DoD awards $9M for sewage treatment facilities, continuing prior contract with P D R PROPERTIES, INC

Contract Overview

Contract Amount: $9,042,325 ($9.0M)

Contractor: P D R Properties, Inc.

Awarding Agency: Department of Defense

Start Date: 2022-11-09

End Date: 2026-11-09

Contract Duration: 1,461 days

Daily Burn Rate: $6.2K/day

Competition Type: NOT AVAILABLE FOR COMPETITION

Number of Offers Received: 1

Pricing Type: FIXED PRICE WITH ECONOMIC PRICE ADJUSTMENT

Sector: Defense

Official Description: THIS IS A CONTINUATION OF W9124P-23-C-0002, AWARDED ON NOVEMBER 9, 2022, DUE TO THE TRANSFER OF CONTRACT ADMINISTRATION. THE PERIOD OF PERFORMANCE IS NOVEMBER 10, 2022 TO NOVEMBER 9, 2026 (48 MONTHS).

Place of Performance

Location: LEXINGTON, FAYETTE County, KENTUCKY, 40513

State: Kentucky Government Spending

Plain-Language Summary

Department of Defense obligated $9.0 million to P D R PROPERTIES, INC. for work described as: THIS IS A CONTINUATION OF W9124P-23-C-0002, AWARDED ON NOVEMBER 9, 2022, DUE TO THE TRANSFER OF CONTRACT ADMINISTRATION. THE PERIOD OF PERFORMANCE IS NOVEMBER 10, 2022 TO NOVEMBER 9, 2026 (48 MONTHS). Key points: 1. Contract is a continuation of a previous award, indicating ongoing need and potential for stable vendor relationship. 2. Long performance period of 48 months suggests a significant, long-term requirement for services. 3. Fixed Price with Economic Price Adjustment (FP EPA) contract type introduces potential for cost fluctuations. 4. Awarded by the Defense Logistics Agency, highlighting support for military infrastructure. 5. The contract's value is substantial, requiring careful monitoring of performance and cost efficiency. 6. Geographic focus on Kentucky suggests localized impact and specific operational needs.

Value Assessment

Rating: fair

The contract value of $9.04 million over 48 months equates to approximately $1.88 million annually. Benchmarking this against similar sewage treatment facility contracts is challenging without more specific service details. However, the FP EPA pricing structure introduces a degree of uncertainty regarding the final cost. The continuation of a prior contract suggests a level of satisfaction with the incumbent, but does not inherently guarantee optimal value.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

The contract was not competed, identified as 'NOT AVAILABLE FOR COMPETITION'. This limits the opportunity for price discovery through a competitive bidding process. Without a competitive solicitation, it is difficult to assess if the pricing reflects market rates or if alternative solutions were considered. The rationale for not competing this award needs further examination to ensure taxpayer interests are protected.

Taxpayer Impact: A sole-source award means taxpayers may not benefit from the cost savings typically achieved through competitive bidding, potentially leading to higher overall expenditures.

Public Impact

Benefits military personnel and their families by ensuring essential infrastructure services at Department of Defense facilities. Provides critical sewage treatment services, contributing to environmental protection and public health. Geographic impact is concentrated in Kentucky, supporting local operations and potentially local employment. The contract supports the operational readiness of defense installations by maintaining vital utility systems.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition raises concerns about potential overpricing and reduced incentive for cost efficiency.
The FP EPA contract type carries inherent risk of cost escalation due to economic adjustments.
Limited transparency into the justification for sole-source award requires further scrutiny.
The long performance period could mask inefficiencies if not actively managed and overseen.

Positive Signals

Continuation of a prior contract suggests a stable and potentially effective working relationship.
The award supports essential infrastructure, contributing to the operational integrity of defense facilities.
The fixed-price component provides some cost certainty, despite the economic price adjustment.

Sector Analysis

This contract falls within the broader Defense sector, specifically supporting base operations and infrastructure maintenance. The market for specialized sewage treatment facilities and services for government installations is often characterized by a limited number of qualified contractors. While specific market size data for this niche is not readily available, it is a critical component of maintaining operational readiness and environmental compliance for military bases.

Small Business Impact

The data indicates that small business participation (SB set-aside and subcontracting) was not a factor in this award (ss: false, sb: false). This suggests that the contract was not specifically targeted towards small businesses, and there may be limited direct benefit or opportunity for the small business ecosystem through this particular award. Further investigation into subcontracting plans would be needed to fully assess any indirect impact.

Oversight & Accountability

Oversight for this contract would typically fall under the Defense Logistics Agency's contracting and program management functions. Accountability measures are inherent in the contract terms, particularly regarding performance standards and delivery schedules. Transparency is limited by the sole-source nature of the award; however, contract details are generally available through federal procurement databases. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse.

Related Government Programs

Base Operations Support Services
Environmental Services Contracts
Public Works and Utilities Contracts
Department of Defense Infrastructure Maintenance

Risk Flags

Sole-source award lacks competitive pricing.
Economic Price Adjustment introduces cost uncertainty.
Long performance period requires diligent oversight.
No small business participation noted.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $9.0 million to P D R PROPERTIES, INC.. THIS IS A CONTINUATION OF W9124P-23-C-0002, AWARDED ON NOVEMBER 9, 2022, DUE TO THE TRANSFER OF CONTRACT ADMINISTRATION. THE PERIOD OF PERFORMANCE IS NOVEMBER 10, 2022 TO NOVEMBER 9, 2026 (48 MONTHS).

Who is the contractor on this award?

The obligated recipient is P D R PROPERTIES, INC..

Which agency awarded this contract?

Awarding agency: Department of Defense (Defense Logistics Agency).

What is the total obligated amount?

The obligated amount is $9.0 million.

What is the period of performance?

Start: 2022-11-09. End: 2026-11-09.

What was the original contract number and award details for the predecessor contract that this award continues?

This award, W9124P-24-F-0001, is a continuation of W9124P-23-C-0002. The prior contract, W9124P-23-C-0002, was awarded on November 9, 2022, with a value of $9,042,325.42 and a period of performance from November 10, 2022, to November 9, 2026. The transfer of contract administration necessitated this new award, W9124P-24-F-0001, to ensure continuity of services. The original award details for W9124P-23-C-0002 would provide insight into the initial justification, competition, and pricing basis for these services.

What specific services are included under 'Sewage Treatment Facilities' for this contract?

The designation 'Sewage Treatment Facilities' (NAICS code 221320) broadly covers establishments primarily engaged in the operation of sewer systems or sewage treatment plants. For this specific Department of Defense contract, it likely encompasses the operation, maintenance, repair, and potentially upgrade of sewage treatment infrastructure at a specific military installation in Kentucky. This could include collection systems, primary, secondary, and tertiary treatment processes, sludge management, and compliance with environmental discharge regulations. Detailed service requirements would be outlined in the Performance Work Statement (PWS) of the contract, which is not provided in the summary data.

What is the justification for awarding this contract on a sole-source basis?

The provided data states the contract type is 'NOT AVAILABLE FOR COMPETITION,' which typically indicates a sole-source award. The specific justification for this sole-source determination is not detailed in the summary. Common reasons for sole-source awards include unique capabilities of a single contractor, urgent and compelling needs where competition is not feasible, or when a previous contract is being transferred and continuity is paramount. Without the official justification document (e.g., a Justification and Approval for Other Than Full and Open Competition), it is impossible to definitively state why this contract was not competed.

How does the 'Fixed Price with Economic Price Adjustment' (FP EPA) structure impact cost certainty for taxpayers?

A Fixed Price with Economic Price Adjustment (FP EPA) contract aims to provide a fixed price baseline while allowing for adjustments based on specific economic factors, typically related to labor or material costs. For taxpayers, this means that while the base price is fixed, the final cost is not entirely predictable. The contract includes mechanisms to adjust the price upwards (or sometimes downwards) if certain economic indicators change significantly over the contract's life. This structure can protect the contractor from unforeseen cost increases, but it shifts some of that risk to the government, meaning taxpayers could end up paying more than the initially stated contract value if economic conditions fluctuate unfavorably.

What is the historical spending pattern for sewage treatment facilities by the Defense Logistics Agency or Department of Defense?

Historical spending data for sewage treatment facilities by the Defense Logistics Agency (DLA) or the broader Department of Defense (DoD) is not provided in the summary. However, the fact that this is a continuation of a prior contract suggests a recurring need for these services. DLA manages a vast supply chain and logistics network, including infrastructure support for various DoD entities. Annual spending on such services can fluctuate based on infrastructure condition, modernization projects, and regulatory changes. To understand historical patterns, one would need to analyze procurement data over several fiscal years, looking at similar contract awards for wastewater management and treatment across different DoD branches and agencies.

Industry Classification

NAICS: Utilities › Water, Sewage and Other Systems › Sewage Treatment Facilities

Product/Service Code: UTILITIES AND HOUSEKEEPING › UTILITIES

Competition & Pricing

Extent Competed: NOT AVAILABLE FOR COMPETITION

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: W9124P23R0014

Offers Received: 1

Pricing Type: FIXED PRICE WITH ECONOMIC PRICE ADJUSTMENT (K)

Evaluated Preference: NONE

Contractor Details

Address: 1029 MONARCH ST STE 250, LEXINGTON, KY, 40513

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

Financial Breakdown

Contract Ceiling: $13,712,302

Exercised Options: $9,234,330

Current Obligation: $9,042,325

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline