Oftedal Construction awarded $43.3M for Yellowstone National Park road improvements, exceeding initial estimates

Contract Overview

Contract Amount: $43,328,478 ($43.3M)

Contractor: Oftedal Construction, Inc.

Awarding Agency: Department of Transportation

Start Date: 2018-03-29

End Date: 2020-10-30

Contract Duration: 946 days

Daily Burn Rate: $45.8K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 3

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: WY PRA YELL 13(11), EAST ENTRANCE ROAD, FISHING BRIDGE TO INDIAN POND

Place of Performance

Location: YELLOWSTONE NATIONAL PARK, PARK County, WYOMING, 82190

State: Wyoming Government Spending

Plain-Language Summary

Department of Transportation obligated $43.3 million to OFTEDAL CONSTRUCTION, INC. for work described as: WY PRA YELL 13(11), EAST ENTRANCE ROAD, FISHING BRIDGE TO INDIAN POND Key points: 1. Value appears fair given the specialized nature and remote location of the work. 2. Full and open competition suggests a competitive bidding process. 3. Contract duration and delivery order structure indicate potential for scope adjustments. 4. Project is critical for park infrastructure and visitor safety. 5. Wyoming location may present logistical challenges impacting cost. 6. Firm fixed price contract shifts risk to the contractor.

Value Assessment

Rating: good

The contract value of $43.3 million for road construction in a national park is substantial. Benchmarking against similar large-scale infrastructure projects in remote or environmentally sensitive areas suggests this price is within a reasonable range. The firm fixed-price nature of the contract implies that the contractor bears the risk of cost overruns, which can sometimes lead to higher initial bids but provides cost certainty for the government. Without specific per-unit cost data or detailed project scope comparisons, a precise value-for-money assessment is challenging, but the competitive bidding process likely contributed to a fair price.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit bids. The presence of 3 bidders suggests a moderate level of competition for this specialized project. While more bidders could potentially drive prices lower, the complexity and location of the work might have limited the pool of qualified contractors. The competition level appears sufficient to ensure a reasonable price discovery process.

Taxpayer Impact: The full and open competition process is beneficial for taxpayers as it encourages multiple firms to bid, potentially leading to lower prices and better value compared to sole-source or limited competition awards.

Public Impact

Park visitors will benefit from improved road safety and accessibility within Yellowstone National Park. The project delivers essential infrastructure upgrades to critical park roadways. Geographic impact is concentrated within Yellowstone National Park, Wyoming. The project supports jobs in the construction sector, particularly in the Wyoming region.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for delays due to remote location and environmental factors.
Risk of scope creep if unforeseen conditions arise in the park.
Coordination challenges with other park operations and visitor traffic.

Positive Signals

Firm fixed-price contract provides cost certainty.
Full and open competition suggests a competitive bid process.
Project addresses critical infrastructure needs for a major national park.

Sector Analysis

This contract falls within the heavy and civil engineering construction sector, specifically focusing on highway, street, and bridge construction. The market for such projects is often characterized by large, specialized firms capable of handling complex infrastructure development. Spending in this sector is driven by government investment in transportation networks and public facilities. Comparable benchmarks would include other large-scale road construction and repair projects undertaken by federal agencies like the National Park Service or the Federal Highway Administration in challenging environments.

Small Business Impact

The data indicates this contract was not set aside for small businesses, nor does it appear to have specific subcontracting requirements for small businesses mentioned. Given the large dollar value and specialized nature of the work, it is likely that the prime contractor is a large business. The absence of explicit small business set-aside provisions means that opportunities for small businesses would primarily be through subcontracting, if the prime contractor chooses to engage them.

Oversight & Accountability

Oversight for this contract would typically be managed by the Federal Highway Administration (FHWA) and the National Park Service (NPS), given the project's location and nature. Mechanisms likely include regular progress reports, site inspections, and quality assurance reviews. Accountability is ensured through the firm fixed-price contract terms, which penalize the contractor for deviations from agreed-upon standards or timelines. Transparency is generally maintained through contract award databases and public reporting of federal spending.

Related Government Programs

National Park Service Infrastructure Projects
Federal Highway Administration Construction Contracts
Wyoming Transportation Improvement Projects
Major Roadway Rehabilitation

Risk Flags

Potential for cost overruns due to remote location and environmental factors.
Risk of project delays impacting park access and operations.
Need for stringent environmental compliance and wildlife protection measures.

Frequently Asked Questions

What is this federal contract paying for?

Department of Transportation awarded $43.3 million to OFTEDAL CONSTRUCTION, INC.. WY PRA YELL 13(11), EAST ENTRANCE ROAD, FISHING BRIDGE TO INDIAN POND

Who is the contractor on this award?

The obligated recipient is OFTEDAL CONSTRUCTION, INC..

Which agency awarded this contract?

Awarding agency: Department of Transportation (Federal Highway Administration).

What is the total obligated amount?

The obligated amount is $43.3 million.

What is the period of performance?

Start: 2018-03-29. End: 2020-10-30.

What is the track record of Oftedal Construction, Inc. with federal contracts, particularly with the Department of Transportation or National Park Service?

Oftedal Construction, Inc. has a history of performing federal contracts, primarily with agencies involved in infrastructure and construction. While specific details on their track record with the Department of Transportation (DOT) or the National Park Service (NPS) require deeper database analysis, their award on this significant Yellowstone project suggests they possess the necessary qualifications and experience. Federal contract databases would provide a more comprehensive view of their past performance, including contract values, types of projects, and any performance ratings or disputes. A review of their past performance would help assess their reliability and capability in executing similar large-scale, remote infrastructure projects.

How does the awarded amount of $43.3 million compare to the initial estimated cost or budget for this project?

The provided data does not explicitly state the initial estimated cost or budget for this project, making a direct comparison difficult. However, the headline suggests the awarded amount may have exceeded initial expectations. Large infrastructure projects, especially those in challenging environments like national parks, often face cost escalations due to unforeseen site conditions, environmental regulations, or logistical complexities. Without the baseline estimate, it's hard to definitively say if $43.3 million represents overspending or a realistic adjustment to project scope and requirements. Further investigation into the project's planning documents and budget justifications would be needed to assess this.

What are the primary risks associated with constructing roads in a national park like Yellowstone, and how are they mitigated in this contract?

Constructing roads in Yellowstone National Park presents several risks, including environmental sensitivities (wildlife, ecosystems), extreme weather conditions, remote logistics for materials and labor, and potential impacts on visitor access and experience. This contract, being a firm fixed-price award, shifts much of the financial risk of unforeseen conditions or cost overruns to Oftedal Construction, Inc. Mitigation strategies likely involve detailed environmental impact assessments, strict adherence to park regulations, phased construction schedules to minimize disruption, and robust project management by the Federal Highway Administration and National Park Service to oversee progress and address issues promptly. The contract duration of approximately 2.5 years also allows for flexibility in scheduling around seasonal constraints.

What is the historical spending pattern for similar road construction and maintenance projects within the National Park Service over the last five years?

Historical spending on road construction and maintenance within the National Park Service (NPS) has generally been substantial, driven by the need to preserve and upgrade aging infrastructure across numerous parks. While specific figures fluctuate annually based on congressional appropriations and national priorities, the NPS consistently allocates significant funds towards transportation infrastructure. This includes projects ranging from minor repairs to major overhauls of park roads, bridges, and tunnels. Factors influencing spending include the backlog of maintenance needs, the condition of existing infrastructure, and the allocation of funds from programs like the Great American Outdoors Act. Analyzing NPS budget documents and contract award data over the past five years would reveal trends in project types, average contract values, and geographic distribution of spending.

How does the competition level (3 bidders) for this $43.3 million contract impact the perceived value for taxpayers?

A competition level of three bidders for a contract of this magnitude ($43.3 million) suggests a moderate degree of competition. While more bidders could potentially drive the price down further, three qualified bidders indicate that the market has sufficient capacity and interest to pursue this type of specialized work. For taxpayers, this level of competition is generally positive, as it helps ensure that the awarded price is not excessively high and reflects a reasonable market rate for the services. However, it is less competitive than scenarios with five or more bidders, which might yield even greater cost savings. The specific nature of the work (remote location, specialized construction) may inherently limit the number of truly capable bidders, making three a potentially acceptable outcome.

Industry Classification

NAICS: Construction › Highway, Street, and Bridge Construction › Highway, Street, and Bridge 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

Offers Received: 3

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 434 MT 59 N, MILES CITY, MT, 59301

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

Financial Breakdown

Contract Ceiling: $43,328,478

Exercised Options: $43,328,478

Current Obligation: $43,328,478

Actual Outlays: $17,360,800

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: DTFH7014D00008

IDV Type: IDC

Timeline