DoD awards $30.4M construction contract to Empire Equipment Service, Inc. for heavy engineering

Contract Overview

Contract Amount: $30,392,307 ($30.4M)

Contractor: Empire Equipment Service, Inc.

Awarding Agency: Department of Defense

Start Date: 2021-09-03

End Date: 2026-02-10

Contract Duration: 1,621 days

Daily Burn Rate: $18.7K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 5

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: SEE ATTACHED CLIN SCHEDULE

Place of Performance

Location: RIVERSIDE, RIVERSIDE County, CALIFORNIA, 92501

State: California Government Spending

Plain-Language Summary

Department of Defense obligated $30.4 million to EMPIRE EQUIPMENT SERVICE, INC. for work described as: SEE ATTACHED CLIN SCHEDULE Key points: 1. Contract value of $30.4M represents a significant investment in civil engineering infrastructure. 2. Awarded under full and open competition, suggesting a competitive bidding process. 3. Fixed-price contract type aims to control costs and provide budget certainty. 4. Contract duration of over 4 years indicates a substantial, long-term project. 5. Geographic focus on California highlights regional infrastructure development needs. 6. The contractor, Empire Equipment Service, Inc., has secured a substantial federal award.

Value Assessment

Rating: fair

The contract value of $30.4 million for heavy and civil engineering construction is substantial. Without specific details on the scope of work, it is difficult to benchmark against similar contracts. However, the fixed-price nature of the award suggests an attempt to manage cost overruns. Further analysis would require comparing the unit costs or project milestones to industry standards and other government contracts for similar services.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit a bid. With 5 bidders participating, the competition level appears moderate. This suggests that while multiple companies vied for the contract, the number of bidders might not have driven prices down to the absolute lowest possible point, but it likely ensured a reasonable price discovery.

Taxpayer Impact: Taxpayers benefit from a competitive process that generally leads to more efficient use of funds compared to sole-source awards. The presence of multiple bidders increases the likelihood that the government secured a fair market price for the construction services.

Public Impact

The primary beneficiaries are the Department of Defense and potentially military personnel and their families who rely on the infrastructure. The contract will deliver essential heavy and civil engineering construction services. The geographic impact is concentrated in California, supporting regional infrastructure development. The contract will likely create or sustain jobs within the construction sector in California.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if the fixed-price contract does not adequately account for unforeseen site conditions or material price fluctuations.
Dependence on a single contractor for a large-scale project introduces risk if performance issues arise.
The long contract duration could lead to scope creep or changes that increase the overall cost if not managed tightly.

Positive Signals

Awarded through full and open competition, indicating a robust selection process.
Fixed-price contract type provides cost certainty for the government.
The contractor has secured a significant federal award, suggesting a level of capability and trust.
The contract duration of over 4 years allows for comprehensive project completion and stability.

Sector Analysis

This contract falls within the heavy and civil engineering construction sector, a critical component of national infrastructure. This sector encompasses a wide range of projects, including roads, bridges, utilities, and other large-scale public works. The market size for federal construction contracts is substantial, driven by ongoing needs for modernization and maintenance of government facilities and infrastructure. This award to Empire Equipment Service, Inc. represents a significant piece of federal spending within this domain.

Small Business Impact

The data indicates that this contract was not set aside for small businesses (ss: false, sb: false). Therefore, there are no direct subcontracting implications specifically mandated for small businesses through a set-aside program. However, the prime contractor, Empire Equipment Service, Inc., may still engage small businesses as subcontractors to fulfill parts of the contract, depending on their own business practices and the nature of the work required.

Oversight & Accountability

Oversight for this contract will likely be managed by the contracting officer and the relevant Department of the Army officials responsible for construction projects. Accountability measures are inherent in the fixed-price contract terms, requiring the contractor to deliver specified services within the agreed budget. Transparency is typically facilitated through contract award databases and reporting requirements, though specific project oversight details may not be publicly available.

Related Government Programs

Military Construction
Civil Engineering Projects
Heavy Equipment Procurement
Infrastructure Development Contracts

Risk Flags

Potential for cost overruns due to fixed-price nature on a long-term project.
Contractor performance risk over the multi-year duration.
Dependence on a single contractor for critical infrastructure work.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $30.4 million to EMPIRE EQUIPMENT SERVICE, INC.. SEE ATTACHED CLIN SCHEDULE

Who is the contractor on this award?

The obligated recipient is EMPIRE EQUIPMENT SERVICE, 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 $30.4 million.

What is the period of performance?

Start: 2021-09-03. End: 2026-02-10.

What is the track record of Empire Equipment Service, Inc. in performing similar federal construction contracts?

Assessing the track record of Empire Equipment Service, Inc. requires a review of their past performance on federal contracts, particularly those involving heavy and civil engineering construction. Information on past performance is often available through sources like the Federal Procurement Data System (FPDS) or the Contractor Performance Assessment Reporting System (CPARS). A review would look at the number of previous contracts, their values, the types of services rendered, and any documented performance issues or commendations. A history of successful, on-time, and within-budget project completion would indicate a lower risk for this current $30.4 million award. Conversely, a pattern of delays, cost overruns, or quality issues would raise concerns about the contractor's reliability and the potential value for money.

How does the awarded amount of $30.4 million compare to the typical cost of similar heavy and civil engineering construction projects for the Department of Defense?

Benchmarking the $30.4 million award requires access to data on comparable Department of Defense (DoD) heavy and civil engineering construction projects. This would involve identifying projects with similar scopes of work, geographic locations, and complexity. Factors such as the specific type of construction (e.g., earthmoving, utility installation, road building), site conditions, and material costs influence project expenses. Without specific project details, a direct comparison is challenging. However, general market data for large-scale civil engineering projects can provide a rough estimate. If this contract's value is significantly higher or lower than comparable projects, it could indicate either exceptional value or potential overpricing/underbidding, respectively. Further analysis would involve examining the detailed CLIN schedule (d: 'SEE ATTACHED CLIN SCHEDULE') to understand the breakdown of costs.

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

A fixed-price definitive contract, like this $30.4 million award to Empire Equipment Service, Inc., carries inherent risks, primarily related to cost control and contractor performance over its extended duration (ending Feb 10, 2026). For the government, the main risk is that the contractor may encounter unforeseen difficulties (e.g., material cost increases, labor shortages, unexpected site conditions) that could lead to subpar quality or delays if the fixed price does not adequately account for these possibilities. Conversely, if the contractor significantly underestimates costs, they might cut corners to maintain profitability, impacting quality. For the contractor, the risk lies in absorbing unexpected cost increases, potentially leading to financial losses. The definitive contract nature means it's a single award, increasing reliance on this specific contractor's ability to execute the entire scope.

How effective is 'full and open competition' in ensuring the best value for taxpayers on large construction contracts?

Full and open competition is generally considered the most effective method for ensuring the best value for taxpayers on large construction contracts. By allowing all responsible sources to submit bids, it maximizes the pool of potential offerors, thereby increasing the likelihood of receiving competitive pricing. The process encourages contractors to submit their most efficient and cost-effective proposals to win the award. When multiple bidders (in this case, 5) participate, it fosters price discovery and puts downward pressure on costs. While the lowest price isn't always the best value (technical factors and past performance also play a role), a competitive environment significantly reduces the risk of overpaying compared to sole-source or limited competition scenarios. Effective evaluation criteria are crucial to ensure the 'best value' is selected, not just the lowest bid.

What is the historical spending pattern for 'Other Heavy and Civil Engineering Construction' (NAICS 237990) by the Department of the Army?

Analyzing historical spending patterns for NAICS code 237990 ('Other Heavy and Civil Engineering Construction') by the Department of the Army provides context for this $30.4 million award. This involves examining past contract awards within this category over several fiscal years. Key metrics to consider include the total annual spending, the average contract value, the number of contracts awarded, and the primary types of projects undertaken. Significant fluctuations in spending could indicate shifts in infrastructure priorities or budget allocations. Understanding this historical context helps determine if this current award is in line with typical investment levels or represents a notable increase or decrease in focus on this type of construction. It also helps identify trends in contractor participation and competition levels over time.

What are the potential implications of this contract on the small business ecosystem in California, given it's not a small business set-aside?

Although this $30.4 million contract was not specifically set aside for small businesses, its execution could still have implications for the small business ecosystem in California. The prime contractor, Empire Equipment Service, Inc., may choose to subcontract portions of the work to small businesses, thereby providing them with opportunities and revenue. The extent of this impact depends on the prime contractor's subcontracting plan and the availability of qualified small businesses in the region capable of performing the required tasks. Furthermore, the overall economic activity generated by such a large project, including job creation and demand for materials and services, can indirectly benefit small businesses in the supply chain and related industries within California.

Industry Classification

NAICS: Construction › Other Heavy and Civil Engineering Construction › Other Heavy and Civil Engineering Construction

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

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: W912PL21B0004

Offers Received: 5

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 5271 AGATE ST, RIVERSIDE, CA, 92509

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Hispanic American Owned Business, Minority Owned Business, Self-Certified Small Disadvantaged Business, Small Business, Special Designations, Subchapter S Corporation, U.S.-Owned Business, Woman Owned Business, Women Owned Small Business

Financial Breakdown

Contract Ceiling: $30,392,307

Exercised Options: $30,392,307

Current Obligation: $30,392,307

Actual Outlays: $8,390,783

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline