Navy awards $44.6M contract for vertical replenishment services to Air Center Helicopters, Inc

Contract Overview

Contract Amount: $44,631,530 ($44.6M)

Contractor: AIR Center Helicopters, Inc

Awarding Agency: Department of Defense

Start Date: 2022-03-28

End Date: 2026-05-31

Contract Duration: 1,525 days

Daily Burn Rate: $29.3K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: N102B/PM6 LAWREN WOLF VERTREP NAVCENT DET A. BASE CONTRACT FOR VERTICAL REPLENISHMENT SERVICES NAVCENT DET A BASE YEAR POP: 01APR22 THROUGH 31MAR23.

Plain-Language Summary

Department of Defense obligated $44.6 million to AIR CENTER HELICOPTERS, INC for work described as: N102B/PM6 LAWREN WOLF VERTREP NAVCENT DET A. BASE CONTRACT FOR VERTICAL REPLENISHMENT SERVICES NAVCENT DET A BASE YEAR POP: 01APR22 THROUGH 31MAR23. Key points: 1. Contract provides essential vertical replenishment services for Naval Support Activity Bahrain. 2. The contract has a base year with options extending through May 2026. 3. Services are critical for maintaining operational readiness in the CENTCOM AOR. 4. The award was made under full and open competition. 5. Air Center Helicopters, Inc. is the sole awardee. 6. The contract type is Firm Fixed Price, indicating predictable costs for the government.

Value Assessment

Rating: good

The contract value of $44.6 million over its potential duration appears reasonable for specialized aviation support services in a high-demand operational area. Benchmarking against similar contracts for aerial logistics and replenishment in the Middle East would provide a more precise value-for-money assessment. However, the firm fixed-price structure suggests that the contractor bears the risk of cost overruns, which is generally favorable for the government.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition after exclusion of sources, indicating that multiple vendors were likely solicited and considered. The specific details of the bidding process, including the number of proposals received and the evaluation criteria, are not fully detailed in the provided data. However, the designation suggests a competitive environment was established.

Taxpayer Impact: A full and open competition generally leads to better price discovery and potentially lower costs for taxpayers compared to sole-source or limited competition awards.

Public Impact

Naval Support Activity Bahrain benefits from reliable and efficient logistical support. Operational readiness of naval forces in the CENTCOM Area of Responsibility is enhanced. The contract supports critical supply chain functions for deployed units. Potential positive impact on the local aviation services industry in the region.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for price increases in subsequent option years if not carefully managed.
Dependence on a single contractor for a critical operational service.

Positive Signals

Firm Fixed Price contract structure limits cost uncertainty for the government.
Awarded through full and open competition, suggesting a competitive pricing environment.
Long-term contract provides stability for essential services.

Sector Analysis

This contract falls within the Nonscheduled Chartered Freight Air Transportation sector, specifically supporting aviation logistics. The market for such services is driven by defense needs, particularly in strategic locations like Bahrain. Comparable spending benchmarks would involve analyzing other contracts for similar aerial logistics and replenishment services provided to military installations in the Middle East, considering factors like aircraft type, operational tempo, and duration.

Small Business Impact

The provided data indicates that this contract was not set aside for small businesses (ss: false, sb: false). Therefore, there are no direct subcontracting implications for small businesses stemming from a set-aside provision. The primary contractor, Air Center Helicopters, Inc., would determine any subcontracting opportunities.

Oversight & Accountability

Oversight for this contract would typically fall under the purview of the Department of the Navy contracting officers and program managers. Accountability measures are embedded in the contract terms, including performance standards and payment schedules. Transparency is generally maintained through contract award databases, though specific performance metrics and detailed cost breakdowns may not be publicly available.

Related Government Programs

NAVCENT Logistics Support Contracts
Naval Aviation Support Services
CENTCOM Aviation Contracts
Vertical Replenishment Services Contracts

Risk Flags

Contract Performance Risk
Contractor Financial Stability
Operational Dependence on Single Source

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $44.6 million to AIR CENTER HELICOPTERS, INC. N102B/PM6 LAWREN WOLF VERTREP NAVCENT DET A. BASE CONTRACT FOR VERTICAL REPLENISHMENT SERVICES NAVCENT DET A BASE YEAR POP: 01APR22 THROUGH 31MAR23.

Who is the contractor on this award?

The obligated recipient is AIR CENTER HELICOPTERS, INC.

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Navy).

What is the total obligated amount?

The obligated amount is $44.6 million.

What is the period of performance?

Start: 2022-03-28. End: 2026-05-31.

What is the track record of Air Center Helicopters, Inc. with Department of Defense contracts?

Air Center Helicopters, Inc. has a history of performing aviation services for the Department of Defense. While specific details of past performance are not provided in this data snippet, their selection for this significant contract suggests they have met the necessary qualifications and demonstrated capability. A deeper dive into their contract history, including past performance reviews, any past disputes, and the types of services previously rendered, would offer a more comprehensive understanding of their reliability and expertise. Examining their performance on similar aviation support contracts, particularly those involving logistical operations or operations in similar geographic regions, would be particularly insightful for assessing their suitability and potential risks associated with this award.

How does the pricing of this contract compare to similar vertical replenishment services?

Direct comparison of the $44.6 million total potential value is challenging without specific details on the scope of services, aircraft utilized, and operational tempo. However, the contract's firm fixed-price nature is a positive indicator for value, as it shifts cost overrun risk to the contractor. To benchmark effectively, one would need to analyze contracts for similar aerial logistics and replenishment services awarded to other providers in the Middle East region. Key comparison points would include the cost per flight hour, cost per ton delivered, and overall contract value relative to the duration and geographic coverage. The fact that it was awarded under full and open competition suggests that the pricing is likely competitive within the market.

What are the primary risks associated with this contract for the Department of the Navy?

The primary risks associated with this contract include potential performance failures by the contractor, Air Center Helicopters, Inc., which could disrupt critical logistical operations and impact naval readiness. Dependence on a single provider for essential services also poses a risk if the contractor experiences financial instability, operational issues, or fails to maintain adequate staffing and equipment. Furthermore, while the firm fixed-price structure mitigates cost escalation, there's a risk that the contractor may cut corners on quality or safety to maintain profitability, necessitating robust government oversight. Geopolitical instability in the region could also impact operations and potentially lead to unforeseen cost increases or delays, despite the fixed-price nature.

How effective are vertical replenishment services in supporting naval operations in the CENTCOM AOR?

Vertical replenishment (VERTREP) services are highly effective and often indispensable for supporting naval operations, particularly in the CENTCOM Area of Responsibility (AOR) where established land-based infrastructure may be limited or contested. VERTREP allows ships at sea to receive essential supplies, equipment, and personnel via helicopter directly from other vessels or shore facilities without needing to come alongside or anchor. This capability significantly enhances operational tempo, extends the endurance of deployed forces, and maintains combat readiness by ensuring timely delivery of critical items like ammunition, food, and spare parts. The efficiency and speed of VERTREP are crucial for sustaining operations in dynamic and potentially hostile environments.

What is the historical spending trend for vertical replenishment services by the Department of the Navy?

Historical spending on vertical replenishment (VERTREP) services by the Department of the Navy has likely been substantial and consistent, reflecting the enduring need for these critical logistical capabilities across global operations. While specific aggregate figures for VERTREP alone are not readily available in this dataset, the Navy consistently procures aviation support and logistical services. Spending trends are influenced by factors such as the number of deployed vessels, the operational tempo, geopolitical conditions requiring sustained presence, and advancements in aviation technology. Budget allocations for such services are typically part of broader naval aviation and logistics appropriations, indicating a sustained commitment to maintaining these essential functions. Fluctuations may occur based on specific deployment schedules and contingency operations.

What is the significance of the 'Nonscheduled Chartered Freight Air Transportation' classification for this contract?

The 'Nonscheduled Chartered Freight Air Transportation' (NAICS code 481212) classification signifies that this contract is for air transport services that are not operated on a regular, scheduled basis. Instead, the services are chartered or contracted on an as-needed or specific-mission basis. This is highly relevant for vertical replenishment (VERTREP) operations, which are inherently mission-specific and responsive to the dynamic needs of naval vessels at sea. It implies flexibility in scheduling and routing to meet the unpredictable demands of military logistics, distinguishing it from scheduled airline cargo services. This classification underscores the specialized, on-demand nature of the aviation support being procured.

Industry Classification

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

Product/Service Code: TRANSPORT, TRAVEL, RELOCATION › TRANSPORTATION OF THINGS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: N3220521R4073

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 308 E RENFRO ST STE 104, BURLESON, TX, 76028

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

Financial Breakdown

Contract Ceiling: $56,315,942

Exercised Options: $47,109,896

Current Obligation: $44,631,530

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Timeline