Atlantic Diving Supply Inc. contract for cooling/heating units valued at $22.1M, awarded by Defense Logistics Agency

Contract Overview

Contract Amount: $22,164,480 ($22.2M)

Contractor: Atlantic Diving Supply, Inc.

Awarding Agency: Department of Defense

Start Date: 2011-12-06

End Date: 2013-01-16

Contract Duration: 407 days

Daily Burn Rate: $54.5K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 14

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: 4519821626!ECU 60K BTU COOLING/10KW HEAT 6 FT AIR D

Place of Performance

Location: VIRGINIA BEACH, VIRGINIA BEACH CITY County, VIRGINIA, 23452

State: Virginia Government Spending

Plain-Language Summary

Department of Defense obligated $22.2 million to ATLANTIC DIVING SUPPLY, INC. for work described as: 4519821626!ECU 60K BTU COOLING/10KW HEAT 6 FT AIR D Key points: 1. Contract awarded for specialized environmental control units, indicating a need for specific climate management solutions. 2. The contract was competed, suggesting a degree of market engagement for these specialized equipment needs. 3. A fixed-price contract type suggests that cost risks are largely borne by the contractor. 4. The duration of the contract (407 days) indicates a medium-term requirement for the delivered goods. 5. The contract falls under the 'Service Establishment Equipment and Supplies Merchant Wholesalers' NAICS code, placing it within a broad wholesale trade category. 6. The award was a delivery order, implying it was part of a larger indefinite-delivery contract vehicle.

Value Assessment

Rating: fair

The total award amount of $22.1 million for environmental control units appears substantial. Benchmarking this against similar contracts for specialized cooling and heating equipment is difficult without more specific technical details and market data. However, the quantity of units (60K BTU cooling/10KW heat) and the price suggest a significant investment in climate control technology for military or sensitive operational environments. Further analysis would require comparing the per-unit cost to industry standards for similar specifications.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

The contract was awarded under 'Full and Open Competition After Exclusion of Sources,' which is an unusual designation. This suggests that while the initial intent might have been full and open competition, certain sources were excluded, potentially due to specific technical requirements, security clearances, or other pre-qualification criteria. The number of bidders (14) indicates a reasonable level of interest, but the exclusion of sources may have limited the overall competitive landscape.

Taxpayer Impact: The exclusion of sources, even with 14 bidders, could mean that taxpayers did not benefit from the lowest possible price that might have been achieved in a truly unrestricted full and open competition.

Public Impact

Military personnel and operations requiring controlled environmental conditions for equipment or living spaces. Delivery of specialized cooling and heating units essential for maintaining operational readiness in diverse climates. Potential impact on readiness and operational effectiveness within the Department of Defense. Support for the logistics and supply chain management of critical equipment for defense operations.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

The 'Exclusion of Sources' clause in the competition type warrants further investigation to understand the justification and potential impact on price.
Lack of detailed technical specifications makes it difficult to assess the value proposition of the cooling/heating units.
The contract's value is significant, raising questions about whether alternative, potentially more cost-effective solutions were considered.

Positive Signals

The contract was awarded through a competitive process, with 14 bidders participating.
The use of a Firm Fixed Price contract type shifts cost overrun risks to the contractor.
The Defense Logistics Agency's involvement suggests a standardized and potentially efficient procurement process for essential equipment.

Sector Analysis

This contract falls within the broader defense logistics and equipment sector, specifically related to environmental control systems. The market for such specialized units is often driven by government and military requirements, where reliability and performance under harsh conditions are paramount. While specific market size data for these exact units is not readily available, the defense sector's consistent need for climate control solutions for sensitive equipment and personnel represents a significant, albeit niche, market segment. Comparable spending benchmarks would likely be found within other defense contracts for environmental control units or specialized HVAC systems for deployed operations.

Small Business Impact

The data indicates that this contract was not specifically set aside for small businesses (ss: false, sb: false). Therefore, the primary impact on the small business ecosystem would be indirect, through potential subcontracting opportunities if Atlantic Diving Supply, Inc. engages small businesses for parts or services. Without specific subcontracting plans detailed in the award, it's difficult to quantify the direct benefit to small businesses from this particular contract.

Oversight & Accountability

Oversight for this contract would primarily fall under the Defense Logistics Agency (DLA) and potentially the Department of Defense's Inspector General. DLA is responsible for managing and overseeing the execution of contracts to ensure compliance with terms and conditions. Transparency is facilitated through contract award databases like FPDS. The Inspector General's office would have jurisdiction to investigate any allegations of fraud, waste, or abuse related to this contract.

Related Government Programs

Defense Logistics Agency Procurement
Environmental Control Systems
Military Equipment Procurement
Service Establishment Equipment
Wholesale Trade Contracts

Risk Flags

Competition Limitation
Potential for Overpricing
Lack of Detailed Technical Data

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $22.2 million to ATLANTIC DIVING SUPPLY, INC.. 4519821626!ECU 60K BTU COOLING/10KW HEAT 6 FT AIR D

Who is the contractor on this award?

The obligated recipient is ATLANTIC DIVING SUPPLY, INC..

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $22.2 million.

What is the period of performance?

Start: 2011-12-06. End: 2013-01-16.

What specific technical requirements led to the exclusion of certain sources in this 'Full and Open Competition After Exclusion of Sources' award?

The designation 'Full and Open Competition After Exclusion of Sources' suggests that while the solicitation was intended to be open to all responsible sources, specific criteria were applied that resulted in the exclusion of some potential bidders. These exclusions are typically based on stringent technical specifications, unique performance requirements, security clearances, or specialized manufacturing capabilities that only a limited number of contractors can meet. For this contract, the need for specific BTU cooling and KW heat ratings, coupled with the intended operational environment (implied by the Defense Logistics Agency award), likely dictated these exclusions. Without access to the solicitation details and pre-qualification records, the exact reasons remain unspecified, but they are generally tied to ensuring the equipment meets critical defense operational needs where failure is not an option.

How does the per-unit cost of these environmental control units compare to similar equipment procured by the government or in the commercial market?

Determining the precise per-unit cost and comparing it requires knowing the exact quantity of units purchased and dividing the total award amount by that quantity. The provided data indicates a total award of $22,164,480. However, the quantity is described as 'ECU 60K BTU COOLING/10KW HEAT 6 FT AIR D,' which is not a clear numerical count of units. Assuming 'ECU' refers to Environmental Control Units and there's a specific quantity implied but not explicitly stated, a per-unit cost could be calculated. Without this quantity, a direct comparison is impossible. Generally, military-grade environmental control units are more expensive than commercial equivalents due to ruggedization, extended operating temperature ranges, and compliance with stringent military standards. A preliminary assessment would require obtaining the unit count and then benchmarking against GSA schedules or other defense procurements for similar specifications.

What is the track record of Atlantic Diving Supply, Inc. in fulfilling similar defense contracts, particularly for environmental control equipment?

Atlantic Diving Supply, Inc. has a history of receiving contracts from the Department of Defense, as indicated by this award. To assess their track record specifically for environmental control equipment, a deeper dive into their contract history would be necessary. This would involve searching contract databases for previous awards related to HVAC systems, climate control units, or similar equipment. Key performance indicators to examine would include on-time delivery, adherence to specifications, and any history of contract modifications, disputes, or terminations. A positive track record in delivering complex equipment on time and to specification would suggest a lower risk for this current contract, while a history of issues would raise concerns about performance and reliability.

What are the potential risks associated with the 'limited' competition level for this contract, and how might they impact taxpayers?

A 'limited' competition level, especially one resulting from the exclusion of sources, carries several potential risks for taxpayers. Firstly, it can lead to higher prices. When fewer bidders are involved, or when specific capabilities are required that only a few firms possess, the competitive pressure to offer the lowest price is reduced. This can result in the government paying more than it might in a broader, more open competition. Secondly, it can limit innovation. Contractors may be less inclined to propose novel or more cost-effective solutions if they believe the contracting agency is focused on a very specific, pre-defined set of requirements that led to the exclusion of other potential providers. Taxpayers bear the brunt of these higher costs and potentially suboptimal solutions.

How does the $22.1 million contract value compare to overall DLA spending on similar equipment or services?

The $22.1 million contract value represents a significant, but not necessarily extraordinary, expenditure within the context of the Defense Logistics Agency's (DLA) overall budget. DLA manages a vast supply chain for the U.S. military, encompassing everything from food and clothing to spare parts and equipment. Contracts for specialized systems like environmental control units, while important, are part of a much larger procurement portfolio. To provide a meaningful comparison, one would need to analyze DLA's historical spending data on climate control systems, HVAC equipment, or similar environmental support systems over several fiscal years. This $22.1 million award should be viewed as one component of DLA's broader mission to equip and sustain military operations, where spending on critical infrastructure and operational support systems can run into billions of dollars annually.

Industry Classification

NAICS: Wholesale Trade › Machinery, Equipment, and Supplies Merchant Wholesalers › Service Establishment Equipment and Supplies Merchant Wholesalers

Product/Service Code: FIRE/RESCUE/SAFETY; ENVIRO PROTECT

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 14

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: ADS Tactical, Inc. (UEI: 078857127)

Address: 621 LYNNHAVEN PARKWAY STE 400, VIRGINIA BEACH, VA, 23452

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Small Business

Financial Breakdown

Contract Ceiling: $22,164,480

Exercised Options: $22,164,480

Current Obligation: $22,164,480

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: SPM8EJ09D0028

IDV Type: IDC

Timeline