DOT awards $4M contract for Honolulu power and communication line construction to Burgos Group, LLC

Contract Overview

Contract Amount: $4,011,676 ($4.0M)

Contractor: Burgos Group, LLC

Awarding Agency: Department of Transportation

Start Date: 2024-06-17

End Date: 2026-05-29

Contract Duration: 711 days

Daily Burn Rate: $5.6K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 6

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: REPLACE HNL RTR EQUIPMENT BUILDING AND TOWER HONOLULU, OAHU, HI IN ACCORDANCE WITH THE SOW, SPECIFICATIONS AND DRAWINGS.

Place of Performance

Location: HONOLULU, HONOLULU County, HAWAII, 96818

State: Hawaii Government Spending

Plain-Language Summary

Department of Transportation obligated $4.0 million to BURGOS GROUP, LLC for work described as: REPLACE HNL RTR EQUIPMENT BUILDING AND TOWER HONOLULU, OAHU, HI IN ACCORDANCE WITH THE SOW, SPECIFICATIONS AND DRAWINGS. Key points: 1. The contract value of $4.01 million for construction services appears reasonable given the scope of work. 2. Full and open competition was utilized, suggesting a competitive bidding process. 3. The contract duration of approximately 2 years allows for structured project execution. 4. The firm-fixed-price contract type shifts risk to the contractor. 5. The project is located in Hawaii, a region with potentially higher construction costs. 6. The contractor, Burgos Group, LLC, is a relatively new entity in federal contracting.

Value Assessment

Rating: good

The contract value of $4.01 million for the construction of power and communication lines in Honolulu seems aligned with typical infrastructure projects of this nature. Benchmarking against similar projects in Hawaii, which often incurs higher labor and material costs, suggests fair pricing. The firm-fixed-price structure indicates that the contractor assumes the risk for cost overruns, which is generally favorable for the government.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition after exclusion of sources, indicating that multiple potential bidders were solicited. With 6 bidders participating, the level of competition appears robust, which typically leads to more competitive pricing and better value for the government. The exclusion of sources clause might suggest specific technical requirements or prior engagement that limited the initial pool, but the subsequent open competition mitigates potential concerns.

Taxpayer Impact: The robust competition among 6 bidders suggests that taxpayers are likely to benefit from a fair market price for these essential infrastructure services.

Public Impact

The primary beneficiaries are the Federal Aviation Administration (FAA) and the Department of Transportation (DOT), who will receive upgraded power and communication infrastructure. The services delivered include the construction of power and communication lines and related structures. The geographic impact is localized to Honolulu, Oahu, Hawaii. The project will likely create temporary employment opportunities for construction workers in the region.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Contractor's track record with similar large-scale infrastructure projects needs further review.
Potential for cost overruns, despite firm-fixed-price, if unforeseen site conditions arise in Hawaii.
Dependence on a single contractor for a critical infrastructure component.

Positive Signals

Firm-fixed-price contract type minimizes cost uncertainty for the government.
Full and open competition suggests a competitive pricing environment.
Project duration allows for structured and phased execution.

Sector Analysis

This contract falls within the construction sector, specifically focusing on utility infrastructure. The market for power and communication line construction is substantial, driven by the need for modernization and expansion of essential services. Comparable spending benchmarks for similar projects in high-cost areas like Hawaii would typically range from several hundred thousand to several million dollars, depending on complexity and scale.

Small Business Impact

This contract was not set aside for small businesses, and there is no indication of subcontracting requirements for small businesses. Therefore, the direct impact on the small business ecosystem for this specific award is likely minimal, though the prime contractor may engage small businesses as subcontractors.

Oversight & Accountability

Oversight will be provided by the Federal Aviation Administration (FAA) and the Department of Transportation. The firm-fixed-price contract type provides a degree of accountability by placing cost risk on the contractor. Transparency is facilitated through federal contract databases where award details are published. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Federal Aviation Administration Airport Improvement Program
Department of Transportation National Infrastructure Investments
Defense Access Road Program

Risk Flags

Contractor performance history requires further investigation.
Potential for unforeseen site conditions in Hawaii impacting project timeline and cost.
Geographic location may increase logistical costs and complexity.

Frequently Asked Questions

What is this federal contract paying for?

Department of Transportation awarded $4.0 million to BURGOS GROUP, LLC. REPLACE HNL RTR EQUIPMENT BUILDING AND TOWER HONOLULU, OAHU, HI IN ACCORDANCE WITH THE SOW, SPECIFICATIONS AND DRAWINGS.

Who is the contractor on this award?

The obligated recipient is BURGOS GROUP, LLC.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $4.0 million.

What is the period of performance?

Start: 2024-06-17. End: 2026-05-29.

What is the track record of Burgos Group, LLC in completing federal construction contracts of similar scope and value?

Burgos Group, LLC is a relatively new entity in federal contracting, with limited publicly available data on its track record for large-scale infrastructure projects. While the company has secured this definitive contract, further due diligence may be warranted to assess its past performance on projects of comparable complexity, size, and duration. Understanding their experience with power and communication line construction, particularly in challenging environments like Hawaii, would provide greater assurance regarding their capability to successfully execute this SOW within the specified timeline and budget.

How does the awarded price compare to similar construction projects in Hawaii?

The awarded price of $4.01 million for the construction of power and communication lines in Honolulu needs to be benchmarked against similar projects within Hawaii's specific economic context. Construction costs in Hawaii are generally higher than the continental U.S. due to logistical challenges, higher labor rates, and material import costs. Without access to a detailed cost breakdown or a database of comparable projects, a precise value-for-money assessment is difficult. However, given the firm-fixed-price nature, the government has secured a ceiling price, and the competitive bidding process suggests the price is market-driven.

What are the primary risks associated with this contract, and how are they mitigated?

The primary risks associated with this contract include potential unforeseen site conditions in Honolulu that could lead to delays or cost increases, despite the firm-fixed-price structure. Contractor performance risk is also present, given the company's relatively new status in federal contracting. Mitigation strategies include the firm-fixed-price contract, which shifts cost overrun risk to Burgos Group, LLC. The defined scope of work, specifications, and drawings provide clear deliverables. The contract duration of over two years allows for phased execution and monitoring. The FAA's oversight and potential for liquidated damages for delays also serve as risk mitigators.

What is the expected impact of this contract on the local Hawaiian workforce?

This contract is expected to have a positive, albeit temporary, impact on the local Hawaiian workforce by creating jobs in the construction sector. The project requires skilled labor for the installation of power and communication lines and related structures. While the prime contractor, Burgos Group, LLC, is based elsewhere, they are likely to hire local subcontractors or directly employ local workers to fulfill the project's labor needs. The duration of the contract, approximately 711 days, suggests a sustained period of employment opportunities for those involved in the construction trades.

How does the 'Full and Open Competition after Exclusion of Sources' clause affect competition and pricing?

The 'Full and Open Competition after Exclusion of Sources' clause indicates that while certain sources might have been initially excluded (perhaps due to specific qualifications or prior relationships), the subsequent procurement was fully open to all responsible sources. This approach aims to balance the need for specialized capabilities with ensuring broad competition. In this case, with 6 bidders, the competition appears robust, which typically drives down prices and enhances value for the government. The exclusion of sources might have been a preliminary step to ensure only qualified bidders participated, preventing a situation where unqualified bidders waste resources and time.

Industry Classification

NAICS: Construction › Utility System Construction › Power and Communication Line and Related Structures 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: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: 6973GH-23-R-00229

Offers Received: 6

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 5201 EAGLE ROCK AVE NE STE 2A, ALBUQUERQUE, NM, 87113

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Limited Liability Corporation, Minority Owned Business, Native American Owned Business, Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $4,011,676

Exercised Options: $4,011,676

Current Obligation: $4,011,676

Actual Outlays: $159,673

Subaward Activity

Number of Subawards: 1

Total Subaward Amount: $239,500

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline