Hensel Phelps Construction Co. awarded $46.8M for Fort Lee construction, a fixed-price delivery order

Contract Overview

Contract Amount: $46,807,000 ($46.8M)

Contractor: Hensel Phelps Construction CO

Awarding Agency: Department of Defense

Start Date: 2007-11-01

End Date: 2010-10-30

Contract Duration: 1,094 days

Daily Burn Rate: $42.8K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: FIXED PRICE

Sector: Construction

Official Description: TSED, FORT LEE

Place of Performance

Location: FORT LEE, PETERSBURG CITY County, VIRGINIA, 23801

State: Virginia Government Spending

Plain-Language Summary

Department of Defense obligated $46.8 million to HENSEL PHELPS CONSTRUCTION CO for work described as: TSED, FORT LEE Key points: 1. Contract value appears reasonable given the duration and scope of construction services. 2. Full and open competition suggests a competitive bidding process. 3. Fixed-price contract type shifts cost risk to the contractor. 4. Project duration of approximately three years indicates a significant undertaking. 5. The contract falls within the Commercial and Institutional Building Construction sector.

Value Assessment

Rating: good

The contract value of $46.8 million for a three-year construction project at Fort Lee appears to be within a reasonable range for large-scale building construction. Benchmarking against similar Department of Defense construction projects of comparable size and complexity would provide a more precise assessment of value for money. The fixed-price nature of the contract suggests that the initial bid was expected to cover all costs, offering predictability for the government.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit bids. The presence of two bids suggests a moderate level of competition for this significant construction project. A higher number of bidders typically leads to more aggressive pricing and better value for the government.

Taxpayer Impact: Full and open competition is generally favorable for taxpayers as it encourages multiple contractors to offer their best pricing, potentially leading to cost savings.

Public Impact

The primary beneficiaries are the Department of the Army and military personnel stationed at Fort Lee, Virginia, who will receive improved or new facilities. The services delivered include commercial and institutional building construction, likely encompassing barracks, administrative buildings, or training facilities. The geographic impact is concentrated at Fort Lee, Virginia. The project likely involved a significant number of construction workers, supporting local and regional employment in the skilled trades.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if unforeseen site conditions arise, despite the fixed-price nature.
Dependence on the contractor's ability to manage complex construction schedules and supply chains.
Risk of delays impacting the readiness or operational capabilities of Fort Lee.
Quality control during construction is critical to ensure long-term durability and safety.

Positive Signals

Fixed-price contract structure provides cost certainty for the government.
Full and open competition suggests a robust bidding process.
Contractor's experience in large-scale construction projects is a positive indicator.
The project duration allows for thorough planning and execution.

Sector Analysis

This contract falls within the Commercial and Institutional Building Construction sector, a significant segment of the overall construction industry. The Department of Defense is a major client for construction services, frequently awarding large contracts for infrastructure development and facility upgrades at military installations. Spending in this sector is influenced by government appropriations, military readiness needs, and infrastructure modernization initiatives. Comparable spending benchmarks would involve analyzing other large military construction projects awarded by the Army or other branches.

Small Business Impact

The provided 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. However, the prime contractor, Hensel Phelps Construction Co., may engage small businesses as subcontractors based on their own procurement strategies and the availability of specialized services within the local market.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and their representatives within the Department of the Army. Quality assurance surveillance plans (QASPs) would likely be in place to monitor performance, adherence to specifications, and timely completion. Transparency is generally maintained through contract award databases and reporting requirements. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Military Construction, Army
General Building Construction, Federal
Defense Infrastructure Projects
Fort Lee Facilities Modernization

Risk Flags

Potential for cost increases due to change orders if scope is not tightly controlled.
Risk of schedule delays impacting facility readiness.
Contractor performance risk requires diligent oversight.
Quality assurance is critical for long-term asset value.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $46.8 million to HENSEL PHELPS CONSTRUCTION CO. TSED, FORT LEE

Who is the contractor on this award?

The obligated recipient is HENSEL PHELPS CONSTRUCTION CO.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $46.8 million.

What is the period of performance?

Start: 2007-11-01. End: 2010-10-30.

What is the track record of Hensel Phelps Construction Co. with the Department of Defense?

Hensel Phelps Construction Co. has a significant history of working with the Department of Defense and other federal agencies on large-scale construction projects. Their portfolio includes numerous military installations, barracks, training facilities, and administrative buildings. Analyzing their past performance on similar fixed-price contracts, their on-time delivery rates, and any history of disputes or claims with the government would provide further insight into their reliability and capability for this specific Fort Lee project. A review of their contract history would reveal their experience in managing budgets, schedules, and quality control for projects of this magnitude.

How does the awarded amount compare to similar construction projects at other military bases?

The awarded amount of $46.8 million for a three-year construction project at Fort Lee needs to be benchmarked against similar projects to assess value. Factors such as project scope (e.g., new construction vs. renovation), building type (e.g., barracks, headquarters, specialized training facilities), location (which impacts labor and material costs), and the specific year of award are crucial for a fair comparison. Without specific data on comparable projects, it's difficult to definitively state if this represents excellent or fair value. However, for large-scale military construction, this figure falls within a plausible range, especially considering potential complexities of military site requirements.

What are the primary risks associated with this fixed-price construction contract?

The primary risks associated with this fixed-price contract, while shifting cost risk to the contractor, still involve potential issues for the government. These include the risk of contractor default or bankruptcy, which could lead to significant delays and the need to re-compete or find a replacement. There's also a risk of subpar quality if the contractor attempts to cut corners to maintain profitability, necessitating robust government oversight. Furthermore, unforeseen site conditions or scope creep (if not managed strictly) could lead to change orders that increase the overall cost, negating some of the fixed-price benefits. Delays in project completion can also impact the operational readiness of the facility.

How effective is the 'full and open competition' strategy for large military construction contracts?

Full and open competition is generally considered the most effective strategy for large military construction contracts as it maximizes the pool of potential bidders, thereby increasing the likelihood of receiving competitive pricing and innovative solutions. It ensures that all responsible contractors have an equal opportunity to bid, fostering a fair marketplace. While this contract had two bidders, a higher number would typically yield even better results. The effectiveness is also dependent on the clarity and completeness of the solicitation documents and the government's ability to evaluate proposals objectively. It promotes transparency and accountability.

What is the historical spending trend for construction at Fort Lee?

Analyzing historical spending trends for construction at Fort Lee would provide context for this $46.8 million award. This would involve examining previous contracts awarded for facility upgrades, new construction, or maintenance at the base over several fiscal years. Understanding whether spending has been consistent, increasing, or decreasing can indicate the base's infrastructure needs and investment priorities. It can also reveal patterns in contract types, competition levels, and average contract values, helping to determine if this award is an outlier or part of a sustained investment.

What are the implications of the contract duration (1094 days) on project management and cost?

A contract duration of 1094 days (approximately three years) for a $46.8 million construction project indicates a substantial undertaking, likely involving complex design, procurement, and execution phases. This extended timeline allows for more thorough planning and potentially mitigates risks associated with rushing complex tasks. However, it also increases exposure to market fluctuations in material costs and labor availability over the project's life. Effective project management is critical to ensure adherence to the schedule, control costs, and maintain quality throughout this multi-year period. Delays can become more costly over longer durations.

Industry Classification

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

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

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: W9123607R0001

Offers Received: 2

Pricing Type: FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 4437 BROOKFIELD CORP DR, CHANTILLY, VA, 20151

Business Categories: Category Business, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $46,807,000

Exercised Options: $46,807,000

Current Obligation: $46,807,000

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: W9123608D0012

IDV Type: IDC

Timeline