Parsons Government Services Inc. awarded $106.7M contract for airbase ordnance recovery, with performance extending to late 2027

Contract Overview

Contract Amount: $106,691,558 ($106.7M)

Contractor: Parsons Government Services Inc

Awarding Agency: Department of Defense

Start Date: 2020-09-18

End Date: 2027-12-10

Contract Duration: 2,639 days

Daily Burn Rate: $40.4K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: RECOVERY OF AIRBASES DENIED BY ORDNANCE

Place of Performance

Location: HUNTSVILLE, MADISON County, ALABAMA, 35806

State: Alabama Government Spending

Plain-Language Summary

Department of Defense obligated $106.7 million to PARSONS GOVERNMENT SERVICES INC for work described as: RECOVERY OF AIRBASES DENIED BY ORDNANCE Key points: 1. Contract awarded on a sole-source basis, raising questions about potential price efficiencies. 2. The fixed-price contract structure aims to control costs, but the lack of competition may limit savings. 3. Performance is concentrated in Alabama, suggesting a localized impact on workforce and resources. 4. The contract duration of nearly 4 years indicates a significant, long-term need for these services. 5. The specific nature of ordnance recovery suggests a high-risk, specialized service area. 6. No small business set-aside was indicated, potentially limiting opportunities for smaller firms in this niche.

Value Assessment

Rating: fair

Benchmarking the value of this contract is challenging due to its specialized nature and sole-source award. Without competitive bids, it's difficult to ascertain if the $106.7 million represents a fair market price. The firm fixed-price structure provides cost certainty for the government, but the absence of competition means there's less pressure on the contractor to offer the most economical solution. Further analysis would require comparing the scope and deliverables to similar, competitively awarded contracts, if available.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning only one vendor, Parsons Government Services Inc., was solicited. This approach bypasses the standard competitive bidding process. While sole-source awards can be justified for unique capabilities or urgent needs, they typically result in less price discovery and potentially higher costs for the government compared to full and open competition. The lack of multiple bidders means the government did not benefit from a range of proposals and pricing strategies.

Taxpayer Impact: The sole-source nature of this award means taxpayers may not be receiving the most cost-effective solution. Without competitive pressure, the awarded price might be higher than what could have been achieved through a bidding process, leading to less efficient use of public funds.

Public Impact

The Department of the Air Force benefits from specialized services to clear airbases of ordnance, ensuring operational readiness and safety. This contract directly supports the military's infrastructure maintenance and safety protocols. The geographic impact is concentrated in Alabama, where the recovery operations will take place. Workforce implications may include the creation of specialized jobs in ordnance disposal and environmental remediation within Alabama.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits competitive pricing and potential cost savings for taxpayers.
Lack of small business participation may exclude smaller, specialized firms from contributing.
The specialized nature of ordnance recovery presents inherent safety and environmental risks.
Contract duration is long, increasing exposure to potential cost overruns or performance issues over time.

Positive Signals

Firm fixed-price contract provides cost certainty for the government.
Parsons Government Services Inc. is an established entity, suggesting a degree of reliability.
The contract addresses a critical military need for base safety and operational capability.

Sector Analysis

The defense sector, particularly within military infrastructure maintenance, often requires highly specialized services like ordnance recovery. This contract falls under the broader category of defense support services, which is a significant market segment. While specific market size data for ordnance recovery is not readily available, the overall defense contracting market is vast. This award represents a substantial investment in ensuring the safety and functionality of critical military assets, aligning with government priorities for readiness and security.

Small Business Impact

This contract was not awarded as a small business set-aside, nor does it appear to have specific subcontracting requirements for small businesses based on the provided data. This means that opportunities for small businesses to participate in this specific contract are limited unless they are direct subcontractors to Parsons Government Services Inc. without a formal set-aside mandate. The absence of a set-aside could mean that larger, established firms are better positioned to secure such specialized work, potentially impacting the broader small business ecosystem in this niche sector.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of the Air Force's contracting and program management offices. As a definitive contract, it is subject to standard federal procurement regulations and oversight mechanisms. Transparency is generally maintained through contract databases like FPDS, where basic award information is published. However, the specifics of performance monitoring, quality assurance, and any Inspector General involvement would depend on the internal procedures of the agency and the terms outlined within the contract itself.

Related Government Programs

Military Base Operations Support
Environmental Remediation Services
Ordnance and Explosives Disposal
Defense Infrastructure Modernization

Risk Flags

Sole-source award may indicate a lack of market competition.
Specialized nature of service carries inherent safety and environmental risks.
Long contract duration increases exposure to potential cost escalations or performance drift.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $106.7 million to PARSONS GOVERNMENT SERVICES INC. RECOVERY OF AIRBASES DENIED BY ORDNANCE

Who is the contractor on this award?

The obligated recipient is PARSONS GOVERNMENT SERVICES 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 $106.7 million.

What is the period of performance?

Start: 2020-09-18. End: 2027-12-10.

What is the track record of Parsons Government Services Inc. in handling similar ordnance recovery contracts?

Parsons Government Services Inc. has a significant history in providing a wide range of engineering, construction, and technical services to government agencies, including defense clients. While specific details on their past ordnance recovery contracts are not provided in this data snippet, the company's extensive experience in complex projects suggests a capability to manage such specialized and high-risk operations. Their portfolio often includes environmental services, hazardous material management, and infrastructure support, which are relevant to ordnance recovery. A deeper dive into their contract history, performance reviews, and any past issues related to safety or environmental compliance on similar projects would be necessary for a comprehensive assessment of their track record in this specific domain.

How does the awarded amount compare to similar ordnance recovery contracts, if available?

Direct comparison of the $106.7 million award for ordnance recovery is difficult without access to a database of similar, competitively awarded contracts. Ordnance recovery is a highly specialized service, and its cost can vary significantly based on the type and quantity of ordnance, the complexity of the site, environmental conditions, and the required safety protocols. Sole-source awards, like this one, inherently lack a competitive benchmark. To assess value, one would ideally compare this contract's scope, duration, and deliverables against other competitively procured contracts for similar services. If such comparable data exists, it would reveal whether this award represents a fair market price or if the lack of competition led to a premium.

What are the primary risks associated with this ordnance recovery contract?

The primary risks associated with this ordnance recovery contract are multifaceted. Firstly, there is the inherent safety risk involved in handling and disposing of potentially unstable ordnance, which could lead to accidents, injuries, or fatalities. Secondly, environmental risks are significant, including potential contamination of soil and groundwater from explosive residues or hazardous materials, requiring extensive remediation. Thirdly, performance risks exist, such as delays in recovery operations due to unforeseen site conditions or technical challenges, impacting airbase readiness. Finally, given the sole-source nature, there's a financial risk that the contract price may not be optimal, and cost overruns could occur if the scope expands or unforeseen complexities arise.

How effective is the firm fixed-price contract type in managing costs for this specialized service?

The firm fixed-price (FFP) contract type is generally effective in managing costs for specialized services by shifting the risk of cost overruns to the contractor. For the government, this provides budget certainty, as the price is fixed regardless of the contractor's actual costs. However, for highly specialized and potentially unpredictable work like ordnance recovery, an FFP contract can incentivize the contractor to cut corners on safety or quality to maintain profitability if unforeseen challenges arise. Conversely, if the contractor accurately estimates costs and manages risks effectively, the government benefits from a predictable price. The effectiveness hinges on the contractor's ability to accurately scope the work and manage inherent risks within the fixed price.

What is the historical spending trend for ordnance recovery services by the Department of the Air Force?

Historical spending data for ordnance recovery services by the Department of the Air Force is not directly available in the provided snippet. This specific contract award of $106.7 million represents a significant single investment. To understand historical trends, one would need to analyze aggregated spending data over several fiscal years for relevant contract categories, such as base maintenance, environmental services, or specialized munitions disposal. Analyzing past awards, contract types, and durations for similar services would reveal whether spending in this area is increasing, decreasing, or remaining stable, and whether it is typically competed or awarded sole-source.

What are the implications of the contract's duration (2639 days) on long-term planning and resource allocation?

The contract's duration of approximately 2639 days (over 7 years) has significant implications for long-term planning and resource allocation. For the Department of the Air Force, it ensures a stable and continuous provision of critical ordnance recovery services, allowing for better integration into base maintenance schedules and operational readiness planning. This long-term commitment provides predictability for both the government and the contractor, potentially fostering a stronger working relationship and encouraging investment in specialized equipment and personnel. However, it also ties up a substantial amount of funding over an extended period, requiring careful budgeting and potentially limiting flexibility to adapt to changing requirements or explore alternative solutions if they emerge during the contract's life.

Industry Classification

NAICS: Manufacturing › Other Transportation Equipment Manufacturing › Military Armored Vehicle, Tank, and Tank Component Manufacturing

Product/Service Code: AMMUNITION AND EXPLOSIVES

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: FA853419R0010

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 401 DIAMOND DR NW, HUNTSVILLE, AL, 35806

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

Financial Breakdown

Contract Ceiling: $117,402,835

Exercised Options: $106,691,558

Current Obligation: $106,691,558

Subaward Activity

Number of Subawards: 120

Total Subaward Amount: $129,231,343

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Timeline