DoD Awards $223M in Facilities Support Services to Chugach Industries, Inc. Over 15 Years
Contract Overview
Contract Amount: $222,878,702 ($222.9M)
Contractor: Chugach Industries, Inc.
Awarding Agency: Department of Defense
Start Date: 2005-08-05
End Date: 2020-09-30
Contract Duration: 5,535 days
Daily Burn Rate: $40.3K/day
Competition Type: NOT AVAILABLE FOR COMPETITION
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: Other
Place of Performance
Location: PICATINNY ARSENAL, MORRIS County, NEW JERSEY, 07806, UNITED STATES OF AMERICA
Plain-Language Summary
Department of Defense obligated $222.9 million to CHUGACH INDUSTRIES, INC. for work described as: Key points: 1. Significant 15-year contract valued at over $222 million for facilities support services. 2. Sole-source award raises questions about competition and potential for overpayment. 3. Long contract duration may limit opportunities for market-driven price adjustments. 4. Focus on facilities support services indicates a critical but potentially commoditized sector.
Value Assessment
Rating: questionable
Contract value is substantial, but without competitive bidding, it's difficult to assess if the pricing represents fair market value. The firm-fixed-price structure provides cost certainty but doesn't inherently guarantee optimal pricing.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
The contract was awarded on a sole-source basis, indicating a lack of competition. This method bypasses the typical price discovery mechanisms inherent in competitive bidding, potentially leading to higher costs for taxpayers.
Taxpayer Impact: The absence of competition for a contract of this magnitude suggests taxpayers may be paying a premium for services that could potentially be procured at a lower cost through a competitive process.
Public Impact
Taxpayers may be overpaying due to the lack of competitive bidding. Long-term commitment limits flexibility to adopt newer, potentially more cost-effective solutions. Dependence on a single contractor for essential facilities support could pose a risk if performance falters.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Long contract duration
- Lack of transparency in pricing justification
Positive Signals
- Firm-fixed-price contract provides cost certainty
- Long-term relationship may foster efficiency
Sector Analysis
Facilities Support Services (NAICS 561210) is a broad category encompassing maintenance, operation, and management of facilities. Spending in this sector can vary widely based on the scope and complexity of services required. This contract's value is high, suggesting extensive services.
Small Business Impact
The contract was awarded to Chugach Industries, Inc., a for-profit subsidiary of the Chugach Alaska Corporation, which is an Alaska Native Corporation. While ANC subsidiaries are often considered small businesses for certain government contracting purposes, the scale of this award suggests it is a significant contract regardless of size classification.
Oversight & Accountability
The sole-source nature of this award warrants scrutiny. Further investigation into the justification for not pursuing a competitive process is recommended to ensure accountability and optimal use of taxpayer funds.
Related Government Programs
- Facilities Support Services
- Department of Defense Contracting
- Department of the Army Programs
Risk Flags
- Lack of competition
- Extended contract duration
- Potential for cost overruns due to sole-source award
- Limited transparency on pricing justification
Tags
facilities-support-services, department-of-defense, nj, dca, 100m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $222.9 million to CHUGACH INDUSTRIES, INC.. See the official description on USAspending.
Who is the contractor on this award?
The obligated recipient is CHUGACH INDUSTRIES, INC..
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Army).
What is the total obligated amount?
The obligated amount is $222.9 million.
What is the period of performance?
Start: 2005-08-05. End: 2020-09-30.
What was the specific justification for awarding this contract on a sole-source basis, and were alternative competitive strategies considered?
The justification for a sole-source award typically involves unique capabilities, urgent needs, or situations where only one responsible source can fulfill the requirement. Without specific documentation, it's impossible to confirm the rationale. However, the absence of competition for a contract of this size and duration raises concerns about whether all avenues for achieving best value through a competitive process were fully explored and documented.
How does the per-unit cost of these facilities support services compare to industry benchmarks or similar government contracts awarded competitively?
Benchmarking the per-unit cost is challenging without detailed service breakdowns and specific performance metrics. However, given the sole-source nature, there's a heightened risk that the pricing may not reflect the most competitive rates achievable in the market. A thorough cost analysis comparing the contract's pricing structure against publicly available data for similar, competitively procured services would be necessary to assess value.
What mechanisms are in place to ensure contractor performance and cost control over the 15-year duration of this contract?
While a firm-fixed-price contract provides cost certainty, effective oversight is crucial for ensuring performance and value over such a long period. This includes robust performance monitoring, regular contract reviews, and clear mechanisms for addressing any deviations or issues. The long duration necessitates proactive management to prevent complacency and ensure the contractor continues to deliver services efficiently and effectively.
Industry Classification
NAICS: Administrative and Support and Waste Management and Remediation Services › Facilities Support Services › Facilities Support Services
Product/Service Code: UTILITIES AND HOUSEKEEPING › HOUSEKEEPING SERVICES
Competition & Pricing
Extent Competed: NOT AVAILABLE FOR COMPETITION
Solicitation Procedures: ONLY ONE SOURCE
Offers Received: 1
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: Chugach Alaska Corporation (UEI: 071844021)
Address: 560 E 34TH AVE, ANCHORAGE, AK, 99503
Business Categories: 8(a) Program Participant, Category Business, Minority Owned Business, Native American Owned Business, Self-Certified Small Disadvantaged Business, Small Business, Small Disadvantaged Business, Special Designations, U.S.-Owned Business
Contract Characteristics
Cost or Pricing Data: NO
Timeline
Start Date: 2005-08-05
Current End Date: 2020-09-30
Potential End Date: 2020-09-30 00:00:00
Last Modified: 2015-06-09
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