DOD's $70M Afghanistan Construction Contract Awarded to Lakeshore Engineering Services
Contract Overview
Contract Amount: $69,973,869 ($70.0M)
Contractor: Lakeshore Engineering Services, Inc.
Awarding Agency: Department of Defense
Start Date: 2011-02-28
End Date: 2014-07-13
Contract Duration: 1,231 days
Daily Burn Rate: $56.8K/day
Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES
Number of Offers Received: 19
Pricing Type: FIRM FIXED PRICE
Sector: Construction
Official Description: ADU PHASE II AFGHANISTAN
Place of Performance
Location: DETROIT, WAYNE County, MICHIGAN, 48202
State: Michigan Government Spending
Plain-Language Summary
Department of Defense obligated $70.0 million to LAKESHORE ENGINEERING SERVICES, INC. for work described as: ADU PHASE II AFGHANISTAN Key points: 1. Significant investment in infrastructure development in Afghanistan. 2. Lakeshore Engineering Services secured a large contract, indicating strong capabilities. 3. Potential risks include project execution in a challenging geopolitical environment. 4. The construction sector sees substantial government spending, with this contract being a notable example.
Value Assessment
Rating: good
The contract value of $69.97M for a 1231-day duration appears reasonable for large-scale construction projects. Benchmarking against similar international construction contracts would provide a more precise assessment.
Cost Per Unit: N/A
Competition Analysis
Competition Level: limited
The contract was awarded under 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES,' suggesting a competitive process but with specific limitations. This method aims for best value while potentially excluding certain bidders.
Taxpayer Impact: Taxpayers funded a significant infrastructure project in a foreign country, with the final cost influenced by the competitive bidding process.
Public Impact
Impact on local Afghan economy through job creation and material sourcing. Contribution to U.S. foreign policy objectives in Afghanistan. Potential for long-term infrastructure benefits or challenges depending on project success and sustainability.
Waste & Efficiency Indicators
Waste Risk Score: 57 / 10
Warning Flags
- Geopolitical instability in Afghanistan impacting project timeline and cost.
- Logistical challenges of operating in a remote and potentially hostile environment.
- Contract type (Firm Fixed Price) may not fully account for unforeseen cost escalations.
Positive Signals
- Award to a single contractor suggests focused expertise.
- Defined contract duration provides a clear project scope.
- Potential for positive impact on regional stability through infrastructure development.
Sector Analysis
This contract falls within the Commercial and Institutional Building Construction sector, a significant area of government spending. Benchmarks for similar large-scale international construction projects would be relevant for a deeper analysis.
Small Business Impact
The data indicates this contract was not awarded to small businesses, as Lakeshore Engineering Services is likely a larger entity. Further analysis would be needed to determine if subcontracting opportunities were made available to small businesses.
Oversight & Accountability
Oversight would be critical given the project's location and duration, involving monitoring of performance, financial expenditures, and adherence to contract terms by the Department of the Air Force.
Related Government Programs
- Commercial and Institutional Building Construction
- Department of Defense Contracting
- Department of the Air Force Programs
Risk Flags
- Geopolitical instability
- Logistical complexity
- Potential for cost overruns despite FFP
- Limited competition transparency
Tags
commercial-and-institutional-building-co, department-of-defense, mi, delivery-order, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $70.0 million to LAKESHORE ENGINEERING SERVICES, INC.. ADU PHASE II AFGHANISTAN
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 $70.0 million.
What is the period of performance?
Start: 2011-02-28. End: 2014-07-13.
What was the primary objective of this construction project in Afghanistan, and how did it align with broader U.S. strategic goals?
The primary objective was likely to support U.S. military operations and reconstruction efforts by providing essential facilities and infrastructure. This aligns with broader U.S. strategic goals of stabilizing Afghanistan, fostering economic development, and improving the security environment through tangible improvements.
What specific risks were identified and mitigated during the 'exclusion of sources' phase of the competition?
The 'exclusion of sources' phase likely involved identifying specific technical requirements or security clearances that only certain companies could meet. Risks mitigated might include ensuring bidders had the necessary expertise for construction in a challenging environment, possessed appropriate security clearances, or had prior successful experience with similar projects, thereby reducing the risk of contractor failure or project delays.
How effectively did the firm fixed price contract structure manage cost overruns given the volatile operating environment?
A firm fixed price contract aims to transfer cost overrun risk to the contractor. However, in a volatile environment like Afghanistan, unforeseen events (security issues, supply chain disruptions) could lead to significant contractor claims for equitable adjustments or contract termination if not managed meticulously through contract clauses and robust oversight.
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 AFTER EXCLUSION OF SOURCES
Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY
Offers Received: 19
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Address: 7310 WOODWARD AVENUE, FIFT, DETROIT, MI, 48202
Business Categories: Category Business, Foreign-Owned and U.S.-Incorporated Business, Minority Owned Business, Not Designated a Small Business, Special Designations, Subchapter S Corporation, Indian (Subcontinent) American Owned Business
Financial Breakdown
Contract Ceiling: $69,973,869
Exercised Options: $69,973,869
Current Obligation: $69,973,869
Subaward Activity
Number of Subawards: 24
Total Subaward Amount: $73,869,763
Contract Characteristics
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Parent Contract
Parent Award PIID: FA890306D8505
IDV Type: IDC
Timeline
Start Date: 2011-02-28
Current End Date: 2014-07-13
Potential End Date: 2014-07-13 00:00:00
Last Modified: 2016-04-05
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