Neptune to protest next-generation air tanker contract awards

Neptune Aviation has announced that the company will lodge a protest with the Government Accountability Office over the contracts that the U.S. Forest Service intends to award for next-generation air tankers. On May 6 the USFS said they intended to give contracts to five companies for a total of seven air tankers to provide turbine or jet powered aircraft that can carry more retardant and fly faster than the Korean War vintage “legacy” air tankers such as the P2V that the federal wildfire agencies have been relying on for decades. Neptune did not receive one of the awards even though they have been the primary supplier of air tankers to the federal government for the last several years.

When the next-gen contracts were announced May 6, the pilots of all five Neptune Aviation air tankers that were working and available for fire assignments walked away from their aircraft in California and New Mexico a little after noon. The aircraft were unstaffed until Tuesday morning. Dan Snyder, Neptune’s Chief Operating Officer, said it was done for safety reasons:

We did not want our crews worried about the company’s future, their jobs, BAe program, etc, instead of being 100% mission focused. We took the opportunity to get clear and concise information to them and allow for questions and concerns to be addressed.

This is not the first time contract awards for next-generation air tankers have been contested. The USFS began the contracting process for the newer air tankers November 30, 2011. Almost seven months later on June 13, 2012 they announced awards for four companies, Neptune, Minden, Aero Air, and Aero Flite, to provide a total of seven air tankers. However two companies that were not going to receive contracts, Coulson Aviation and 10 Tanker Air Carrierprotested the awards, and the Government Accountability Office upheld their protest. At that time the contracts had not actually been signed, since negotiations about reimbursement if the contracts were cancelled had not been completed. The USFS went back to the drawing board for four months. They amended and re-announced the solicitation on October 5, 2012 with a response due date of November 1, 2012. The second time the awards were announced last week was seven months after the second solicitation was issued and 523 days after the process first began. If the USFS has to go through a third round of solicitation due to this latest protest, the appearance of next-gen air tankers over wildfires will be delayed for many more months.

The two companies that filed protests following round 1, Coulson and 10 Tanker, both received awards after round 2, which may have given confidence to Neptune to try the same tactic and perhaps force a third round.

Neptune has invested heavily in four BAe-146 aircraft, retired airliners with more than 20 years of service. Two have been converted to air tankers, Tankers 40 and 41, and have interim approval from the Interagency Air Tanker board. But their retardant delivery performance has been criticized, since the last several hundred gallons of retardant does not exit the tanks quickly enough. Neptune thinks they have a fix for the problem and the next two BAe-146s being converted now, Tankers 10 and 01, will have an improved tanking system. They expect to begin drop tests with Tanker 10 no later than June 10 of this year, Ron Hooper, their Chief Executive Officer said. The company will retrofit the tanks in Tankers 40 and 41 with the new variant of the tank next winter. One of them is currently on the USFS legacy contract for this year.

Neptune CEO interviewed about failure to win Next-Gen contract

An ABC affiliate TV station in Montana conducted an interview with Ron Hooper, the CEO of Neptune Aviation, after the company failed to win one of the contracts for next-generation air tankers announced by the U.S. Forest Service May 6. The reporter made it sound like the company was definitely going to file a protest about the contract, but Dan Snyder, Neptune’s Chief Operating Officer, told us yesterday that they would make a decision about a possible protest after receiving a debriefing from the USFS contracting officer.

The Missoulian also has an interesting article about the award of the next-gen contracts.

A fun fact: Mr. Hooper as recently as November, 2010 worked for the U.S. Forest Service as the Director of Acquisition Management for the agency. His name is also mentioned in a summary of the 1987 U.S. Forest Service “airtanker scandal”. When qualified as a contracting officer, he reportedly made a determination after the transfer of the 28 aircraft to private companies that the transfer was void and they should be returned to the government. At the time Mr. Hooper was the staff assistant to the Forest Service Deputy Chief for Business Operations.

Neptune air tankers shut down Monday

After the U.S. Forest Service announced on Monday morning their intention to award contracts for next-generation air tankers to five companies, the pilots of all five Neptune Aviation air tankers that were currently working and available for fire assignments walked away from their aircraft in California and New Mexico at about 12:30 p.m MT. The aircraft were unstaffed until Tuesday morning. Neptune did not receive one of the next-gen contracts even though they supplied all but one of the large air tankers on exclusive use contracts for the last one and a half years. The company did, however, receive contracts a few weeks ago for one BAe-146 and six  P2vs on a new USFS “legacy air tanker” contract.

One person who contacted Fire Aviation assumed that the pilots walking off the job was a protest about the fact that the company did not receive a next-gen contract.

We contacted Dan Snyder, Neptune’s Chief Operating Officer, who told us the following:

Neptune decided, for safety reasons, to stand-down our contract fleet (plus flight training in MSO) due to the number of questions and concerns that were flooding into Missoula from the crews in the field. The decision was made with the USFS’s full knowledge and done in accordance with the current “Legacy Contract”. We were notified of the contract awards at the same time of the USFS press release. The timing of the two messages did not give us enough time to send out a notice to our employees of the USFS decision and what it meant to the company and employees. We did not want our crews worried about the company’s future, their jobs, BAe program, etc, instead of being 100% mission focused. We took the opportunity to get clear and concise information to them and allow for questions and concerns to be addressed.

Bottom line, no one was told to walk off the job in protest and to my knowledge no one did it independently.

The first attempt to award the next-gen contracts on June 13, 2012 was overturned after protests by 10 Tanker Air Carrier and Coulson Aviation, who did not receive awards, were upheld by the Government Accountability Office. We asked Mr. Snyder if they planned to protest this latest contracting process, and he told Fire Aviation that their company would make a decision about that after a debriefing from the U.S. Forest Service contracting officer.

In their news release, the USFS said the five successful bidders were selected because their proposals were determined to offer the best value to the government based on a technical evaluation of their air tanker concept, organizational experience and past performance, combined with pricing. A person who is familiar with the air tanker contracting process told Fire Aviation that the reasons for not selecting Neptune for this latest next-gen award were most likely based on price and their accident history.

If Neptune submitted the same bid structure on this latest next-gen solicitation as they did the first time, their price, based on the total cost estimate for the 5-year base period, would have been higher than all of the successful bidders in round two, except for the proposal for the DC-10 from 10 Tanker, who based their bid on delivering 5,000 gallons, compared to Neptune’s BAe-146 with a maximum capacity of around 3,000 gallons. The DC-10’s bid allowed for options for the additional 6,600 gallons in their 11,600-gallon tank. The solicitation’s specification was for tankers delivering between 3,000 and 5,000 gallons. 10 Tanker shrewdly configured their bid to work within the constraints of the solicitation.