DoD awards $5.4M engineering services contract to Red Peak Technical Services LLC, with a 3-year duration

Contract Overview

Contract Amount: $5,449,244 ($5.4M)

Contractor: RED Peak Technical Services LLC

Awarding Agency: Department of Defense

Start Date: 2022-12-01

End Date: 2026-03-31

Contract Duration: 1,216 days

Daily Burn Rate: $4.5K/day

Competition Type: NOT AVAILABLE FOR COMPETITION

Pricing Type: COST PLUS FIXED FEE

Sector: Defense

Official Description: ENGINEERING SERVICES

Plain-Language Summary

Department of Defense obligated $5.4 million to RED PEAK TECHNICAL SERVICES LLC for work described as: ENGINEERING SERVICES Key points: 1. Contract awarded on a non-competitive basis, raising questions about potential cost efficiencies. 2. The contract's duration of over three years suggests a need for sustained engineering support. 3. Pricing structure is Cost Plus Fixed Fee, which can lead to cost overruns if not closely managed. 4. The specific engineering services provided are not detailed, making performance assessment difficult. 5. No small business set-aside was utilized, potentially limiting opportunities for smaller firms.

Value Assessment

Rating: questionable

The contract's value of $5.4 million over approximately three years for engineering services appears moderate. However, without specific details on the services rendered or comparable contract data, a robust value assessment is challenging. The Cost Plus Fixed Fee (CPFF) pricing structure, while common for complex services, carries inherent risks of cost escalation. Benchmarking against similar engineering service contracts within the Department of Defense would be necessary to determine if the pricing is competitive and offers good value for money.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a 'NOT AVAILABLE FOR COMPETITION' basis, indicating a sole-source procurement. This means that only one contractor, Red Peak Technical Services LLC, was solicited. While sole-source awards can be justified for specialized capabilities or urgent needs, they typically result in less competitive pricing and reduced opportunities for market-driven cost savings. The lack of competition means there was no direct comparison of offers to ensure the best value was obtained for the government.

Taxpayer Impact: Taxpayers may not be receiving the best possible price due to the absence of a competitive bidding process. This can lead to higher overall costs for the services rendered compared to what might have been achieved in an open market scenario.

Public Impact

The Department of the Navy benefits from specialized engineering services to support its operations. Red Peak Technical Services LLC is positioned to deliver critical engineering expertise. The contract supports the defense sector's infrastructure and technological development. The duration of the contract implies a stable, albeit limited, engagement for the contractor's workforce.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may lead to higher costs.
Cost Plus Fixed Fee structure introduces risk of cost overruns.
Limited transparency on specific services and performance metrics.
No small business participation noted.

Positive Signals

Contract awarded to a specific company for needed engineering services.
Long-term engagement provides stability for service delivery.
Department of Defense receives specialized technical support.

Sector Analysis

Engineering services are a critical component of the defense sector, encompassing design, development, testing, and maintenance of military systems and infrastructure. The market for these services is substantial, with government agencies, particularly the Department of Defense, being major clients. This contract fits within the broader category of professional services supporting national defense. Comparable spending benchmarks for engineering services within the DoD are often in the millions, depending on the scope and complexity.

Small Business Impact

This contract does not appear to have a small business set-aside component, as indicated by 'ss': false and 'sb': false. This means that opportunities for small businesses to participate directly as the prime contractor were not prioritized in this specific procurement. While Red Peak Technical Services LLC may engage subcontractors, the absence of a set-aside suggests a missed opportunity to foster small business growth within this particular contract's scope. Further investigation into subcontracting plans would be needed to assess the impact on the small business ecosystem.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of the Navy's contracting and program management offices. The Cost Plus Fixed Fee structure necessitates rigorous financial oversight to monitor costs and ensure they remain within reasonable bounds relative to the fixed fee. Transparency regarding the specific tasks performed and the justification for costs incurred would be crucial. Inspector General jurisdiction would apply if any fraud, waste, or abuse is suspected.

Related Government Programs

Department of Defense Engineering Services
Navy Professional Services Contracts
Cost Plus Fixed Fee Contracts
Sole Source Defense Procurements

Risk Flags

Non-competitive award
Cost Plus Fixed Fee pricing structure
Lack of detailed service description

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $5.4 million to RED PEAK TECHNICAL SERVICES LLC. ENGINEERING SERVICES

Who is the contractor on this award?

The obligated recipient is RED PEAK TECHNICAL SERVICES LLC.

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Navy).

What is the total obligated amount?

The obligated amount is $5.4 million.

What is the period of performance?

Start: 2022-12-01. End: 2026-03-31.

What is the specific nature of the engineering services being provided under this contract?

The provided data indicates the contract is for 'ENGINEERING SERVICES' with the North American Industry Classification System (NAICS) code 541330. However, the specific tasks, deliverables, and technical requirements are not detailed in the summary data. These services could range from structural engineering for naval facilities, systems engineering for defense platforms, or research and development support. Without more granular information, it is difficult to ascertain the precise nature of the engineering work. Further review of the contract's Statement of Work (SOW) or Performance Work Statement (PWS) would be necessary to understand the full scope.

How does the pricing structure (Cost Plus Fixed Fee) compare to other engineering service contracts awarded by the Navy?

The Cost Plus Fixed Fee (CPFF) pricing structure is common for contracts where the scope of work is not precisely defined at the outset or involves significant uncertainty, such as research and development or complex engineering projects. For the Navy, CPFF contracts are used when it's difficult to estimate costs accurately beforehand. While CPFF allows for flexibility, it also shifts some cost risk to the government. Benchmarking this contract's CPFF rate against similar Navy engineering contracts would require access to detailed pricing data and contract types. Generally, competitive fixed-price contracts are preferred when feasible to ensure better cost control for taxpayers.

What is the track record of Red Peak Technical Services LLC in performing similar government contracts?

The provided data identifies Red Peak Technical Services LLC as the contractor but does not include information on their past performance or track record with government contracts. A comprehensive assessment would require reviewing their contract history, including past performance evaluations, any awards or penalties, and their experience with similar types of engineering services and contract vehicles. Without this historical data, it is challenging to evaluate their reliability and capability to successfully execute this $5.4 million contract effectively and efficiently.

What are the potential risks associated with a sole-source award for engineering services?

Sole-source awards, like the one for Red Peak Technical Services LLC, carry several potential risks. The primary risk is the lack of price competition, which can lead to the government paying a higher price than if multiple bids were solicited. There's also a reduced incentive for the contractor to innovate or optimize costs, as they are the only option. Furthermore, it can limit opportunities for new or smaller businesses to enter the market and demonstrate their capabilities. Ensuring fair pricing and robust oversight becomes even more critical in sole-source situations to mitigate these inherent risks.

What is the historical spending trend for engineering services by the Department of the Navy?

The provided data focuses on a single contract award and does not offer historical spending trends for engineering services by the Department of the Navy. To analyze historical spending, one would need access to broader contract databases or budget reports that track expenditures across multiple fiscal years and various contract types for engineering services. Such an analysis would reveal patterns in spending, identify major contractors, and highlight fluctuations in demand or investment in engineering capabilities over time, providing context for the current award's significance.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Architectural, Engineering, and Related Services › Engineering Services

Product/Service Code: INSTALLATION OF EQUIPMENT › INSTALLATION OF EQUIPMENT

Competition & Pricing

Extent Competed: NOT AVAILABLE FOR COMPETITION

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: N6600121R0035

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Address: 300 ALIMAQ DR, KODIAK, AK, 99615

Business Categories: 8(a) Program Participant, Alaskan Native Corporation Owned Firm, Category Business, Corporate Entity Not Tax Exempt, HUBZone Firm, Limited Liability Corporation, Minority Owned Business, Native American Owned Business, Self-Certified Small Disadvantaged Business, Small Business, Special Designations, Tribally Owned Firm, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $5,449,244

Exercised Options: $5,449,244

Current Obligation: $5,449,244

Subaward Activity

Number of Subawards: 35

Total Subaward Amount: $2,563,463

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: N6600122D0035

IDV Type: IDC

Timeline