DoD's $21.9M contract for real estate activities awarded to Rock Island Arsenal Development Group, with no competition

Contract Overview

Contract Amount: $21,918,478 ($21.9M)

Contractor: Rock Island Arsenal Development Group

Awarding Agency: Department of Defense

Start Date: 2007-09-30

End Date: 2010-12-31

Contract Duration: 1,188 days

Daily Burn Rate: $18.4K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: SERVICES

Place of Performance

Location: ROCK ISLAND, ROCK ISLAND County, ILLINOIS, 61299

State: Illinois Government Spending

Plain-Language Summary

Department of Defense obligated $21.9 million to ROCK ISLAND ARSENAL DEVELOPMENT GROUP for work described as: SERVICES Key points: 1. The contract's value of $21.9 million over three years suggests a significant investment in real estate services. 2. The absence of competition raises concerns about potential overpricing and lack of market-driven value. 3. The contract's duration and fixed-price nature may limit flexibility but provide cost certainty. 4. Performance context is limited due to the lack of competitive bidding and publicly available performance metrics. 5. This contract falls within the broader 'Other Activities Related to Real Estate' category, indicating specialized services. 6. The sole-source award suggests unique capabilities or circumstances, warranting further investigation into the justification.

Value Assessment

Rating: questionable

Benchmarking the value of this $21.9 million contract is challenging without competitive data. The fixed-price structure provides some cost certainty, but the lack of competition means there's no direct comparison to market rates or other potential providers. Without more information on the specific services rendered and the contractor's performance, it's difficult to definitively assess value for money. The absence of a competitive process inherently limits the ability to ensure the government received the best possible price.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning it was not competed. This indicates that the Department of the Army identified a single source believed to be capable of fulfilling the requirement. The lack of competition limits the government's ability to explore a range of solutions and pricing from multiple vendors, potentially leading to higher costs than if the contract had been openly competed.

Taxpayer Impact: For taxpayers, a sole-source award means there was no opportunity to benefit from competitive bidding, which typically drives down prices and encourages innovation. This could result in a higher overall expenditure for the services provided.

Public Impact

The primary beneficiaries are likely the Department of the Army and its personnel at Rock Island Arsenal, who receive support for real estate-related activities. The services delivered are related to 'Other Activities Related to Real Estate,' which could encompass property management, development, leasing, or other specialized functions. The geographic impact is concentrated around Rock Island Arsenal in Illinois, where the services are presumably being performed. Workforce implications are not explicitly detailed but would involve personnel from the contractor and potentially government oversight staff.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may lead to inflated pricing.
Sole-source award raises questions about the justification and potential for better alternatives.
Limited transparency due to non-competitive nature makes performance assessment difficult.

Positive Signals

Fixed-price contract provides cost certainty for the duration.
Contract awarded to a specific entity suggests a perceived need for their unique capabilities.
Long-term contract (over 3 years) indicates a sustained requirement for these real estate services.

Sector Analysis

This contract falls under the broad 'Other Activities Related to Real Estate' category, which is a niche but essential service for government agencies managing extensive property portfolios. The market for such specialized real estate services can vary, but government contracts often involve complex regulatory and security requirements. Comparable spending benchmarks are difficult to establish without more specific service details, but large-scale real estate support for military installations can represent significant annual expenditures across the federal government.

Small Business Impact

This contract was not competed and there is no indication of small business set-asides or subcontracting requirements. The sole-source nature of the award means that opportunities for small businesses to participate as prime contractors or subcontractors were likely not explored through this specific procurement vehicle. Further analysis would be needed to determine if small businesses were involved in any capacity prior to or after this award.

Oversight & Accountability

Oversight mechanisms for this contract are not detailed in the provided data. As a sole-source award, it would typically be subject to review by the contracting officer and potentially higher levels within the Department of the Army. Transparency is limited due to the non-competitive nature. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

Department of Defense Real Estate Management
Army Corps of Engineers Real Estate
Federal Real Property Management
Government Property Development
Military Base Support Services

Risk Flags

Sole-source award lacks competitive justification.
Potential for inflated pricing due to lack of competition.
Limited transparency regarding service delivery and performance metrics.
No clear indication of small business participation or subcontracting.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $21.9 million to ROCK ISLAND ARSENAL DEVELOPMENT GROUP. SERVICES

Who is the contractor on this award?

The obligated recipient is ROCK ISLAND ARSENAL DEVELOPMENT GROUP.

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Army).

What is the total obligated amount?

The obligated amount is $21.9 million.

What is the period of performance?

Start: 2007-09-30. End: 2010-12-31.

What specific real estate services were provided under this contract?

The contract is categorized under 'Other Activities Related to Real Estate' (NAICS code 531390). While the specific services are not detailed in the provided data, this category typically encompasses a range of activities such as property management, leasing, acquisition and disposal support, appraisal services, and real estate consulting. Given the award to Rock Island Arsenal Development Group, it is probable that the services were directly related to supporting the operations and infrastructure at the Rock Island Arsenal, potentially involving the management or development of facilities and land crucial for the base's mission.

Why was this contract awarded on a sole-source basis?

The provided data indicates the contract was 'NOT COMPETED' and awarded as a 'SOLE SOURCE'. The specific justification for this sole-source award is not detailed. Typically, sole-source contracts are justified when only one responsible source is available or capable of meeting the government's needs. This could be due to unique capabilities, proprietary technology, urgent and compelling circumstances, or a lack of market research indicating other viable sources. Without the official justification document (e.g., a Justification and Approval - J&A), the precise reasons remain unknown, but it implies a specific requirement that the Army believed only Rock Island Arsenal Development Group could fulfill.

How does the $21.9 million contract value compare to similar real estate services contracts?

Comparing the $21.9 million contract value is difficult without knowing the precise scope of services and the contract duration. However, for large federal real estate support contracts, this figure represents a substantial investment over its 3-year period (2007-2010). Federal agencies often spend millions annually on real estate services, including property management, leasing, and development. The value suggests a significant need for specialized support at Rock Island Arsenal. Without competitive benchmarks or details on the specific services rendered, it's hard to definitively state if it's high or low relative to market rates for comparable, complex projects.

What is the track record of Rock Island Arsenal Development Group with federal contracts?

The provided data shows this specific contract (awarded 2007, ending 2010) for $21.9 million to Rock Island Arsenal Development Group. This indicates a history of receiving federal funding for real estate activities. However, to fully assess their track record, a broader search of federal procurement databases (like FPDS or SAM.gov) would be necessary to identify all contracts awarded to this entity, their values, agencies involved, performance history, and any past performance issues or accolades. This single contract suggests they have experience working with the Department of the Army.

What are the potential risks associated with a sole-source contract of this magnitude?

The primary risk associated with a sole-source contract of this magnitude ($21.9 million) is the potential for reduced value for money due to the lack of competition. Without competing bids, the government may pay a higher price than necessary. There's also a risk that the chosen contractor may not be the most innovative or efficient provider available. Furthermore, the absence of a competitive process can sometimes lead to less stringent oversight, as the pressure to perform well to win future contracts is diminished. Transparency is also reduced, making it harder for external parties to assess fairness and efficiency.

How does the contract's fixed-price nature impact its risk profile?

The contract's 'FIRM FIXED PRICE' (FFP) type generally shifts most of the risk to the contractor. This means the contractor is obligated to complete the work for a predetermined price, regardless of their actual costs. For the government, this provides cost certainty and predictability, making budgeting easier. However, if the contractor significantly underestimates costs or encounters unforeseen difficulties, they may incur losses, potentially impacting their motivation or ability to deliver quality services. Conversely, if the contractor manages costs efficiently, they can achieve a higher profit margin. The FFP structure is generally preferred for well-defined requirements where cost and performance risks can be reasonably estimated.

Industry Classification

NAICS: Real Estate and Rental and Leasing › Activities Related to Real Estate › Other Activities Related to Real Estate

Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › ADMINISTRATIVE SUPPORT SERVICES

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 1830 2ND AVE STE 200, ROCK ISLAND, IL, 61201

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

Financial Breakdown

Contract Ceiling: $21,918,478

Exercised Options: $21,918,478

Current Obligation: $21,918,478

Contract Characteristics

Commercial Item: COMMERCIAL ITEM

Cost or Pricing Data: NO

Timeline