DoD's $20.78M Fuels Management Contract Awarded to Walsingham Group Inc. Amidst Full and Open Competition

Contract Overview

Contract Amount: $20,770,819 ($20.8M)

Contractor: Walsingham Group Inc

Awarding Agency: Department of Defense

Start Date: 2022-08-01

End Date: 2026-07-31

Contract Duration: 1,460 days

Daily Burn Rate: $14.2K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 6

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: 8509123042!AF FUELS MANAGEMENT SERVICES

Place of Performance

Location: FAYETTEVILLE, CUMBERLAND County, NORTH CAROLINA, 28311

State: North Carolina Government Spending

Plain-Language Summary

Department of Defense obligated $20.8 million to WALSINGHAM GROUP INC for work described as: 8509123042!AF FUELS MANAGEMENT SERVICES Key points: 1. The contract's value of $20.78 million over its duration suggests a significant investment in essential defense logistics. 2. Full and open competition after exclusion of sources indicates a deliberate effort to ensure a broad range of potential bidders were considered. 3. The firm-fixed-price contract type generally shifts performance risk to the contractor, potentially leading to more predictable costs. 4. The duration of 1460 days (4 years) allows for long-term planning and execution of complex logistics services. 5. The North Carolina location for service delivery may indicate a strategic hub for fuel management operations. 6. The absence of small business set-aside flags suggests this contract was not specifically targeted for small business participation.

Value Assessment

Rating: good

The contract value of $20.78 million over four years averages approximately $5.19 million annually. Benchmarking this against similar fuels management contracts is challenging without specific details on the scope of services and geographic coverage. However, the firm-fixed-price structure suggests that the government has negotiated a price that is expected to cover all contractor costs and profit. The number of bids received (6) provides a reasonable basis for price negotiation, implying the price is likely competitive within the market for these services.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under 'Full and Open Competition After Exclusion of Sources.' This procurement method typically involves a solicitation that is broadly advertised, allowing all responsible sources to submit an offer. The 'after exclusion of sources' phrasing might indicate that certain types of entities or specific pre-qualified vendors were initially considered, but the final award was still made through a competitive process. Receiving 6 bids suggests a healthy level of competition for this requirement.

Taxpayer Impact: A competitive process, even with initial exclusions, generally benefits taxpayers by driving down prices and encouraging efficiency from the winning contractor. The presence of multiple bidders helps ensure that the awarded price reflects market value rather than being inflated due to a lack of alternatives.

Public Impact

The Department of Defense benefits through the reliable and efficient management of its fuel supplies, crucial for operational readiness. Services delivered include warehousing and storage of fuels, ensuring availability for military operations. The geographic impact is centered in North Carolina, potentially supporting regional military installations. Workforce implications may include job creation within the logistics and fuel management sector in North Carolina.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for price increases if market conditions for fuel storage and handling change significantly during the contract term.
Dependence on a single contractor for critical fuel management services could pose a risk if performance issues arise.
The 'after exclusion of sources' clause warrants further investigation to understand if it limited the competitive pool more than necessary.

Positive Signals

The firm-fixed-price contract type transfers cost overrun risk to the contractor.
The award was made after a competitive process with 6 bidders, indicating a degree of market validation for the price.
The contract duration allows for stable planning and execution of services.

Sector Analysis

The contract falls within the Warehousing and Storage sector (NAICS 493190), specifically related to fuel management. This sector is critical for national defense, ensuring the logistical backbone for military operations. The market for specialized fuel logistics services is often characterized by stringent regulatory requirements, high capital investment, and a need for specialized expertise. Comparable spending benchmarks would depend on the specific volume and type of fuels managed, but significant government contracts in this area are common due to the scale of military operations.

Small Business Impact

The data indicates that this contract was not set aside for small businesses (ss: false, sb: false). This suggests that the requirement was likely too large in scope or complexity, or that the market analysis determined that large businesses were best positioned to meet the needs. There is no explicit information on subcontracting plans, but large prime contractors are often required to outline their strategies for engaging small businesses as subcontractors. The absence of a small business set-aside means that opportunities for small businesses in this specific contract are likely limited to subcontracting roles, if any.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of Defense and the Defense Logistics Agency. As a definitive contract, it is subject to standard federal procurement regulations and oversight. Accountability measures are embedded in the firm-fixed-price structure, which incentivizes the contractor to manage costs effectively. Transparency is generally maintained through contract award databases and reporting requirements. The specific Inspector General jurisdiction would likely be that of the DoD IG, responsible for investigating fraud, waste, and abuse within the department.

Related Government Programs

Defense Fuel Supply Center Operations
Military Fuel Procurement and Distribution
Logistics and Supply Chain Management Services
Government Warehousing Contracts
Department of Defense Fuel Contracts

Risk Flags

Potential for limited competition due to 'exclusion of sources' clause.
Contractor performance risk in critical fuel supply chain.
Market volatility impacting fixed-price contract.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $20.8 million to WALSINGHAM GROUP INC. 8509123042!AF FUELS MANAGEMENT SERVICES

Who is the contractor on this award?

The obligated recipient is WALSINGHAM GROUP INC.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $20.8 million.

What is the period of performance?

Start: 2022-08-01. End: 2026-07-31.

What is the track record of Walsingham Group Inc. with federal contracts, particularly in fuels management?

Walsingham Group Inc. has a history of federal contracting, though specific details on their performance in fuels management require deeper analysis of their contract portfolio. Examining past performance evaluations, any contract disputes, or awards for similar services would provide a clearer picture of their capabilities and reliability. A review of their contract history with the DoD and other agencies could reveal patterns in contract size, duration, and success rates. Without access to detailed performance data, it's difficult to definitively assess their track record. However, being awarded a significant contract like this suggests they met the agency's pre-qualification criteria and demonstrated some level of competence.

How does the $20.78 million contract value compare to similar fuels management contracts awarded by the DoD or other agencies?

The $20.78 million value over four years, averaging approximately $5.19 million annually, places this contract in the mid-to-large tier for specialized logistics services. To provide a precise comparison, one would need to analyze contracts with similar scopes of work, geographic coverage, and service requirements (e.g., type of fuel, storage capacity, distribution complexity). Contracts for bulk fuel storage and distribution at major military installations or for large-scale logistical support operations can range from tens to hundreds of millions of dollars. This contract appears to be a substantial but not exceptionally large award within the broader context of defense logistics spending, suggesting it covers a significant but perhaps regionally focused or specialized set of fuel management needs.

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

Key risks include potential performance failures by the contractor, leading to disruptions in fuel supply critical for military operations. Market volatility in fuel prices or storage costs could also impact the contractor's profitability and potentially lead to requests for contract modification, although the firm-fixed-price structure aims to mitigate this. Operational risks, such as accidents or environmental incidents during fuel handling, are also present. Mitigation strategies likely include robust performance monitoring by the Defense Logistics Agency, adherence to strict safety and environmental protocols mandated by the contract, and contingency planning. The competitive award process itself serves as a risk mitigation tool by selecting a contractor deemed capable and offering a fair price.

How effective is the 'Full and Open Competition After Exclusion of Sources' method in ensuring value for taxpayers?

This procurement method aims to balance broad competition with the need to potentially narrow the field based on specific qualifications or capabilities. By excluding certain sources, the agency might be targeting contractors with proven expertise in specialized areas like fuel management, thereby ensuring a higher quality of service. However, if the exclusions are too broad or not well-justified, it could limit competition and potentially lead to higher prices than a truly unrestricted full and open competition. The fact that 6 bids were received suggests that the exclusions did not unduly restrict the market, and the competitive process likely yielded a reasonable price for the value received by the taxpayer.

What is the historical spending trend for fuels management services within the Department of Defense?

Historical spending on fuels management services by the Department of Defense is substantial and generally consistent, reflecting the continuous need for fuel supply to support global military operations. Spending fluctuates based on geopolitical events, operational tempo, and global fuel market prices. Over the past decade, the DoD has consistently allocated billions of dollars annually towards fuel procurement, storage, and distribution. Contracts like this one, for specialized management services, are a component of that larger spending picture. Analyzing trends would involve looking at the aggregate spending on fuel logistics contracts, identifying major providers, and observing shifts in procurement strategies, such as increased emphasis on efficiency or alternative fuels.

Industry Classification

NAICS: Transportation and Warehousing › Warehousing and Storage › Other Warehousing and Storage

Product/Service Code: OPERATION OF GOVT OWNED FACILITY › OPERATE GOVT OWNED BUILDINGS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: SPE60322R0502

Offers Received: 6

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 6390 RAMSEY ST, FAYETTEVILLE, NC, 28311

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

Financial Breakdown

Contract Ceiling: $20,770,819

Exercised Options: $20,770,819

Current Obligation: $20,770,819

Actual Outlays: $938,159

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Timeline