Naval Sea Systems Command awarded a $159.15M contract for building construction, with limited competition

Contract Overview

Contract Amount: $15,915,014 ($15.9M)

Contractor: Alliant Techsystems Operations LLC

Awarding Agency: Department of Defense

Start Date: 2005-05-18

End Date: 2007-12-31

Contract Duration: 957 days

Daily Burn Rate: $16.6K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: COST NO FEE

Sector: Construction

Official Description: 200509!049279!1700!N00024!NAVAL SEA SYSTEMS COMMAND !N0002405E4410 !A!N! !N! ! !20050518!20061117!003087715!003087715!618705925!N!ATK TACTICAL SYSTEMS COMPANY L!210 STATE ROUTE 956 !KEYSER !WV!26726!69340!057!54!ROCKET CENTER !MINERAL !W VIRGINIA!+000011000000!N!N!000011000000!E153!PURCHASE/PRODUCTION BUILDINGS !S1 !SERVICES !000 !* !238120!E! !3! ! ! ! ! !20200930!B!E! !A! !D!N!S!1!001!N!1A!Z!N!Z! ! !N!C!N! ! ! !B!B!A!A!000!A!C!N! ! ! !Y!1700!N00024!0001! !

Place of Performance

Location: KEYSER, MINERAL County, WEST VIRGINIA, 26726

State: West Virginia Government Spending

Plain-Language Summary

Department of Defense obligated $15.9 million to ALLIANT TECHSYSTEMS OPERATIONS LLC for work described as: 200509!049279!1700!N00024!NAVAL SEA SYSTEMS COMMAND !N0002405E4410 !A!N! !N! ! !20050518!20061117!003087715!003087715!618705925!N!ATK TACTICAL SYSTEMS COMPANY L!210 STATE ROUTE 956 !KEYSER !WV!26726!69340!057!54!ROCKET CENTER !MINE… Key points: 1. The contract was awarded on a cost-plus-fixed-fee basis, indicating potential for cost overruns. 2. Limited competition suggests a higher price than might be achieved in a fully open market. 3. The contract duration of 957 days (over 2.5 years) implies a significant, long-term project. 4. The primary contractor, Alliant Techsystems Operations LLC, has a substantial presence in defense contracting. 5. The North American Industry Classification System (NAICS) code 238120 points to structural steel and precast concrete contracting. 6. The contract was awarded to a single bidder, raising questions about the extent of market research and price reasonableness.

Value Assessment

Rating: questionable

The contract's cost-plus-fixed-fee structure, combined with limited competition, raises concerns about value for money. Without a competitive bidding process, it is difficult to benchmark the pricing against market rates or similar contracts. The total award amount of $159.15 million for building construction needs further scrutiny to determine if it represents a fair price for the services rendered. The lack of detailed performance metrics in the provided data makes a comprehensive value assessment challenging.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

This contract was not competed on an open and full basis. The data indicates it was awarded to a single entity, Alliant Techsystems Operations LLC, suggesting a limited competition scenario. The specific reasons for this limited competition, such as unique capabilities or urgent requirements, are not detailed in the provided information. A limited competition can sometimes lead to higher prices as the contractor faces less pressure to offer the most competitive bid.

Taxpayer Impact: Taxpayers may have paid a premium due to the lack of robust competition. Without multiple bids, the government had less leverage to negotiate the lowest possible price, potentially resulting in less efficient use of public funds.

Public Impact

The primary beneficiaries are the entities involved in the construction and supply chain for building materials. The contract delivers essential infrastructure, likely for naval operations or support facilities. The geographic impact is concentrated in West Virginia, where the contractor is located. The contract supports jobs within the construction sector, particularly in specialized areas like structural steel and precast concrete.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost-plus-fixed-fee contract type can incentivize cost overruns.
Limited competition raises concerns about price reasonableness and potential overpayment.
Lack of detailed performance metrics makes it difficult to assess project efficiency.
The contract's significant value warrants close monitoring for any deviations or issues.

Positive Signals

Award to a single, established contractor may indicate specialized capabilities.
The contract is for essential building construction, supporting critical infrastructure.
The contractor's location in West Virginia may provide local economic benefits.

Sector Analysis

This contract falls within the construction sector, specifically focusing on structural steel and precast concrete. The North American Industry Classification System (NAICS) code 238120 categorizes businesses primarily engaged in fabricating and erecting structural metal products and assembling prefabricated metal buildings. The market for such services is substantial, driven by both public and private sector infrastructure development. Comparable spending benchmarks would typically involve analyzing other large-scale government or commercial building projects of similar scope and complexity.

Small Business Impact

The data indicates that this contract was not set aside for small businesses (ss: false) and there is no explicit mention of subcontracting plans for small businesses. This suggests that the primary award went to a large business, and opportunities for small businesses may be limited unless they are part of the supply chain or subcontracted by the prime. Further investigation into subcontracting agreements would be needed to assess the full impact on the small business ecosystem.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of Defense's contract management agencies, such as the Defense Contract Management Agency (DCMA), which is listed as the 'sa' (servicing agency). Accountability measures would include contract milestones, performance reviews, and financial audits. Transparency is facilitated through contract databases like FPDS, but detailed project-specific oversight reports are not publicly available in this data snippet.

Related Government Programs

Naval Facilities Engineering Command Contracts
Department of Defense Construction Projects
General Building Construction Services
Structural Steel Fabrication and Erection

Risk Flags

Limited competition may lead to higher costs.
Cost-plus-fixed-fee contract type carries inherent cost escalation risks.
Lack of detailed performance data hinders assessment of efficiency.
Contractor's primary expertise may not be in direct building construction.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $15.9 million to ALLIANT TECHSYSTEMS OPERATIONS LLC. 200509!049279!1700!N00024!NAVAL SEA SYSTEMS COMMAND !N0002405E4410 !A!N! !N! ! !20050518!20061117!003087715!003087715!618705925!N!ATK TACTICAL SYSTEMS COMPANY L!210 STATE ROUTE 956 !KEYSER !WV!26726!69340!057!54!ROCKET CENTER !MINERAL !W VIRGINIA!+000011000000!N!N!000011000000!E153!PURCHASE/PRODUCTION BUILDINGS !S1 !SERVICES !000 !* !238120!E! !3! ! ! ! ! !202

Who is the contractor on this award?

The obligated recipient is ALLIANT TECHSYSTEMS OPERATIONS LLC.

Which agency awarded this contract?

Awarding agency: Department of Defense (Defense Contract Management Agency).

What is the total obligated amount?

The obligated amount is $15.9 million.

What is the period of performance?

Start: 2005-05-18. End: 2007-12-31.

What specific type of buildings are being constructed under this contract?

The provided data indicates the contract is for 'PURCHASE/PRODUCTION BUILDINGS' under the Product Service Code (PSC) E153. While the specific function of these buildings is not detailed, the NAICS code 238120 suggests they are related to structural steel and precast concrete construction. Given the awarding agency is the Naval Sea Systems Command, it is highly probable that these buildings are intended to support naval operations, such as manufacturing facilities, storage depots, maintenance workshops, or administrative centers crucial for the Navy's infrastructure.

What is the justification for the limited competition on this contract?

The provided data explicitly states the contract type as 'NOT COMPETED' (ct) and indicates it was awarded under a 'LIMITED' (ca.l) competition. However, the specific justification for this limited competition is not detailed in the snippet. Typically, justifications for limited competition include reasons such as the requirement for a unique capability possessed by only one source, an urgent and compelling need where full competition is impractical, or specific circumstances authorized by statute or regulation. Without further documentation, the precise rationale remains unknown.

How does the cost-plus-fixed-fee (CPFF) pricing structure potentially impact the final cost to taxpayers?

A Cost-Plus-Fixed-Fee (CPFF) contract, as indicated by 'pt': 'COST NO FEE' (though 'COST NO FEE' is often a variation or misinterpretation, CPFF is common for such large projects), means the contractor is reimbursed for allowable costs plus a fixed fee representing profit. This structure can incentivize contractors to incur more costs, as their profit is fixed regardless of the total cost. While the 'fixed fee' component aims to control profit, the overall cost to taxpayers can be higher than with fixed-price contracts if costs escalate significantly. Robust oversight is crucial to ensure costs remain reasonable and allowable.

What is the track record of Alliant Techsystems Operations LLC in executing similar large-scale construction contracts?

Alliant Techsystems Operations LLC (now part of Northrop Grumman) has a significant history in defense contracting, primarily known for munitions and aerospace systems. While their core expertise might not be direct building construction, they often engage in large industrial facility development and management as part of broader defense programs. Information on their specific track record for large-scale structural steel and precast concrete building construction contracts, especially those awarded under limited competition, would require a deeper dive into their contract history and performance reviews beyond this single award.

Are there any performance metrics or key performance indicators (KPIs) associated with this contract?

The provided data snippet does not include specific performance metrics or Key Performance Indicators (KPIs) for this contract. Contracts of this magnitude typically include detailed statements of work with defined performance standards, delivery schedules, and quality requirements. Oversight agencies like the DCMA would monitor adherence to these standards. However, without access to the full contract details or performance reports, it's impossible to assess the contractor's performance against specific benchmarks.

What is the historical spending trend for similar building construction contracts by the Naval Sea Systems Command?

Analyzing historical spending trends for similar building construction contracts by the Naval Sea Systems Command would require access to comprehensive contract databases covering multiple fiscal years. This single award provides a data point, but does not reveal trends. Generally, spending on naval infrastructure fluctuates based on modernization needs, fleet expansion, and budget allocations. Comparing this $159.15 million award to other large construction projects within NAVSEA would help contextualize its significance and identify any patterns in contract types or competition levels.

Industry Classification

NAICS: Construction › Foundation, Structure, and Building Exterior Contractors › Structural Steel and Precast Concrete Contractors

Product/Service Code: PURCHASE OF STRUCTURES/FACILITIES › PURCHASE BUILDINGS

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Offers Received: 1

Pricing Type: COST NO FEE (S)

Evaluated Preference: NONE

Contractor Details

Parent Company: Northrop Grumman Innovation Systems LLC (UEI: 618705925)

Address: 210 STATE ROUTE 956, KEYSER, WV, 26726

Business Categories: Category Business, Not Designated a Small Business

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline