Department of Defense awards $44.5M for facility repairs, with 2 bids received

Contract Overview

Contract Amount: $44,476,033 ($44.5M)

Contractor: Perini Management Services, Inc.

Awarding Agency: Department of Defense

Start Date: 2020-03-04

End Date: 2025-06-11

Contract Duration: 1,925 days

Daily Burn Rate: $23.1K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: X003 FLO - ADMIN/WAREHOUSE FACILITY REPAIRS

Place of Performance

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

State: North Carolina Government Spending

Plain-Language Summary

Department of Defense obligated $44.5 million to PERINI MANAGEMENT SERVICES, INC. for work described as: X003 FLO - ADMIN/WAREHOUSE FACILITY REPAIRS Key points: 1. Contract value of $44.5M for facility repairs indicates significant investment in infrastructure. 2. The award was made under full and open competition, suggesting a broad market search. 3. Two bids were received, which may indicate limited competition or a specialized service. 4. The contract duration of 1925 days (approx. 5.3 years) suggests a long-term need for maintenance and repairs. 5. The fixed-price contract type aims to control costs for the government. 6. The contract is for administrative and warehouse facility repairs, a critical but often overlooked aspect of operational readiness.

Value Assessment

Rating: fair

Benchmarking the value of this contract is challenging without specific details on the scope of repairs. However, the total award amount of $44.5 million for facility repairs over approximately 5.3 years suggests a substantial investment. Comparing this to similar large-scale facility maintenance contracts across the Department of Defense or other federal agencies would be necessary to assess if the pricing is competitive. The fixed-price nature of the contract provides some cost certainty, but the ultimate value for money will depend on the quality and extent of the repairs delivered.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, meaning all responsible sources were permitted to submit a bid. However, only two bids were received. This level of competition, while technically open, might suggest that the scope of work is highly specialized, the market for such services is limited, or potential bidders perceived risks or barriers that discouraged broader participation. The limited number of bidders could potentially impact price discovery, as fewer competing offers may lead to less downward pressure on pricing.

Taxpayer Impact: While full and open competition is generally favorable for taxpayers, the low number of bids received warrants attention. It suggests that taxpayers may not have benefited from the most competitive pricing achievable if more firms had participated. Further analysis into why only two bids were submitted could reveal opportunities for improving future competition.

Public Impact

The primary beneficiaries are the Department of the Navy, which will receive improved administrative and warehouse facilities. Services delivered include repairs to commercial and institutional buildings, ensuring operational readiness and safety. The geographic impact is specific to the facility locations in North Carolina. The contract supports the construction and maintenance workforce, likely involving skilled tradespeople and project managers.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Limited competition (2 bids) may have resulted in a higher price than if more bidders had participated.
The long contract duration could lead to scope creep or unforeseen cost increases if not managed tightly.
The specific nature of 'facility repairs' can be broad, potentially leading to disputes over work scope and cost.

Positive Signals

Awarded under full and open competition, adhering to principles of broad market access.
Fixed-price contract type helps to cap government liability and provides cost predictability.
The contract addresses essential infrastructure needs, contributing to the operational effectiveness of the Navy.

Sector Analysis

This contract falls within the Commercial and Institutional Building Construction sector, a significant segment of the broader construction industry. This sector encompasses a wide range of activities from new builds to extensive renovations and maintenance of non-residential structures. Federal spending in this area is crucial for maintaining government infrastructure, including administrative buildings, warehouses, and operational facilities. Comparable spending benchmarks would involve analyzing the average cost per square foot for similar repair projects across federal agencies or large private sector entities.

Small Business Impact

The data indicates that small business participation was not a primary focus, as the 'small business set-aside' flag is false and the 'small business' flag is also false. This suggests the contract was not specifically targeted towards small businesses. There is no explicit information on subcontracting plans for small businesses. Without this information, it's difficult to assess the direct impact on the small business ecosystem, though larger prime contractors may still engage small businesses for specialized repair tasks.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of the Navy's contracting and facilities management divisions. Accountability measures are inherent in the firm fixed-price contract type, which obligates the contractor to complete the work for the agreed-upon price. Transparency is facilitated by the public nature of federal contract awards, allowing for review of basic contract details. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

Department of Defense Facilities Maintenance
Naval Base Infrastructure Projects
Federal Building Repair Contracts
Construction Services for Government Agencies
Administrative Facility Upgrades

Risk Flags

Limited Competition
Potential for Cost Overruns
Scope Definition Risk

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $44.5 million to PERINI MANAGEMENT SERVICES, INC.. X003 FLO - ADMIN/WAREHOUSE FACILITY REPAIRS

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 $44.5 million.

What is the period of performance?

Start: 2020-03-04. End: 2025-06-11.

What is the specific scope of work covered by the $44.5 million for facility repairs?

The contract data identifies the work as 'ADMIN/WAREHOUSE FACILITY REPAIRS' under the North American Industry Classification System (NAICS) code 236220, which pertains to Commercial and Institutional Building Construction. However, the precise details of the repairs—such as structural work, HVAC upgrades, roofing, electrical systems, or cosmetic improvements—are not provided in the summary data. A comprehensive understanding of the scope would require reviewing the detailed Statement of Work (SOW) or Performance Work Statement (PWS) associated with the contract. This level of detail is crucial for assessing the value for money and comparing it to similar projects.

How does the price per bid compare to industry benchmarks for similar facility repair projects?

Directly comparing the price per bid to industry benchmarks is difficult without knowing the specific scope of repairs. The total award is $44,476,033.45. With two bids received, we can infer that the government likely negotiated based on these offers. To benchmark, one would need to identify comparable projects (e.g., square footage repaired, type of repairs, location) and their associated costs. For instance, if this contract covers extensive structural and system overhauls in large warehouse facilities in North Carolina, the cost might be reasonable. Conversely, if it's for more routine maintenance, it could be high. A detailed cost breakdown from the bids would be necessary for a robust comparison.

What are the potential risks associated with a firm fixed-price contract for facility repairs over a 5.3-year period?

A firm fixed-price (FFP) contract aims to provide cost certainty for the government. However, for long-duration facility repair projects, risks can emerge. If the scope of work is not perfectly defined, the contractor may face unexpected costs due to unforeseen conditions (e.g., hidden structural damage, hazardous materials). In an FFP contract, the contractor bears this risk, which they may have priced into their initial bid, potentially leading to a higher overall cost. Conversely, if the scope is too narrowly defined, the government might not get all necessary repairs completed within the contract's budget. Effective project management and clear communication are vital to mitigate these risks and ensure the contractor delivers the required repairs within the agreed price.

What is the track record of Perini Management Services, Inc. with federal contracts, particularly in facility maintenance?

Perini Management Services, Inc. has a history of performing federal contracts, including significant work for agencies like the Department of Defense. Their portfolio often includes construction, renovation, and facility management services. To assess their track record specifically for facility repairs of this scale, a review of their past performance evaluations (e.g., Contractor Performance Assessment Reporting System - CPARS) would be beneficial. Examining previous contracts for similar scope, duration, and value would provide insights into their ability to deliver quality work on time and within budget, and their history of managing cost and schedule risks effectively.

How does the $44.5 million spending on facility repairs compare to historical spending patterns for the Department of the Navy in North Carolina?

To assess this, one would need to analyze historical federal spending data for the Department of the Navy specifically within North Carolina, focusing on facility maintenance and repair contracts over several fiscal years. This contract represents a significant single award. Comparing its value to the average annual spending on similar services in that region would indicate whether this award is an outlier, part of a larger trend, or a response to a specific infrastructure need. Without access to detailed historical spending databases filtered by agency, geography, and service type, this comparison remains speculative.

What are the implications of only two bids being submitted for this contract?

The submission of only two bids under a full and open competition raises questions about market dynamics. It could indicate a highly specialized service requirement that only a few firms possess the capability to fulfill. Alternatively, it might suggest that the contract's terms, location, or perceived risks deterred broader participation. From a taxpayer perspective, limited competition generally leads to less robust price discovery, potentially resulting in higher costs than if a more competitive field of bidders had vied for the contract. It also presents a risk if one of the bidders withdraws or is disqualified, leaving only one viable option.

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: $44,476,033

Exercised Options: $44,476,033

Current Obligation: $44,476,033

Actual Outlays: $14,161,752

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