Coast Guard awards $3.25M contract for major maintenance and repair of Sector Field Office in Grand Haven, MI

Contract Overview

Contract Amount: $3,248,868 ($3.2M)

Contractor: Peak Runge Company JV

Awarding Agency: Department of Homeland Security

Start Date: 2024-03-05

End Date: 2026-02-27

Contract Duration: 724 days

Daily Burn Rate: $4.5K/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: PROVIDE ALL LABOR, MATERIALS, TRANSPORTATION, EQUIPMENT AND SUPERVISION TO PERFORM A MAJOR M&R OF SFO OPCEN AT U.S. COAST GUARD SECTOR FIELD OFFICE GAND HAVEN, MI

Place of Performance

Location: GRAND HAVEN, OTTAWA County, MICHIGAN, 49417

State: Michigan Government Spending

Plain-Language Summary

Department of Homeland Security obligated $3.2 million to PEAK RUNGE COMPANY JV for work described as: PROVIDE ALL LABOR, MATERIALS, TRANSPORTATION, EQUIPMENT AND SUPERVISION TO PERFORM A MAJOR M&R OF SFO OPCEN AT U.S. COAST GUARD SECTOR FIELD OFFICE GAND HAVEN, MI Key points: 1. Contract focuses on essential maintenance and repair for a critical Coast Guard facility. 2. The fixed-price contract type aims to control costs for the government. 3. Competition was conducted after exclusion of sources, warranting a closer look at the justification. 4. The contract duration of 724 days suggests a comprehensive scope of work. 5. The award is for a specific geographic location, impacting local operations and potentially workforce. 6. This contract falls under the broad category of commercial and institutional building construction.

Value Assessment

Rating: fair

The contract value of $3.25 million for major maintenance and repair of a Sector Field Office appears within a reasonable range for such projects, though specific benchmarks are difficult to ascertain without detailed project scope. The firm fixed-price structure is generally favorable for cost control. However, the 'full and open competition after exclusion of sources' method raises questions about whether the most competitive pricing was achieved. Further analysis would require comparing the scope of work and final price to similar M&R projects for Coast Guard or other maritime facilities.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

This contract was awarded using 'full and open competition after exclusion of sources.' This procurement method suggests that while the intent was competition, certain sources were excluded, potentially limiting the pool of bidders. The number of bids received (6) indicates some level of interest, but the exclusion of specific sources means the government may not have received offers from all capable contractors. This could impact price discovery and potentially lead to a higher price than if all potential bidders had been included.

Taxpayer Impact: The exclusion of sources, even if justified, means taxpayers may not have benefited from the broadest possible competition, potentially leading to a less competitive price than a truly open solicitation.

Public Impact

The U.S. Coast Guard Sector Field Office in Grand Haven, MI, will benefit from improved infrastructure and operational readiness. Services delivered include major maintenance and repair, ensuring the facility's long-term functionality. The geographic impact is localized to Grand Haven, Michigan, supporting Coast Guard operations in that region. The contract is likely to create or sustain jobs in the construction sector within Michigan.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

The procurement method 'full and open competition after exclusion of sources' requires careful review to ensure the exclusion was justified and did not unduly limit competition.
Lack of detailed scope of work in the provided data makes it difficult to benchmark the value for money effectively.
The firm fixed-price contract, while good for cost control, can shift risk to the contractor, potentially leading to higher initial bids if unforeseen issues arise.

Positive Signals

The use of a firm fixed-price contract provides cost certainty for the government.
The award to a joint venture (PEAK RUNGE COMPANY JV) may indicate a capacity to handle complex projects.
The contract is for essential maintenance and repair, directly supporting the Coast Guard's mission readiness.

Sector Analysis

This contract falls within the Commercial and Institutional Building Construction sector, a significant segment of the broader construction industry. This sector encompasses the building and renovation of non-residential structures like government facilities, offices, and public buildings. Spending in this area is often driven by government needs for infrastructure maintenance and upgrades, as well as private sector development. Benchmarking this specific contract's value would ideally involve comparing it to similar M&R projects for federal facilities, particularly those managed by maritime or defense-related agencies, considering regional labor and material costs.

Small Business Impact

The data indicates that small business participation (sb: false) was not a specific set-aside for this contract. There is no explicit mention of subcontracting requirements for small businesses. This suggests that the primary contractor, a joint venture, will likely manage the majority of the work, and the direct impact on the small business ecosystem may be limited unless the joint venture proactively engages small businesses for subcontracting opportunities.

Oversight & Accountability

Oversight for this contract will likely be managed by the U.S. Coast Guard contracting and program management offices. Accountability measures are inherent in the firm fixed-price contract type, which obligates the contractor to deliver specified work within the agreed price. Transparency would be enhanced by public availability of detailed contract performance reports and any associated Inspector General audits or reviews, though such specific oversight mechanisms are not detailed in the provided data.

Related Government Programs

U.S. Coast Guard Facility Maintenance Contracts
Department of Homeland Security Construction Projects
Federal Building and Grounds Maintenance
Maritime Infrastructure Repair

Risk Flags

Limited Competition Justification
Potential for Cost Overruns in FFP Contracts
Operational Disruption During Extended Construction

Frequently Asked Questions

What is this federal contract paying for?

Department of Homeland Security awarded $3.2 million to PEAK RUNGE COMPANY JV. PROVIDE ALL LABOR, MATERIALS, TRANSPORTATION, EQUIPMENT AND SUPERVISION TO PERFORM A MAJOR M&R OF SFO OPCEN AT U.S. COAST GUARD SECTOR FIELD OFFICE GAND HAVEN, MI

Who is the contractor on this award?

The obligated recipient is PEAK RUNGE COMPANY JV.

Which agency awarded this contract?

Awarding agency: Department of Homeland Security (U.S. Coast Guard).

What is the total obligated amount?

The obligated amount is $3.2 million.

What is the period of performance?

Start: 2024-03-05. End: 2026-02-27.

What is the specific justification for excluding certain sources in this 'full and open competition after exclusion of sources' procurement?

The provided data does not contain the specific justification for excluding sources. Typically, such exclusions are based on factors like unique capabilities, proprietary technology, urgent and compelling needs that limit the time for full competition, or specific government requirements that only a limited number of contractors can meet. A thorough review of the contract's solicitation documents and award justification would be necessary to understand the rationale behind the source exclusion. Without this information, it's difficult to assess whether the exclusion was appropriate and if it potentially limited the government's ability to secure the best possible price and value.

How does the $3.25 million cost compare to similar major maintenance and repair projects for Coast Guard facilities?

Directly comparing the $3.25 million cost without a detailed breakdown of the scope of work (e.g., specific repairs, materials, labor hours) is challenging. However, major maintenance and repair projects for federal facilities, especially those in demanding environments like coastal areas, can range significantly. For a facility like a Sector Field Office, which is critical for operations, the cost could be considered reasonable if it encompasses structural repairs, HVAC upgrades, electrical systems, plumbing, and potentially specialized maritime-related infrastructure. Benchmarking against similar projects awarded by the Coast Guard or other agencies like the Navy or Army Corps of Engineers for comparable facilities would provide a more accurate assessment of value for money.

What are the potential risks associated with a firm fixed-price contract for this type of project?

While firm fixed-price (FFP) contracts are generally favored for cost control, they can introduce risks, particularly for complex maintenance and repair projects where unforeseen conditions are common. The primary risk is that the contractor may encounter issues not fully anticipated during the bidding phase (e.g., hidden structural damage, hazardous materials, unexpected site conditions). If these issues are significant, the contractor might incur costs exceeding the fixed price, potentially leading to requests for change orders, disputes, or even contractor default if the financial strain is too great. Conversely, if the contractor significantly overestimates costs to mitigate risk, the government may end up paying a premium.

What is the track record of PEAK RUNGE COMPANY JV in performing similar government contracts?

Information regarding the specific track record of PEAK RUNGE COMPANY JV for performing similar government contracts is not provided in the data. To assess their reliability and past performance, one would typically consult resources like the Federal Procurement Data System (FPDS), the Contractor Performance Assessment Reporting System (CPARS), or conduct direct inquiries with agencies they have previously worked with. A review of their past performance would focus on their ability to complete projects on time, within budget, and to the required quality standards, as well as their history of disputes or contract terminations.

What are the implications of the 724-day duration for the project's impact on Coast Guard operations?

A contract duration of 724 days (approximately two years) suggests a substantial scope of work for the major maintenance and repair project. This extended timeline implies that significant portions of the facility may be undergoing renovation or repair simultaneously, potentially leading to disruptions in normal Coast Guard operations at the Grand Haven Sector Field Office. Mitigation strategies, such as phased construction, temporary relocation of certain functions, or extended operating hours for unaffected areas, would likely be necessary to minimize the impact on the Coast Guard's mission readiness during the contract period.

How does the geographic location in Michigan influence the contract's cost and execution?

The location in Grand Haven, Michigan, influences the contract primarily through regional labor costs, material availability, and potentially weather-related construction constraints. Michigan's labor market will dictate wage rates for skilled construction workers. The proximity to suppliers for materials and equipment will affect transportation costs and lead times. Furthermore, Michigan's climate, particularly during winter months, can impose significant limitations on outdoor construction activities, potentially extending project timelines and increasing costs if not adequately planned for. The specific needs of a coastal facility in this region, such as resistance to harsh weather and saltwater, may also necessitate specialized materials or construction techniques.

Industry Classification

NAICS: Construction › Nonresidential Building Construction › Commercial and Institutional Building Construction

Product/Service Code: MAINT, REPAIR, ALTER REAL PROPERTY › MAINT, ALTER, REPAIR NONBUILDINGS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 6

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 3539 NE CATAWBA RD, PORT CLINTON, OH, 43452

Business Categories: Black American Owned Business, Category Business, Corporate Entity Not Tax Exempt, Limited Liability Corporation, Minority Owned Business, SBA Certified 8 a Joint Venture, Self-Certified Small Disadvantaged Business, Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $3,248,868

Exercised Options: $3,248,868

Current Obligation: $3,248,868

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: 70Z08318DPCR22300

IDV Type: IDC

Timeline