DoD's $32.4M fuel contract with JDLogic, LLC awarded under full and open competition

Contract Overview

Contract Amount: $32,396,837 ($32.4M)

Contractor: Jdlogic, LLC

Awarding Agency: Department of Defense

Start Date: 2012-06-01

End Date: 2015-06-30

Contract Duration: 1,124 days

Daily Burn Rate: $28.8K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 43

Pricing Type: FIXED PRICE WITH ECONOMIC PRICE ADJUSTMENT

Sector: Other

Official Description: VARIOUS FUEL PRODUCTS (BDI, DS2, AND GUR)

Place of Performance

Location: PARKER, DOUGLAS County, COLORADO, 80134, UNITED STATES OF AMERICA

State: Colorado Government Spending

Plain-Language Summary

Department of Defense obligated $32.4 million to JDLOGIC, LLC for work described as: VARIOUS FUEL PRODUCTS (BDI, DS2, AND GUR) Key points: 1. Contract value represents a significant investment in essential fuel products for defense operations. 2. The fixed-price structure with economic price adjustment aims to mitigate market volatility. 3. Awarded to JDLogic, LLC, a single entity, raising questions about the breadth of competition. 4. The contract duration of over three years suggests a sustained need for these fuel products. 5. The petroleum refineries NAICS code indicates a focus on a specialized industrial sector. 6. The contract was awarded under 'full and open competition', suggesting broad market solicitation.

Value Assessment

Rating: fair

The total award of $32.4 million for various fuel products over approximately three years appears to be within a reasonable range for large-scale defense fuel procurement. However, without specific per-unit pricing benchmarks or comparisons to similar contracts for these exact fuel types (BDI, DS2, GUR), a definitive value-for-money assessment is challenging. The economic price adjustment clause introduces a variable that could impact the final cost, making direct comparison difficult.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under 'full and open competition', indicating that the solicitation was made available to all responsible sources. While the data shows 43 bids were received, the ultimate award went to a single contractor, JDLogic, LLC. This suggests a competitive bidding process initially, but the final selection highlights JDLogic's ability to meet the stringent requirements or offer the most advantageous proposal.

Taxpayer Impact: A competitive bidding process generally benefits taxpayers by driving down prices and encouraging efficiency. The receipt of 43 bids suggests a healthy level of market interest, which should have contributed to favorable pricing for the government.

Public Impact

The Department of Defense is the primary beneficiary, ensuring the availability of critical fuel supplies for its operations. Services delivered include the provision of various fuel products such as BDI, DS2, and GUR. The contract's geographic impact is likely national, supporting military bases and operations across the United States. The contract supports jobs within the petroleum refining and fuel distribution sectors.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for price increases due to the economic price adjustment clause, impacting budget predictability.
Reliance on a single awardee, JDLogic, LLC, could limit future competitive options if performance issues arise.
The specific fuel types (BDI, DS2, GUR) may have limited suppliers, potentially affecting long-term competition.
The duration of the contract might not align with rapidly evolving fuel technologies or environmental regulations.

Positive Signals

Awarded under full and open competition, indicating a broad market solicitation and potential for competitive pricing.
Receipt of 43 bids suggests significant market interest and a robust initial competitive landscape.
The fixed-price component provides some cost certainty, with adjustments only for specific economic factors.
The contract supports critical national defense needs, ensuring operational readiness.

Sector Analysis

This contract falls within the Petroleum Refineries sector (NAICS 324110), a critical component of the energy industry. The market for specialized fuels like BDI and DS2 can be niche, often dominated by a few large players or those with specific refining capabilities. The Department of Defense is a major consumer of such products, and its procurement activities significantly influence market dynamics and pricing within this segment. Benchmarking this contract's value against other government fuel procurements or large commercial contracts would provide further context on its economic efficiency.

Small Business Impact

The data indicates that this contract was not set aside for small businesses (sb: false) and the awardee, JDLogic, LLC, is not explicitly identified as a small business. Therefore, there are no direct subcontracting implications for small businesses stemming from a set-aside provision. However, large prime contractors are often encouraged or required to seek small business participation in their supply chains, which may or may not be occurring here.

Oversight & Accountability

Oversight for this contract would typically be managed by the Defense Logistics Agency (DLA), which is responsible for procuring and distributing a wide range of supplies for the U.S. military. Accountability measures would include performance monitoring, adherence to contract terms, and quality control of the delivered fuel products. Transparency is generally maintained through contract award databases and reporting requirements, though specific details of performance and pricing adjustments may be less public.

Related Government Programs

Defense Fuel Supply Center Contracts
Department of Defense Fuel Procurement
Petroleum Product Supply Contracts
Energy Sector Procurement
Logistics and Transportation Services

Risk Flags

Potential for price volatility due to Economic Price Adjustment (EPA) clause.
Reliance on a single awardee for critical fuel supplies.
Need for detailed benchmarking of fuel prices against market rates.
Ensuring sustained competition for future fuel procurements.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $32.4 million to JDLOGIC, LLC. VARIOUS FUEL PRODUCTS (BDI, DS2, AND GUR)

Who is the contractor on this award?

The obligated recipient is JDLOGIC, LLC.

Which agency awarded this contract?

Awarding agency: Department of Defense (Defense Logistics Agency).

What is the total obligated amount?

The obligated amount is $32.4 million.

What is the period of performance?

Start: 2012-06-01. End: 2015-06-30.

What is the historical spending pattern for similar fuel products by the Defense Logistics Agency?

Analyzing historical spending by the Defense Logistics Agency (DLA) for similar fuel products (BDI, DS2, GUR) is crucial for context. While this specific contract is valued at $32.4 million over approximately three years, understanding past procurements can reveal trends in pricing, competition, and contractor performance. For instance, if DLA has previously awarded similar contracts at significantly lower total values or with more favorable per-unit costs, it might suggest that current pricing is elevated or that competition has diminished. Conversely, consistent spending levels could indicate stable market conditions and predictable demand. Examining the number of bids received in prior solicitations for comparable fuels can also shed light on the health of the competitive landscape. Without access to DLA's historical procurement data for these specific fuel types, it is difficult to definitively assess whether the $32.4 million award represents an increase or decrease compared to past investments.

How does the pricing of JDLogic, LLC's fuel products compare to market rates or other government contracts?

Benchmarking the pricing of JDLogic, LLC's fuel products against market rates and other government contracts is essential for assessing value for money. The contract specifies 'VARIOUS FUEL PRODUCTS (BDI, DS2, AND GUR)' with a fixed price plus economic price adjustment. To perform a thorough comparison, one would need access to the specific unit prices or indices used for the economic price adjustment. If these fuel types are standard commodities, comparing their prices to published indices (e.g., EIA data for refined products) or to prices paid by other federal agencies or commercial entities for similar volumes and delivery terms would be informative. A significant deviation from established benchmarks, especially if unfavorable to the government, could indicate a lack of competitive pressure or less advantageous contract terms. Conversely, pricing in line with or below market rates would suggest a good value. The 'full and open competition' award mechanism, coupled with 43 bids, theoretically should drive prices toward market efficiency.

What are the specific risks associated with the economic price adjustment (EPA) clause in this contract?

The economic price adjustment (EPA) clause in this contract introduces several risks, primarily related to cost predictability and potential overspending. While intended to protect both the contractor and the government from extreme market fluctuations in fuel prices, an EPA can lead to higher-than-anticipated costs for the Department of Defense if market prices rise significantly. The specific formula or index used to calculate these adjustments is critical; if it is overly sensitive or not representative of the actual cost drivers for these specific fuels (BDI, DS2, GUR), it could lead to inflated prices. Furthermore, the EPA can complicate budget forecasting and make it difficult to accurately track the total expenditure over the contract's life. The government bears the risk of price increases, while the contractor is shielded from price decreases beyond a certain baseline, potentially shifting the risk-reward balance unfavorably.

What is JDLogic, LLC's track record with similar fuel supply contracts for the government?

Evaluating JDLogic, LLC's track record with similar fuel supply contracts, particularly for the government, is vital for assessing reliability and performance risk. Information on past performance, including contract history, delivery timeliness, product quality, and any past disputes or contract modifications, would provide insight into their capabilities. If JDLogic has a history of successfully fulfilling large-scale fuel contracts for agencies like the Defense Logistics Agency (DLA) or other branches of the military, it suggests a lower risk profile. Conversely, a history of performance issues, such as late deliveries, quality non-compliance, or significant cost overruns on previous contracts, would raise concerns. Access to federal procurement databases and contractor performance assessment reports (CPARS) would be necessary to conduct a comprehensive review of JDLogic's relevant past performance.

How does the number of bids (43) translate into potential cost savings for the taxpayer?

Receiving 43 bids for this contract, awarded under 'full and open competition', is a strong positive signal regarding market interest and the potential for cost savings for taxpayers. A high number of bidders typically indicates a competitive environment where multiple companies are vying for the contract. This competition generally pressures bidders to offer their most favorable pricing and terms to win the award. The government can leverage this competitive dynamic to negotiate better prices than might be achievable in a sole-source or limited-competition scenario. While the exact cost savings cannot be quantified without knowing the bid prices, the sheer volume of bids suggests that the government likely secured a price that reflects robust market competition, thereby maximizing the value of taxpayer dollars spent on these essential fuel products.

Industry Classification

NAICS: Manufacturing › Petroleum and Coal Products Manufacturing › Petroleum Refineries

Product/Service Code: FUELS, LUBRICANTS, OILS, WAXES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: SP060012R0202

Offers Received: 43

Pricing Type: FIXED PRICE WITH ECONOMIC PRICE ADJUSTMENT (K)

Evaluated Preference: NONE

Contractor Details

Address: 5754 SADDLE CREEK TRL, PARKER, CO, 80134

Business Categories: Category Business, Limited Liability Corporation, Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $32,396,837

Exercised Options: $32,396,837

Current Obligation: $32,396,837

Contract Characteristics

Multi-Year Contract: Yes

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: SP060012D4513

IDV Type: IDC

Timeline