DoD awards $106.1M for Tinian pavement and transportation support, with Fluor Intercontinental Inc. as prime

Contract Overview

Contract Amount: $106,100,000 ($106.1M)

Contractor: Fluor Intercontinental, Inc

Awarding Agency: Department of Defense

Start Date: 2024-05-02

End Date: 2029-04-30

Contract Duration: 1,824 days

Daily Burn Rate: $58.2K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: COST PLUS FIXED FEE

Sector: Other

Official Description: PAVEMENT AND TRANSPORTATION SUPPORT, NORTH FIELD, TINIAN, CNMI

Place of Performance

Location: PANAMA CITY, BAY County, FLORIDA, 32403

State: Florida Government Spending

Plain-Language Summary

Department of Defense obligated $106.1 million to FLUOR INTERCONTINENTAL, INC for work described as: PAVEMENT AND TRANSPORTATION SUPPORT, NORTH FIELD, TINIAN, CNMI Key points: 1. Contract value of $106.1M over 5 years suggests significant investment in infrastructure. 2. Full and open competition indicates a potentially competitive bidding process. 3. The contract type (Cost Plus Fixed Fee) may lead to cost overruns if not managed carefully. 4. Performance period of 1824 days (approx. 5 years) allows for sustained support. 5. The North American Industry Classification System (NAICS) code 561210 points to facilities support services. 6. The contract is not set aside for small businesses, suggesting large prime contractor involvement.

Value Assessment

Rating: fair

Benchmarking this contract's value is challenging without specific details on the scope of 'pavement and transportation support' in Tinian. However, a $106.1M award over five years for facilities support services in a remote location like Tinian, CNMI, suggests a substantial investment. The Cost Plus Fixed Fee (CPFF) contract type, while allowing flexibility, can sometimes lead to higher final costs compared to fixed-price contracts if costs escalate beyond initial estimates. Further analysis would require comparing unit costs for specific services (e.g., per square foot of pavement maintenance, per vehicle serviced) against industry standards or similar DoD contracts in comparable geographic regions.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, implying that all responsible sources were permitted to submit bids. The data indicates two bids were received. While two bidders suggest some level of competition, it is on the lower end for a contract of this magnitude and could potentially limit price discovery compared to a scenario with a larger number of competitive offers. The specific details of the bidding process and the evaluation criteria would provide further insight into the effectiveness of the competition.

Taxpayer Impact: Full and open competition is generally favorable for taxpayers as it aims to secure the best value through a wider pool of potential offerors. However, with only two bids, the potential for significant cost savings through robust competition may have been limited.

Public Impact

The primary beneficiaries are the Department of Defense and the U.S. Air Force, receiving essential infrastructure and transportation support services. Services delivered include pavement maintenance, repair, and potentially transportation logistics and fleet management. The geographic impact is concentrated on Tinian, Commonwealth of the Northern Mariana Islands (CNMI), supporting military operations in the Pacific region. Workforce implications may include employment opportunities for local residents and potentially U.S. personnel for specialized roles. Enhanced infrastructure and transportation capabilities can support increased military readiness and operational effectiveness in the Indo-Pacific.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost Plus Fixed Fee (CPFF) contract type introduces risk of cost overruns if not closely monitored.
Limited competition (2 bids) may have reduced the potential for optimal price negotiation.
Performance in a remote location like Tinian can present logistical challenges and potentially higher operational costs.
The scope of 'pavement and transportation support' is broad and requires detailed oversight to ensure efficient service delivery.

Positive Signals

Awarded under full and open competition, suggesting an effort to maximize the bidder pool.
The contract duration of approximately five years allows for stable, long-term support.
Fluor Intercontinental, Inc. is a large, experienced contractor with a history of performing complex government contracts.
The contract aims to ensure critical infrastructure and transportation services are maintained.

Sector Analysis

This contract falls within the Facilities Support Services sector, a broad category encompassing a wide range of services necessary for the operation and maintenance of physical infrastructure. The market for such services, particularly for government installations, is substantial, driven by the need to maintain readiness and operational capabilities. Fluor Intercontinental, Inc. is a major player in this sector, often competing for large-scale government contracts globally. Comparable spending benchmarks would typically involve analyzing other large-scale base operations support contracts awarded by the DoD in similar geographic or operational contexts.

Small Business Impact

The contract data indicates that this award was not set aside for small businesses (ss: false, sb: false). This suggests that the prime contractor, Fluor Intercontinental, Inc., will likely be responsible for performing the majority of the work. While there is no explicit small business set-aside, large prime contractors are often required to meet subcontracting goals for small businesses as part of their contract terms. The extent to which Fluor will engage small businesses for specialized services or local support will impact the small business ecosystem in the region.

Oversight & Accountability

Oversight for this contract will primarily reside with the Department of the Air Force, a component of the Department of Defense. The contract's Cost Plus Fixed Fee (CPFF) structure necessitates robust financial oversight to monitor expenditures and ensure the fixed fee remains appropriate. Accountability measures will likely involve performance metrics, regular reporting requirements, and site inspections. Transparency is typically managed through contract award databases and public reporting mechanisms. The Inspector General of the Department of Defense would have jurisdiction to investigate any allegations of fraud, waste, or abuse related to this contract.

Related Government Programs

Base Operations Support (BOS)
Infrastructure Maintenance and Repair
Transportation and Logistics Services
Pacific Theater Military Support
Facilities Engineering and Management

Risk Flags

Cost Plus Fixed Fee contract type requires vigilant oversight to prevent cost overruns.
Limited number of bids received may indicate reduced competitive pressure and potentially higher costs.
Performance in a remote location can introduce logistical and operational cost risks.
Broad scope of 'pavement and transportation support' necessitates clear performance metrics and oversight.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $106.1 million to FLUOR INTERCONTINENTAL, INC. PAVEMENT AND TRANSPORTATION SUPPORT, NORTH FIELD, TINIAN, CNMI

Who is the contractor on this award?

The obligated recipient is FLUOR INTERCONTINENTAL, INC.

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 $106.1 million.

What is the period of performance?

Start: 2024-05-02. End: 2029-04-30.

What is Fluor Intercontinental, Inc.'s track record with similar large-scale facilities support contracts for the Department of Defense?

Fluor Intercontinental, Inc. has a significant history of performing large-scale government contracts, including extensive base operations support and infrastructure development for the Department of Defense and other federal agencies. They have been involved in complex projects in various global locations, often managing multiple service lines such as maintenance, construction, logistics, and environmental services. Their experience typically includes operating in challenging environments and adhering to stringent government regulations and performance standards. While specific details of past performance on contracts identical in scope and location to this Tinian award would require deeper research into contract databases and performance reports, Fluor's general profile suggests they are well-equipped to handle such requirements. Past performance evaluations, often available through government contracting portals or agency reports, would provide a more granular assessment of their reliability, quality of work, and cost control on previous similar endeavors.

How does the $106.1M contract value compare to similar pavement and transportation support contracts in remote Pacific locations?

Comparing the $106.1M contract value for pavement and transportation support in Tinian to similar contracts in remote Pacific locations requires careful consideration of scope, duration, and specific service requirements. Contracts for base operations support in the Pacific can vary significantly due to factors like geographic isolation, logistical complexities, labor costs, and the specific military mission requirements. A five-year contract of this magnitude suggests a substantial and ongoing need for these services. Without detailed breakdowns of unit costs or specific deliverables, a direct comparison is difficult. However, large-scale infrastructure and support contracts in the Pacific region often run into tens or hundreds of millions of dollars due to the inherent costs associated with operating in these areas. Further analysis would involve identifying comparable contracts awarded by the DoD or other agencies for similar services in Guam, Hawaii, or other Pacific territories, adjusting for inflation and differences in contract scope.

What are the primary risks associated with a Cost Plus Fixed Fee (CPFF) contract for facilities support in Tinian?

The primary risks associated with a Cost Plus Fixed Fee (CPFF) contract for facilities support in Tinian revolve around cost control and contractor efficiency. In a CPFF arrangement, the contractor is reimbursed for allowable costs plus a predetermined fixed fee representing profit. The main risk for the government is that the contractor may have less incentive to control costs rigorously compared to a fixed-price contract, as cost overruns are generally reimbursable. This can lead to the final contract price exceeding initial estimates. For a remote location like Tinian, additional risks include potential cost escalations due to unforeseen logistical challenges, supply chain disruptions, or difficulties in sourcing labor and materials. Effective oversight by the contracting agency is crucial to mitigate these risks, involving detailed review of incurred costs, validation of expenses, and ensuring that the contractor exercises due diligence in managing project expenses to achieve the required services within the anticipated cost structure.

What is the significance of the North American Industry Classification System (NAICS) code 561210 for this contract?

The North American Industry Classification System (NAICS) code 561210, 'Facilities Support Services,' is significant as it defines the primary business activity and scope of work for this contract. This classification indicates that the contract is intended to cover a broad range of services necessary for the operation and maintenance of facilities. These services can include activities such as building maintenance and cleaning, groundskeeping, pest control, security, waste management, and potentially minor repairs. For the Department of Defense, contracting under this NAICS code allows for consolidated procurement of essential support functions, streamlining management and oversight. It signals that the awarded contractor, Fluor Intercontinental, Inc., is expected to provide comprehensive facility management solutions rather than specialized construction or specific technical services, ensuring the smooth and efficient functioning of the military installation on Tinian.

How does the limited competition (2 bids) potentially impact the value for taxpayers on this $106.1M award?

The limited competition, with only two bids received for this $106.1M contract, can have a direct impact on the value realized by taxpayers. Robust competition, typically involving multiple bidders, drives down prices as contractors vie for the award by offering more competitive terms and lower costs. When only two bids are submitted, the potential for significant price reductions through competitive pressure is diminished. The government may not achieve the lowest possible price, and the negotiating leverage could be reduced. While the contract was awarded under 'full and open competition,' the low number of bids suggests that either the market for these specific services in Tinian is limited, or potential bidders faced barriers to entry. Consequently, taxpayers might be paying a higher price than they would have in a more competitive scenario, underscoring the importance of understanding the market dynamics and ensuring adequate outreach to potential bidders for future solicitations.

Industry Classification

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

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

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 2

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Parent Company: Fluor Corporation

Address: 100 FLUOR DANIEL DR, GREENVILLE, SC, 29607

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $409,893,105

Exercised Options: $246,096,402

Current Obligation: $106,100,000

Actual Outlays: $8,919,774

Subaward Activity

Number of Subawards: 35

Total Subaward Amount: $192,273,222

Contract Characteristics

Multi-Year Contract: Yes

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: FA805120D0004

IDV Type: IDC

Timeline