Department of the Army's $25.2M Small Arms Repair contract awarded to Southeastern Industrial Construction Company, Inc

Contract Overview

Contract Amount: $25,191,523 ($25.2M)

Contractor: Southeastern Industrial Construction Company, Inc.

Awarding Agency: Department of Defense

Start Date: 2009-08-28

End Date: 2013-12-30

Contract Duration: 1,585 days

Daily Burn Rate: $15.9K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 11

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: SMALL ARMS REPAIR

Place of Performance

Location: OXFORD, CALHOUN County, ALABAMA, 36203

State: Alabama Government Spending

Plain-Language Summary

Department of Defense obligated $25.2 million to SOUTHEASTERN INDUSTRIAL CONSTRUCTION COMPANY, INC. for work described as: SMALL ARMS REPAIR Key points: 1. The contract value of $25.2 million represents a significant investment in maintaining critical military equipment. 2. Awarded under full and open competition, this contract suggests a competitive bidding process. 3. The duration of the contract (over 4 years) indicates a long-term need for these repair services. 4. The firm-fixed-price nature of the contract shifts cost risk to the contractor. 5. The contract falls within the Commercial and Institutional Building Construction sector, highlighting the infrastructure needs supporting military operations. 6. The absence of small business set-asides suggests the primary contractor is not a small business, and subcontracting opportunities for small businesses are not explicitly mandated. 7. The contract was awarded as a delivery order, implying it's part of a larger indefinite-delivery/indefinite-quantity (IDIQ) vehicle or a similar framework.

Value Assessment

Rating: fair

Benchmarking the value of this specific contract is challenging without more granular data on the scope of 'small arms repair' and comparable service costs. The total award of $25.2 million over approximately 4.3 years averages to about $5.8 million annually. This figure needs to be assessed against the volume and complexity of the repair work performed. Without specific unit costs or performance metrics, it's difficult to definitively assess value for money. However, the firm-fixed-price contract type generally promotes cost control by the contractor.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES,' which indicates a competitive process was initiated, but certain sources were excluded. This suggests that while multiple bidders were likely considered, the final selection was made from a pre-qualified or restricted pool. The number of bidders is not specified, but the 'full and open' designation implies a robust competition was intended.

Taxpayer Impact: This level of competition, even with exclusions, generally benefits taxpayers by encouraging competitive pricing and potentially leading to better value. However, the exclusion of sources warrants further investigation to ensure it did not unduly limit competition and inflate costs.

Public Impact

The primary beneficiaries are the U.S. Army units requiring functional small arms for their operations. The contract ensures the readiness and operational capability of infantry and other combat forces by maintaining their primary individual weapons. Services delivered include the repair and maintenance of various types of small arms. The geographic impact is likely concentrated where Army units are stationed or where repair facilities are located, with Alabama being the state of the contractor. Workforce implications include employment for skilled technicians and support staff at Southeastern Industrial Construction Company, Inc.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

The 'exclusion of sources' in the competition type raises questions about whether the most competitive bids were truly considered.
Lack of specific performance metrics makes it difficult to assess the true value for money delivered.
The contract's focus on building construction (NAICS 236220) for 'small arms repair' is unusual and may indicate a broader scope than just weapon maintenance, potentially including facility upgrades or specialized construction related to armories or repair shops.

Positive Signals

Awarded under a full and open competition framework, suggesting an effort to solicit broad market interest.
The firm-fixed-price contract type transfers cost overrun risk to the contractor, which can be beneficial for budget predictability.
The contract duration of over 4 years indicates a stable, long-term requirement, allowing for efficient resource planning by the contractor.

Sector Analysis

This contract falls under the Commercial and Institutional Building Construction sector (NAICS 236220), which is broad and encompasses the construction or renovation of non-residential buildings. While the description is 'SMALL ARMS REPAIR,' the NAICS code suggests the work may involve the construction or modification of facilities where small arms are stored, maintained, or repaired, rather than the direct repair of the weapons themselves. This highlights the significant infrastructure support required for military readiness. Comparable spending benchmarks in this sector are highly variable based on project scope, but large-scale construction projects can easily run into tens of millions of dollars.

Small Business Impact

The data indicates that small business participation was not a primary focus, as the contract was not set aside for small businesses (ss: false) and there's no explicit mention of small business subcontracting goals (sb: false). This suggests that the prime contractor, Southeastern Industrial Construction Company, Inc., is likely a large business, and opportunities for small businesses would depend on their subcontracting decisions rather than a mandated requirement. This could limit the direct economic impact on the small business ecosystem for this specific contract.

Oversight & Accountability

Oversight for this contract would typically be managed by the Department of the Army contracting and program management offices. Accountability measures are embedded in the firm-fixed-price contract terms, requiring the contractor to deliver specified services within the agreed price. Transparency is generally facilitated through contract databases like FPDS, where basic award information is publicly available. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

Department of Defense Maintenance and Repair Contracts
Army Weapons Systems Support
Military Construction Projects
Logistics and Readiness Support Services

Risk Flags

Unusual NAICS code classification for contract description.
Potential for limited competition due to 'exclusion of sources'.
Lack of explicit small business subcontracting requirements.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $25.2 million to SOUTHEASTERN INDUSTRIAL CONSTRUCTION COMPANY, INC.. SMALL ARMS REPAIR

Who is the contractor on this award?

The obligated recipient is SOUTHEASTERN INDUSTRIAL CONSTRUCTION COMPANY, 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 $25.2 million.

What is the period of performance?

Start: 2009-08-28. End: 2013-12-30.

What is the specific nature of the 'small arms repair' being performed under a construction NAICS code?

The classification under NAICS code 236220 (Commercial and Institutional Building Construction) for a contract described as 'SMALL ARMS REPAIR' is unusual. It strongly suggests that the contract's scope is not the direct repair of individual firearms. Instead, it likely pertains to the construction, renovation, or maintenance of facilities that house, store, or support the repair of small arms. This could include building or upgrading armories, maintenance workshops, firing ranges, or specialized storage facilities. The 'repair' aspect might refer to the upkeep or modification of these structures. Further clarification from the contracting agency would be needed to precisely define the work.

How does the $25.2 million contract value compare to similar Army repair or construction contracts?

Direct comparison of the $25.2 million contract value is difficult without knowing the precise scope of work and the specific type of construction or repair involved. However, for large-scale construction projects or facility upgrades within the Department of Defense, a $25.2 million award over approximately 4.3 years is a substantial sum, indicating a significant undertaking. For context, major military construction projects can range from tens to hundreds of millions of dollars. The value needs to be benchmarked against the square footage, complexity of the facility, and the specific repair or construction tasks outlined in the contract's statement of work, which are not detailed here.

What are the key risks associated with this contract for the Department of the Army?

Key risks include potential cost overruns if the scope of work is not clearly defined or if unforeseen construction challenges arise, despite the firm-fixed-price structure. There's also a risk related to the contractor's performance and ability to meet quality standards and deadlines, especially given the unusual combination of a construction NAICS code with a 'repair' description. Ensuring the completed facilities adequately meet the operational needs for small arms maintenance and storage is critical. Furthermore, if the 'exclusion of sources' limited competition significantly, there's a risk that the Army did not secure the best possible price or value.

What does the contract duration of 1585 days imply about the program's stability and the contractor's performance?

A contract duration of 1585 days (approximately 4.3 years) suggests a stable, long-term requirement for the services or construction provided. This extended period allows the contractor, Southeastern Industrial Construction Company, Inc., to plan resources, invest in necessary equipment, and potentially build expertise specific to the project. For the Army, it implies a consistent need that is not expected to change drastically in the near future. Such long durations can foster a stronger working relationship and potentially lead to efficiencies, but also necessitate robust oversight to ensure continued performance and value throughout the contract's life.

How does the 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES' impact price discovery and taxpayer value?

This procurement method indicates that the agency initially intended to compete the contract broadly but subsequently excluded certain potential offerors. While 'full and open' aims for maximum competition, the exclusion implies that the pool of bidders was narrowed. The impact on price discovery depends on the reasons for exclusion and the number of remaining bidders. If the exclusions were justified (e.g., based on specific technical capabilities or past performance) and a sufficient number of qualified bidders remained, competitive pricing could still be achieved. However, if the exclusions significantly reduced the number of viable competitors, it could potentially lead to less aggressive bidding and a higher price for taxpayers than under a truly unrestricted full and open competition.

What is the historical spending pattern for 'SMALL ARMS REPAIR' or related construction services by the Department of the Army?

Analyzing historical spending patterns for 'SMALL ARMS REPAIR' specifically, especially when linked to construction (NAICS 236220), is complex due to the potential ambiguity in contract descriptions and classifications. General spending on military readiness, equipment maintenance, and facility construction by the Department of the Army runs into billions of dollars annually. Contracts for repair and maintenance of weapon systems are distinct from construction contracts for facilities. Without more specific data filtering by relevant NAICS codes and keywords related to military infrastructure, it's difficult to establish a precise historical spending trend for this particular intersection of services. However, the Army consistently invests heavily in both maintaining its equipment and its physical infrastructure.

Industry Classification

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

Product/Service Code: CONSTRUCT OF STRUCTURES/FACILITIES › CONSTRUCT NONBUILDING FACILITIES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: W9127807R0017

Offers Received: 11

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 180 COMMERCE DR, PELHAM, AL, 35124

Business Categories: 8(a) Program Participant, American Indian Owned Business, Category Business, Minority Owned Business, Native American Owned Business, Self-Certified Small Disadvantaged Business, Small Business, Small Disadvantaged Business, Special Designations, Veteran Owned Business

Financial Breakdown

Contract Ceiling: $25,191,523

Exercised Options: $25,191,523

Current Obligation: $25,191,523

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: W9127807D0072

IDV Type: IDC

Timeline