DoD's $29M Building Renovation Contract Awarded to Stronghold Engineering Inc. for NMCSD

Contract Overview

Contract Amount: $29,045,072 ($29.0M)

Contractor: Stronghold Engineering Inc

Awarding Agency: Department of Defense

Start Date: 2008-09-29

End Date: 2012-05-08

Contract Duration: 1,317 days

Daily Burn Rate: $22.1K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 5

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: RENOVATION OF BLDG 26 @ NMCSD

Place of Performance

Location: SAN DIEGO, SAN DIEGO County, CALIFORNIA, 92134

State: California Government Spending

Plain-Language Summary

Department of Defense obligated $29.0 million to STRONGHOLD ENGINEERING INC for work described as: RENOVATION OF BLDG 26 @ NMCSD Key points: 1. The contract value of approximately $29 million for building renovation suggests a significant investment in infrastructure. 2. Awarded under full and open competition, this contract indicates a potentially competitive bidding process. 3. The duration of the contract (over 3 years) implies a complex and extensive renovation project. 4. The fixed-price contract type aims to control costs, but potential for change orders exists. 5. The project's focus on building renovation highlights the ongoing need for facility maintenance and upgrades within military installations. 6. The absence of small business set-aside suggests the primary contractor is likely a larger entity.

Value Assessment

Rating: fair

The contract value of $29 million for renovating a single building (Building 26 at NMCSD) appears substantial. Without specific details on the scope of work, it's difficult to benchmark against similar projects. However, large-scale institutional building renovations can range widely in cost depending on the age, condition, and specific requirements of the facility. The firm fixed-price nature of the contract suggests an attempt to cap costs, but the final expenditure could be higher if significant change orders are issued.

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. With 5 bids received, the competition level appears moderate. A moderate number of bidders can lead to competitive pricing, but a higher number of bids typically drives prices down further. The specific details of the bidding process and the evaluation criteria would provide a clearer picture of how effectively competition translated into value.

Taxpayer Impact: Full and open competition is generally favorable for taxpayers as it increases the likelihood of receiving competitive pricing and encourages a wider pool of contractors to participate, potentially leading to better value.

Public Impact

The primary beneficiaries are the Department of the Navy and the Naval Medical Center San Diego (NMCSD), which will receive an upgraded facility. The services delivered include the renovation of Building 26, likely encompassing structural, mechanical, electrical, and cosmetic improvements. The geographic impact is localized to San Diego, California, where the NMCSD is located. Workforce implications include employment opportunities for construction workers, engineers, project managers, and support staff involved in the renovation.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if the scope of work expands beyond the initial fixed-price agreement.
The long duration of the contract could lead to unforeseen challenges or delays.
Dependence on a single contractor for a large-scale renovation project carries inherent risks.
The specific nature of the renovation (e.g., historical preservation, specialized medical facility upgrades) could introduce unique complexities.

Positive Signals

Awarded under full and open competition, suggesting a robust bidding process.
Firm fixed-price contract type helps to establish cost certainty.
The contractor, Stronghold Engineering Inc., has experience in government contracting.
The project addresses critical infrastructure needs for a medical facility.

Sector Analysis

This contract falls within the Commercial and Institutional Building Construction sector, a significant segment of the broader construction industry. Federal spending in this sector often supports the maintenance, modernization, and expansion of government facilities, including military bases, hospitals, and administrative buildings. The market size for federal construction is substantial, driven by the need to maintain aging infrastructure and build new capabilities. This specific contract represents a portion of the Department of Defense's overall capital investment in its real property portfolio.

Small Business Impact

The contract was not awarded as a small business set-aside, and the 'sb' field is false, indicating no specific preference for small businesses in the primary award. This suggests the primary contract was likely awarded to a large business. However, the prime contractor may engage small businesses as subcontractors to fulfill portions of the work, which could provide opportunities within the small business ecosystem. The extent of subcontracting to small businesses would need further investigation.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and the contracting officer's representative (COR) within the Department of the Navy. Performance monitoring, quality assurance, and compliance checks are standard oversight mechanisms. Transparency is generally facilitated through contract award databases like FPDS. Inspector General jurisdiction would apply if any allegations of fraud, waste, or abuse arise during the contract's lifecycle.

Related Government Programs

Department of Defense Facilities Maintenance
Naval Facilities Engineering Command Contracts
Military Medical Infrastructure Projects
General Building Construction Services

Risk Flags

Potential for cost escalation due to change orders in a long-term fixed-price contract.
Scope definition clarity for complex building renovations.
Contractor's capacity to manage a project of this scale over its duration.
Ensuring quality standards are met throughout the renovation process.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $29.0 million to STRONGHOLD ENGINEERING INC. RENOVATION OF BLDG 26 @ NMCSD

Who is the contractor on this award?

The obligated recipient is STRONGHOLD ENGINEERING INC.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $29.0 million.

What is the period of performance?

Start: 2008-09-29. End: 2012-05-08.

What was the specific scope of work for the renovation of Building 26 at NMCSD, and how did it justify the $29 million cost?

The provided data does not detail the specific scope of work for the renovation of Building 26 at the Naval Medical Center San Diego (NMCSD). However, a $29 million contract for building renovation typically involves extensive upgrades. This could include structural repairs, HVAC system replacement, electrical and plumbing overhauls, interior fit-outs, asbestos abatement, seismic retrofitting, and potentially modernization of specialized medical equipment infrastructure. The justification for the cost would stem from the complexity of these tasks, the size of the building, the required materials, labor, and compliance with stringent military and healthcare facility standards. Without a detailed SOW, a precise cost-benefit analysis is not possible, but such projects are critical for maintaining operational readiness and safety of essential medical facilities.

How did Stronghold Engineering Inc.'s past performance and pricing compare to other bidders in this full and open competition?

The available data indicates that Stronghold Engineering Inc. was awarded this contract, and that there were 5 bids in total under full and open competition. However, specific details regarding the past performance evaluations or the pricing of each bidder are not provided. Typically, in a full and open competition, the award decision is based on a combination of factors, which may include technical approach, past performance, price, and other evaluation criteria outlined in the solicitation. While Stronghold Engineering Inc. won the contract, suggesting they met or exceeded the evaluation criteria, a direct comparison of their performance and pricing against the other four bidders would require access to the source selection decision document or debriefing information, which is not publicly available in this dataset.

What are the potential risks associated with a firm fixed-price contract for a multi-year renovation project of this magnitude?

Firm fixed-price (FFP) contracts aim to provide cost certainty by obligating the contractor to complete the work for a predetermined price. However, for a multi-year renovation project of this magnitude ($29 million), several risks can emerge. The primary risk is scope creep: if unforeseen conditions arise during renovation (e.g., hidden structural damage, outdated systems requiring more extensive replacement than anticipated), the contractor may request change orders. If these change orders are approved, they can significantly increase the total contract cost, negating the intended cost control of the FFP structure. Another risk is contractor performance; an FFP contract can incentivize cutting corners to maintain profit margins, potentially impacting quality. Conversely, if the contractor significantly underestimates costs, they might face financial distress or default. The long duration also increases the risk of material price fluctuations or labor shortages impacting the contractor's ability to deliver within the fixed price.

How does this contract align with the Department of Defense's broader infrastructure modernization goals, particularly for medical facilities?

This contract directly aligns with the Department of Defense's (DoD) broader infrastructure modernization goals, especially concerning its medical facilities. Military medical centers like NMCSD are critical for maintaining the health and readiness of service members and their families. Aging infrastructure in these facilities can impede the delivery of care, pose safety risks, and limit the adoption of new medical technologies. Renovating Building 26 signifies an investment in upgrading these essential assets, ensuring they meet current operational requirements, safety standards, and technological needs. Such projects are part of the DoD's ongoing effort to modernize its vast real property portfolio, ensuring that its installations are capable, resilient, and supportive of its mission objectives, including providing high-quality healthcare.

What is the historical spending pattern for building renovations at NMCSD or similar naval medical facilities, and how does this contract compare?

The provided data focuses solely on this single contract award. To understand historical spending patterns for building renovations at NMCSD or similar naval medical facilities, one would need to analyze contract data over several fiscal years. This would involve searching for contracts with similar Product Service Codes (PSCs) or North American Industry Classification System (NAICS) codes (like 236220 for Commercial and Institutional Building Construction) awarded to NMCSD or other naval hospitals. Comparing the $29 million value and the duration (over 3 years) of this contract to historical awards would reveal if this is a typical investment size, a particularly large project, or if spending in this category has increased or decreased. Without that broader dataset, this contract stands as an isolated data point.

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: N6871105R4076

Offers Received: 5

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 2000 MARKET ST, RIVERSIDE, CA, 92501

Business Categories: Asian Pacific American Owned Business, Category Business, Minority Owned Business, Not Designated a Small Business, Woman Owned Business

Financial Breakdown

Contract Ceiling: $29,045,072

Exercised Options: $29,045,072

Current Obligation: $29,045,072

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: N6247306D1057

IDV Type: IDC

Timeline