Department of the Army awarded $9.9M contract for powerhouse generator repair, highlighting long-term maintenance needs

Contract Overview

Contract Amount: $9,942,873 ($9.9M)

Contractor: National Electric Coil Inc

Awarding Agency: Department of Defense

Start Date: 2006-09-29

End Date: 2012-09-30

Contract Duration: 2,193 days

Daily Burn Rate: $4.5K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: B4R065P REWIND OF BLAKELY MOUNTAIN POWERHOUSE GENERATORS

Place of Performance

Location: ROYAL, GARLAND County, ARKANSAS, 71968

State: Arkansas Government Spending

Plain-Language Summary

Department of Defense obligated $9.9 million to NATIONAL ELECTRIC COIL INC for work described as: B4R065P REWIND OF BLAKELY MOUNTAIN POWERHOUSE GENERATORS Key points: 1. Contract value of $9.9M for generator repair suggests significant investment in critical infrastructure. 2. The award to National Electric Coil Inc. indicates a focus on specialized repair services. 3. A 6-year performance period points to the long-term nature of maintaining complex machinery. 4. The firm fixed-price contract type aims to provide cost certainty for the government. 5. This contract falls under the Commercial and Industrial Machinery and Equipment repair sector. 6. The Arkansas location suggests a focus on regional infrastructure maintenance.

Value Assessment

Rating: good

The contract value of $9.9 million for generator repair and maintenance appears reasonable given the specialized nature of the equipment and the 6-year duration. Benchmarking against similar large-scale industrial equipment repair contracts would provide a more precise value-for-money assessment. However, the firm fixed-price structure suggests an effort to control costs. Without specific details on the scope of work, a direct per-unit cost comparison is difficult, but the overall investment aligns with maintaining critical power generation infrastructure.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that multiple bidders had the opportunity to submit proposals. The presence of two bidders suggests a competitive environment, which typically benefits price discovery and can lead to more favorable pricing for the government. The specific details of the bidding process, such as the number of proposals received and the evaluation criteria, would offer further insight into the effectiveness of the competition.

Taxpayer Impact: Full and open competition generally leads to better pricing for taxpayers by encouraging a wider range of suppliers to offer their best prices.

Public Impact

The primary beneficiaries are the Department of Defense and potentially the Army Corps of Engineers, ensuring the operational readiness of power generation facilities. The services delivered include the repair and maintenance of powerhouse generators, crucial for reliable energy supply. The geographic impact is focused on Arkansas, where the Blakely Mountain Powerhouse is located. The contract supports specialized labor in the industrial machinery repair sector, potentially creating or sustaining jobs for skilled technicians.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Long performance period (6 years) could introduce risks related to technological obsolescence or unforeseen maintenance challenges.
Dependence on a single contractor for critical generator repair might pose a risk if the contractor faces financial or operational difficulties.

Positive Signals

Firm fixed-price contract provides cost predictability and reduces the risk of cost overruns for the government.
Full and open competition suggests a robust selection process, likely resulting in a qualified contractor.
The contract's focus on essential infrastructure maintenance ensures operational continuity for critical facilities.

Sector Analysis

This contract falls within the Industrial Machinery and Equipment Repair and Maintenance sector, a critical component of the broader industrial services market. This sector supports the operational readiness of various industries, including energy, manufacturing, and defense. The market size for such specialized repair services can be substantial, driven by the need to maintain aging infrastructure and complex machinery. This specific contract represents a significant investment in maintaining a key piece of energy infrastructure for the Department of Defense.

Small Business Impact

The contract was not set aside for small businesses, and there is no indication of subcontracting requirements for small businesses. This suggests that the primary focus was on securing specialized expertise for a large-scale repair project, potentially limiting direct opportunities for small businesses in this specific award. Further analysis of the contractor's past performance and subcontracting plans would be needed to fully assess the impact on the small business ecosystem.

Oversight & Accountability

The contract is a definitive contract awarded by the Department of the Army, implying adherence to federal procurement regulations. Oversight would typically involve contract officers, program managers, and potentially quality assurance specialists to ensure work is performed according to specifications. Transparency is facilitated through federal contract databases. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse.

Related Government Programs

Department of Defense Maintenance and Repair Contracts
Army Corps of Engineers Infrastructure Projects
Power Generation Equipment Maintenance
Industrial Machinery Repair Services

Risk Flags

Long-term contract duration may increase risk of cost escalation or performance issues over time.
Potential for sole-source reliance if follow-on work is needed and contractor capabilities are unique.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $9.9 million to NATIONAL ELECTRIC COIL INC. B4R065P REWIND OF BLAKELY MOUNTAIN POWERHOUSE GENERATORS

Who is the contractor on this award?

The obligated recipient is NATIONAL ELECTRIC COIL INC.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $9.9 million.

What is the period of performance?

Start: 2006-09-29. End: 2012-09-30.

What is the track record of National Electric Coil Inc. with the Department of Defense?

National Electric Coil Inc. has a history of performing work for the Department of Defense, as indicated by this contract. To assess their track record thoroughly, one would need to examine their past performance evaluations on similar contracts, including any awards, penalties, or disputes. Analyzing the number and value of previous contracts awarded to them by the DoD, as well as their performance ratings (if publicly available), would provide a clearer picture of their reliability and capability in fulfilling government requirements. A review of contract databases like SAM.gov or FPDS could reveal the extent of their engagement with the DoD across various agencies and contract types.

How does the value of this contract compare to similar generator repair contracts?

The $9.9 million contract value for powerhouse generator repair and maintenance over a 6-year period needs to be benchmarked against comparable projects to assess its value for money. Factors such as the size and type of generators, the complexity of the required repairs, and the prevailing market rates for specialized industrial maintenance services are crucial for comparison. Without access to a database of similar contracts with detailed scope and pricing, a precise comparison is challenging. However, for critical infrastructure like powerhouses, such investments are often substantial and reflect the long-term operational needs and the specialized expertise required.

What are the primary risks associated with this type of long-term maintenance contract?

Long-term maintenance contracts, such as this 6-year agreement for generator repair, carry several inherent risks. One significant risk is technological obsolescence; power generation technology can evolve, potentially making the repaired equipment less efficient or requiring different maintenance approaches over the contract's duration. Another risk is contractor performance degradation; the quality of service might decline over time due to staffing changes, financial issues, or a lack of sustained focus. Furthermore, unforeseen issues with the equipment could arise that were not fully anticipated during the initial contract negotiation, potentially leading to scope creep or disputes over additional costs. Ensuring robust oversight and clear performance metrics is vital to mitigate these risks.

What is the expected impact of this contract on the operational readiness of the facility?

This contract is expected to significantly enhance the operational readiness of the Blakely Mountain Powerhouse by ensuring its generators are maintained in optimal working condition. Regular and specialized maintenance prevents unexpected breakdowns, extends the lifespan of the equipment, and guarantees the reliable supply of power. For a military facility, consistent power is critical for operations, training, and supporting personnel. By addressing repair and maintenance needs proactively over a 6-year period, the Department of the Army mitigates the risk of power disruptions, thereby bolstering the overall readiness and effectiveness of the installation.

How has spending on industrial machinery repair and maintenance by the Department of Defense trended historically?

Historical spending data for industrial machinery repair and maintenance by the Department of Defense would reveal trends in investment in critical infrastructure upkeep. Analyzing past expenditures in this category can indicate whether spending has been increasing, decreasing, or remaining stable. Such trends are often influenced by factors like the aging of military equipment and facilities, budget allocations, and strategic priorities. A consistent or increasing trend in spending on maintenance suggests a recognition of the importance of preserving existing assets, while a decrease might signal a shift towards new acquisitions or budget constraints. This specific contract represents a portion of that broader historical spending pattern.

What is the significance of the firm fixed-price contract type for this generator repair work?

The selection of a firm fixed-price (FFP) contract type for this generator repair work is significant as it places the primary responsibility for cost control on the contractor, National Electric Coil Inc. Under an FFP agreement, the total price is fixed regardless of the contractor's actual costs incurred in performing the work. This structure provides the Department of the Army with a high degree of cost certainty and predictability, minimizing the risk of budget overruns. It incentivizes the contractor to manage their resources efficiently and perform the work within the agreed-upon budget to maximize their profit. This is generally advantageous for the government when the scope of work is well-defined and risks are manageable.

Industry Classification

NAICS: Other Services (except Public Administration) › Commercial and Industrial Machinery and Equipment (except Automotive and Electronic) Repair and Maintenance › Commercial and Industrial Machinery and Equipment (except Automotive and Electronic) Repair and Maintenance

Product/Service Code: MAINT, REPAIR, REBUILD EQUIPMENT › MAINT, REPAIR, REBUILD OF EQUIPMENT

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: W912EE06R0013

Offers Received: 2

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 800 KING AVE, COLUMBUS, OH, 43212

Business Categories: Category Business, Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $9,942,873

Exercised Options: $9,942,873

Current Obligation: $9,942,873

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline