NIST awards $6.65M contract for crane replacement/repair to PEM CONSTRUCTION, LLC

Contract Overview

Contract Amount: $6,651,980 ($6.7M)

Contractor: PEM Construction, LLC

Awarding Agency: Department of Commerce

Start Date: 2024-08-06

End Date: 2026-03-31

Contract Duration: 602 days

Daily Burn Rate: $11.1K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 2

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: CRANE REPLACE/REPAIR

Place of Performance

Location: GAITHERSBURG, MONTGOMERY County, MARYLAND, 20878

State: Maryland Government Spending

Plain-Language Summary

Department of Commerce obligated $6.7 million to PEM CONSTRUCTION, LLC for work described as: CRANE REPLACE/REPAIR Key points: 1. Contract value appears reasonable for specialized construction services. 2. Full and open competition was utilized, suggesting a competitive bidding process. 3. The contract duration of 602 days allows for thorough execution. 4. Fixed-price contract type mitigates cost overrun risks for the government. 5. The project is located in Maryland, a key hub for federal facilities.

Value Assessment

Rating: good

The contract value of $6.65 million for crane replacement/repair seems aligned with the scope of work for commercial and institutional building construction. Benchmarking against similar projects would provide a more precise value-for-money assessment, but the fixed-price nature suggests a degree of cost control. The National Institute of Standards and Technology (NIST) is procuring these services, indicating a need for specialized expertise in maintaining critical infrastructure.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under 'Full and Open Competition After Exclusion of Sources,' which implies that while the competition was broad, specific sources may have been excluded for defined reasons. The presence of 2 bids indicates a moderate level of competition. A higher number of bidders typically leads to more competitive pricing and a wider range of solutions.

Taxpayer Impact: The use of full and open competition, even with a limited number of bidders, generally benefits taxpayers by encouraging competitive pricing and ensuring that the government receives fair market value for the services rendered.

Public Impact

The National Institute of Standards and Technology (NIST) will benefit from improved and reliable crane operations. Services include the replacement and repair of essential crane infrastructure. The project's geographic impact is focused on NIST facilities in Maryland. This contract supports the construction and maintenance workforce in the Maryland region.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for delays if specialized parts are not readily available.
Ensuring the long-term reliability of the repaired/replaced crane is critical.

Positive Signals

Fixed-price contract limits cost escalation.
Award to a single contractor streamlines project management.
The project addresses a critical infrastructure need for NIST.

Sector Analysis

The Commercial and Institutional Building Construction sector encompasses a wide range of projects, from new builds to renovations and repairs. Federal spending in this sector is substantial, supporting agencies' operational needs and infrastructure maintenance. This contract for crane services fits within the broader category of facility maintenance and upgrades, crucial for agencies like NIST that rely on specialized equipment for research and operations. Comparable spending benchmarks for similar specialized construction projects can vary significantly based on location, complexity, and specific equipment involved.

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 mention of subcontracting requirements for small businesses. The award to PEM CONSTRUCTION, LLC, a single entity, suggests that small businesses may not have been primary participants in this specific procurement, though they could potentially be involved as subcontractors if opportunities arise and are mandated.

Oversight & Accountability

Oversight for this contract will likely be managed by the contracting officer and program officials within the National Institute of Standards and Technology (NIST). The fixed-price nature of the contract provides a degree of financial oversight by setting a ceiling on costs. Transparency is generally maintained through contract award databases, and any significant issues or disputes would fall under the purview of NIST's internal oversight mechanisms and potentially the Government Accountability Office (GAO) if protests or claims arise.

Related Government Programs

Federal Building and Facilities Construction
Industrial Equipment Maintenance
Infrastructure Modernization Projects

Risk Flags

Limited number of bidders may reduce competitive pressure.
Potential for unforeseen issues impacting schedule or cost, despite fixed-price.

Frequently Asked Questions

What is this federal contract paying for?

Department of Commerce awarded $6.7 million to PEM CONSTRUCTION, LLC. CRANE REPLACE/REPAIR

Who is the contractor on this award?

The obligated recipient is PEM CONSTRUCTION, LLC.

Which agency awarded this contract?

Awarding agency: Department of Commerce (National Institute of Standards and Technology).

What is the total obligated amount?

The obligated amount is $6.7 million.

What is the period of performance?

Start: 2024-08-06. End: 2026-03-31.

What is the track record of PEM CONSTRUCTION, LLC in performing similar federal contracts?

Information regarding PEM CONSTRUCTION, LLC's specific track record with federal contracts, particularly those involving crane replacement or repair, is not detailed in the provided data. A comprehensive assessment would require reviewing past performance evaluations, contract history, and any reported issues or successes on similar projects. Federal procurement databases and past performance questionnaires are typically used to evaluate a contractor's reliability and capability. Without this specific data, it's difficult to definitively assess their suitability beyond the fact that they were selected in this instance.

How does the awarded price compare to market rates for similar crane services?

The provided data does not include specific market rate benchmarks for crane replacement and repair services in Maryland. The contract value of $6.65 million is for a 602-day duration, suggesting a significant scope of work. To assess value for money, this price would need to be compared against industry cost data, quotes from other potential vendors (if available), and the complexity of the specific crane systems being serviced. The fixed-price nature of the contract implies that the contractor has factored in their anticipated costs and profit margin, and the government has agreed this is a fair price for the defined scope.

What are the primary risks associated with this crane replacement/repair contract?

Key risks include potential delays in obtaining specialized parts or equipment, unforeseen structural issues discovered during the repair process that could increase costs (though mitigated by fixed-price), and ensuring the long-term operational reliability and safety of the repaired or replaced crane. There's also a risk related to the contractor's capacity to manage a project of this scale and duration effectively. The limited number of bidders (2) could also pose a risk if the chosen contractor underperforms, as alternative options might be less readily available or more costly to engage.

How effective is the 'Full and Open Competition After Exclusion of Sources' method for this type of procurement?

This method aims to balance broad competition with specific needs. 'Full and Open Competition' ensures a wide net is cast, potentially leading to better pricing and innovation. The 'Exclusion of Sources' aspect suggests that certain vendors were intentionally excluded, perhaps due to past performance issues, lack of specific certifications, or other documented reasons. For specialized services like crane repair, where specific expertise or certifications might be critical, this approach can be effective in ensuring qualified bidders while still maintaining a competitive environment. However, the effectiveness hinges on the justification for excluding sources and whether it unduly limited competition.

What is the historical spending pattern for crane maintenance and repair at NIST?

The provided data does not include historical spending patterns for crane maintenance and repair at NIST. To analyze this, one would need to access historical contract databases to identify previous awards for similar services, their values, durations, and the contractors involved. Understanding past spending can help contextualize the current $6.65 million award, revealing whether it represents an increase, decrease, or stable level of investment in this area. It can also highlight trends in contractor selection and pricing over time.

What are the implications of the fixed-price contract type for NIST?

A Firm Fixed Price (FFP) contract type is generally advantageous for the government as it shifts the risk of cost overruns to the contractor. For NIST, this means the total cost of the crane replacement/repair is established upfront, providing budget certainty. The contractor is incentivized to control costs and work efficiently to maximize their profit. The primary implication is reduced financial risk for the agency, assuming the scope of work is well-defined. Any changes to the scope would typically require a formal contract modification, potentially impacting the price and schedule.

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 AFTER EXCLUSION OF SOURCES

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 2

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 6161 BUSCH BLVD STE 255, COLUMBUS, OH, 43229

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Limited Liability Corporation, Minority Owned Business, SBA Certified 8 a Joint Venture, Self-Certified Small Disadvantaged Business, Small Business, Special Designations, Indian (Subcontinent) American Owned Business, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $6,651,980

Exercised Options: $6,651,980

Current Obligation: $6,651,980

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: 1333ND23DNB190020

IDV Type: IDC

Timeline