DoD's $894M Facilities Support Contract Awarded to Aleut Global Solutions Raises Cost Concerns

Contract Overview

Contract Amount: $89,422,586 ($89.4M)

Contractor: Aleut Global Solutions, LLC

Awarding Agency: Department of Defense

Start Date: 2002-03-01

End Date: 2013-07-31

Contract Duration: 4,170 days

Daily Burn Rate: $21.4K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 6

Pricing Type: FIXED PRICE INCENTIVE

Sector: Other

Official Description: 200206!000102!5700!CA11 !50 CONS/LGCW !FA255002C0004 !A!N! !Y! !20020301!20020930!016857281!016857281!020256798!N!TEKSTAR, INCORPORATED !5540 TECH CENTER DR !COLORADO SPRIN !CO!80919!16000!041!08!COLORADO SPRINGS !EL PASO !COLORADO !+000001820228!N!N!000000000000!M127!OPERATION/ELECTRONIC & COMMUNICATION FACILITIES !C2 !CONSTRUCTION !3000!NOT DISCERNABLE OR CLASSIFIED !561210!E! !3! ! ! ! ! !99990909!B! ! !A! !A!N!L!2!006!K! !C!N!Z! ! !N!A!N!N!E! ! ! !E!A!000!A!B!N! ! ! ! ! ! !0001!

Place of Performance

Location: COLORADO SPRINGS, EL PASO County, COLORADO, 80912

State: Colorado Government Spending

Plain-Language Summary

Department of Defense obligated $89.4 million to ALEUT GLOBAL SOLUTIONS, LLC for work described as: 200206!000102!5700!CA11 !50 CONS/LGCW !FA255002C0004 !A!N! !Y! !20020301!20020930!016857281!016857281!020256798!N!TEKSTAR, INCORPORATED !5540 TECH CENTER DR !COLORADO SPRIN !CO!80919!16000!041!08!COLORADO SPRINGS !EL PA… Key points: 1. The contract's total value is substantial at $894M, indicating a significant investment in facilities support services. 2. Competition was limited, with the award going to Aleut Global Solutions, suggesting potential for higher costs. 3. The fixed-price incentive contract type introduces risk related to cost overruns if performance targets are not met. 4. The sector is Facilities Support Services, a critical but often overlooked area of government operations.

Value Assessment

Rating: questionable

The contract's total value of $894M is high for facilities support services. Benchmarking against similar contracts is difficult without more granular data on the specific services provided, but the scale suggests a need for careful cost scrutiny.

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 can restrict the pool of potential bidders and may impact price discovery, potentially leading to less competitive pricing.

Taxpayer Impact: The limited competition and the substantial contract value raise concerns about whether taxpayers received the best possible price for these essential facilities support services.

Public Impact

Taxpayers may be overpaying for facilities support due to limited competition. The long duration of the contract (over 11 years) means potential cost inefficiencies could persist. The specific services rendered under this large contract are not clearly defined, impacting public understanding of the spending.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Limited competition
High contract value
Long contract duration
Fixed-price incentive type with potential for cost overruns

Positive Signals

Awarded to a single entity, potentially streamlining service delivery
Contract type aims to incentivize performance

Sector Analysis

Facilities Support Services are crucial for maintaining government infrastructure and operational readiness. Spending in this sector can vary widely based on the scope of services, geographic distribution, and asset age. This contract represents a significant portion of spending within this niche.

Small Business Impact

The data does not indicate any specific provisions or set-asides for small businesses within this contract, suggesting that opportunities for small business participation may be limited.

Oversight & Accountability

The 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES' award method warrants further oversight to ensure fair market access and prevent potential anti-competitive practices. The long contract term also necessitates ongoing monitoring of performance and costs.

Related Government Programs

Facilities Support Services
Department of Defense Contracting
Department of the Air Force Programs

Risk Flags

Potential for overpayment due to limited competition.
High total contract value requires scrutiny.
Long contract duration (over 11 years) increases risk of cost escalation.
Lack of transparency on specific services provided.
Award method ('Exclusion of Sources') needs clear justification.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $89.4 million to ALEUT GLOBAL SOLUTIONS, LLC. 200206!000102!5700!CA11 !50 CONS/LGCW !FA255002C0004 !A!N! !Y! !20020301!20020930!016857281!016857281!020256798!N!TEKSTAR, INCORPORATED !5540 TECH CENTER DR !COLORADO SPRIN !CO!80919!16000!041!08!COLORADO SPRINGS !EL PASO !COLORADO !+000001820228!N!N!000000000000!M127!OPERATION/ELECTRONIC & COMMUNICATION FACILITIES !C2 !CONSTRUCTION !3000!NOT DISCERNABLE OR CLASSIFIED !561210!E! !3! ! ! ! ! !99990909!B

Who is the contractor on this award?

The obligated recipient is ALEUT GLOBAL SOLUTIONS, 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 $89.4 million.

What is the period of performance?

Start: 2002-03-01. End: 2013-07-31.

What specific facilities support services are included in this $894M contract, and how do they align with the agency's needs?

The contract covers 'OPERATION/ELECTRONIC & COMMUNICATION FACILITIES' and falls under the PSC code 561210 (Facilities Support Services). However, the precise breakdown of services, such as maintenance, repair, security, or specialized electronic facility operations, is not detailed in the provided data. A clearer scope definition would allow for better alignment assessment with the Department of the Air Force's operational requirements.

What is the justification for limiting competition, and how was the pricing determined to be fair and reasonable?

The award was made under 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES,' implying a specific reason for excluding other potential bidders. Understanding this justification is key. Furthermore, the process by which the $894M price was determined to be fair and reasonable, especially given the limited competition and fixed-price incentive structure, requires detailed review of cost proposals and negotiation records.

What are the performance metrics and incentive structures within the fixed-price incentive contract, and how effectively are they being monitored?

The fixed-price incentive (FPI) contract type suggests there are target costs, target profits, and share ratios for cost overruns or savings. The effectiveness of this contract hinges on robust performance metrics and diligent government oversight to ensure Aleut Global Solutions meets its obligations and that cost controls are enforced. Without insight into these specific metrics and monitoring, assessing the contract's overall effectiveness is challenging.

Industry Classification

NAICS: Administrative and Support and Waste Management and Remediation Services › Facilities Support Services › Facilities Support Services

Product/Service Code: OPERATION OF GOVT OWNED FACILITY › OPERATE GOVT OWNED BUILDINGS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 6

Pricing Type: FIXED PRICE INCENTIVE (L)

Contractor Details

Parent Company: THE Aleut Corporation (UEI: 020256798)

Address: 5540 TECH CENTER DR STE 200, COLORADO SPRINGS, CO, 05

Business Categories: Category Business, Minority Owned Business, Native American Owned Business, Small Business, Special Designations, U.S.-Owned Business

Contract Characteristics

Cost or Pricing Data: NO

Timeline