DoD's $14.4M preventative maintenance contract with Interdyne Corp shows questionable value and limited competition

Contract Overview

Contract Amount: $14,387,767 ($14.4M)

Contractor: Interdyne Corp

Awarding Agency: Department of Defense

Start Date: 2009-02-19

End Date: 2020-02-28

Contract Duration: 4,026 days

Daily Burn Rate: $3.6K/day

Competition Type: NOT AVAILABLE FOR COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: PREVENTATIVE MAINTENANCE

Plain-Language Summary

Department of Defense obligated $14.4 million to INTERDYNE CORP for work described as: PREVENTATIVE MAINTENANCE Key points: 1. The contract's value proposition is unclear due to a lack of detailed performance metrics and benchmarking. 2. Limited competition suggests potential for higher costs and reduced innovation. 3. The long duration and fixed-price nature may not adequately account for evolving maintenance needs. 4. Contractor performance history, while not explicitly detailed, is a key factor in assessing long-term value. 5. The contract falls within the industrial machinery repair sector, a critical but often overlooked area of government spending.

Value Assessment

Rating: questionable

Benchmarking this $14.4 million contract against similar preventative maintenance agreements for industrial machinery is challenging due to limited publicly available data on specific services rendered and performance outcomes. The fixed-price structure, while offering cost certainty, may not be optimal for a service with potentially variable needs over a decade. Without clear performance indicators or comparisons to industry standards for similar equipment, assessing the true value-for-money is difficult. The absence of detailed cost breakdowns further obscures a precise value assessment.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded under a sole-source justification, indicating that only one vendor, Interdyne Corp, was considered capable of fulfilling the requirement. This lack of competition means that the Department of Defense did not benefit from a competitive bidding process, which typically drives down prices and encourages innovation. The absence of multiple bidders raises concerns about whether the government secured the best possible price and service.

Taxpayer Impact: The sole-source nature of this award means taxpayers may have paid a premium compared to what could have been achieved through a competitive procurement. It also limits opportunities for other qualified businesses to compete for this work.

Public Impact

The Department of Defense benefits from the continued operational readiness of its industrial machinery and equipment. Essential maintenance services are delivered to ensure the longevity and functionality of critical assets. The geographic impact is primarily within the operational areas of the Department of the Army, supporting its mission readiness. The contract supports specialized technical roles within the maintenance and repair workforce.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competitive bidding may lead to inflated costs for taxpayers.
The long contract duration (over 11 years) could result in outdated service provisions or pricing.
Limited transparency on specific performance metrics makes value assessment difficult.
Sole-source awards can stifle innovation and prevent smaller, capable firms from participating.

Positive Signals

Ensures continued operational readiness of critical industrial machinery.
Provides a stable, long-term maintenance solution for essential equipment.
The fixed-price contract offers cost predictability for the agency.

Sector Analysis

This contract falls within the Industrial Machinery and Equipment Repair and Maintenance sector, a vital but often less visible segment of federal procurement. This sector supports the operational readiness of numerous government agencies by ensuring the functionality of diverse equipment, from manufacturing tools to specialized machinery. Spending in this area is crucial for maintaining infrastructure and operational capabilities across defense, research, and other government functions. Benchmarking against similar contracts is difficult due to the specialized nature of the equipment and services, but consistent spending in this category highlights its importance.

Small Business Impact

This contract does not appear to have a small business set-aside component, nor is there information indicating significant subcontracting opportunities for small businesses. The sole-source nature of the award further limits the potential for small business participation. This suggests that the primary focus was on fulfilling a specific requirement with a known provider, rather than leveraging the small business ecosystem.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of the Army's contracting and program management offices. Accountability measures would be tied to the terms of the firm-fixed-price contract and any performance standards outlined, though these are not detailed in the provided data. Transparency is limited due to the sole-source nature and the lack of publicly accessible performance reports. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

Department of Defense Maintenance and Repair Contracts
Industrial Equipment Maintenance Services
Federal Preventative Maintenance Programs
Army Logistics and Readiness Contracts

Risk Flags

Limited competition
Lack of performance metrics
Long contract duration
Sole-source award

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $14.4 million to INTERDYNE CORP. PREVENTATIVE MAINTENANCE

Who is the contractor on this award?

The obligated recipient is INTERDYNE CORP.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $14.4 million.

What is the period of performance?

Start: 2009-02-19. End: 2020-02-28.

What specific types of industrial machinery and equipment are covered under this contract, and what is the criticality of this equipment to Army operations?

The contract covers preventative maintenance for 'Commercial and Industrial Machinery and Equipment (except Automotive and Electronic) Repair and Maintenance' under NAICS code 811310. While the specific equipment is not itemized, this broad category suggests a wide range of machinery essential for Army operations, potentially including manufacturing equipment, specialized repair tools, generators, and other industrial apparatus. The criticality is implied by the substantial contract value and long duration, indicating these assets are vital for maintaining operational readiness, logistics, and potentially production capabilities within the Army. Without a detailed inventory, the precise impact on specific operations remains generalized but is understood to be significant enough to warrant over a decade of dedicated maintenance funding.

How does the $14.4 million cost compare to industry benchmarks for similar preventative maintenance services over an 11-year period?

Directly comparing the $14.4 million cost to industry benchmarks is challenging without specific details on the types and quantities of machinery maintained, the scope of preventative tasks, and the geographic locations. However, an average annual cost of approximately $1.3 million ($14.4M / 11 years) for maintaining a potentially diverse fleet of industrial equipment is not inherently excessive, but the lack of competition raises concerns. In a competitive market, similar services might yield lower prices through bidding. The absence of detailed service level agreements and performance metrics in the public record prevents a robust value-for-money assessment against private sector standards. The sole-source nature further complicates benchmarking, as market-driven price discovery was bypassed.

What are the key performance indicators (KPIs) used to measure the success and effectiveness of Interdyne Corp's preventative maintenance services under this contract?

The provided data does not specify the key performance indicators (KPIs) used to measure the success and effectiveness of Interdyne Corp's preventative maintenance services. Typically, such contracts would include metrics related to equipment uptime, Mean Time Between Failures (MTBF), Mean Time To Repair (MTTR), adherence to maintenance schedules, and response times for emergency service. The absence of publicly available KPIs makes it difficult to objectively assess whether the contractor is meeting performance expectations and delivering optimal value. This lack of transparency is a common challenge when evaluating sole-source contracts, where the government may rely more heavily on direct oversight rather than competitive performance data.

What is Interdyne Corp's track record with the Department of Defense and other federal agencies, particularly regarding similar maintenance contracts?

Interdyne Corp has a history of performing contracts with the Department of Defense. While specific details on their track record for similar large-scale, long-term preventative maintenance contracts are not readily available in this dataset, their selection for this sole-source award suggests a pre-existing relationship or a perceived capability to meet the Army's needs. Further investigation into contract databases (like FPDS) would be required to fully assess their performance history, including past performance evaluations, any contract disputes, or awards for similar services. A comprehensive review of their past performance is crucial for understanding the rationale behind the sole-source decision and assessing the overall risk associated with this contract.

Given the contract's duration and sole-source nature, what are the potential risks associated with contractor performance and cost escalation over time?

The primary risks associated with this long-term, sole-source contract include potential complacency from the contractor, leading to suboptimal performance, and the possibility of cost escalation if pricing mechanisms are not robustly structured to account for inflation or changing market conditions. Without competitive pressure, Interdyne Corp may have less incentive to innovate or improve efficiency. Furthermore, the government's ability to renegotiate terms or switch providers is limited, potentially locking it into a less-than-ideal arrangement. The fixed-price nature mitigates direct cost escalation for services rendered, but the initial price might have been higher due to the lack of competition. Vigilant oversight is critical to mitigate these risks.

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 SHOP EQPT

Competition & Pricing

Extent Competed: NOT AVAILABLE FOR COMPETITION

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: W912ER09R0018

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 136 CORPORATE PARK DR STE 6, MOORESVILLE, NC, 10

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $14,546,867

Exercised Options: $14,387,767

Current Obligation: $14,387,767

Contract Characteristics

Cost or Pricing Data: NO

Timeline