Department of Transportation awards $3.7M contract for Skilak Lake Road improvements in Alaska

Contract Overview

Contract Amount: $3,696,545 ($3.7M)

Contractor: STG Pacific, LLC

Awarding Agency: Department of Transportation

Start Date: 2024-01-18

End Date: 2024-09-01

Contract Duration: 227 days

Daily Burn Rate: $16.3K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 4

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: CONSTRUCTION SERVICES FOR PROJECT AK FWS KNA 1192(1), SKILAK LAKE ROAD AOP IMPROVEMENTS

Place of Performance

Location: SOLDOTNA, KENAI PENINSULA County, ALASKA, 99669

State: Alaska Government Spending

Plain-Language Summary

Department of Transportation obligated $3.7 million to STG PACIFIC, LLC for work described as: CONSTRUCTION SERVICES FOR PROJECT AK FWS KNA 1192(1), SKILAK LAKE ROAD AOP IMPROVEMENTS Key points: 1. Contract awarded to STG PACIFIC, LLC for construction services. 2. Project involves improvements to Skilak Lake Road AOP. 3. The contract type is Firm Fixed Price, indicating predictable costs. 4. Duration of the contract is 227 days. 5. Geographic focus is Alaska, specifically the Kenai Peninsula. 6. This contract falls under Highway, Street, and Bridge Construction.

Value Assessment

Rating: good

The contract value of $3.7 million for highway construction services appears reasonable given the scope of road improvements. Benchmarking against similar projects in Alaska for bridge and road construction would provide a more precise value-for-money assessment. The firm fixed-price structure helps manage cost overruns, but the final cost will depend on the execution of the project.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

The contract was awarded under 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES'. This indicates that while the competition was intended to be broad, specific sources were excluded, potentially limiting the number of bidders. Further details on the reasons for exclusion are needed to fully assess the competitive landscape and its impact on price discovery.

Taxpayer Impact: The limited competition may have resulted in a higher price for taxpayers compared to a fully open and unrestricted competition, as fewer potential bidders were considered.

Public Impact

Residents and travelers in Alaska will benefit from improved road infrastructure. Services delivered include construction and engineering for road improvements. The geographic impact is concentrated in the Kenai Peninsula region of Alaska. Local workforce may see employment opportunities during the construction phase.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if unforeseen site conditions arise, despite firm fixed price.
Limited competition could lead to less favorable pricing for the government.
Dependence on a single contractor for project completion carries execution risk.

Positive Signals

Firm fixed-price contract provides cost certainty for the government.
Project addresses critical infrastructure needs in a remote region.
Award to a specific contractor suggests they met all technical and performance requirements.

Sector Analysis

This contract falls within the Highway, Street, and Bridge Construction sector, a critical component of the broader Construction industry. The market for federal highway construction is substantial, with significant annual spending allocated to maintaining and improving national transportation networks. This project's value of $3.7 million is moderate within this sector, representing a specific investment in Alaskan infrastructure.

Small Business Impact

The contract was not set aside for small businesses, and there is no indication of subcontracting requirements for small businesses. This suggests that the primary award went to a larger entity, and the direct impact on the small business ecosystem for this specific contract may be limited unless the prime contractor engages them for subcontracting.

Oversight & Accountability

Oversight will likely be managed by the Federal Highway Administration (FHWA) through contract officers and technical representatives. Accountability measures are embedded in the firm fixed-price contract terms, requiring STG PACIFIC, LLC to deliver specified improvements within the agreed budget and timeframe. Transparency is generally maintained through federal contract databases, though specific project-level oversight details are not provided.

Related Government Programs

Federal Highway Administration Construction Projects
Alaska Transportation Infrastructure
Road Improvement Contracts
Highway, Street, and Bridge Construction

Risk Flags

Limited competition may impact price.
Potential for unforeseen site conditions in remote Alaska.
Contract duration is relatively short, requiring efficient execution.

Frequently Asked Questions

What is this federal contract paying for?

Department of Transportation awarded $3.7 million to STG PACIFIC, LLC. CONSTRUCTION SERVICES FOR PROJECT AK FWS KNA 1192(1), SKILAK LAKE ROAD AOP IMPROVEMENTS

Who is the contractor on this award?

The obligated recipient is STG PACIFIC, LLC.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $3.7 million.

What is the period of performance?

Start: 2024-01-18. End: 2024-09-01.

What is the track record of STG PACIFIC, LLC with the Department of Transportation and similar federal agencies?

A review of federal procurement data indicates that STG PACIFIC, LLC has a history of receiving contracts, primarily in the construction domain, from various federal agencies including the Department of Transportation. Their past performance on similar highway and infrastructure projects would be a key factor in the award decision for this contract. Analyzing their performance metrics on previous contracts, such as on-time delivery, adherence to budget, and quality of work, would provide further insight into their reliability and capability for the Skilak Lake Road project. Specific details on past issues or commendations would require a deeper dive into contract close-out reports and performance evaluations.

How does the awarded amount of $3.7 million compare to similar highway construction projects in Alaska?

Benchmarking the $3.7 million contract value against similar highway construction projects in Alaska requires access to comparable project data. Factors such as project scope, complexity, location (e.g., remote access, environmental considerations), and specific improvements (e.g., paving, bridge repair, drainage) significantly influence costs. Generally, construction in Alaska can incur higher costs due to logistical challenges and climate. Without specific comparable projects, it's difficult to definitively state if $3.7 million is high or low, but it represents a significant investment for a specific road improvement initiative in the state.

What are the primary risks associated with this firm fixed-price contract for highway construction?

The primary risks associated with this firm fixed-price contract for highway construction, despite its cost certainty, include potential for scope creep if not managed tightly, unforeseen site conditions (e.g., geological issues, environmental discoveries) that could lead to change orders and increased costs, and contractor performance issues. If the contractor underbids or faces unexpected challenges, they might cut corners on quality or delay completion, impacting the project's long-term viability and user satisfaction. The 'limited competition' aspect also introduces a risk that the government may not have secured the most competitive pricing possible.

What is the expected effectiveness of these road improvements on traffic flow and safety in the Skilak Lake area?

The effectiveness of the road improvements on traffic flow and safety in the Skilak Lake area will depend on the specific nature of the 'AOP improvements' detailed in the project scope, which are not fully elaborated here. Typically, such projects aim to enhance pavement quality, improve sightlines, widen lanes, upgrade signage, or repair structural deficiencies. If these improvements address known bottlenecks, reduce accident rates, or facilitate smoother vehicle movement, the effectiveness would be high. A detailed review of the project's engineering plans and objectives would be necessary to quantify expected improvements in travel times, accident reduction, and overall user experience.

How has federal spending on highway construction in Alaska trended over the past five years?

Analyzing federal spending trends on highway construction in Alaska over the past five years would reveal patterns in investment in the state's transportation infrastructure. This data is typically available through sources like the Bureau of Transportation Statistics or agency-specific budget reports. A general trend might show fluctuations based on federal appropriations, infrastructure bills, and specific project needs. Understanding these trends can provide context for the current $3.7 million award, indicating whether it aligns with historical spending levels or represents a significant increase or decrease in federal investment for such projects in Alaska.

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 AFTER EXCLUSION OF SOURCES

Solicitation Procedures: SEALED BID

Solicitation ID: 69056724B000002

Offers Received: 4

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 3700 CENTERPOINT DR, ANCHORAGE, AK, 99503

Business Categories: 8(a) Program Participant, Alaskan Native Corporation Owned Firm, Category Business, Corporate Entity Not Tax Exempt, DoT Certified Disadvantaged Business Enterprise, Limited Liability Corporation, Minority Owned Business, Native American Owned Business, Self-Certified Small Disadvantaged Business, Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $3,696,545

Exercised Options: $3,696,545

Current Obligation: $3,696,545

Actual Outlays: $3,629,741

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline