Navy awards $49M facility repair contract to Perini Management Services, Inc

Contract Overview

Contract Amount: $48,962,805 ($49.0M)

Contractor: Perini Management Services, Inc.

Awarding Agency: Department of Defense

Start Date: 2020-02-27

End Date: 2024-11-05

Contract Duration: 1,713 days

Daily Burn Rate: $28.6K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: X002 FLO - DIVISION MOTOR-T FACILITY REPAIRS (190136)

Place of Performance

Location: CAMP LEJEUNE, ONSLOW County, NORTH CAROLINA, 28547

State: North Carolina Government Spending

Plain-Language Summary

Department of Defense obligated $49.0 million to PERINI MANAGEMENT SERVICES, INC. for work described as: X002 FLO - DIVISION MOTOR-T FACILITY REPAIRS (190136) Key points: 1. Contract value appears reasonable given the duration and scope of facility repairs. 2. Full and open competition suggests a competitive bidding process. 3. Fixed-price contract type shifts performance risk to the contractor. 4. Contract duration of over 4 years indicates a significant, long-term project. 5. The North Carolina location suggests a focus on regional infrastructure needs. 6. The contract falls within the broad Commercial and Institutional Building Construction sector.

Value Assessment

Rating: good

The contract value of approximately $49 million over a period of more than four years suggests a substantial investment in facility repairs. Benchmarking against similar large-scale construction and repair contracts for government facilities indicates that this award is within a typical range for projects of this magnitude. The firm-fixed-price structure is generally favorable for the government when the scope of work is well-defined, as it caps the contractor's potential earnings and incentivizes cost control.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit bids. While the specific number of bidders is not provided, this procurement method typically fosters a competitive environment, which can lead to better pricing and terms for the government. The presence of multiple bidders generally suggests that the market has sufficient capacity and interest to support competitive bidding for such projects.

Taxpayer Impact: Full and open competition is the most advantageous for taxpayers as it maximizes the potential for cost savings through a robust bidding process, ensuring the government receives the best value.

Public Impact

The Department of the Navy benefits from the repair and maintenance of its facilities, ensuring operational readiness. Services delivered include comprehensive repairs to institutional buildings, likely encompassing structural, mechanical, and electrical systems. The geographic impact is concentrated in North Carolina, supporting regional infrastructure. The contract supports the construction and maintenance workforce in the region.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if unforeseen issues arise during repairs, despite fixed-price structure.
Contractor performance risks related to schedule delays or quality of work.
Dependency on a single contractor for a significant duration.

Positive Signals

Firm-fixed-price contract aligns incentives for contractor efficiency.
Full and open competition suggests a competitive market and potentially better pricing.
Long contract duration allows for sustained focus on facility upkeep.

Sector Analysis

This contract falls under the Commercial and Institutional Building Construction sector, a significant segment of the construction industry that includes the building and repair of non-residential structures. Federal spending in this area is crucial for maintaining government infrastructure, including military bases, administrative buildings, and research facilities. Comparable spending benchmarks for large-scale government construction projects often run into tens or hundreds of millions of dollars, depending on the complexity and scale.

Small Business Impact

The data indicates that this contract was not set aside for small businesses (ss: false, sb: false). Therefore, there are no direct subcontracting implications or specific impacts on the small business ecosystem stemming from a set-aside provision. However, the prime contractor may engage small businesses as subcontractors, which would contribute to the small business economy.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and the relevant Department of the Navy contracting activity. Performance monitoring, quality assurance, and compliance with contract terms are standard oversight mechanisms. Transparency is generally maintained through contract award databases and reporting requirements. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse.

Related Government Programs

Military Base Maintenance Contracts
Federal Building Construction
Department of Defense Facilities Management
Naval Facilities Engineering Command Contracts

Risk Flags

Long contract duration may increase risk of performance degradation.
Potential for unforeseen issues in facility repairs impacting fixed-price budget.
Contractor's past performance record should be reviewed for similar projects.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $49.0 million to PERINI MANAGEMENT SERVICES, INC.. X002 FLO - DIVISION MOTOR-T FACILITY REPAIRS (190136)

Who is the contractor on this award?

The obligated recipient is PERINI MANAGEMENT SERVICES, 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 $49.0 million.

What is the period of performance?

Start: 2020-02-27. End: 2024-11-05.

What is the historical spending pattern for facility repairs by the Department of the Navy in North Carolina?

Analyzing historical spending patterns for facility repairs by the Department of the Navy in North Carolina requires access to detailed historical contract data. Without specific databases or reports, a precise historical comparison is challenging. However, federal agencies like the Navy typically allocate significant budgets annually for infrastructure maintenance and repair across their installations. Factors influencing these patterns include the age of facilities, operational tempo, environmental regulations, and strategic infrastructure investments. The $49 million awarded for this specific contract over approximately four years suggests a substantial, but not necessarily unprecedented, investment for a major repair project within a specific region like North Carolina, which hosts several significant naval installations.

How does the awarded amount compare to similar facility repair contracts for other military branches?

Comparing the $49 million award to similar facility repair contracts across other military branches requires a broad analysis of federal procurement data. Large-scale facility repair and construction projects for military branches can vary significantly in cost due to factors such as geographic location, specific facility type (e.g., barracks, hangars, training facilities), scope of work, and prevailing labor and material costs. Contracts in the tens of millions of dollars are common for major repair or renovation projects. For instance, the Army Corps of Engineers or the Air Force might award contracts in a similar range for base infrastructure upgrades. The firm-fixed-price nature and full and open competition suggest a standard procurement approach, making it broadly comparable to other major federal construction awards.

What are the key performance indicators (KPIs) used to assess the contractor's performance on this contract?

Key Performance Indicators (KPIs) for a contract of this nature, focused on facility repairs, would typically revolve around schedule adherence, quality of work, safety compliance, and budget management. Specific KPIs might include on-time completion of project milestones, adherence to specified building codes and standards, incident rates (e.g., lost-time injuries), and the number of defects or rework required. The contract likely includes clauses for performance evaluations, potentially using a standardized rating system (e.g., Past Performance Information Retrieval System - PPIRS). Meeting these KPIs ensures the Navy receives the intended facility improvements within the agreed-upon terms and maintains operational readiness.

What is the potential risk associated with the firm-fixed-price contract type for this project?

The primary risk associated with a firm-fixed-price (FFP) contract type for a project like facility repairs is that the contractor assumes most of the cost risk. If the contractor underestimates costs, encounters unforeseen issues (e.g., hazardous materials, structural problems not identified in initial surveys), or experiences significant increases in material or labor costs, their profit margin will be reduced, or they could incur a loss. For the government, the main risk is that the contractor may cut corners on quality or scope to protect their profit if costs escalate unexpectedly. However, FFP is generally preferred by the government for well-defined scopes as it provides cost certainty and incentivizes contractor efficiency.

How does the contract's duration of over 1700 days impact project management and oversight?

A contract duration exceeding 1700 days (approximately 4.7 years) for facility repairs signifies a long-term, potentially phased project. This extended timeline allows for more comprehensive planning and execution, potentially accommodating complex repairs or renovations that cannot be completed quickly. However, it also necessitates sustained oversight to ensure consistent performance, manage scope creep, and adapt to changing requirements or conditions over the years. Long durations can increase the risk of contractor performance degradation, require more frequent performance reviews, and necessitate robust contract administration to maintain focus and accountability throughout the project lifecycle.

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

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: N6247017R6016

Offers Received: 2

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Tutor Perini Corporation

Address: 73 MOUNT WAYTE AVE, FRAMINGHAM, MA, 01702

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

Financial Breakdown

Contract Ceiling: $48,962,805

Exercised Options: $48,962,805

Current Obligation: $48,962,805

Actual Outlays: $10,624,430

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: N6247019D8027

IDV Type: IDC

Timeline