Forest Service awarded $213M for large airtanker services, with Neptune Aviation Services securing the contract

Contract Overview

Contract Amount: $213,318,007 ($213.3M)

Contractor: Neptune Aviation Services, Inc.

Awarding Agency: Department of Agriculture

Start Date: 2013-03-27

End Date: 2017-12-31

Contract Duration: 1,740 days

Daily Burn Rate: $122.6K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 3

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: IGF::CT::IGF CRITICAL FUNCTION- LARGE FIXED WING AIRTANKER

Place of Performance

Location: MISSOULA, MISSOULA County, MONTANA, 59808

State: Montana Government Spending

Plain-Language Summary

Department of Agriculture obligated $213.3 million to NEPTUNE AVIATION SERVICES, INC. for work described as: IGF::CT::IGF CRITICAL FUNCTION- LARGE FIXED WING AIRTANKER Key points: 1. The contract's firm-fixed-price structure provides cost certainty for the Forest Service. 2. Full and open competition was utilized, indicating a broad market solicitation. 3. The contract duration of 1740 days suggests a long-term need for these critical services. 4. The award to Neptune Aviation Services represents a significant investment in aerial firefighting capabilities. 5. The geographic location of the contractor in Montana may influence operational response times. 6. The absence of small business set-asides means opportunities for smaller firms are not explicitly prioritized in this award.

Value Assessment

Rating: good

The contract's total value of $213.3 million over approximately 4.7 years suggests a substantial but potentially reasonable cost for critical aerial firefighting services. Benchmarking against similar large airtanker contracts would be necessary for a definitive value assessment. The firm-fixed-price nature of the contract helps manage cost risks for the government, assuming the scope of work is well-defined. The price per day or per flight hour would be a key metric for detailed value analysis.

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,' which implies that while the initial solicitation was broad, specific sources may have been excluded based on pre-defined criteria. The presence of 3 bidders indicates a degree of competition, though the exact number of interested parties and the reasons for exclusion of others would provide further clarity on the competitive landscape. A higher number of bidders generally leads to better price discovery.

Taxpayer Impact: The use of full and open competition aims to ensure that taxpayers receive the best possible value by encouraging a wide range of qualified contractors to bid, driving down prices through market forces.

Public Impact

The primary beneficiaries are the US Forest Service and the public, through enhanced wildfire suppression capabilities. The services delivered are critical for combating large-scale wildfires, protecting lives, property, and natural resources. The geographic impact is national, with airtankers deployed to areas experiencing significant wildfire activity. The contract supports a specialized workforce in aviation and firefighting, contributing to the skilled labor market in these sectors.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if operational demands exceed initial projections within the fixed-price structure.
Dependence on a limited number of bidders could indicate market concentration risks.
Geographic concentration of the contractor may lead to extended response times in certain regions.
The 'after exclusion of sources' clause warrants scrutiny to ensure fair competition.

Positive Signals

Firm-fixed-price contract provides budget certainty.
Full and open competition generally promotes competitive pricing.
Long contract duration indicates a stable, ongoing need for these services.
The contractor is a known entity in the aerial firefighting sector.

Sector Analysis

This contract falls within the aviation services sector, specifically focusing on specialized aerial firefighting. The market for large airtankers is relatively niche, dominated by a few key providers capable of meeting stringent operational and safety requirements. Spending in this area is directly tied to wildfire seasons and the agency's strategy for resource allocation in fire suppression. Comparable spending benchmarks would likely involve analyzing contracts for similar aircraft types and service levels across different federal and state agencies.

Small Business Impact

The contract details indicate that small business participation was not a primary set-aside consideration for this specific award, as 'sb' is false. This suggests that the primary focus was on securing specialized, large-scale aerial firefighting capabilities from established providers. While there might be opportunities for small businesses to subcontract indirectly, the prime contract itself does not appear to be structured to directly benefit the small business ecosystem.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of Agriculture's Forest Service contracting officers and program managers. Accountability measures are embedded in the contract's performance standards and delivery requirements. Transparency is facilitated through contract award databases like FPDS. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse related to the contract's execution.

Related Government Programs

Wildfire Management Programs
Aviation Support Services
Emergency Response Contracts
Department of the Interior Air Operations

Risk Flags

Limited number of bidders
Potential for sole-source if competition fails
High operational risk
Dependence on specialized assets

Frequently Asked Questions

What is this federal contract paying for?

Department of Agriculture awarded $213.3 million to NEPTUNE AVIATION SERVICES, INC.. IGF::CT::IGF CRITICAL FUNCTION- LARGE FIXED WING AIRTANKER

Who is the contractor on this award?

The obligated recipient is NEPTUNE AVIATION SERVICES, INC..

Which agency awarded this contract?

Awarding agency: Department of Agriculture (Forest Service).

What is the total obligated amount?

The obligated amount is $213.3 million.

What is the period of performance?

Start: 2013-03-27. End: 2017-12-31.

What is Neptune Aviation Services' track record with large airtanker contracts, particularly with federal agencies?

Neptune Aviation Services has a significant history in providing large airtanker services, including contracts with the US Forest Service. They operate a fleet of P-3 Orion and BAe 146 aircraft, which are commonly used for aerial firefighting. Their experience typically involves meeting rigorous performance, safety, and maintenance standards required by federal agencies. Past performance reviews and any documented issues or commendations would provide a fuller picture of their reliability and effectiveness in fulfilling similar large-scale contracts. Information on their operational uptime, incident response times, and safety record would be crucial for a comprehensive assessment.

How does the awarded price compare to market rates for similar large airtanker services?

Determining the precise market rate comparison for this $213.3 million contract requires detailed analysis of per-hour or per-mission costs, aircraft type, capacity, and operational support included. Large airtankers are highly specialized assets, and their operational costs (fuel, maintenance, crew, insurance) are substantial. Industry reports and analyses of other federal or state contracts for similar aircraft (e.g., P-3s, BAe 146s) would be necessary benchmarks. Given the firm-fixed-price nature, the government has a degree of certainty, but understanding the contractor's cost structure and profit margin relative to industry norms is key to assessing value for money. Without specific per-unit cost data, a definitive comparison is challenging.

What are the primary risks associated with this contract and the contractor's performance?

Key risks include potential operational failures or accidents involving the aircraft, which could lead to loss of life, property damage, and disruption of firefighting efforts. Performance risks involve the contractor's ability to maintain aircraft readiness and deploy them effectively during peak wildfire seasons. There's also a risk of cost escalation if unforeseen maintenance issues arise, although the firm-fixed-price structure aims to mitigate this for the government. Market concentration, where only a few companies can provide these specialized services, could also pose a risk if Neptune Aviation Services faces significant operational challenges, limiting available alternatives.

How effective has the Forest Service been in leveraging competition for large airtanker services over time?

The Forest Service has historically utilized competitive bidding for large airtanker services, often employing full and open competition. However, the market for these specialized assets is inherently limited, meaning the number of bidders can fluctuate. The agency has faced challenges in ensuring consistent competition and availability of assets, sometimes leading to sole-source or limited-competition awards when critical needs arise and few qualified providers exist. Analyzing historical contract awards, the number of bidders per solicitation, and contract values over time would reveal trends in competition effectiveness and potential market consolidation.

What is the historical spending pattern for large airtanker services by the Forest Service?

The Forest Service's spending on large airtanker services has varied significantly year-to-year, largely dependent on the severity of wildfire seasons and the agency's strategic approach to resource acquisition. Historically, the agency has entered into multi-year contracts to secure a reliable fleet. Spending has often been in the tens to hundreds of millions of dollars annually, reflecting the high operational costs and critical nature of these assets. Fluctuations can also be attributed to changes in contracting strategies, such as transitioning from exclusive-use contracts to call-when-needed models or vice-versa, and the availability of federal appropriations.

What are the implications of the 'after exclusion of sources' clause on competition and cost?

The 'Full and Open Competition After Exclusion of Sources' clause indicates that while the initial solicitation was broad, certain potential offerors were excluded based on specific criteria established prior to the final award. This exclusion could be due to factors like past performance issues, inability to meet specific technical requirements, or other pre-defined government needs. While it aims to ensure only qualified and suitable contractors are considered, it can limit the pool of competitors. If the excluded sources were capable and competitive, their exclusion might reduce overall competition, potentially impacting price discovery and leading to higher costs for the government compared to a truly unrestricted full and open competition.

Industry Classification

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

Product/Service Code: TRANSPORT, TRAVEL, RELOCATION › TRAVEL, LODGING, RECRUITMENT SVCS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: AG-024B-S-12-9026

Offers Received: 3

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 2 CORPORATE WAY, MISSOULA, MT, 59808

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Small Business, Special Designations, Subchapter S Corporation, U.S.-Owned Business, Woman Owned Business

Financial Breakdown

Contract Ceiling: $213,318,007

Exercised Options: $213,318,007

Current Obligation: $213,318,007

Contract Characteristics

Multi-Year Contract: Yes

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline