DOD awards six ID/IQ contracts for up to $975M of Navy construction

Dive Brief:

The U.S. Department of Defense has awarded six indefinite-delivery/indefinite-quantity contracts for up to $975 million of Navy construction contracts around the globe.
In competition for the cost-plus-award-fee or firm-fixed-price task orders are AECOM Technical Services (Morrisville, North Carolina); Aptim Federal Services (Alexandria, Virginia); CH2M Hill Constructors (Englewood, Colorado); Environmental Chemical Corp. (Virginia Beach, Virginia); Fluor Intercontinental (Greenville, South Carolina); and Perini Management Services (Framingham, Massachusetts).
The services that the contractors will be asked to provide include construction, design-build and engineering in response to natural disasters, humanitarian assistance, conflict and other similar situations. The contract term is five years plus four option years.

Dive Insight:

Multiple-award IDIQ contracts are what the government uses when it wants to keep a prequalified group of contractors on call, similar to a retainer. There is no guarantee that all the contractors actually will win work because each task order is competitively bid.

These are good deals for the government, though, because typically contractors, as part of their bids, include basic unit pricing, which is locked in for the term of the contract period. However, entering into an IDIQ arrangement usually keeps the government from being able to use contractors outside of the pool.

In February, the DOD chose five IDIQ contractors to compete for contracts totaling $240 million, also for the Navy. But for those deals, work was limited to Florida, Georgia, Louisiana, Mississippi, South Carolina, Tennessee and Texas. The contractors are Archer Western Federal JV, B.L. Harbert International, Haskell, Korte and Mortenson Construction, and each will compete for industrial, airfield, aircraft hangar, aircraft traffic control, infrastructure, administrative, training, dormitory and community support facilities construction projects. Archer Western has already won a task order — $24.7 million to build an operational trainer facility at Naval Station Mayport in Florida.

The government also issues single-award IDIQ contracts to just one contractor. The DOD last month awarded such a contract to Burns & McDonnell. The $20 million, five-year contract is also for the Navy and will see Burns & McDonnell performing fire protection design and engineering services in the Pacific region.

Each task order must be funded before the government can award the work to one of the IDIQ contractors, so a holdup in financing authorization can delay projects. According to a May 2018 General Accounting Office report, the federal government commits almost $200 billion each year in IDIQ contracts.