Air Force awards $28.7M for prefabricated metal buildings, exceeding benchmark by $6.4M

Contract Overview

Contract Amount: $28,683,282 ($28.7M)

Contractor: Atlantic Diving Supply, Inc.

Awarding Agency: Department of Defense

Start Date: 2017-04-11

End Date: 2018-06-30

Contract Duration: 445 days

Daily Burn Rate: $64.5K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: DELIVERY ORDER FOR BEAR KITCHEN SHELTERS

Place of Performance

Location: VIRGINIA BEACH, VIRGINIA BEACH CITY County, VIRGINIA, 23452

State: Virginia Government Spending

Plain-Language Summary

Department of Defense obligated $28.7 million to ATLANTIC DIVING SUPPLY, INC. for work described as: DELIVERY ORDER FOR BEAR KITCHEN SHELTERS Key points: 1. Spending on prefabricated metal buildings is significant, with this contract representing a notable portion. 2. Atlantic Diving Supply, Inc. secured the contract through full and open competition. 3. The contract's price appears to be above the benchmark, raising potential value concerns. 4. The IT sector is not directly involved, but construction and logistics are key.

Value Assessment

Rating: questionable

The contract price of $28.7 million is $6.4 million (28%) above the benchmark of $22.3 million. This significant overage warrants further investigation into the pricing justification and market conditions.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded using full and open competition after exclusion of sources. While competition was present, the final price exceeding the benchmark suggests potential issues with price discovery or market dynamics.

Taxpayer Impact: Taxpayers may be impacted by the $6.4 million premium paid above the established benchmark for these prefabricated metal buildings.

Public Impact

Military readiness and infrastructure are supported by the acquisition of essential shelter components. The Department of the Air Force's procurement process is under scrutiny due to the cost overrun. Companies specializing in prefabricated metal building manufacturing may see increased demand.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Price significantly exceeds benchmark
Potential for cost savings through better negotiation or market analysis

Positive Signals

Full and open competition was utilized
Contract awarded to a known entity

Sector Analysis

This contract falls within the construction and manufacturing sector, specifically for prefabricated metal buildings. Spending benchmarks in this area are crucial for ensuring cost-effectiveness in military infrastructure projects.

Small Business Impact

The data does not indicate whether small businesses were involved in this specific contract, either as prime contractors or subcontractors. Further analysis would be needed to assess small business participation.

Oversight & Accountability

The significant deviation from the benchmark price suggests a need for enhanced oversight in the negotiation and award process for similar construction contracts to ensure fiscal responsibility.

Related Government Programs

Prefabricated Metal Building and Component Manufacturing
Department of Defense Contracting
Department of the Air Force Programs

Risk Flags

Price significantly exceeds benchmark
Potential for cost savings
Lack of transparency on specific cost drivers
Benchmark may be outdated or inaccurate

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $28.7 million to ATLANTIC DIVING SUPPLY, INC.. DELIVERY ORDER FOR BEAR KITCHEN SHELTERS

Who is the contractor on this award?

The obligated recipient is ATLANTIC DIVING SUPPLY, INC..

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 $28.7 million.

What is the period of performance?

Start: 2017-04-11. End: 2018-06-30.

What factors contributed to the $6.4 million cost overrun compared to the benchmark for these prefabricated metal buildings?

The cost overrun could be attributed to several factors including unforeseen material cost increases, specialized design requirements not initially captured in the benchmark, or a lack of competitive pressure driving down the final price despite the 'full and open' designation. Market volatility and specific logistical challenges for delivery to the intended location might also play a role.

What are the risks associated with awarding contracts significantly above established benchmarks?

The primary risk is financial waste, leading to inefficient use of taxpayer funds. It can also set a precedent for higher pricing in future procurements, erode trust in government spending, and potentially signal a lack of effective market research or negotiation strategies. Furthermore, it may indicate that the benchmark itself is outdated or inaccurate.

How effectively does the 'full and open competition after exclusion of sources' method ensure competitive pricing in practice?

While intended to maximize competition, this method's effectiveness in ensuring competitive pricing can be compromised if the initial exclusion criteria are too narrow or if the market for the specific good or service is limited. In this case, despite the competition, the price exceeded the benchmark, suggesting that either the market dynamics allowed for higher pricing or the competitive process did not sufficiently drive down costs.

Industry Classification

NAICS: Manufacturing › Architectural and Structural Metals Manufacturing › Prefabricated Metal Building and Component Manufacturing

Product/Service Code: FOOD PREPARATION/SERVING EQPT

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: ADS Tactical, Inc. (UEI: 078857127)

Address: 621 LYNNHAVEN PKWY STE 400, VIRGINIA BEACH, VA, 23452

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

Financial Breakdown

Contract Ceiling: $28,683,282

Exercised Options: $28,683,282

Current Obligation: $28,683,282

Subaward Activity

Number of Subawards: 3

Total Subaward Amount: $2,940,558

Contract Characteristics

Commercial Item: SUPPLIES OR SERVICES PURSUANT TO FAR 12.102(F)

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: FA853315D0001

IDV Type: IDC

Timeline