Air Force awards $57.3M for Alaska power plant repair, highlighting construction sector spending

Contract Overview

Contract Amount: $57,342,126 ($57.3M)

Contractor: AECOM Technical Services, Inc.

Awarding Agency: Department of Defense

Start Date: 2012-10-26

End Date: 2019-06-24

Contract Duration: 2,432 days

Daily Burn Rate: $23.6K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: REPAIR/REPLACE POWER PLANT, EARECKSON AS ALASKA

Place of Performance

Location: HOMER, KENAI PENINSULA County, ALASKA, 99603

State: Alaska Government Spending

Plain-Language Summary

Department of Defense obligated $57.3 million to AECOM TECHNICAL SERVICES, INC. for work described as: REPAIR/REPLACE POWER PLANT, EARECKSON AS ALASKA Key points: 1. Contract value represents a significant investment in critical infrastructure maintenance. 2. Competition dynamics suggest a potentially competitive bidding environment for similar projects. 3. Contract duration of over 2000 days indicates a long-term need for services. 4. Fixed-price contract type aims to control costs and provide budget certainty. 5. Geographic focus on Alaska points to specialized logistical and environmental considerations. 6. The award falls within the broad commercial and institutional building construction category.

Value Assessment

Rating: good

The contract value of $57.3 million for repairing and replacing a power plant in Alaska appears reasonable given the scope and duration. While direct comparisons are difficult without specific project details, large-scale infrastructure projects in remote locations often incur higher costs due to logistics and specialized labor. The firm fixed-price structure suggests an effort to manage cost overruns, which is a positive indicator for value.

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. With two bidders participating, the competition level suggests a moderate degree of market interest. This level of competition is generally favorable for price discovery and can lead to more competitive pricing for the government.

Taxpayer Impact: Full and open competition with multiple bidders helps ensure that taxpayer dollars are used efficiently by driving down prices through market forces.

Public Impact

The primary beneficiaries are the U.S. Air Force personnel and operations at Eareckson Air Station in Alaska, ensuring reliable power. The services delivered include the repair and replacement of essential power plant infrastructure. The geographic impact is concentrated in Alaska, a region with unique environmental and logistical challenges. Workforce implications may include the need for specialized construction and engineering personnel familiar with remote operations.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if unforeseen site conditions arise in remote Alaska.
Logistical challenges in delivering materials and personnel to a remote location could impact schedule and cost.
Dependence on a single contractor for a critical infrastructure component carries inherent risk.

Positive Signals

Firm fixed-price contract provides cost certainty for the government.
Awarded through full and open competition, suggesting a competitive process.
Long-term duration indicates a sustained need and potential for contractor expertise development.

Sector Analysis

This contract falls within the construction sector, specifically commercial and institutional building construction. The market for large-scale infrastructure repair and replacement, particularly for government facilities in remote or challenging environments like Alaska, is specialized. Comparable spending benchmarks would typically involve other major military base infrastructure upgrades or similar large public works projects, where costs can range significantly based on location, complexity, and materials.

Small Business Impact

This contract does not appear to have a small business set-aside component, as indicated by 'sb': false. There is no explicit information regarding subcontracting plans for small businesses. The award to a large prime contractor suggests that opportunities for small businesses would likely be through subcontracting, the extent of which is not detailed in the provided data.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and the relevant Air Force contracting command. Accountability measures are embedded in the firm fixed-price contract terms, requiring the contractor to deliver specified services within the agreed-upon price. Transparency is generally maintained through contract award databases, though specific performance metrics and oversight reports may not be publicly accessible.

Related Government Programs

Military Base Infrastructure Modernization
Department of Defense Facilities Maintenance
Alaska Regional Development Projects
Power Generation and Distribution Systems

Risk Flags

Potential for cost escalation due to remote location
Long project duration increases risk exposure
Dependence on specialized infrastructure maintenance

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $57.3 million to AECOM TECHNICAL SERVICES, INC.. REPAIR/REPLACE POWER PLANT, EARECKSON AS ALASKA

Who is the contractor on this award?

The obligated recipient is AECOM TECHNICAL 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 $57.3 million.

What is the period of performance?

Start: 2012-10-26. End: 2019-06-24.

What is the track record of AECOM TECHNICAL SERVICES, INC. with similar large-scale construction and infrastructure projects for the Department of Defense?

AECOM Technical Services, Inc. has a substantial track record with the Department of Defense and other federal agencies, often undertaking complex engineering, construction, and maintenance projects. Their portfolio includes significant work on military installations, infrastructure upgrades, and environmental services. For large-scale power plant repair and replacement, especially in challenging environments, AECOM has demonstrated capabilities. However, a detailed review of their past performance on projects of comparable size, complexity, and geographic location would be necessary to fully assess their suitability and risk profile for this specific contract. Past performance evaluations, if available through federal databases like the Contractor Performance Assessment Reporting System (CPARS), would provide more granular insights into their delivery, quality, and adherence to schedule and budget on similar endeavors.

How does the awarded amount of $57.3 million compare to similar power plant repair/replacement contracts for military installations?

Comparing the $57.3 million award for the Eareckson Air Station power plant requires context regarding the scope, age of the facility, specific repair needs, and location. Large-scale power plant construction or major overhauls can easily run into tens or hundreds of millions of dollars. Projects in remote locations like Alaska often incur higher costs due to logistical challenges, specialized labor requirements, and potentially harsher environmental conditions. Without specific details on the plant's condition, the extent of the 'repair/replace' scope, and the duration of the work (2432 days), a precise benchmark is difficult. However, for a critical infrastructure component like a power plant on a military installation, this figure appears within a plausible range for a multi-year project, especially considering the unique demands of operating in Alaska.

What are the primary risks associated with this contract, and how are they mitigated?

The primary risks associated with this contract include potential cost overruns due to unforeseen site conditions in Alaska, logistical challenges in material and personnel transport, and the long duration of the project (over 2000 days) which increases exposure to market fluctuations and potential contractor performance issues. Mitigation strategies are primarily embedded in the contract type: a firm fixed-price (FFP) award places the cost risk on the contractor, incentivizing them to manage expenses tightly. The full and open competition with two bidders suggests a degree of market vetting. Further mitigation would involve robust government oversight, clear performance standards, regular progress reviews, and potentially contingency planning for critical material sourcing. The contractor's own risk management processes would also be a key factor.

What is the historical spending pattern for power plant maintenance and construction at Eareckson Air Station or similar remote Air Force installations?

Historical spending patterns for power plant maintenance and construction at Eareckson Air Station or similar remote Air Force installations are not detailed in the provided data. However, it is reasonable to infer that such facilities require significant and recurring investment due to the critical nature of power supply and the demanding environmental conditions. Spending would likely fluctuate based on major upgrade cycles versus routine maintenance. Remote locations typically see higher per-unit costs for services and materials compared to mainland bases. Analyzing historical budgets for the Air Force's Civil Engineer Center or specific installation support contracts could reveal trends in capital investment for power infrastructure in comparable regions.

How does the 'Commercial and Institutional Building Construction' (NAICS 236220) classification influence the analysis of this contract?

The NAICS code 236220, 'Commercial and Institutional Building Construction,' broadly categorizes this contract. While it accurately reflects the construction nature of the work, it is a very general classification. Power plant construction and repair often involve specialized engineering disciplines beyond typical building construction, including heavy industrial, mechanical, and electrical systems. This classification suggests the contract was procured through a general construction vehicle. The analysis should consider that the specific requirements might necessitate specialized expertise within the broader construction umbrella, potentially impacting the pool of eligible bidders and the complexity of project management compared to standard commercial building projects.

Industry Classification

NAICS: Construction › Nonresidential Building Construction › Commercial and Institutional Building Construction

Product/Service Code: CONSTRUCT OF STRUCTURES/FACILITIES › CONSTRUCTION OF BUILDINGS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 2

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: AECOM (UEI: 153561212)

Address: 300 OCEANGATE, STE 700, LONG BEACH, CA, 90802

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

Financial Breakdown

Contract Ceiling: $57,342,126

Exercised Options: $57,342,126

Current Obligation: $57,342,126

Subaward Activity

Number of Subawards: 14

Total Subaward Amount: $160,002,504

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: FA300208D0006

IDV Type: IDC

Timeline