Army awards $332.6M construction contract for building maintenance and repairs

Contract Overview

Contract Amount: $10,224,541 ($10.2M)

Contractor: Bundesamt F¿R Bauwesen UND Raumordnung

Awarding Agency: Department of Defense

Start Date: 2005-06-24

End Date: 2012-08-31

Contract Duration: 2,625 days

Daily Burn Rate: $3.9K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: 200511!501424!2100!W912PE!RCO SECHENHEIM !W912PE05C0016 !A!N! !N! ! !20050624!20090630!332619535!332619535!342257649!N!BUNDESAMT FUER BAUWESEN UND RA!DEICHMANNS AUE 31-37 !BONN !GM!* !00000! !GM!* !* !GERMANY !+000000333358!N!N!000000333358!Z199!MAINT/OTHER MISCELLANEOUS BUILDINGS !C2 !CONSTRUCTION !000 !* !236220!E! !3! ! ! ! ! !20200930!B! ! !N!Z!A!U!J!2!002!A! !Z!N!Z!B!GM!N!L!N! ! ! ! ! !A!A!000!A!B!N! ! ! ! ! ! !0001! !

Plain-Language Summary

Department of Defense obligated $10.2 million to BUNDESAMT F¿R BAUWESEN UND RAUMORDNUNG for work described as: 200511!501424!2100!W912PE!RCO SECHENHEIM !W912PE05C0016 !A!N! !N! ! !20050624!20090630!332619535!332619535!342257649!N!BUNDESAMT FUER BAUWESEN UND RA!DEICHMANNS AUE 31-37 !BONN !GM!* !00000! !GM!* !* … Key points: 1. Contract awarded for maintenance and repair of miscellaneous buildings. 2. Significant duration of over 2600 days indicates a long-term service requirement. 3. Fixed-price contract type suggests cost certainty for the government. 4. Awarded by the Department of the Army, indicating a defense-related need. 5. Contractor is a German entity, suggesting international cooperation or presence. 6. The contract falls under the broad category of commercial and institutional building construction.

Value Assessment

Rating: fair

The total award amount of $332.6 million over approximately 7 years represents a substantial investment in building infrastructure. Benchmarking this against similar long-term maintenance contracts is challenging without more specific details on the scope of work and the types of buildings involved. However, the fixed-price nature of the contract aims to provide cost predictability. The per-year cost averages around $47.5 million, which needs to be evaluated in the context of the scale and complexity of the facilities managed.

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 were likely solicited. This approach generally promotes a competitive environment, potentially leading to better pricing and service offerings. The presence of two bids suggests a moderate level of competition for this significant contract.

Taxpayer Impact: Full and open competition is beneficial for taxpayers as it encourages a wider range of potential contractors to bid, driving down costs and improving the quality of services through market forces.

Public Impact

The primary beneficiaries are likely military personnel and civilian staff operating within the facilities managed by the Bundesamt für Bauwesen und Raumentwicklung. Services delivered include maintenance and repair of miscellaneous buildings, ensuring operational readiness and safety. The geographic impact is centered in Germany, where the contractor is based and presumably where the facilities are located. Workforce implications include potential job creation for construction and maintenance professionals in Germany.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if unforeseen maintenance issues arise in fixed-price contracts.
Dependence on a single contractor for a long duration could lead to complacency or reduced service quality over time.
Geographic concentration of the contractor may pose logistical challenges if facilities are widely dispersed.

Positive Signals

Full and open competition suggests a robust bidding process.
Fixed-price contract provides budget certainty for the government.
Long contract duration allows for stable planning and execution of maintenance activities.

Sector Analysis

This contract falls within the Construction sector, specifically focusing on commercial and institutional building construction and maintenance. The market for such services is substantial, driven by the ongoing need to maintain government and private infrastructure. Comparable spending benchmarks would typically involve analyzing other large-scale, long-term facilities maintenance contracts awarded by government entities, both domestically and internationally, to assess cost-effectiveness and contractor performance.

Small Business Impact

There is no indication that this contract included specific small business set-asides. Given the nature and scale of the work, it is likely that the prime contractor is a large entity. Subcontracting opportunities may exist, but their extent and benefit to small businesses would depend on the prime contractor's strategy and the specific requirements of the maintenance tasks.

Oversight & Accountability

Oversight would typically be managed by the contracting agency (Department of the Army) through contract officers and technical representatives. Accountability measures are inherent in the contract terms, with potential penalties for non-performance. Transparency is facilitated by the public nature of contract awards, though detailed performance metrics may not always be publicly available. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Base Operations Support
Facilities Engineering
Military Construction
Architectural and Engineering Services

Risk Flags

Limited competition (2 bidders)
Long contract duration may increase risk of cost escalation or performance degradation
Potential challenges in oversight due to international contractor location

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $10.2 million to BUNDESAMT F¿R BAUWESEN UND RAUMORDNUNG. 200511!501424!2100!W912PE!RCO SECHENHEIM !W912PE05C0016 !A!N! !N! ! !20050624!20090630!332619535!332619535!342257649!N!BUNDESAMT FUER BAUWESEN UND RA!DEICHMANNS AUE 31-37 !BONN !GM!* !00000! !GM!* !* !GERMANY !+000000333358!N!N!000000333358!Z199!MAINT/OTHER MISCELLANEOUS BUILDINGS !C2 !CONSTRUCTION !000 !* !236220!E! !3! ! ! ! ! !202

Who is the contractor on this award?

The obligated recipient is BUNDESAMT F¿R BAUWESEN UND RAUMORDNUNG.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $10.2 million.

What is the period of performance?

Start: 2005-06-24. End: 2012-08-31.

What is the specific scope of 'MAINT/OTHER MISCELLANEOUS BUILDINGS' covered under this contract?

The term 'MAINT/OTHER MISCELLANEOUS BUILDINGS' is broad and typically encompasses a wide range of routine and non-routine maintenance, repair, and minor alteration services for various types of government-owned or leased structures that do not fall under specialized categories like barracks or administrative offices. This could include anything from HVAC system upkeep, plumbing repairs, electrical work, roofing, structural repairs, pest control, janitorial services, and general upkeep of grounds associated with these buildings. The exact scope would be detailed in the contract's Statement of Work (SOW), which specifies the exact services required, performance standards, and reporting obligations. Without the SOW, it's difficult to precisely define the extent of the services.

How does the awarded amount of $332.6 million compare to similar long-term building maintenance contracts?

Comparing this $332.6 million contract requires context regarding the duration, scope, and geographic location. The contract spans over 7 years (from June 2005 to August 2012, with an original end date of June 2009 and subsequent modifications), averaging approximately $47.5 million per year. Large-scale, multi-year facilities maintenance contracts for government entities can range from tens to hundreds of millions of dollars. For instance, Base Operations Support (BOS) contracts, which often include extensive maintenance, can be in this range or higher. However, the specific nature of 'miscellaneous buildings' and the location in Germany make direct comparisons difficult without knowing the number and type of facilities, their condition, and the prevailing labor and material costs in that region. It appears to be a significant but not necessarily outlier amount for a long-term, comprehensive maintenance requirement.

What are the potential risks associated with a fixed-price contract of this magnitude and duration?

A significant risk with a long-term, fixed-price contract is the potential for the contractor to incur losses if costs escalate beyond initial projections due to inflation, unforeseen site conditions, or changes in material prices. Conversely, the government risks paying a premium if the contractor's initial cost estimates were overly conservative or if competition was limited. For the government, the primary risk is that the fixed price might not reflect true market value over the entire contract period, especially if market conditions change significantly. Additionally, ensuring consistent quality and performance over a long duration under a fixed price can be challenging, requiring robust oversight to prevent scope creep or a decline in service standards. The contractor bears the risk of cost overruns, which could impact their financial stability or lead to disputes.

What does the presence of only two bidders imply about the competition for this contract?

The fact that this contract, awarded under full and open competition, received only two bids suggests that the market for this specific type of service might be relatively concentrated, or that the barriers to entry for potential bidders were significant. This could be due to specialized requirements, the need for specific certifications or clearances, the large scale of the contract, or the geographic location. While two bidders indicate some level of competition, it is less robust than if there were numerous offers. This limited competition could potentially lead to less aggressive pricing than might be achieved in a more crowded field. However, it's also possible that these two bidders were highly qualified and capable, representing the most suitable options available.

How does the contractor's location in Germany impact the contract's execution and oversight?

The contractor, Bundesamt für Bauwesen und Raumentwicklung, being based in Germany has several implications. Firstly, it suggests the facilities being maintained are likely located in Germany, potentially supporting U.S. military or diplomatic operations abroad. This international aspect can introduce complexities related to local labor laws, regulations, currency exchange rates (if applicable), and logistical challenges. Oversight might require coordination between U.S. contracting personnel and local authorities or representatives. It also implies a need for the contractor to navigate both U.S. federal acquisition regulations and German business practices. The selection of a German entity suggests either a strategic decision to leverage local expertise and resources or a requirement tied to the specific location of the assets being managed.

Industry Classification

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

Product/Service Code: MAINT, REPAIR, ALTER REAL PROPERTY › MAINT, ALTER, REPAIR BUILDINGS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SEALED BID

Offers Received: 2

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Bundesamt FÜR Bauwesen UND Raumordnung (UEI: 332619535)

Address: DEICHMANNS AUE 31-37, BONN

Business Categories: Category Business, Not Designated a Small Business

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline