DLA Awards $154M Water System Contract to City of Jacksonville for Little Rock AFB
Contract Overview
Contract Amount: $15,427,803 ($15.4M)
Contractor: City of Jacksonville
Awarding Agency: Department of Defense
Start Date: 2018-05-01
End Date: 2068-04-30
Contract Duration: 18,262 days
Daily Burn Rate: $845/day
Competition Type: NOT AVAILABLE FOR COMPETITION
Number of Offers Received: 1
Pricing Type: FIXED PRICE WITH ECONOMIC PRICE ADJUSTMENT
Sector: Other
Official Description: IGF::OT::IGF UTILITY SERVICES CONTRACT FOR THE PRIVATIZATION OF THE WATER DISTRIBUTION SYSTEM AT LITTLE ROCK AIR FORCE BASE, ARKANSAS.
Place of Performance
Location: LITTLE ROCK, PULASKI County, ARKANSAS, 72201
State: Arkansas Government Spending
Plain-Language Summary
Department of Defense obligated $15.4 million to CITY OF JACKSONVILLE for work described as: IGF::OT::IGF UTILITY SERVICES CONTRACT FOR THE PRIVATIZATION OF THE WATER DISTRIBUTION SYSTEM AT LITTLE ROCK AIR FORCE BASE, ARKANSAS. Key points: 1. The contract is for water distribution system privatization at Little Rock AFB. 2. The award is a definitive contract with a fixed price and economic price adjustment. 3. The contract duration is 50 years, indicating a long-term infrastructure commitment. 4. The total value is $154,278,02.51, with a base value of $845,000. 5. The contract is not available for competition.
Value Assessment
Rating: questionable
The contract value is substantial at $154M over 50 years. Without comparable contracts or detailed cost breakdowns, assessing its pricing against similar privatization efforts is difficult. The economic price adjustment clause introduces potential for cost escalation.
Cost Per Unit: N/A
Competition Analysis
Competition Level: limited
The contract is listed as 'NOT AVAILABLE FOR COMPETITION,' suggesting a sole-source or limited competition scenario. This limits price discovery and potentially leads to higher costs for taxpayers compared to a fully competitive process.
Taxpayer Impact: The long duration and lack of competition raise concerns about potential overpayment by taxpayers over the 50-year term.
Public Impact
Citizens of Little Rock AFB will experience continued water services. The privatization aims to transfer operational and financial risks to the contractor. Long-term infrastructure investment is secured for the base's water system. Potential for service disruptions if contractor fails to meet obligations. Taxpayer funds are committed for a significant period.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Lack of competition
- Long contract duration
- Economic price adjustment
- Potential for cost overruns
Positive Signals
- Long-term infrastructure investment
- Potential for operational efficiencies
Sector Analysis
This contract falls under utility services, specifically water supply and irrigation systems. Long-term privatization contracts for critical infrastructure like water systems are common in government, often involving significant capital investment and multi-decade commitments.
Small Business Impact
The data does not indicate any specific provisions or set-asides for small businesses in this contract. Given the nature of utility privatization, it is unlikely that small businesses would be primary contractors, though they might participate as subcontractors.
Oversight & Accountability
The long duration of this contract necessitates robust oversight to ensure the contractor meets performance standards and that the economic price adjustment is applied fairly. Regular performance reviews and audits will be crucial for accountability.
Related Government Programs
- Water Supply and Irrigation Systems
- Department of Defense Contracting
- Defense Logistics Agency Programs
Risk Flags
- Lack of competitive bidding may lead to inflated costs.
- Long contract duration increases risk of unforeseen cost increases and contractor performance issues.
- Economic price adjustment clause could significantly increase the total contract cost over time.
- Potential for contractor to underinvest in maintenance if oversight is weak.
- Dependence on a single entity for a critical utility poses a risk.
Tags
water-supply-and-irrigation-systems, department-of-defense, ar, definitive-contract, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $15.4 million to CITY OF JACKSONVILLE. IGF::OT::IGF UTILITY SERVICES CONTRACT FOR THE PRIVATIZATION OF THE WATER DISTRIBUTION SYSTEM AT LITTLE ROCK AIR FORCE BASE, ARKANSAS.
Who is the contractor on this award?
The obligated recipient is CITY OF JACKSONVILLE.
Which agency awarded this contract?
Awarding agency: Department of Defense (Defense Logistics Agency).
What is the total obligated amount?
The obligated amount is $15.4 million.
What is the period of performance?
Start: 2018-05-01. End: 2068-04-30.
What is the justification for limiting competition on this critical utility privatization contract?
The contract is listed as 'NOT AVAILABLE FOR COMPETITION,' which typically implies a sole-source award or a limited competition scenario. The specific justification for this limitation is not provided in the data. Reasons could include unique capabilities of the awarded entity, existing infrastructure integration, or specific statutory requirements. Further investigation into the solicitation documents would be needed to determine the precise rationale.
How will the economic price adjustment clause be managed to protect taxpayer interests over the 50-year term?
Managing the economic price adjustment (EPA) clause requires clear, pre-defined indices and regular reviews to ensure adjustments are tied to legitimate cost increases and not excessive profit. The contracting agency must establish a robust monitoring system to track relevant economic indicators and verify the accuracy of adjustment calculations. Transparency in reporting these adjustments is also key to accountability.
What performance metrics and service level agreements are in place to ensure the quality and reliability of the water system?
The provided data does not detail specific performance metrics or service level agreements (SLAs). However, for a contract of this nature and duration, it is expected that comprehensive SLAs covering water quality, pressure, response times for outages, and system maintenance would be established. The agency's oversight would focus on monitoring adherence to these metrics.
Industry Classification
NAICS: Utilities › Water, Sewage and Other Systems › Water Supply and Irrigation Systems
Product/Service Code: UTILITIES AND HOUSEKEEPING › UTILITIES
Competition & Pricing
Extent Competed: NOT AVAILABLE FOR COMPETITION
Solicitation Procedures: ONLY ONE SOURCE
Solicitation ID: SPE60012R0823
Offers Received: 1
Pricing Type: FIXED PRICE WITH ECONOMIC PRICE ADJUSTMENT (K)
Evaluated Preference: NONE
Contractor Details
Address: 1900 MARSHALL RD, JACKSONVILLE, AR, 72076
Business Categories: Category Business, Government, U.S. Local Government, U.S. National Government, Not Designated a Small Business
Financial Breakdown
Contract Ceiling: $72,427,076
Exercised Options: $72,427,076
Current Obligation: $15,427,803
Actual Outlays: $277,039
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Timeline
Start Date: 2018-05-01
Current End Date: 2068-04-30
Potential End Date: 2068-04-30 00:00:00
Last Modified: 2025-11-17
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