DOT awards $41.6M for FAA facility modernization, Walsh Federal LLC to lead construction

Contract Overview

Contract Amount: $41,570,637 ($41.6M)

Contractor: Walsh Federal LLC

Awarding Agency: Department of Transportation

Start Date: 2024-05-23

End Date: 2026-07-16

Contract Duration: 784 days

Daily Burn Rate: $53.0K/day

Competition Type: COMPETED UNDER SAP

Number of Offers Received: 3

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: HCF TFIP MODERNIZATION AND OFDPS REPLACEMENT

Place of Performance

Location: HONOLULU, HONOLULU County, HAWAII, 96818

State: Hawaii Government Spending

Plain-Language Summary

Department of Transportation obligated $41.6 million to WALSH FEDERAL LLC for work described as: HCF TFIP MODERNIZATION AND OFDPS REPLACEMENT Key points: 1. Construction contract awarded for critical FAA facility upgrades. 2. Project aims to modernize infrastructure and replace outdated systems. 3. Contract duration spans over two years, indicating a significant scope. 4. Awarded under Simplified Acquisition Procedures, suggesting a focus on efficiency. 5. Firm Fixed Price contract type offers cost certainty for the government. 6. The project is located in Hawaii, impacting regional infrastructure.

Value Assessment

Rating: good

The contract value of $41.6 million for a large-scale construction project is within a reasonable range for facility modernization. Benchmarking against similar large federal construction projects, the price appears competitive, especially considering the firm fixed-price nature which transfers risk to the contractor. The specific details of the scope of work will be crucial for a definitive value assessment, but initial indicators suggest a fair price for the services rendered.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was competed under Simplified Acquisition Procedures (SAP), which typically involves a broader range of potential bidders than micro-purchases but may not reach the full extent of large-scale competitive procurements. The presence of 3 bidders indicates a degree of competition, suggesting that multiple firms were interested and capable of undertaking this project. This level of competition is generally positive for price discovery and ensuring a reasonable offer.

Taxpayer Impact: The competition among three bidders for this construction project likely resulted in a more favorable price for taxpayers compared to a sole-source award. While not the most extensive competition, it still provided a basis for price comparison and encouraged competitive bidding.

Public Impact

The Federal Aviation Administration (FAA) will benefit from modernized facilities, enhancing operational capabilities. Construction services will be delivered in Hawaii, supporting regional infrastructure development. The project is expected to create or sustain jobs within the construction sector in Hawaii. Improved facilities will contribute to the safety and efficiency of air traffic control and related operations.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if unforeseen site conditions arise during construction.
Dependence on contractor's ability to meet project timelines and quality standards.
Risk of supply chain disruptions impacting material availability and project schedule.

Positive Signals

Firm Fixed Price contract mitigates budget uncertainty for the government.
Competition among bidders suggests a potentially competitive price.
The project addresses critical infrastructure needs for the FAA.

Sector Analysis

This contract falls within the Commercial and Institutional Building Construction sector, a significant segment of the federal contracting market. The federal government is a major investor in construction, particularly for critical infrastructure like airports and air traffic control facilities. Spending in this sector is influenced by infrastructure needs, modernization efforts, and agency operational requirements. Comparable spending benchmarks would typically involve other large-scale federal building projects, often in the tens to hundreds of millions of dollars.

Small Business Impact

The data indicates this contract was not set aside for small businesses (ss: false, sb: false). While the competition was under SAP, which can include small businesses, there's no explicit set-aside mentioned. This means larger firms likely participated, and subcontracting opportunities for small businesses will depend on the prime contractor's strategy and any flow-down requirements, which are not detailed here.

Oversight & Accountability

Oversight for this contract will primarily be managed by the Department of Transportation's Federal Aviation Administration. The firm fixed-price nature of the contract provides a degree of financial oversight by locking in costs. Accountability measures will include adherence to the contract's scope of work, performance standards, and delivery schedules. Transparency is facilitated through contract award data, but detailed project progress reports and Inspector General involvement would depend on specific agency policies and any identified issues.

Related Government Programs

Federal Aviation Administration Facility Upgrades
Department of Transportation Construction Projects
Commercial and Institutional Building Construction Contracts
Infrastructure Modernization Programs

Risk Flags

Potential for cost overruns if unforeseen site conditions arise.
Risk of delays due to supply chain disruptions or labor availability.
Contract performance dependent on contractor's project management capabilities.

Frequently Asked Questions

What is this federal contract paying for?

Department of Transportation awarded $41.6 million to WALSH FEDERAL LLC. HCF TFIP MODERNIZATION AND OFDPS REPLACEMENT

Who is the contractor on this award?

The obligated recipient is WALSH FEDERAL LLC.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $41.6 million.

What is the period of performance?

Start: 2024-05-23. End: 2026-07-16.

What is the track record of Walsh Federal LLC in completing similar large-scale federal construction projects on time and within budget?

Walsh Federal LLC has a history of undertaking significant federal construction projects. A thorough review of their past performance, including contract awards, completion rates, and any reported disputes or cost overruns on similar projects for agencies like the FAA or other branches of the Department of Defense and Homeland Security, would be necessary. Analyzing their performance on projects of comparable size and complexity, particularly those involving facility modernization or new construction in sensitive environments, would provide insight into their reliability and ability to manage budgets and schedules effectively. Data from contract databases and performance evaluations (e.g., Contractor Performance Assessment Reporting System - CPARS) would be key sources for this assessment.

How does the awarded price of $41.6 million compare to similar FAA facility modernization projects in the last three years?

To benchmark the $41.6 million award, we would compare it against other Federal Aviation Administration (FAA) facility modernization or new construction contracts of similar scope and size awarded within the past three years. Key comparison points would include the square footage of the facility, the complexity of the systems being installed (e.g., HVAC, electrical, IT infrastructure), and the geographic location, as construction costs can vary regionally. If similar projects were awarded at significantly lower or higher price points, it would warrant further investigation into the specific requirements, competition levels, and economic conditions at the time of each award. For instance, if comparable projects averaged $35 million, this $41.6 million award might be considered slightly high, necessitating a review of the scope or contractor's bid.

What are the primary risks associated with this specific contract, and what mitigation strategies are in place?

Primary risks for this contract include potential construction delays due to unforeseen site conditions (e.g., environmental issues, subsurface obstructions), supply chain disruptions affecting material delivery, and labor shortages in Hawaii. Given it's a Firm Fixed Price (FFP) contract, the contractor bears the brunt of cost overruns related to these risks. Mitigation strategies typically involve robust project management by the contractor, including detailed scheduling, contingency planning, and proactive communication with suppliers. The FAA's role includes diligent oversight, regular progress reviews, and ensuring the contractor has adequate bonding and insurance. The contract itself may include clauses for excusable delays or force majeure events, but the financial risk largely remains with Walsh Federal LLC.

What is the expected impact of this facility modernization on the FAA's operational effectiveness and efficiency?

The modernization and replacement of outdated facilities are expected to significantly enhance the FAA's operational effectiveness and efficiency. Newer facilities often incorporate advanced building systems (HVAC, power, lighting) that are more reliable, energy-efficient, and easier to maintain, reducing downtime and operational costs. Furthermore, modern infrastructure is crucial for supporting advanced air traffic management technologies, communication systems, and data processing capabilities. By upgrading these physical assets, the FAA can better ensure the resilience and performance of its critical systems, contributing to enhanced aviation safety, reduced delays, and improved overall air traffic flow management.

How has federal spending on construction for the FAA evolved over the past five fiscal years, and where does this contract fit in?

Federal spending on construction for the FAA has historically fluctuated based on infrastructure needs, modernization initiatives, and budget appropriations. Over the past five fiscal years, the FAA has likely allocated substantial funds towards maintaining and upgrading its vast network of facilities, including air traffic control towers, radar facilities, and administrative buildings. This $41.6 million contract for facility modernization and replacement represents a significant, but not unprecedented, investment within that broader spending trend. It aligns with ongoing efforts to modernize aging infrastructure and incorporate new technologies, suggesting a continued commitment to capital improvements within the agency. Analyzing historical spending patterns would reveal if this award is part of a larger, sustained investment or a response to a specific, critical need.

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: COMPETED UNDER SAP

Solicitation Procedures: SIMPLIFIED ACQUISITION

Solicitation ID: 697DCK-24-R-ECRC1

Offers Received: 3

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 929 W ADAMS ST, CHICAGO, IL, 60607

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

Financial Breakdown

Contract Ceiling: $41,570,637

Exercised Options: $41,570,637

Current Obligation: $41,570,637

Actual Outlays: $28,333,264

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: 697DCK23G00011

IDV Type: BOA

Timeline