DOE awarded $10.7M contract for mechanical services, with 11 bidders indicating strong competition

Contract Overview

Contract Amount: $10,764,051 ($10.8M)

Contractor: East Tennessee Mechanical Contractors, Inc

Awarding Agency: Department of Energy

Start Date: 1999-10-15

End Date: 2002-04-15

Contract Duration: 913 days

Daily Burn Rate: $11.8K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 11

Pricing Type: COST PLUS AWARD FEE

Sector: Construction

Place of Performance

Location: OAK RIDGE, ANDERSON County, TENNESSEE, 37830

State: Tennessee Government Spending

Plain-Language Summary

Department of Energy obligated $10.8 million to EAST TENNESSEE MECHANICAL CONTRACTORS, INC for work described as: Key points: 1. Contract awarded through full and open competition, suggesting a competitive marketplace. 2. The contract type (Cost Plus Award Fee) allows for flexibility but requires robust oversight. 3. A significant number of bidders (11) implies potential for good price discovery. 4. The contract duration of 913 days suggests a substantial, ongoing need for services. 5. The contractor has a track record with the Department of Energy. 6. Geographic focus on Tennessee may indicate regional service delivery needs.

Value Assessment

Rating: fair

The total award amount of $10.7 million over approximately 3 years (913 days) needs further benchmarking against similar mechanical services contracts. Without specific line-item costs or detailed performance metrics, a precise value-for-money assessment is challenging. The Cost Plus Award Fee structure means the final cost could vary based on performance, making direct comparison difficult without knowing the award fee achieved. However, the presence of 11 bidders suggests a competitive environment that should have driven a reasonable price.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, with 11 bids received. This high level of competition is generally positive, indicating that multiple capable contractors were aware of and interested in the opportunity. A larger number of bidders typically leads to better price discovery and can incentivize contractors to offer more competitive terms to secure the award. The agency's decision to use full and open competition suggests they believed a broad market existed for these services.

Taxpayer Impact: For taxpayers, a high number of bidders generally translates to a more efficient use of funds, as competition tends to drive down prices and improve the quality of services offered.

Public Impact

The primary beneficiary is the Department of Energy, which receives essential mechanical services for its facilities. Services likely include maintenance, repair, and potentially installation of mechanical systems within DOE facilities. The geographic impact is concentrated in Tennessee, where the contractor is based and services are likely performed. Workforce implications include employment opportunities for skilled tradespeople in the mechanical services sector within Tennessee.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost Plus Award Fee contracts can lead to higher final costs if not managed tightly.
Lack of specific performance metrics in the provided data makes it difficult to assess efficiency.
The contract's age (awarded 1999) means current market rates and technologies may differ significantly.

Positive Signals

Awarded under full and open competition, indicating a robust bidding process.
11 bidders suggest a healthy competitive environment.
The contractor, EAST TENNESSEE MECHANICAL CONTRACTORS, INC, has prior experience with the Department of Energy.

Sector Analysis

This contract falls within the broader construction and facilities maintenance sector, specifically focusing on mechanical systems. The market for such services is typically robust, driven by the ongoing need to maintain and operate government and commercial facilities. Comparable spending benchmarks would involve analyzing other federal contracts for similar mechanical services, considering factors like facility size, complexity, and geographic location. The Department of Energy, with its extensive infrastructure, represents a significant client within this sector.

Small Business Impact

The data indicates this contract was awarded under full and open competition and does not specify any small business set-aside provisions. Furthermore, the 'sb' field is false, suggesting no explicit small business preference was applied. While the prime contractor's size is not detailed, the lack of set-aside implies that large businesses were likely eligible and potentially competed. Subcontracting opportunities for small businesses may exist, but this would depend on the prime contractor's strategy and the specific requirements of the contract, which are not detailed here.

Oversight & Accountability

The Cost Plus Award Fee (CPAF) contract type necessitates strong oversight from the Department of Energy to manage costs and ensure performance objectives are met. The agency must actively monitor expenditures, evaluate contractor performance against defined criteria to determine award fees, and ensure compliance with contract terms. Transparency would be enhanced by public reporting of performance evaluations and final costs. Inspector General jurisdiction would apply to investigations of fraud, waste, or abuse related to this contract.

Related Government Programs

Department of Energy Facility Maintenance Contracts
Federal Mechanical Services Contracts
Cost Plus Award Fee Contracts
Construction and Engineering Services

Risk Flags

Contract awarded in 1999; current market conditions and technology may differ.
Cost Plus Award Fee structure requires diligent oversight to control costs.
Scope of work details are not provided, limiting detailed performance assessment.

Frequently Asked Questions

What is this federal contract paying for?

Department of Energy awarded $10.8 million to EAST TENNESSEE MECHANICAL CONTRACTORS, INC. See the official description on USAspending.

Who is the contractor on this award?

The obligated recipient is EAST TENNESSEE MECHANICAL CONTRACTORS, INC.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $10.8 million.

What is the period of performance?

Start: 1999-10-15. End: 2002-04-15.

What is the track record of EAST TENNESSEE MECHANICAL CONTRACTORS, INC with the Department of Energy prior to this award?

The provided data indicates that EAST TENNESSEE MECHANICAL CONTRACTORS, INC was awarded this contract by the Department of Energy (DOE). While this confirms a relationship, it doesn't detail the nature or success of prior engagements. To assess their track record, one would need to examine historical contract databases for previous awards to this company by the DOE, looking at contract values, performance reviews, and any documented issues or commendations. Without this historical data, we can only infer that the DOE found them qualified based on this specific award.

How does the awarded amount of $10.7 million compare to similar mechanical services contracts awarded by the DOE or other agencies?

Benchmarking the $10.7 million award requires comparing it to contracts for similar mechanical services, considering factors like contract duration (913 days), scope of work, and facility complexity. A direct comparison is difficult without more specific details on the services rendered. However, given the 11 bidders, the competitive nature suggests the price was likely within a reasonable market range at the time of award (1999). To provide a precise comparison, one would need to query federal procurement databases for contracts with similar PSC codes (if available) and award dates, adjusting for inflation and regional cost differences.

What are the primary risks associated with a Cost Plus Award Fee (CPAF) contract structure for this type of service?

The primary risk with a CPAF contract is the potential for cost overruns if the 'cost plus' component is not tightly controlled and the 'award fee' component incentivizes exceeding baseline cost targets rather than efficiency. For mechanical services, risks include unforeseen complexities in facility systems, material price fluctuations, and labor availability. Effective risk mitigation requires the agency to establish clear, objective performance criteria for the award fee, robust cost accounting standards, and diligent oversight to monitor expenditures and contractor performance throughout the contract lifecycle. Without strong management, CPAF can be more expensive than fixed-price contracts.

How effective was the competition, indicated by 11 bidders, in ensuring value for money for this $10.7 million contract?

The presence of 11 bidders for this $10.7 million contract is a strong positive indicator of effective competition. A larger pool of bidders generally leads to a more robust price discovery process, where contractors are incentivized to offer competitive pricing and terms to win the contract. This heightened competition increases the likelihood that the government is receiving fair market value for the services. While the Cost Plus Award Fee structure introduces some cost uncertainty, the initial competitive bidding process provides a solid foundation for achieving value. Post-award performance monitoring would be crucial to ensure sustained value delivery.

What is the historical spending pattern for mechanical services by the Department of Energy in Tennessee?

The provided data focuses on a single contract awarded in 1999. To understand historical spending patterns for mechanical services by the Department of Energy (DOE) in Tennessee, a broader analysis of federal procurement data would be necessary. This would involve querying databases for all contracts related to mechanical services (potentially using specific PSC codes) awarded by the DOE within Tennessee over a defined period (e.g., the last 5-10 years). Analyzing the volume, value, types of contracts (e.g., fixed-price, cost-reimbursable), and primary contractors would reveal trends, identify major spending areas, and indicate the level of competition and average contract values within the region.

What specific mechanical services were included under this $10.7 million contract, and how do they align with DOE's operational needs?

The provided data identifies the contract as being for 'mechanical services' awarded to 'EAST TENNESSEE MECHANICAL CONTRACTORS, INC' by the Department of Energy. However, it does not specify the exact scope of work. Typically, mechanical services in a federal context could encompass a wide range of activities, including HVAC system maintenance and repair, plumbing, boiler and chiller services, and potentially specialized equipment maintenance within DOE facilities. The alignment with DOE's operational needs would depend on the specific facilities managed by the DOE in Tennessee and their requirements for maintaining critical infrastructure, safety systems, and operational readiness. A detailed review of the original contract statement of work would be needed for precise alignment.

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Offers Received: 11

Pricing Type: COST PLUS AWARD FEE (R)

Contractor Details

Address: 109 BERTRAND ST NE, KNOXVILLE

Business Categories: Category Business, Self-Certified Small Disadvantaged Business, Small Business, Small Disadvantaged Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $28,152,122

Exercised Options: $28,152,122

Current Obligation: $10,764,051

Contract Characteristics

Cost or Pricing Data: NO

Timeline