Air Force awards $8.7M chiller plant repair contract to HHI Corporation, highlighting construction sector spending

Contract Overview

Contract Amount: $8,705,538 ($8.7M)

Contractor: HHI Corporation

Awarding Agency: Department of Defense

Start Date: 2024-06-17

End Date: 2026-09-24

Contract Duration: 829 days

Daily Burn Rate: $10.5K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 3

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: CMSFS REPAIR CHILLER PLANT B12106

Place of Performance

Location: COLORADO SPRINGS, EL PASO County, COLORADO, 80914

State: Colorado Government Spending

Plain-Language Summary

Department of Defense obligated $8.7 million to HHI CORPORATION for work described as: CMSFS REPAIR CHILLER PLANT B12106 Key points: 1. Contract value of $8.7 million for chiller plant repair. 2. Awarded by the Department of the Air Force, part of the Department of Defense. 3. HHI Corporation is the prime contractor. 4. Contract type is Firm Fixed Price, indicating defined costs. 5. Duration of 829 days, spanning over two years. 6. Competition was Full and Open after exclusion of sources. 7. Service Acquisition is Delivery Order, suggesting it's part of a larger contract vehicle.

Value Assessment

Rating: fair

The contract value of $8.7 million for chiller plant repair appears within a reasonable range for a project of this scope and duration. Benchmarking against similar Department of Defense construction projects for facility maintenance and repair would provide a more precise value-for-money assessment. The firm fixed price structure suggests that cost overruns are primarily the contractor's responsibility, which can be a positive indicator for cost control. However, without detailed project specifications and comparable bids, a definitive assessment of exceptional value is difficult.

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.' This indicates that while the competition was open, certain sources were excluded prior to the solicitation, which might limit the pool of potential bidders. The number of bidders is not specified, but the 'full and open' designation generally implies a competitive process. The effectiveness of price discovery depends on the number and quality of bids received.

Taxpayer Impact: A full and open competition, even with exclusions, generally aims to achieve competitive pricing for taxpayers. However, the exclusion of specific sources warrants scrutiny to ensure it did not unduly restrict competition and lead to higher costs.

Public Impact

The primary beneficiaries are the Department of the Air Force and its personnel at the facility where the chiller plant is located. The contract delivers essential maintenance and repair services for critical infrastructure. The geographic impact is localized to the Air Force base in Colorado. The contract supports the construction and maintenance workforce, likely involving skilled trades.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for limited competition due to 'exclusion of sources' clause.
Risk of cost escalation if repair scope is underestimated in fixed-price contract.
Dependence on contractor performance for timely and quality repair of critical infrastructure.

Positive Signals

Firm Fixed Price contract provides cost certainty.
Full and open competition aims for competitive pricing.
Long-term duration allows for comprehensive repair and potential system upgrades.

Sector Analysis

This contract falls within the Commercial and Institutional Building Construction sector, a significant segment of the federal contracting landscape. The Department of Defense is a major client for construction services, frequently awarding contracts for facility maintenance, repair, and new construction. Spending in this sector is often driven by the need to maintain aging infrastructure and support operational readiness. Comparable spending benchmarks would involve analyzing other large-scale HVAC repair or facility modernization contracts within the DoD.

Small Business Impact

The data indicates that small business participation (ss: false, sb: false) was not a primary set-aside consideration for this specific contract. There is no explicit mention of small business subcontracting goals. This suggests that the prime contractor, HHI Corporation, is likely a larger entity, and the contract's structure did not prioritize direct small business involvement as a prime or through mandated subcontracting.

Oversight & Accountability

Oversight for this contract would typically be managed by contracting officers and project managers within the Department of the Air Force. Accountability measures are embedded in the firm fixed-price contract terms, requiring delivery of specified services. Transparency is facilitated through federal procurement databases where contract awards are published. Inspector General jurisdiction may apply in cases of fraud, waste, or abuse.

Related Government Programs

Department of Defense Facilities Maintenance
Air Force Infrastructure Modernization
HVAC System Repair Contracts
Commercial Building Construction Services

Risk Flags

Potential for reduced competition due to source exclusion.
Risk of scope creep or unforeseen issues in fixed-price repair contracts.
Dependence on contractor's technical expertise for critical infrastructure repair.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $8.7 million to HHI CORPORATION. CMSFS REPAIR CHILLER PLANT B12106

Who is the contractor on this award?

The obligated recipient is HHI CORPORATION.

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Air Force).

What is the total obligated amount?

The obligated amount is $8.7 million.

What is the period of performance?

Start: 2024-06-17. End: 2026-09-24.

What is the track record of HHI Corporation in performing similar large-scale HVAC repair contracts for the Department of Defense?

Assessing HHI Corporation's track record requires a review of their past performance on similar contracts. This would involve examining contract databases for previous awards to HHI for facility repair, specifically focusing on HVAC systems and chiller plants. Key metrics to analyze include on-time completion rates, adherence to budget (especially for fixed-price contracts), quality of work as indicated by past performance reviews or contract close-out data, and any history of disputes or contract modifications. A strong history of successful project delivery on comparable DoD projects would indicate a lower performance risk for this current contract. Conversely, a pattern of delays, cost overruns, or quality issues would raise concerns about their capability to execute this $8.7 million project effectively.

How does the awarded amount of $8.7 million compare to the estimated cost or market rates for similar chiller plant repair projects?

To benchmark the $8.7 million award, we would need to compare it against similar projects in terms of scope, complexity, and location. This involves identifying other federal or large commercial contracts for chiller plant repair or major HVAC system overhauls. Factors such as the size of the plant, the extent of the required repairs (e.g., component replacement vs. system-wide overhaul), and the specific technologies involved are crucial for a fair comparison. Market rates can also be estimated using industry cost data for construction and specialized mechanical services. If this award is significantly higher or lower than comparable projects or market estimates, it could indicate either exceptional value or potential overpricing/underbidding, respectively. Without access to detailed project specifications and a broader dataset of comparable projects, a precise value assessment is challenging.

What are the specific risks associated with a 'Full and Open Competition After Exclusion of Sources' for this contract?

The 'Full and Open Competition After Exclusion of Sources' designation presents a nuanced risk profile. While it aims for broad competition, the explicit exclusion of certain sources suggests a deliberate decision to narrow the field. The primary risk is that this exclusion may have inadvertently limited the number of highly qualified bidders, potentially reducing the overall competitive pressure on pricing. If the excluded sources were significant players in this specific market, their absence could lead to less aggressive bidding. Furthermore, the justification for the exclusion needs to be robust; if it was not well-founded, it could indicate a potential for favoritism or an inefficient procurement process. Taxpayers could face higher costs if the remaining bidders face less pressure to offer their best prices due to a restricted competitive environment.

What is the expected impact of this contract on the operational readiness and energy efficiency of the Air Force facility?

The successful completion of this chiller plant repair contract is expected to have a direct positive impact on the operational readiness of the Air Force facility. Chiller plants are critical for maintaining climate control, which is essential for the functionality of sensitive equipment, living quarters, and workspaces. A well-functioning system ensures consistent temperatures, preventing disruptions that could affect mission-critical operations. Furthermore, modern repairs or component upgrades often incorporate energy-efficient technologies. This could lead to reduced energy consumption, lower utility costs for the facility, and a smaller environmental footprint, contributing to the Air Force's sustainability goals. The duration of the contract suggests a comprehensive approach to repair, aiming for long-term reliability.

How does this $8.7 million award fit into the broader historical spending patterns for facility maintenance and repair by the Department of the Air Force?

This $8.7 million award for chiller plant repair represents a specific investment within the Department of the Air Force's substantial budget for facilities maintenance and repair. The Air Force, like other branches of the DoD, consistently allocates significant funds towards maintaining its vast real estate portfolio, which includes numerous bases and installations. Spending in this category is often driven by the age of infrastructure, operational requirements, and regulatory compliance. Analyzing historical spending data would reveal whether this contract amount is typical for major HVAC system overhauls or if it represents a larger or smaller investment compared to previous similar projects. Understanding these patterns helps contextualize the current award within the Air Force's overall infrastructure management strategy and budget priorities.

Industry Classification

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

Product/Service Code: MAINT, REPAIR, ALTER REAL PROPERTY › MAINT, ALTER, REPAIR NONBUILDINGS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 3

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 736 W HARRISVILLE RD, OGDEN, UT, 84404

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $8,705,538

Exercised Options: $8,705,538

Current Obligation: $8,705,538

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: FA251720D0011

IDV Type: IDC

Timeline