Defense contract for building construction awarded to Bethel Services, Inc. for over $21 million

Contract Overview

Contract Amount: $21,198,775 ($21.2M)

Contractor: Bethel Services, Incorporated

Awarding Agency: Department of Defense

Start Date: 2009-03-10

End Date: 2011-06-17

Contract Duration: 829 days

Daily Burn Rate: $25.6K/day

Competition Type: NOT AVAILABLE FOR COMPETITION

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: ELM280 LO PHASE II

Place of Performance

Location: ELMENDORF AFB, ANCHORAGE County, ALASKA, 99506

State: Alaska Government Spending

Plain-Language Summary

Department of Defense obligated $21.2 million to BETHEL SERVICES, INCORPORATED for work described as: ELM280 LO PHASE II Key points: 1. Contract value of $21.2 million for construction services. 2. Awarded by the Department of the Army, indicating a defense-related need. 3. The contract duration was approximately 2.7 years. 4. The North American Industry Classification System (NAICS) code 236220 points to commercial and institutional building construction. 5. The contract was not competed, raising questions about price discovery and potential value. 6. The contract was awarded in Alaska, suggesting a specific geographic requirement.

Value Assessment

Rating: questionable

Without specific benchmarks for similar construction projects in Alaska during 2009-2011, it is difficult to definitively assess the value for money. The lack of competition is a significant factor that could lead to inflated pricing. Further analysis would require comparing the scope of work and final cost to other government or private sector projects of similar scale and complexity in the region.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning it was not openly competed. This typically occurs when only one vendor is capable of meeting the requirement, or in specific circumstances where competition is deemed impractical or not in the government's interest. The lack of competition limits the government's ability to secure the best possible price through a bidding process.

Taxpayer Impact: Sole-source awards can potentially lead to higher costs for taxpayers as there is no competitive pressure to drive down prices. It also reduces transparency in the procurement process.

Public Impact

The primary beneficiary is the Department of Defense, specifically the Army, which received the construction services. The services delivered involved the construction of commercial and institutional buildings. The geographic impact is localized to Alaska, where the construction took place. The contract likely supported local construction workforce and related industries in Alaska.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may have resulted in a higher price than a competed contract.
Sole-source awards can reduce transparency and accountability in government spending.
Limited data available on the specific scope of work makes detailed performance assessment challenging.

Positive Signals

The contract was awarded to a specific entity, Bethel Services, Inc., indicating a direct award.
The contract was for a defined period, suggesting a clear project timeline.
The firm fixed price contract type generally provides cost certainty for the government.

Sector Analysis

The construction sector is a significant part of the federal procurement landscape, encompassing a wide range of building and infrastructure projects. This contract falls under commercial and institutional building construction, a category that includes a variety of facilities. Federal spending in this sector is often driven by infrastructure needs, base improvements, and specialized facility requirements, particularly within the Department of Defense. Benchmarking this contract's value would ideally involve comparing it to similar construction projects awarded by the government or in the private sector in Alaska during the same period.

Small Business Impact

There is no indication that this contract involved small business set-asides or subcontracting requirements. The award was made directly to Bethel Services, Inc. without specific provisions for small business participation mentioned in the provided data. This means the direct impact on the small business ecosystem from this specific contract is likely minimal, unless Bethel Services, Inc. itself is a small business and utilized other small businesses in its supply chain, which is not detailed here.

Oversight & Accountability

Oversight for this contract would have been managed by the Department of the Army contracting and project management offices. Accountability measures would typically include contract performance reviews, site inspections, and adherence to the firm fixed price terms. Transparency is limited due to the sole-source nature of the award. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

Department of Defense Construction Contracts
Army Facilities Management
Commercial Building Construction
Institutional Building Construction
Alaska Federal Contracts

Risk Flags

Sole-source award
Lack of competition
Limited performance data available

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $21.2 million to BETHEL SERVICES, INCORPORATED. ELM280 LO PHASE II

Who is the contractor on this award?

The obligated recipient is BETHEL SERVICES, INCORPORATED.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $21.2 million.

What is the period of performance?

Start: 2009-03-10. End: 2011-06-17.

What was the specific scope of work for this construction contract?

The provided data indicates the contract was for 'ELM280 LO PHASE II' and falls under NAICS code 236220 (Commercial and Institutional Building Construction). However, the precise details of the scope of work, such as the type of building, its purpose, size, and specific construction requirements, are not available in the abbreviated data. This information would be crucial for a comprehensive assessment of the contract's value and performance. Typically, such contracts would detail architectural plans, material specifications, and construction timelines.

How does the $21.2 million contract value compare to similar construction projects in Alaska during that period?

Benchmarking the $21.2 million contract value against similar projects in Alaska between 2009 and 2011 is challenging without access to a broader dataset of comparable federal or state construction contracts. Factors like project complexity, specific location within Alaska, material costs, and labor rates significantly influence construction costs. Given the sole-source nature of this award, it is difficult to ascertain if the price reflects competitive market rates. A detailed comparison would require analyzing the scope of work against projects of similar size and function in the same geographic region.

What are the potential risks associated with a sole-source award for a construction project of this magnitude?

The primary risk associated with a sole-source award for a $21.2 million construction project is the potential for overpayment due to the absence of competitive bidding. Without competing offers, the government may not achieve the lowest possible price. Other risks include a lack of innovation that might be brought by multiple bidders, and potential challenges in verifying the contractor's capabilities and pricing against market alternatives. Furthermore, sole-source awards can sometimes raise concerns about fairness and transparency in the procurement process.

What was the track record of Bethel Services, Incorporated prior to this award?

The provided data does not include information on the prior track record of Bethel Services, Incorporated. To assess their performance history, one would need to examine past contracts awarded to the company, their performance evaluations on those contracts, and any history of disputes or litigation. A contractor's past performance is a critical factor in evaluating the risk associated with a new award, especially for a significant project like this construction contract.

How did the firm fixed price (FFP) contract type influence the risk and cost for this project?

A Firm Fixed Price (FFP) contract type generally places the majority of the cost risk on the contractor. This means that Bethel Services, Incorporated was responsible for completing the construction project within the agreed-upon $21.2 million budget, regardless of unforeseen cost increases. For the government, this offers cost certainty, as the final price is fixed. However, if the contractor underestimated costs, they could incur losses, potentially impacting their ability or motivation to deliver quality work. Conversely, if the contractor accurately estimated or found efficiencies, they could achieve a higher profit margin.

What is the significance of the contract being awarded in Alaska?

Awarding a construction contract in Alaska can have specific implications due to the unique logistical challenges and higher costs often associated with operating in remote or geographically demanding regions. Factors such as transportation of materials, availability of skilled labor, and environmental considerations can influence project timelines and overall costs. The specific location suggests the construction was likely for a facility or infrastructure critical to military operations or presence within Alaska.

Industry Classification

NAICS: Construction › Nonresidential Building Construction › Commercial and Institutional Building Construction

Product/Service Code: CONSTRUCT OF STRUCTURES/FACILITIES › CONSTRUCTION OF BUILDINGS

Competition & Pricing

Extent Competed: NOT AVAILABLE FOR COMPETITION

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: W911KB08R0038

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Bethel Native Corporation (UEI: 089331862)

Address: 460 RIDGECREST DR, BETHEL, AK, 00

Business Categories: 8(a) Program Participant, Alaskan Native Corporation Owned Firm, Category Business, Corporate Entity Not Tax Exempt, Emerging Small Business, HUBZone Firm, Minority Owned Business, Native American Owned Business, Self-Certified Small Disadvantaged Business, Small Business, Special Designations, Woman Owned Business

Financial Breakdown

Contract Ceiling: $21,198,775

Exercised Options: $21,198,775

Current Obligation: $21,198,775

Contract Characteristics

Cost or Pricing Data: NO

Timeline