSIVE USE LARGE FIRE SUPPORT HELICOPTER SERVICES FOR WILDLAND FIREFIGHTING. Key points: 1. Contract awarded via full and open competition after exclusion of sources, indicating a potentially competitive process. 2. The contract type is Fixed Price with Economic Price Adjustment, which can protect against inflation but may increase costs. 3. The duration of 1481 days suggests a long-term need for these critical firefighting assets. 4. The contractor, Helicopter Transport Services, LLC, has secured a significant award for specialized aerial support. 5. The North American Industry Classification System (NAICS) code 481212 points to nonscheduled chartered freight air transportation. 6. The contract's purpose is for national exclusive use of large fire support helicopters, highlighting its critical nature.

Value Assessment

Rating: fair

Benchmarking the value of this contract is challenging without specific performance metrics or comparable service costs. The fixed-price with economic price adjustment structure introduces potential cost variability. The significant dollar amount suggests a substantial investment in critical national infrastructure, but the value-for-money assessment hinges on the effectiveness and efficiency of the services provided over the contract's duration. Further analysis would require understanding the operational tempo and success rates of the firefighting missions supported.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

The contract was awarded under 'Full and Open Competition After Exclusion of Sources.' This suggests that while the competition was intended to be broad, certain sources may have been excluded for specific reasons, potentially limiting the full spectrum of potential bidders. The number of bidders is not specified, making it difficult to definitively assess the level of competition. This procurement approach might indicate a need for highly specialized capabilities where only a limited number of firms can meet the stringent requirements.

Taxpayer Impact: The exclusion of sources, even if justified, could potentially lead to higher prices for taxpayers if it significantly reduced the competitive landscape. A more open competition might have driven prices down.

Public Impact

Wildland firefighting efforts across the nation benefit from dedicated, exclusive-use helicopter support. The services delivered are critical for suppressing large-scale wildfires, protecting lives, property, and natural resources. The geographic impact is national, covering areas prone to wildland fires. The contract supports specialized aviation jobs within the helicopter transport industry.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns due to the economic price adjustment clause.
Limited competition due to 'exclusion of sources' could impact price discovery.
Dependence on a single contractor for exclusive national use raises concerns about service continuity if issues arise.

Positive Signals

Awarded through a competitive process, suggesting an effort to secure best value.
Addresses a critical national need for wildland firefighting support.
Long contract duration provides stability for essential services.

Sector Analysis

The aviation services sector, particularly charter and air transportation, is a significant market. This contract falls within the specialized niche of aerial firefighting support, which requires unique aircraft capabilities and operational expertise. The market for such services is often characterized by high barriers to entry due to regulatory requirements, specialized equipment, and the need for experienced personnel. The total federal spending on aviation services is substantial, and this contract represents a specific allocation towards critical emergency response capabilities.

Small Business Impact

The provided data does not indicate any small business set-aside provisions or subcontracting goals. Therefore, the direct impact on small businesses through this specific contract appears minimal. However, the prime contractor may engage small businesses for support services, though this is not explicitly detailed in the award information.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of Agriculture's Forest Service contracting officers and program managers. Accountability measures would be tied to the performance standards outlined in the contract. Transparency is generally facilitated through contract databases like FPDS, where basic award information is publicly available. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse.

Related Government Programs

Wildland Fire Management
Aviation Support Services
Emergency Response Contracts
Department of Agriculture Contracts
Forest Service Aviation

Risk Flags

Potential for limited competition due to source exclusion.
Economic price adjustment clause may lead to cost increases.
Single contractor dependency for critical national assets.

Frequently Asked Questions

What is this federal contract paying for?

Department of Agriculture awarded $125.7 million to HELICOPTER TRANSPORT SERVICES, LLC. CRITICAL FUNCTIONS - NATIONAL EXCLUSIVE USE LARGE FIRE SUPPORT HELICOPTER SERVICES FOR WILDLAND FIREFIGHTING.

Who is the contractor on this award?

The obligated recipient is HELICOPTER TRANSPORT SERVICES, LLC.

Which agency awarded this contract?

Awarding agency: Department of Agriculture (Forest Service).

What is the total obligated amount?

The obligated amount is $125.7 million.

What is the period of performance?

Start: 2012-04-10. End: 2016-04-30.

What is the historical spending trend for similar large fire support helicopter services by the Forest Service?

Analyzing historical spending trends for similar services requires accessing and aggregating data from previous contract awards for large fire support helicopters. This would involve identifying contracts with comparable scope, duration, and aircraft types over several fiscal years. Trends might reveal fluctuations in demand, changes in pricing, or shifts in contracting strategies. For instance, periods of high wildfire activity often correlate with increased contract spending. Understanding these patterns helps contextualize the current $125.7 million award, indicating whether it represents an increase, decrease, or stable level of investment in this critical capability. Without specific historical data, it's difficult to ascertain if this award is part of a growing, shrinking, or steady budget allocation for these essential services.

How does the per-hour cost of these helicopters compare to industry benchmarks for similar specialized aircraft?

Determining the per-hour cost benchmark for these helicopters requires detailed information on the specific aircraft models used, their operational configurations, and the included services (e.g., crew, maintenance, fuel). The contract type, 'Fixed Price with Economic Price Adjustment,' complicates direct hourly cost comparisons as it includes provisions for price changes. To benchmark, one would need to isolate the base hourly rate and compare it against market data for similar heavy-lift or specialized firefighting helicopters. Factors like exclusivity ('national exclusive use') can command a premium. If the contract specifies a certain number of flight hours or availability hours, the total contract value divided by those hours (adjusted for economic adjustments) can provide an average effective hourly rate. A significant deviation from established industry rates, after accounting for the unique aspects of this contract, could indicate either exceptional value or potential overpricing.

What specific risks are associated with relying on a single contractor for exclusive national use of these critical assets?

Relying on a single contractor for exclusive national use of critical assets like large fire support helicopters introduces several significant risks. Firstly, there's a risk of service disruption due to contractor-related issues such as mechanical failures, labor disputes, or financial instability. If the primary contractor experiences operational problems, there may be no immediate alternative available due to the 'exclusive use' nature of the contract, potentially leaving critical firefighting needs unmet. Secondly, the lack of direct competition during the contract's performance period could reduce the contractor's incentive to maintain optimal performance or cost efficiency. This can lead to complacency or demands for contract modifications that increase costs. Thirdly, the government's bargaining power is diminished once the contract is awarded, making renegotiations or addressing performance deficiencies more challenging. Finally, the 'exclusion of sources' in the initial competition, if not carefully managed, could mean that the chosen contractor is the only viable option, exacerbating the risks associated with single-source dependency.

What performance metrics are typically included in such contracts to ensure effectiveness and value?

Contracts for critical services like large fire support helicopter operations typically include a robust set of performance metrics to ensure effectiveness and value. These often encompass availability rates (ensuring helicopters are ready when needed), response times (how quickly they can be deployed to an incident), mission completion rates (successfully executing assigned tasks), and safety records (number of incidents or accidents). For firefighting, specific metrics might relate to the effectiveness of water or retardant drops. Fuel efficiency and adherence to maintenance schedules are also common. The contract likely specifies acceptable performance levels and outlines remedies or penalties for failing to meet these standards, such as service level credits or termination clauses. These metrics are crucial for the Forest Service to monitor contractor performance, justify expenditures, and ensure the assets are delivering the expected public benefit.

How has the Forest Service's approach to procuring aerial firefighting resources evolved over time?

The Forest Service's approach to procuring aerial firefighting resources has evolved significantly, driven by lessons learned from major fire seasons, technological advancements, and critiques of past contracting methods. Historically, the agency relied heavily on a mix of government-owned aircraft and short-term, call-when-needed contracts. However, increasing wildfire severity and duration led to a recognition of the need for more predictable access to specialized assets. This shift has involved moving towards longer-term contracts, including exclusive-use agreements like the one awarded to Helicopter Transport Services, LLC, to ensure dedicated availability. There has also been a greater emphasis on diversifying the types of aircraft procured, from large air tankers to various types of helicopters, and on improving the competitive processes to ensure fair pricing and robust capabilities. Regulatory changes and interagency coordination have also shaped procurement strategies, aiming for greater efficiency and effectiveness in managing aerial firefighting resources.

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-S-11-9001

Offers Received: 18

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

Evaluated Preference: NONE

Contractor Details

Address: 2711 CENTERVILLE RD STE 400, WILMINGTON, DE, 19808

Business Categories: Category Business, Limited Liability Corporation, Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $125,711,146

Exercised Options: $125,711,146

Current Obligation: $125,711,146

Contract Characteristics

Commercial Item: COMMERCIAL ITEM

Cost or Pricing Data: NO

Timeline