Watervliet Arsenal electrical substation replacement contract awarded for $17.1M, with limited competition

Contract Overview

Contract Amount: $17,135,334 ($17.1M)

Contractor: CCI Utility and Construction Services LLC

Awarding Agency: Department of Defense

Start Date: 2020-10-28

End Date: 2025-12-31

Contract Duration: 1,890 days

Daily Burn Rate: $9.1K/day

Competition Type: NOT AVAILABLE FOR COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: TO COVER THE COST OF LABOR, EQUIPMENT AND MATERIAL FOR THE REPLACEMENT OF THREE ELECTRICAL SUBSTATIONS AT BLDG 110, BUILDING 35, FOR THE WATERVLIET ARSENAL, NY 12189-4000

Place of Performance

Location: WATERVLIET, ALBANY County, NEW YORK, 12189

State: New York Government Spending

Plain-Language Summary

Department of Defense obligated $17.1 million to CCI UTILITY AND CONSTRUCTION SERVICES LLC for work described as: TO COVER THE COST OF LABOR, EQUIPMENT AND MATERIAL FOR THE REPLACEMENT OF THREE ELECTRICAL SUBSTATIONS AT BLDG 110, BUILDING 35, FOR THE WATERVLIET ARSENAL, NY 12189-4000 Key points: 1. The contract addresses critical infrastructure needs for the Watervliet Arsenal, focusing on essential electrical substations. 2. Awarded as a definitive contract with a firm fixed price, indicating a defined scope and cost structure. 3. The duration of the contract spans over 1.5 years, suggesting a significant scope of work. 4. The contract was not competed, raising questions about potential cost efficiencies and market-based pricing. 5. The awarded amount of $17.1 million covers labor, equipment, and materials for the replacement project. 6. The project is located in Watervliet, New York, impacting local infrastructure and potentially local employment.

Value Assessment

Rating: fair

Benchmarking the value of this contract is challenging due to the lack of publicly available comparable projects for electrical substation replacement at military installations. The firm fixed-price structure provides cost certainty, but the absence of competition limits the ability to assess if the price reflects optimal market value. The awarded amount of $17.1 million is substantial and requires careful scrutiny to ensure it aligns with the scope and complexity of replacing three electrical substations.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning it was not openly competed. This approach is typically used when only one responsible source is available or when a compelling justification exists for not seeking competition. The lack of multiple bidders means there was no opportunity for price discovery through a competitive bidding process, which could potentially lead to higher costs for the government.

Taxpayer Impact: Sole-source awards can result in taxpayers paying a premium compared to what might be achieved through a competitive process. Without competition, there is less pressure on the contractor to offer the lowest possible price.

Public Impact

The primary beneficiaries are the U.S. Army and the personnel operating at the Watervliet Arsenal, ensuring reliable power for critical operations. The services delivered include the replacement of three essential electrical substations, modernizing aging infrastructure. The geographic impact is localized to Watervliet, New York, specifically within the Watervliet Arsenal facility. Workforce implications may include employment opportunities for skilled trades and construction workers in the New York region.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may lead to inflated pricing.
Sole-source award raises concerns about the justification and potential for better value elsewhere.
The significant dollar amount requires robust oversight to ensure efficient use of funds.

Positive Signals

Addresses critical infrastructure needs for a military installation.
Firm fixed-price contract provides cost certainty.
Long-term contract duration (over 1.5 years) allows for planned execution.

Sector Analysis

This contract falls within the construction sector, specifically related to power and communication line infrastructure. The market for specialized military base infrastructure projects can be limited, sometimes necessitating sole-source or limited competition awards. Comparable spending benchmarks for similar substation replacement projects at federal facilities are not readily available in the public domain, making direct cost comparisons difficult.

Small Business Impact

The contract details indicate that small business participation was not a primary consideration, as the award was not set aside for small businesses and the prime contractor is CCI Utility and Construction Services LLC. There is no explicit information regarding subcontracting plans with small businesses. This suggests that the primary focus was on securing the necessary expertise for the specialized infrastructure work, rather than prioritizing small business engagement.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of the Army's contracting and project management offices. Accountability measures are inherent in the firm fixed-price contract type, which obligates the contractor to deliver the specified work within the agreed-upon cost. Transparency is limited due to the sole-source nature of the award and the lack of detailed public reporting on project progress or cost breakdowns.

Related Government Programs

Military Base Infrastructure Modernization
Electrical Grid Upgrades
Department of Defense Facilities Management
Army Corps of Engineers Construction Projects

Risk Flags

Sole-source award
Lack of competition
Limited public data on comparable projects

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $17.1 million to CCI UTILITY AND CONSTRUCTION SERVICES LLC. TO COVER THE COST OF LABOR, EQUIPMENT AND MATERIAL FOR THE REPLACEMENT OF THREE ELECTRICAL SUBSTATIONS AT BLDG 110, BUILDING 35, FOR THE WATERVLIET ARSENAL, NY 12189-4000

Who is the contractor on this award?

The obligated recipient is CCI UTILITY AND CONSTRUCTION SERVICES LLC.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $17.1 million.

What is the period of performance?

Start: 2020-10-28. End: 2025-12-31.

What is the track record of CCI Utility and Construction Services LLC in performing similar large-scale electrical infrastructure projects for the federal government?

Information regarding CCI Utility and Construction Services LLC's specific track record on large-scale federal electrical infrastructure projects is not readily available in the provided data. A comprehensive review would require accessing federal procurement databases (like SAM.gov or FPDS) to analyze past performance, contract history, and any reported issues or successes. Understanding their experience with substation replacements, adherence to deadlines, and quality of work on previous government contracts is crucial for assessing their capability to successfully execute this $17.1 million project.

How does the awarded price of $17.1 million compare to industry benchmarks for similar electrical substation replacement projects?

Directly comparing the $17.1 million award to industry benchmarks for electrical substation replacements is challenging without more specific project details and access to proprietary cost data. Factors influencing cost include the size and capacity of the substations, the complexity of the existing infrastructure, the scope of modernization required, and site-specific conditions at the Watervliet Arsenal. Given the sole-source nature of this award, a robust independent cost estimate or a comparison against multiple bids would typically be necessary to validate the price against market rates. Publicly available data on comparable federal projects is scarce.

What are the specific risks associated with a sole-source award for critical infrastructure like electrical substations?

Sole-source awards for critical infrastructure present several risks. Primarily, the absence of competition can lead to a lack of price pressure, potentially resulting in the government paying more than necessary. It also reduces the incentive for the contractor to innovate or optimize costs, as they are the only option. Furthermore, without a competitive process, there's a reduced assurance that the selected contractor is the absolute best fit in terms of technical expertise, past performance, and overall value proposition compared to other potential providers in the market. This can increase the risk of project delays, cost overruns, or suboptimal outcomes if the chosen contractor underperforms.

What are the potential program effectiveness implications of replacing these electrical substations at the Watervliet Arsenal?

The replacement of these electrical substations is expected to significantly enhance the program effectiveness of operations at the Watervliet Arsenal. Modernized substations will likely improve power reliability, reduce the risk of outages, and ensure consistent power delivery essential for sensitive military operations and equipment. This upgrade can also lead to increased energy efficiency, potentially lowering long-term operational costs. Furthermore, it ensures compliance with current safety and environmental standards, mitigating risks associated with aging infrastructure and contributing to the overall security and operational readiness of the installation.

What has been the historical spending pattern for electrical infrastructure upgrades at the Watervliet Arsenal or similar Army installations?

Historical spending patterns for electrical infrastructure upgrades at the Watervliet Arsenal or similar Army installations are not detailed in the provided data. To assess this, one would need to analyze past contracts awarded by the Department of the Army for facilities maintenance and upgrades over several fiscal years. This analysis would involve identifying the frequency, value, and types of contracts awarded for electrical systems, substations, and related infrastructure. Understanding historical spending can help contextualize the current $17.1 million award and identify any trends in investment or potential shifts in procurement strategies for critical infrastructure.

What specific justification was provided for awarding this contract on a sole-source basis?

The provided data indicates the contract was 'NOT AVAILABLE FOR COMPETITION,' which is a common designation for sole-source awards. However, the specific justification or rationale behind this determination is not detailed. Typically, federal agencies must document a justification for other than full and open competition (JOFOC) when a contract is not competed. This might include reasons such as only one responsible source being available, or a compelling urgency that precludes competition. Without access to the official JOFOC document, the precise reasons remain unknown.

Industry Classification

NAICS: Construction › Utility System Construction › Power and Communication Line and Related Structures Construction

Product/Service Code: MAINT, REPAIR, ALTER REAL PROPERTY › MAINT, ALTER, REPAIR NONBUILDINGS

Competition & Pricing

Extent Competed: NOT AVAILABLE FOR COMPETITION

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: W911PT20R0009

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 526 WESTERN AVE, AUGUSTA, ME, 04330

Business Categories: 8(a) Program Participant, Alaskan Native Corporation Owned Firm, Category Business, Corporate Entity Not Tax Exempt, Limited Liability Corporation, Minority Owned Business, Self-Certified Small Disadvantaged Business, Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $17,135,334

Exercised Options: $17,135,334

Current Obligation: $17,135,334

Actual Outlays: $1,126,458

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline