State Department awards $50M architectural services contract to Pernix Group, Inc. for overseas facilities

Contract Overview

Contract Amount: $49,993,305 ($50.0M)

Contractor: Pernix Group, Inc.

Awarding Agency: Department of State

Start Date: 2006-09-27

End Date: 2011-08-31

Contract Duration: 1,799 days

Daily Burn Rate: $27.8K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 6

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: SUVA, FIJI NEC

Plain-Language Summary

Department of State obligated $50.0 million to PERNIX GROUP, INC. for work described as: SUVA, FIJI NEC Key points: 1. Contract awarded through full and open competition, suggesting a competitive bidding process. 2. The contract duration of 1799 days (approx. 5 years) indicates a long-term need for architectural services. 3. The fixed-price contract type may offer cost certainty for the government, but could limit flexibility. 4. The services are for overseas facilities, highlighting the logistical and security considerations involved. 5. The North American Industry Classification System (NAICS) code 541310 points to a focus on architectural design. 6. The award amount of $49,993,305.43 represents a significant investment in infrastructure.

Value Assessment

Rating: good

The contract value of approximately $50 million for architectural services over nearly five years appears reasonable given the scope of work for overseas facilities. Benchmarking against similar large-scale architectural contracts for government facilities, especially those in challenging international locations, would provide further context. The firm-fixed-price structure suggests an effort to control costs, though the final value could fluctuate based on specific project requirements and unforeseen circumstances inherent in overseas construction.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit a bid. The presence of 6 bids suggests a healthy level of interest and competition for this requirement. A competitive process like this generally leads to better price discovery and potentially more innovative solutions as contractors vie for the award.

Taxpayer Impact: Taxpayers benefit from a competitive process that aims to secure the best value for their money by driving down prices and encouraging efficiency among bidders.

Public Impact

The primary beneficiaries are the Department of State and its personnel who will utilize the improved or new overseas facilities. The services delivered include architectural design and potentially related engineering and project management for facilities abroad. The geographic impact is focused on locations where the U.S. State Department operates diplomatic missions or other overseas installations. Workforce implications may include employment for architects, engineers, project managers, and construction personnel, both domestically and potentially locally at overseas sites.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if unforeseen issues arise in overseas locations.
Logistical challenges in managing projects in foreign countries can impact timelines and budgets.
Ensuring compliance with local building codes and regulations in various international jurisdictions.

Positive Signals

Awarded through full and open competition, indicating a robust bidding process.
Firm-fixed-price contract type provides cost predictability.
Long-term duration suggests a sustained need and commitment to infrastructure improvement.

Sector Analysis

The architectural services sector is a critical component of the construction and engineering industry, providing design and planning for a wide range of projects. For federal agencies, architectural services are essential for designing and maintaining government buildings, embassies, and other facilities, particularly those located internationally. The market for these services can be competitive, with firms specializing in government contracts and overseas projects often having an advantage due to experience and security clearances. This contract fits within the broader federal spending on infrastructure and facilities management.

Small Business Impact

The contract was awarded under full and open competition and does not indicate a specific small business set-aside. While the prime contractor is Pernix Group, Inc., there is no explicit information on subcontracting plans for small businesses within this award notice. Further analysis would be needed to determine if subcontracting opportunities exist and how effectively small businesses are integrated into the project's execution.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of State's contracting officers and program managers. The firm-fixed-price nature of the contract provides a degree of accountability for the contractor to deliver within the agreed-upon cost. Transparency is facilitated by the public nature of contract awards, though detailed project-specific oversight mechanisms are internal to the agency. Inspector General jurisdiction would apply if any fraud, waste, or abuse is suspected.

Related Government Programs

Overseas Buildings Operations (State Department)
Public Buildings Service (GSA)
Department of Defense Facilities Construction

Risk Flags

Potential for cost overruns due to overseas operations
Geopolitical risks in operating locations
Logistical complexities of international projects

Frequently Asked Questions

What is this federal contract paying for?

Department of State awarded $50.0 million to PERNIX GROUP, INC.. SUVA, FIJI NEC

Who is the contractor on this award?

The obligated recipient is PERNIX GROUP, INC..

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $50.0 million.

What is the period of performance?

Start: 2006-09-27. End: 2011-08-31.

What is Pernix Group, Inc.'s track record with federal contracts, particularly with the Department of State?

Pernix Group, Inc. has a history of securing federal contracts, including significant work with the Department of State and other agencies. Their portfolio often includes construction and facilities management projects, particularly in challenging overseas environments. Examining their past performance ratings, any past performance issues, and the types of projects they have successfully completed for the government would provide insight into their capability to execute this architectural services contract. A review of their contract history would reveal if they have previously managed projects of similar scale and complexity, especially those involving international locations and stringent security requirements.

How does the $50 million award compare to similar architectural services contracts for overseas facilities?

The $49.99 million award for architectural services for overseas facilities is substantial, reflecting the complexity and scale often associated with such projects. To benchmark this value, one would compare it to contracts awarded by the State Department, Department of Defense, or other agencies for similar services at diplomatic posts or military installations abroad. Factors such as the specific country, security requirements, size of the facility, and duration of the contract significantly influence pricing. Without specific comparable contract data, it's difficult to definitively state if this represents a premium or a discount, but the competitive nature of the award suggests an effort to achieve fair market value.

What are the primary risks associated with this contract, and how are they being mitigated?

Key risks include geopolitical instability in overseas locations, logistical challenges in procuring materials and personnel, currency fluctuations, and potential security threats. Mitigation strategies likely involve robust risk management plans developed by Pernix Group, Inc., close coordination with the State Department's regional security officers, and contingency planning for unforeseen events. The firm-fixed-price contract structure incentivizes the contractor to manage costs effectively, but the agency must maintain strong oversight to ensure adherence to scope and quality standards, especially given the critical nature of diplomatic facilities.

How effective is the full and open competition process in ensuring value for this type of contract?

The full and open competition process is generally considered the most effective method for ensuring value for large federal contracts like this one. By allowing all qualified contractors to bid, it fosters a competitive environment that drives down prices and encourages innovation. The fact that six bids were received indicates sufficient market interest. The agency's evaluation process, which likely considers both price and technical qualifications, is crucial for selecting the best overall value. However, the effectiveness also depends on the clarity of the solicitation requirements and the rigor of the evaluation criteria used.

What is the historical spending trend for architectural services by the Department of State for overseas facilities?

Historical spending data for architectural services by the Department of State for overseas facilities would reveal trends in contract values, award volumes, and the types of services procured. Analyzing this data over several fiscal years can help identify periods of increased or decreased investment in infrastructure, potential shifts in contracting strategies (e.g., more sole-source vs. competitive awards), and the average cost per project. Such analysis would provide context for the current $50 million award, indicating whether it aligns with historical spending patterns or represents a significant deviation, potentially due to new policy initiatives or urgent infrastructure needs.

Industry Classification

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

Product/Service Code: ARCHITECT/ENGINEER SERVICES › ARCH-ENG SVCS - GENERAL

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: TWO STEP

Offers Received: 6

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 860 PARKVIEW BOULEVARD, LOMBARD, IL, 06

Business Categories: Category Business, Emerging Small Business, Not Designated a Small Business, Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $49,993,305

Exercised Options: $49,993,305

Current Obligation: $49,993,305

Timeline