DoD Awards $36.6M for Peterson SFB Building Conversion, Raising Questions on Competition and Value

Contract Overview

Contract Amount: $36,595,583 ($36.6M)

Contractor: Olgoonik Enterprises, LLC

Awarding Agency: Department of Defense

Start Date: 2023-08-01

End Date: 2027-04-26

Contract Duration: 1,364 days

Daily Burn Rate: $26.8K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: TDKA 22-1007 PROJECT AT PETERSON SPACE FORCE BASE, CO., TO CONVERT/REPAIR BUILDING 845 TO OPERATIONAL TESTING AND TRAINING INFRASTRUCTURE (OTTI) MISSION SPACE, DELTA BEDDOWN

Place of Performance

Location: COLORADO SPRINGS, EL PASO County, COLORADO, 80914

State: Colorado Government Spending

Plain-Language Summary

Department of Defense obligated $36.6 million to OLGOONIK ENTERPRISES, LLC for work described as: TDKA 22-1007 PROJECT AT PETERSON SPACE FORCE BASE, CO., TO CONVERT/REPAIR BUILDING 845 TO OPERATIONAL TESTING AND TRAINING INFRASTRUCTURE (OTTI) MISSION SPACE, DELTA BEDDOWN Key points: 1. Significant investment in critical infrastructure for testing and training. 2. Competition method raises concerns about potential price discovery limitations. 3. Firm Fixed Price contract type offers cost certainty but may limit flexibility. 4. Project duration of nearly four years suggests complex scope or potential delays.

Value Assessment

Rating: questionable

The award of $36.6 million for building conversion appears high compared to typical commercial and institutional building construction projects of similar scope. Benchmarking against similar DoD infrastructure projects is needed to assess value.

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 may have restricted the pool of potential bidders, potentially impacting price competitiveness and the government's ability to secure the best possible price.

Taxpayer Impact: The limited competition raises concerns about whether taxpayers received the best value for this significant investment. Further analysis is needed to determine if the pricing reflects a competitive market.

Public Impact

Enhances operational testing and training capabilities at Peterson Space Force Base. Supports the Department of the Air Force's infrastructure modernization efforts. Potential for job creation in the Colorado construction sector. Long-term project duration could impact base operations or require phased implementation.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Limited competition raises value concerns.
Long project duration may indicate scope creep or delays.
Exclusion of sources needs justification for fairness.

Positive Signals

Addresses critical infrastructure needs.
Firm Fixed Price contract provides cost predictability.
Supports military readiness and training.

Sector Analysis

This project falls under Commercial and Institutional Building Construction. While specific benchmarks for OTII mission spaces are not readily available, the $36.6 million award for a nearly four-year project is substantial and warrants scrutiny against broader construction spending trends.

Small Business Impact

The contract was awarded to Olgoonik Enterprises, LLC, which is noted as not being a small business. There is no indication of subcontracting goals for small businesses in the provided data, suggesting limited direct benefit to the small business sector from this prime contract.

Oversight & Accountability

The award method, 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES,' requires careful oversight to ensure fairness and prevent undue restrictions on competition. The long duration of the contract also necessitates robust oversight to manage performance and costs effectively.

Related Government Programs

Commercial and Institutional Building Construction
Department of Defense Contracting
Department of the Air Force Programs

Risk Flags

Limited competition may result in inflated costs.
Long project duration increases risk of cost overruns and schedule delays.
Lack of small business subcontracting opportunities.
Justification for source exclusion needs thorough review.
Potential for scope creep over the extended contract period.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $36.6 million to OLGOONIK ENTERPRISES, LLC. TDKA 22-1007 PROJECT AT PETERSON SPACE FORCE BASE, CO., TO CONVERT/REPAIR BUILDING 845 TO OPERATIONAL TESTING AND TRAINING INFRASTRUCTURE (OTTI) MISSION SPACE, DELTA BEDDOWN

Who is the contractor on this award?

The obligated recipient is OLGOONIK ENTERPRISES, LLC.

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Air Force).

What is the total obligated amount?

The obligated amount is $36.6 million.

What is the period of performance?

Start: 2023-08-01. End: 2027-04-26.

What specific criteria led to the exclusion of certain sources, and how was the fairness of the limited competition ensured?

The exclusion of sources typically occurs when specific capabilities or security clearances are required that only a limited number of contractors possess. Ensuring fairness involves a documented justification process, adherence to federal acquisition regulations, and potentially a review by oversight bodies to confirm that the exclusion was necessary and did not unduly restrict competition.

How does the $36.6 million cost compare to similar building conversion projects for operational testing and training infrastructure within the DoD or other federal agencies?

Benchmarking this cost against similar projects is crucial for assessing value. Without specific comparative data, it's difficult to definitively state if the price is reasonable. Factors like specialized equipment, unique security requirements, and the specific scope of work for OTII mission spaces would need to be considered in any comparison.

What mechanisms are in place to monitor and control costs and schedule over the 1364-day duration of this firm-fixed-price contract?

Even with a firm-fixed-price contract, robust oversight is essential. Mechanisms include regular progress reviews, site inspections, performance metrics tracking, and change order management. The government should actively monitor the contractor's performance against the baseline schedule and budget to identify potential issues early and mitigate risks.

Industry Classification

NAICS: Construction › Nonresidential Building Construction › Commercial and Institutional Building Construction

Product/Service Code: MAINT, REPAIR, ALTER REAL PROPERTY › MAINT, ALTER, REPAIR NONBUILDINGS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 411 S TEJON ST STE G, COLORADO SPRINGS, CO, 80903

Business Categories: 8(a) Program Participant, Alaskan Native Corporation Owned Firm, Category Business, Corporate Entity Not Tax Exempt, Limited Liability Corporation, Minority Owned Business, Native American Owned Business, Self-Certified Small Disadvantaged Business, Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $36,595,583

Exercised Options: $36,595,583

Current Obligation: $36,595,583

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: FA251720D0004

IDV Type: IDC

Timeline