Department of the Navy awards $19.2M engineering services contract to Hodges Transportation, Inc

Contract Overview

Contract Amount: $19,185,907 ($19.2M)

Contractor: Hodges Transportation, Inc.

Awarding Agency: Department of Defense

Start Date: 2012-10-05

End Date: 2015-03-31

Contract Duration: 907 days

Daily Burn Rate: $21.2K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: COST PLUS FIXED FEE

Sector: Other

Official Description: BUILD EFFORT

Place of Performance

Location: SILVER SPRINGS, LYON County, NEVADA, 89429, UNITED STATES OF AMERICA

State: Nevada Government Spending

Plain-Language Summary

Department of Defense obligated $19.2 million to HODGES TRANSPORTATION, INC. for work described as: BUILD EFFORT Key points: 1. Contract awarded on a cost-plus-fixed-fee basis, which can lead to cost overruns if not managed carefully. 2. The contract was not competed, raising questions about potential price discovery and value for money. 3. The duration of the contract (907 days) suggests a significant scope of work for engineering services. 4. The award was made to a single contractor, indicating a lack of competitive pressure on pricing. 5. The contract falls under the 'Engineering Services' NAICS code, a common area for federal procurement. 6. The small business status of the contractor is not indicated, nor is there a small business set-aside. 7. The contract was awarded by the Department of the Navy, a major component of the Department of Defense.

Value Assessment

Rating: questionable

Benchmarking the value of this contract is challenging without more detailed cost breakdowns and comparison to similar engineering service contracts. The cost-plus-fixed-fee structure inherently carries more risk for the government compared to fixed-price contracts, as costs can escalate. The lack of competition further limits the ability to assess if the pricing is competitive or represents good value for the services rendered. Without a competitive bidding process, it's difficult to determine if the fixed fee adequately compensates the contractor for the effort involved or if it includes a premium due to the absence of alternatives.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a 'NOT COMPETED' basis, meaning it was not subjected to a full and open competitive bidding process. This typically occurs when only one source is capable of meeting the agency's needs, or in specific emergency situations. The lack of competition means that potential savings that could arise from multiple bidders vying for the contract were not realized. It also limits the agency's ability to explore a wider range of technical solutions or pricing structures that might have been offered by other qualified firms.

Taxpayer Impact: The absence of competition means taxpayers may not have received the best possible price for these engineering services. Without a competitive process, there is a higher risk that the awarded price is not the most cost-effective option available.

Public Impact

The primary beneficiary of this contract is the Department of the Navy, which receives essential engineering services. The services delivered are categorized under 'Engineering Services,' likely supporting naval operations, infrastructure, or systems. The geographic impact is likely concentrated in Nevada, where the contract was awarded, or wherever the engineering services are performed. The contract supports the defense industrial base by engaging a company that provides specialized engineering expertise.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may lead to higher costs for taxpayers.
Cost-plus-fixed-fee contracts can incentivize cost overruns if not rigorously monitored.
Limited transparency due to sole-source award makes performance and value assessment more difficult.

Positive Signals

Contract awarded to a specific entity (Hodges Transportation, Inc.) for specialized engineering services.
The contract duration suggests a substantial and potentially critical need for these services.
The award falls under a recognized NAICS code for engineering services, indicating a defined scope.

Sector Analysis

Engineering services represent a significant segment of the federal procurement landscape, encompassing a wide range of technical expertise. This contract, valued at approximately $19.2 million, falls within the broader category of professional services procured by the Department of Defense. Comparable spending in this sector often involves complex design, analysis, and consulting for infrastructure, defense systems, and research and development projects. The market for engineering services is diverse, with many firms capable of providing specialized expertise, making the non-competitive award notable.

Small Business Impact

There is no indication that this contract was set aside for small businesses, nor is there information suggesting subcontracting opportunities for small businesses. The award to Hodges Transportation, Inc. does not specify its size category. Without a small business set-aside, larger firms are typically eligible, and the impact on the small business ecosystem is neutral unless subcontracting plans are mandated and fulfilled.

Oversight & Accountability

Oversight for this contract would primarily reside with the contracting officers and program managers within the Department of the Navy. Accountability measures would be defined by the contract terms, including performance standards and payment schedules. Transparency is limited due to the sole-source nature of the award. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

Department of Defense Engineering Services
Naval Facilities Engineering Command Contracts
Professional Services Contracts
Cost-Plus-Fixed-Fee Contracts

Risk Flags

Sole-source award
Cost-plus contract type
Lack of competition

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $19.2 million to HODGES TRANSPORTATION, INC.. BUILD EFFORT

Who is the contractor on this award?

The obligated recipient is HODGES TRANSPORTATION, 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 $19.2 million.

What is the period of performance?

Start: 2012-10-05. End: 2015-03-31.

What is the specific nature of the engineering services provided under this contract?

The provided data indicates the contract is for 'Engineering Services' under NAICS code 541330. However, the specific nature of these services is not detailed. Typically, engineering services for the Department of the Navy could encompass a broad spectrum, including but not limited to, architectural design, structural engineering, mechanical and electrical systems design, environmental engineering, systems engineering, or technical consulting related to naval platforms, infrastructure, or facilities. Further details would be found in the contract's Statement of Work (SOW) or Performance Work Statement (PWS), which are not included in the provided data.

Why was this contract awarded on a sole-source basis instead of being competed?

The data explicitly states the contract was 'NOT COMPETED'. Federal procurement regulations allow for non-competitive awards under specific circumstances, such as when only one responsible source is available, or in cases of urgent and compelling need. Without additional justification from the awarding agency (Department of the Navy), the precise reason for the sole-source award remains unknown. Common justifications include unique capabilities, proprietary technology, or a critical need that cannot be met through competition within the required timeframe. This lack of competition raises concerns about potential price inflation and reduced value for taxpayer funds.

How does the 'Cost Plus Fixed Fee' (CPFF) contract type compare to other contract types in terms of risk and value?

Cost Plus Fixed Fee (CPFF) contracts are used when the extent or duration of the work cannot be determined in advance, but the agency has a good estimate of the total cost. The government pays the contractor's actual costs plus a fixed fee representing profit. This structure shifts some cost risk to the government, as the final cost can exceed initial estimates if actual costs are higher than anticipated. Compared to fixed-price contracts, CPFF can offer more flexibility for complex or uncertain projects but may result in higher overall costs for the government. It requires robust oversight to ensure costs are reasonable and the fixed fee is appropriate for the effort.

What is the historical spending pattern for engineering services by the Department of the Navy?

Historical spending data for engineering services by the Department of the Navy is extensive and varies significantly year over year based on operational needs, infrastructure projects, and defense modernization efforts. The Navy procures a vast array of engineering services, from design and planning for new facilities and shipyards to specialized technical support for complex weapon systems and cybersecurity infrastructure. While this specific $19.2 million contract represents a portion of that spending, a comprehensive analysis would require examining annual procurement reports, contract databases (like FPDS), and budget allocations for relevant naval commands over several fiscal years to identify trends, major contract awards, and dominant service providers.

What are the potential implications of a 907-day contract duration for engineering services?

A contract duration of 907 days (approximately 2.5 years) for engineering services suggests a substantial, long-term requirement. This extended period implies that the project or services are complex, require sustained effort, or involve multiple phases. For the contractor, it offers a degree of revenue stability. For the agency, it indicates a significant commitment to the project's objectives. Such durations often necessitate careful planning, resource allocation, and ongoing performance management to ensure milestones are met and the project remains on track and within budget, especially given the CPFF structure.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Architectural, Engineering, and Related Services › Engineering Services

Product/Service Code: RESEARCH AND DEVELOPMENT › DEFENSE (OTHER) R&D

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Offers Received: 1

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Address: 605 FORT CHURCHILL RD, SILVER SPRINGS, NV, 89429

Business Categories: Category Business, Corporate Entity Not Tax Exempt, HUBZone Firm, Small Business, Special Designations, Subchapter S Corporation, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $19,356,854

Exercised Options: $19,185,907

Current Obligation: $19,185,907

Contract Characteristics

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: M6785412G0202

IDV Type: BOA

Timeline