Air Force awards $35M contract for Eielson AFB housing, impacting Alaska's construction sector

Contract Overview

Contract Amount: $35,073,689 ($35.1M)

Contractor: Lakeshore Engineering Services, Inc.

Awarding Agency: Department of Defense

Start Date: 2009-10-23

End Date: 2011-10-21

Contract Duration: 728 days

Daily Burn Rate: $48.2K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: DEMOLISH 12 MFH UNITS AND DEMOLITION OF 11 ADDITIVE MFH UNITS AND CONSTRUCT 54 MFH UNITS AT EIELSON AFB, AK.

Place of Performance

Location: EIELSON AFB, FAIRBANKS NORTH STAR County, ALASKA, 99702

State: Alaska Government Spending

Plain-Language Summary

Department of Defense obligated $35.1 million to LAKESHORE ENGINEERING SERVICES, INC. for work described as: DEMOLISH 12 MFH UNITS AND DEMOLITION OF 11 ADDITIVE MFH UNITS AND CONSTRUCT 54 MFH UNITS AT EIELSON AFB, AK. Key points: 1. Contract value of $35.1 million for demolition and construction of military housing. 2. Awarded to Lakeshore Engineering Services, Inc., a single contractor. 3. Project duration of 728 days indicates a significant construction timeline. 4. Located in Alaska, suggesting potential logistical and environmental considerations. 5. Firm Fixed Price contract type aims to control costs for the government. 6. The project involves both demolition and new construction, a complex undertaking.

Value Assessment

Rating: fair

The contract value of $35.1 million for the demolition and construction of 54 units of military housing appears to be within a reasonable range for such a project, considering the location in Alaska which often incurs higher construction costs. Benchmarking against similar military housing projects would provide a more precise assessment of value for money. The firm fixed price structure suggests an attempt to manage cost overruns, but the overall value is contingent on the quality and timely completion of the work.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

The contract was awarded under 'Full and Open Competition After Exclusion of Sources,' which implies that while the competition was intended to be broad, specific reasons led to the exclusion of certain potential bidders. This could be due to specialized requirements, past performance issues with other contractors, or other justifications. The exact number of bidders is not specified, but the 'exclusion of sources' suggests a potentially narrower field than true full and open competition.

Taxpayer Impact: This procurement method, while aiming for competition, may limit the number of viable bidders, potentially impacting the government's ability to secure the lowest possible price compared to a truly unrestricted full and open competition.

Public Impact

Military families at Eielson Air Force Base will benefit from new housing units. The project delivers essential infrastructure improvements for the Air Force. The geographic impact is concentrated in Alaska, supporting local economic activity. The construction work will likely involve a significant number of skilled laborers and tradespeople in the region.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if unforeseen site conditions arise in Alaska.
Logistical challenges in remote Alaska could impact project timeline and costs.
Limited competition may have resulted in a higher-than-optimal price.

Positive Signals

Firm Fixed Price contract provides cost certainty for the government.
Project addresses critical infrastructure needs for military personnel.
Construction in Alaska can stimulate local economy and job creation.

Sector Analysis

This contract falls within the Commercial and Institutional Building Construction sector, a significant segment of the broader construction industry. Projects of this scale, involving military installations, often require specialized contractors with experience in government contracting and adherence to strict building codes and security protocols. The market for military construction is substantial, driven by ongoing modernization and maintenance needs of defense infrastructure.

Small Business Impact

The contract was not set aside for small businesses, and there is no indication of subcontracting requirements for small businesses in the provided data. This suggests that the primary contractor, Lakeshore Engineering Services, Inc., will likely handle the majority of the work, with potential for larger subcontractors. The impact on the small business ecosystem is likely minimal unless the prime contractor actively engages small businesses for specialized services.

Oversight & Accountability

Oversight for this contract would typically be managed by the Department of the Air Force contracting and project management offices. Accountability measures are inherent in the Firm Fixed Price contract, which penalizes the contractor for cost overruns. Transparency is generally maintained through contract award databases and reporting requirements, though specific oversight details are not provided. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Military Family Housing Construction
Defense Infrastructure Projects
Alaska Construction Contracts
Demolition and New Construction Projects

Risk Flags

Potential for cost overruns due to Alaska's environment
Logistical challenges in remote locations
Limited competition may impact price competitiveness

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $35.1 million to LAKESHORE ENGINEERING SERVICES, INC.. DEMOLISH 12 MFH UNITS AND DEMOLITION OF 11 ADDITIVE MFH UNITS AND CONSTRUCT 54 MFH UNITS AT EIELSON AFB, AK.

Who is the contractor on this award?

The obligated recipient is LAKESHORE ENGINEERING SERVICES, INC..

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Air Force).

What is the total obligated amount?

The obligated amount is $35.1 million.

What is the period of performance?

Start: 2009-10-23. End: 2011-10-21.

What is the track record of Lakeshore Engineering Services, Inc. with Department of Defense contracts?

Lakeshore Engineering Services, Inc. has a history of performing contracts for the Department of Defense. While specific details on past performance quality and adherence to schedule for this particular contractor are not fully detailed in the provided data, their ability to win this $35 million contract suggests they have met the necessary qualifications and demonstrated capability. A deeper dive into their contract history, including any past performance reviews, disputes, or awards, would provide a more comprehensive understanding of their reliability and expertise in executing similar projects for the government.

How does the awarded price compare to similar military housing construction projects?

Without specific comparable projects in terms of size, scope, and location, it is challenging to definitively benchmark the $35.1 million award. However, construction costs in Alaska are generally higher than in the continental U.S. due to logistical challenges, climate, and labor rates. The contract's firm fixed price structure indicates that the government sought to lock in costs. A detailed value analysis would involve comparing the cost per square foot or cost per unit against other recently awarded military housing projects of similar scale and complexity, adjusted for regional economic factors.

What are the primary risks associated with this contract?

The primary risks associated with this contract include potential delays due to Alaska's harsh weather conditions and remote logistics, which can impact both schedule and cost. Unforeseen site conditions during demolition or foundation work could lead to scope changes or cost increases, despite the firm fixed price. Furthermore, the 'Full and Open Competition After Exclusion of Sources' suggests a potentially limited bidder pool, which could imply a risk of not achieving the most competitive pricing. The contractor's ability to manage these risks effectively will be crucial for successful project completion.

How effective is the 'Full and Open Competition After Exclusion of Sources' method in ensuring value for money?

The effectiveness of 'Full and Open Competition After Exclusion of Sources' in ensuring value for money is variable. While it aims to maintain a competitive environment, the exclusion of specific sources inherently narrows the field of potential bidders. This method is typically employed when there are specific justifications, such as requiring unique capabilities or addressing past performance concerns with certain firms. If the exclusions are well-founded and the remaining competition is robust, it can still yield good value. However, if the exclusions are overly broad or not adequately justified, it could limit price discovery and potentially lead to higher costs for the government compared to unrestricted competition.

What is the historical spending pattern for military housing construction at Eielson AFB?

Analyzing historical spending patterns for military housing construction at Eielson AFB would require access to historical contract databases and budget allocations specific to the base. This contract, valued at $35.1 million for demolition and construction of 54 units, represents a significant investment. Understanding past spending would involve looking at the number and value of similar projects awarded over the last 5-10 years, the types of contracts used, and the average cost per unit. This historical context is crucial for assessing whether current spending aligns with past trends or represents a notable deviation, potentially indicating changes in construction costs, project scope, or funding priorities.

What are the implications of a Firm Fixed Price contract for this project?

A Firm Fixed Price (FFP) contract for this military housing project means the contractor, Lakeshore Engineering Services, Inc., is obligated to complete the work for a predetermined price, regardless of their actual costs. This shifts the risk of cost overruns to the contractor. For the government, this provides budget certainty and protection against rising costs. However, contractors may build in higher contingency amounts into their FFP bids to account for potential risks, which could result in a higher initial price compared to cost-reimbursement contracts. The success of an FFP contract relies heavily on a well-defined scope of work and accurate initial cost estimations.

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 AFTER EXCLUSION OF SOURCES

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 7310 WOODWARD AVENUE, FIFT, DETROIT, MI, 90

Business Categories: Category Business, Minority Owned Business, Not Designated a Small Business, Subchapter S Corporation, Indian (Subcontinent) American Owned Business

Financial Breakdown

Contract Ceiling: $35,073,689

Exercised Options: $35,073,689

Current Obligation: $35,073,689

Contract Characteristics

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: FA890306D8505

IDV Type: IDC

Timeline