State Dept. Awards $29.8M for Embassy IT Infrastructure in Egypt, Sole-Source Contract

Contract Overview

Contract Amount: $29,847,282 ($29.8M)

Contractor: Kadiak LLC

Awarding Agency: Department of State

Start Date: 2023-09-29

End Date: 2027-05-12

Contract Duration: 1,321 days

Daily Burn Rate: $22.6K/day

Competition Type: NOT AVAILABLE FOR COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: US EMBASSY IN EGYPT - INFORMATION TECHNOLOGY INFRASTRUCTURE REHABILITATION PROJECT

Plain-Language Summary

Department of State obligated $29.8 million to KADIAK LLC for work described as: US EMBASSY IN EGYPT - INFORMATION TECHNOLOGY INFRASTRUCTURE REHABILITATION PROJECT Key points: 1. Significant investment in critical overseas infrastructure. 2. Sole-source award raises questions about competition and price discovery. 3. Long-term contract duration (over 3 years) for rehabilitation project. 4. Potential for cost overruns given the nature of infrastructure work.

Value Assessment

Rating: questionable

The contract value of $29.8 million is substantial for IT infrastructure rehabilitation. Without competitive bidding, it's difficult to assess if this price represents fair market value compared to similar projects.

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 limits the government's ability to leverage market forces for better pricing and potentially overlooks qualified alternative vendors.

Taxpayer Impact: The absence of competition may lead to taxpayers paying a premium for the services rendered.

Public Impact

Ensures operational continuity and security for the US Embassy in Egypt. Supports diplomatic operations and personnel safety through modern IT systems. Potential for job creation within the contractor's organization.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award
Lack of competition
Long contract duration

Positive Signals

Critical infrastructure upgrade
Supports US diplomatic mission

Sector Analysis

This contract falls under commercial and institutional building construction, specifically focusing on IT infrastructure. Benchmarks for similar overseas embassy IT rehabilitation projects are scarce, making direct comparison difficult.

Small Business Impact

There is no indication that small businesses were involved in this sole-source award, suggesting missed opportunities for their participation.

Oversight & Accountability

Oversight will be crucial to ensure the project stays within budget and meets its objectives, especially given the sole-source nature of the award.

Related Government Programs

Commercial and Institutional Building Construction
Department of State Contracting
Department of State Programs

Risk Flags

Potential for overpricing due to sole-source award.
Risk of project delays or scope creep.
Limited transparency in vendor selection.
Dependency on a single contractor.

Frequently Asked Questions

What is this federal contract paying for?

Department of State awarded $29.8 million to KADIAK LLC. US EMBASSY IN EGYPT - INFORMATION TECHNOLOGY INFRASTRUCTURE REHABILITATION PROJECT

Who is the contractor on this award?

The obligated recipient is KADIAK LLC.

Which agency awarded this contract?

Awarding agency: Department of State (Department of State).

What is the total obligated amount?

The obligated amount is $29.8 million.

What is the period of performance?

Start: 2023-09-29. End: 2027-05-12.

What specific factors justified the sole-source award, and were alternatives thoroughly explored?

The justification for a sole-source award typically involves unique capabilities, urgent needs, or lack of available competition. A thorough review would detail why other vendors could not meet the requirements and the process undertaken to confirm this exclusivity. Without this information, it's difficult to ascertain if the government truly exhausted all competitive avenues.

How does the $29.8 million price compare to similar IT infrastructure rehabilitation projects in comparable diplomatic facilities?

Benchmarking this contract's value against similar projects is challenging due to the unique nature of overseas embassy infrastructure and the sole-source award. A comprehensive analysis would require access to data on comparable projects, factoring in location, scope, and security requirements. The lack of competitive bids makes a definitive value assessment difficult.

What mechanisms are in place to ensure effective project management and prevent cost overruns over the 3+ year duration?

Given the project's length and complexity, robust oversight is essential. This includes clear performance metrics, regular progress reviews, and contingency planning. The contract type (Firm Fixed Price) offers some cost control, but scope creep or unforeseen issues could still impact the final cost, necessitating vigilant management.

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: 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: Koniag, Inc.

Address: 3800 CENTERPOINT DR, ANCHORAGE, AK, 99503

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

Financial Breakdown

Contract Ceiling: $29,847,282

Exercised Options: $29,847,282

Current Obligation: $29,847,282

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Timeline