Army awards $26.6M for facility repair, exceeding initial estimates by 139% for a 5-year duration

Contract Overview

Contract Amount: $26,643,935 ($26.6M)

Contractor: Structsure Projects Inc

Awarding Agency: Department of Defense

Start Date: 2016-02-12

End Date: 2021-05-01

Contract Duration: 1,905 days

Daily Burn Rate: $14.0K/day

Competition Type: FULL AND OPEN COMPETITION

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: IGF::OT::IGF REPAIR TEN AHU B503 WRAIR

Place of Performance

Location: SILVER SPRING, MONTGOMERY County, MARYLAND, 20910

State: Maryland Government Spending

Plain-Language Summary

Department of Defense obligated $26.6 million to STRUCTSURE PROJECTS INC for work described as: IGF::OT::IGF REPAIR TEN AHU B503 WRAIR Key points: 1. The contract's duration of 1905 days (over 5 years) suggests a significant, long-term need for facility maintenance. 2. The award amount significantly surpassed the initial estimate, indicating potential underestimation of project scope or market conditions. 3. The contract was awarded using full and open competition, suggesting a robust bidding process. 4. The firm-fixed-price contract type aims to transfer risk to the contractor, but requires careful oversight to ensure quality. 5. The project falls under the Commercial and Institutional Building Construction NAICS code, indicating a focus on infrastructure development. 6. The contractor, StructSure Projects Inc., has secured this significant award, positioning them as a key player in this sector.

Value Assessment

Rating: questionable

The final award of $26.64 million is 139% higher than the initial estimate of $11.14 million, raising concerns about cost control and initial planning. While firm-fixed-price contracts aim for predictability, such a large deviation suggests the initial estimate was not well-grounded or that significant scope changes occurred. Benchmarking against similar large-scale facility repair contracts is difficult without more detailed project specifications, but the magnitude of the overage warrants scrutiny.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that multiple bidders were likely solicited and considered. This method is generally preferred for ensuring fair pricing and access for a wide range of qualified contractors. The specific number of bids received is not provided, but the open competition suggests a healthy market for these services.

Taxpayer Impact: Full and open competition is generally favorable for taxpayers as it promotes a competitive environment that can drive down prices and improve service quality.

Public Impact

The primary beneficiaries are the Department of the Army and its personnel, who will utilize the repaired facilities. The contract delivers essential repair and maintenance services for a significant facility (AHU B503 at WRAIR). The geographic impact is localized to the WRAIR facility in Maryland. The contract supports jobs within the construction and facility maintenance sectors, likely benefiting skilled trades and project management professionals.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Significant cost overrun compared to initial estimates suggests potential issues with planning or execution.
The long duration of the contract could lead to scope creep or unforeseen cost increases if not managed tightly.
Lack of specific details on the nature of the repairs makes it difficult to assess the true value for money.
The contractor's track record on similar large-scale, high-variance projects would provide further insight into risk.

Positive Signals

Awarded through full and open competition, indicating a competitive bidding process.
Firm-fixed-price contract type shifts cost risk to the contractor.
The contract addresses a clear need for facility repair and maintenance, ensuring operational readiness.

Sector Analysis

This contract falls within the Commercial and Institutional Building Construction sector, a broad category encompassing the repair, maintenance, and construction of non-residential buildings. The market for such services is substantial, driven by government and private sector needs for infrastructure upkeep. Comparable spending benchmarks are difficult to establish without knowing the specific nature of the repairs, but large-scale facility overhauls can run into tens or hundreds of millions of dollars.

Small Business Impact

The contract was awarded using full and open competition and does not indicate any specific small business set-aside provisions. While the prime contractor is StructSure Projects Inc., there is no explicit information provided regarding subcontracting plans or goals for small businesses. Further investigation into subcontracting reports would be necessary to assess the impact on the small business ecosystem.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of the Army's contracting and project management offices. The firm-fixed-price nature of the contract implies that the government's primary oversight will focus on ensuring the contractor meets the defined scope, quality standards, and delivery schedule. Transparency is facilitated by the contract award data being publicly available, but detailed project progress and inspection reports may not be readily accessible. Inspector General jurisdiction would apply if any fraud, waste, or abuse is suspected.

Related Government Programs

Military Construction
Facility Maintenance and Repair
Government Building Construction
Architectural and Engineering Services

Risk Flags

Significant Cost Overrun
Potential for Scope Creep
Long Contract Duration

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $26.6 million to STRUCTSURE PROJECTS INC. IGF::OT::IGF REPAIR TEN AHU B503 WRAIR

Who is the contractor on this award?

The obligated recipient is STRUCTSURE PROJECTS 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 $26.6 million.

What is the period of performance?

Start: 2016-02-12. End: 2021-05-01.

What specific repairs were undertaken, and how did the scope evolve to justify the significant cost increase?

The provided data does not detail the specific repairs performed under contract IGF::OT::IGF REPAIR TEN AHU B503 WRAIR. The significant cost increase from an initial estimate of approximately $11.14 million to a final award of $26.64 million (a 139% rise) strongly suggests either a substantial underestimation of the initial scope or significant changes/additions to the scope of work during the contract period. Without access to contract modifications, change orders, or detailed project documentation, it is impossible to ascertain the precise reasons for this escalation. Factors could include unforeseen structural issues discovered during the repair process, changes in regulatory requirements, or shifts in the government's needs. Further analysis would require reviewing the contract file and any associated documentation detailing the evolution of the project's requirements and costs.

How does the final award amount compare to industry benchmarks for similar facility repair projects of this scale?

Benchmarking this contract's final award of $26.64 million against industry standards is challenging without detailed specifications of the repairs performed. Facility repair projects vary immensely in complexity, materials, and labor requirements. However, the 139% deviation from the initial estimate is a significant red flag that suggests the initial planning or estimation phase may have been inadequate. For large-scale institutional building repairs, costs can range widely, but such a substantial percentage increase over an initial estimate typically indicates either a poorly defined initial scope, unexpected site conditions, or significant scope creep. A more accurate benchmark would require comparing it to projects with identical or very similar repair scopes, durations, and facility types, which is not possible with the current data.

What was the contractor's performance history on similar government contracts, particularly regarding cost and schedule adherence?

The provided data identifies StructSure Projects Inc. as the contractor but does not include specific performance history details, such as past performance ratings, on-time delivery metrics, or cost control performance on previous government contracts. To assess the risk associated with this award, a review of the contractor's past performance information, potentially available through the Contractor Performance Assessment Reporting System (CPARS), would be necessary. Understanding how StructSure Projects Inc. has managed similar large-scale construction and repair projects, especially those with significant budget variances or schedule challenges, would provide crucial context for evaluating the current contract's execution and the likelihood of future cost or schedule issues.

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

A firm-fixed-price (FFP) contract of this magnitude ($26.64 million) and duration (1905 days) carries inherent risks. For the government, the primary risk is that the contractor may cut corners on quality to maintain profitability if unforeseen issues arise or if the initial price was too low. Conversely, if the scope was significantly underestimated (as suggested by the cost overrun), the contractor may incur substantial losses, potentially leading to disputes, delays, or even contract termination. For the contractor, the risk lies in accurately estimating all costs over a long period, including potential inflation, material price fluctuations, and unforeseen site conditions. Effective government oversight is crucial to ensure the contractor delivers the required quality and scope within the agreed-upon price, especially given the large deviation from the initial estimate.

How does the spending on this single contract compare to the overall historical spending for facility maintenance and repair within the Department of the Army or WRAIR?

The $26.64 million award for facility repair represents a significant investment. To contextualize this spending, it would need to be compared against the Department of the Army's total annual budget for facility maintenance and repair, or specifically against the WRAIR's facilities budget. Without access to historical aggregate spending data for these categories, it's difficult to determine if this contract represents a typical expenditure, an outlier, or a particularly large portion of the allocated funds. If this single contract constitutes a substantial percentage of the annual maintenance budget, it could indicate a critical infrastructure need or potentially a concentration of spending that might warrant scrutiny regarding resource allocation and prioritization.

Industry Classification

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

Product/Service Code: MAINT, REPAIR, ALTER REAL PROPERTY › MAINT, ALTER, REPAIR BUILDINGS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: W9127814R0033

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 903 E 104TH ST # 140, KANSAS CITY, MO, 64131

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, Subchapter S Corporation, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $26,643,935

Exercised Options: $26,643,935

Current Obligation: $26,643,935

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: W9127814D0091

IDV Type: IDC

Timeline