Department of Defense's $81.6M Hawthorne Army Depot contract awarded to SOC Nevada LLC for facilities support

Contract Overview

Contract Amount: $81,602,173 ($81.6M)

Contractor: SOC Nevada LLC

Awarding Agency: Department of Defense

Start Date: 2020-01-01

End Date: 2022-06-30

Contract Duration: 911 days

Daily Burn Rate: $89.6K/day

Competition Type: FULL AND OPEN COMPETITION

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: CALENDAR YEAR 2020 STORAGE, RECEIPT, AND ISSUANCE OF ASSETS AT THE HAWTHORNE ARMY DEPOT.

Place of Performance

Location: HAWTHORNE, MINERAL County, NEVADA, 89415

State: Nevada Government Spending

Plain-Language Summary

Department of Defense obligated $81.6 million to SOC NEVADA LLC for work described as: CALENDAR YEAR 2020 STORAGE, RECEIPT, AND ISSUANCE OF ASSETS AT THE HAWTHORNE ARMY DEPOT. Key points: 1. The contract value represents a significant investment in maintaining critical logistics and storage capabilities. 2. SOC Nevada LLC's award suggests a competitive landscape for facilities support services within the defense sector. 3. The firm-fixed-price structure aims to control costs, but performance monitoring is key to ensuring value. 4. This contract supports essential functions at a major military installation, highlighting its strategic importance. 5. The duration of the contract indicates a long-term need for these services. 6. The absence of small business set-aside flags suggests larger prime contractors are expected to handle this scope.

Value Assessment

Rating: good

The contract's value of approximately $81.6 million over its period of performance appears reasonable for the scope of storage, receipt, and issuance of assets at a large military depot. Benchmarking against similar facilities support contracts for large-scale logistics operations would provide a more precise value-for-money assessment. However, the firm-fixed-price nature suggests an expectation of cost control by the contractor.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that multiple bidders were likely considered. The specific number of bidders is not provided, but this procurement method generally fosters a competitive environment, which can lead to better pricing and service offerings for the government. The agency sought the best value through this competitive process.

Taxpayer Impact: Full and open competition is beneficial for taxpayers as it encourages a wider range of potential contractors to bid, driving down prices and improving the quality of services received, ultimately maximizing the efficient use of public funds.

Public Impact

The primary beneficiaries are the Department of the Army and its operational units relying on the Hawthorne Army Depot for logistical support. The contract delivers essential services including the storage, receipt, and issuance of military assets. The geographic impact is concentrated at the Hawthorne Army Depot in Nevada, a key logistical hub. This contract supports a workforce involved in logistics, warehousing, and facility management at the depot.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if scope creep occurs despite firm-fixed-price.
Reliance on a single contractor for critical depot operations could pose a risk if performance falters.
Ensuring adequate oversight to maintain service quality throughout the contract duration.

Positive Signals

Awarded through full and open competition, suggesting a robust selection process.
Firm-fixed-price contract type helps in budget predictability and cost control.
Long-term contract duration indicates a stable and ongoing need for these vital services.

Sector Analysis

This contract falls within the Facilities Support Services sector, a critical component of the broader government contracting landscape. This sector encompasses a wide range of services essential for the operation and maintenance of government facilities, including logistics, maintenance, and administrative support. The market for these services is substantial, with significant government spending allocated annually to ensure the functionality of military bases, administrative buildings, and other federal installations. This specific contract supports a major Army depot, highlighting the scale and importance of facilities management within defense 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 scope and scale of the services required were likely beyond the capacity or specific requirements for small business participation. Consequently, the prime contractor, SOC Nevada LLC, is expected to manage the entire service delivery. There may be opportunities for small businesses to participate as subcontractors, but this is not explicitly mandated by the contract's set-aside status.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and the contracting officer's representative (COR) within the Department of the Army. Accountability measures are inherent in the firm-fixed-price contract, which obligates the contractor to deliver specified services within agreed-upon terms. Transparency is facilitated through contract award databases and reporting requirements. Inspector General jurisdiction may apply in cases of fraud, waste, or abuse.

Related Government Programs

Army Logistics Readiness
Base Operations Support
Military Storage and Warehousing
Defense Logistics Agency Contracts
Federal Facilities Management

Risk Flags

Performance Risk: Potential for service degradation impacting depot operations.
Contractor Dependency: Reliance on a single entity for critical functions.
Cost Control: Need for diligent oversight to ensure firm-fixed-price effectiveness.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $81.6 million to SOC NEVADA LLC. CALENDAR YEAR 2020 STORAGE, RECEIPT, AND ISSUANCE OF ASSETS AT THE HAWTHORNE ARMY DEPOT.

Who is the contractor on this award?

The obligated recipient is SOC NEVADA LLC.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $81.6 million.

What is the period of performance?

Start: 2020-01-01. End: 2022-06-30.

What is the historical spending trend for facilities support services at Hawthorne Army Depot?

Analyzing historical spending data for facilities support at Hawthorne Army Depot prior to this $81.6 million contract (2020-2022) is crucial for understanding spending patterns and value. Without specific prior contract data, we can infer that the depot has consistently required such services. If previous contracts were significantly lower or higher, it would indicate changes in operational scope, service levels, or market pricing. A consistent or increasing trend might suggest growing operational demands or inflation, while a decrease could imply efficiency gains or reduced requirements. Understanding this trend helps assess if the current contract's value is aligned with historical investment and operational needs.

How does the awarded price compare to industry benchmarks for similar facilities support contracts?

To assess the value for money, the awarded price of approximately $81.6 million for SOC Nevada LLC's facilities support contract needs to be benchmarked against similar contracts. This involves comparing the cost per square foot, cost per asset managed, or cost per service unit (e.g., storage, receipt, issuance) against industry standards for large-scale military depots. Factors like geographic location, specific service requirements, and contract duration influence these benchmarks. If the price falls within or below typical ranges for comparable services, it suggests good value. Conversely, a price significantly above benchmarks may indicate potential overpayment or unique service demands justifying the higher cost.

What are the key performance indicators (KPIs) used to measure the success of this contract?

The success of this contract hinges on specific Key Performance Indicators (KPIs) that measure the effectiveness of storage, receipt, and issuance of assets. These KPIs likely include metrics such as on-time delivery rates for incoming and outgoing assets, accuracy of inventory management (e.g., discrepancy rates), facility maintenance standards (e.g., cleanliness, safety compliance), response times for asset requests, and adherence to security protocols. The firm-fixed-price nature implies that meeting these KPIs is directly tied to the contractor's profitability, incentivizing performance. Regular performance reviews by the Department of the Army would track these KPIs to ensure the contractor is meeting contractual obligations and delivering value.

What is SOC Nevada LLC's track record with similar government contracts?

Evaluating SOC Nevada LLC's past performance on similar government contracts is essential for assessing the risk and reliability associated with this $81.6 million award. Information on their experience with large-scale logistics, storage, and asset management, particularly within military environments, would be informative. A history of successful contract completion, positive performance reviews, and minimal disputes suggests a lower risk profile. Conversely, a record of performance issues, contract disputes, or significant cost overruns on comparable projects would raise concerns about their ability to meet the demands of this significant facilities support contract for the Hawthorne Army Depot.

What are the potential risks associated with a single contractor managing such critical depot operations?

The primary risk associated with awarding a large facilities support contract like this to a single entity, SOC Nevada LLC, is the potential for service disruption if the contractor underperforms or faces financial instability. Critical depot operations rely on seamless storage, receipt, and issuance of assets; any failure in these processes could have significant downstream impacts on military readiness. Furthermore, a lack of competition during potential future contract renewals could lead to complacency or price increases. Mitigation strategies include robust contract oversight, clear performance standards, and contingency planning by the Department of the Army to ensure continuity of essential services.

Industry Classification

NAICS: Administrative and Support and Waste Management and Remediation Services › Facilities Support Services › Facilities Support Services

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

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: SOC LLC

Address: 2 S MAINE AVE, HAWTHORNE, NV, 89415

Business Categories: Category Business, Limited Liability Corporation, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $81,602,173

Exercised Options: $81,602,173

Current Obligation: $81,602,173

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: W52P1J11D0002

IDV Type: IDC

Timeline