Granite Construction awarded $57.7M for highway, street, and bridge construction in California
Contract Overview
Contract Amount: $57,667,303 ($57.7M)
Contractor: Granite Construction Company
Awarding Agency: Department of Defense
Start Date: 2008-05-27
End Date: 2010-04-02
Contract Duration: 675 days
Daily Burn Rate: $85.4K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 7
Pricing Type: FIRM FIXED PRICE
Sector: Construction
Official Description: BASE BID ITEM
Place of Performance
Location: EL CENTRO, IMPERIAL County, CALIFORNIA, 92243
Plain-Language Summary
Department of Defense obligated $57.7 million to GRANITE CONSTRUCTION COMPANY for work described as: BASE BID ITEM Key points: 1. Contract awarded through full and open competition, suggesting a competitive pricing environment. 2. The firm fixed-price contract type shifts performance risk to the contractor. 3. Delivery order under a larger contract indicates potential for follow-on work and established relationships. 4. The North American Industry Classification System (NAICS) code 237310 points to significant infrastructure development. 5. The contract duration of 675 days suggests a substantial project scope. 6. The base bid amount of $57.7M represents a significant investment in California's infrastructure.
Value Assessment
Rating: good
The contract value of $57.7 million for highway, street, and bridge construction appears reasonable given the scope implied by the duration and the nature of infrastructure projects. Benchmarking against similar large-scale civil engineering contracts would provide a more precise assessment, but the competitive award mechanism suggests a fair market price was likely achieved. The firm fixed-price structure also indicates that the contractor bears the primary financial risk, which can be a positive indicator of value if managed effectively.
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 7 bidders (no) suggests a healthy level of competition for this project. A competitive bidding process generally leads to more favorable pricing for the government and taxpayers, as contractors vie to offer the most attractive terms.
Taxpayer Impact: The robust competition for this contract likely resulted in a lower price than would have been achieved through a sole-source or limited competition award, maximizing the value of taxpayer dollars.
Public Impact
Benefits the residents and businesses of California through improved transportation infrastructure. Delivers essential services related to the construction and maintenance of highways, streets, and bridges. Geographic impact is concentrated within California, specifically where the construction projects are located. Potential workforce implications include job creation for construction workers, engineers, and related support staff in the region.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Potential for cost overruns if unforeseen site conditions arise, despite the fixed-price nature.
- Risk of schedule delays due to weather, material availability, or labor issues.
- Ensuring compliance with environmental regulations during construction can be complex.
Positive Signals
- Firm fixed-price contract shifts cost risk to the contractor.
- Awarded through full and open competition, indicating competitive pricing.
- Contractor has a track record in large-scale construction projects.
- Delivery order structure suggests a pre-vetted and capable contractor.
Sector Analysis
The construction sector, particularly highway, street, and bridge construction (NAICS 237310), is a critical component of national infrastructure. This contract falls within a segment that often sees significant government investment to maintain and upgrade transportation networks. Market size for such projects can be substantial, driven by federal, state, and local funding initiatives. Comparable spending benchmarks would typically be assessed based on project complexity, location, and specific engineering requirements.
Small Business Impact
The data indicates that small business participation was not a primary set-aside consideration for this specific contract (ss: false, sb: false). While this contract itself may not directly benefit small businesses through set-asides, the prime contractor, Granite Construction Company, may engage small businesses as subcontractors. The extent of subcontracting to small businesses would need further investigation to assess the overall impact on the small business ecosystem for this project.
Oversight & Accountability
Oversight for this contract would typically be managed by the Department of the Army contracting officers and project managers. Accountability measures are inherent in the firm fixed-price contract type, which penalizes the contractor for cost overruns. Transparency is generally maintained through contract award databases and reporting requirements. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.
Related Government Programs
- Federal Highway Administration Programs
- Army Corps of Engineers Civil Works Projects
- Department of Transportation Infrastructure Grants
- State and Local Transportation Improvement Projects
Risk Flags
- Potential for schedule delays
- Risk of unforeseen site conditions
- Contractor performance monitoring required
- Compliance with environmental regulations
Tags
construction, department-of-defense, department-of-the-army, california, highway-construction, bridge-construction, street-construction, full-and-open-competition, firm-fixed-price, delivery-order, infrastructure, large-contract
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $57.7 million to GRANITE CONSTRUCTION COMPANY. BASE BID ITEM
Who is the contractor on this award?
The obligated recipient is GRANITE CONSTRUCTION COMPANY.
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Army).
What is the total obligated amount?
The obligated amount is $57.7 million.
What is the period of performance?
Start: 2008-05-27. End: 2010-04-02.
What is Granite Construction Company's track record with similar federal contracts?
Granite Construction Company has a significant history of performing large-scale civil infrastructure projects for various government agencies, including the Department of Defense and the Department of Transportation. Their portfolio includes numerous highway, bridge, and heavy civil construction contracts. Analyzing their past performance ratings, any contract disputes, and the scale of previously completed projects would provide a clearer picture of their capabilities and reliability for this specific contract. Publicly available contract data often details past awards and performance information, which can be cross-referenced to assess their suitability and experience in delivering projects of this magnitude and complexity.
How does the awarded amount compare to the estimated cost or budget for this project?
The provided data lists the 'BASE BID ITEM' amount as $57,667,303.47. Without access to the government's independent government cost estimate (IGCE) or the total contract value including options, a direct comparison is challenging. However, the fact that it was awarded under 'FULL AND OPEN COMPETITION' with 7 bidders suggests that the awarded price is likely competitive and reflects market conditions. If the awarded amount is significantly below the IGCE, it could indicate strong competition or potentially an underestimated scope by the government. Conversely, if it's close to or exceeds the IGCE, further scrutiny of the government's estimate and the contractor's pricing might be warranted.
What are the primary risks associated with this type of construction contract?
The primary risks for this firm fixed-price contract include potential cost overruns due to unforeseen site conditions (e.g., unexpected soil issues, hazardous materials), scope creep if project requirements are not clearly defined or managed, and schedule delays caused by factors like weather, labor shortages, or supply chain disruptions. For the government, risks include contractor performance issues, potential for disputes, and ensuring the final product meets all quality and safety standards. The fixed-price nature shifts most cost risk to the contractor, but significant delays or performance failures can still impact the government through extended oversight needs and potential claims.
What is the historical spending pattern for NAICS code 237310 by the Department of the Army?
Historical spending data for NAICS code 237310 (Highway, Street, and Bridge Construction) by the Department of the Army reveals a consistent investment in infrastructure maintenance and development. While specific annual totals fluctuate based on budgetary allocations and project needs, the Army regularly procures services in this category to support its installations and operational readiness. Analyzing trends over the past 5-10 years would show whether spending in this sector has been increasing, decreasing, or remaining stable. This context helps in understanding if the current award aligns with historical investment levels or represents a significant shift in priorities or funding.
What are the implications of this contract being a 'Delivery Order'?
This contract being a 'Delivery Order' implies it was issued under a previously awarded Indefinite Delivery/Indefinite Quantity (IDIQ) contract or a similar multiple-award contract vehicle. This structure allows the government to procure specific services or supplies as needed, up to a certain ceiling amount, without conducting a new full and open competition for each individual task. For taxpayers, this can mean faster procurement times and potentially pre-negotiated favorable rates. However, it also means the total spending under the parent IDIQ contract needs to be monitored to ensure it remains within authorized limits and that the competition within the IDIQ was robust.
Industry Classification
NAICS: Construction › Highway, Street, and Bridge Construction › Highway, Street, and Bridge Construction
Product/Service Code: CONSTRUCT OF STRUCTURES/FACILITIES › CONSTRUCT NONBUILDING FACILITIES
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Offers Received: 7
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: Granite Construction Incorporated (UEI: 622826360)
Address: 585 WEST BEACH ST, WATSONVILLE, CA, 95076
Business Categories: Category Business, Not Designated a Small Business
Financial Breakdown
Contract Ceiling: $57,667,303
Exercised Options: $57,667,303
Current Obligation: $57,667,303
Contract Characteristics
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: W912BV07D2020
IDV Type: IDC
Timeline
Start Date: 2008-05-27
Current End Date: 2010-04-02
Potential End Date: 2010-04-02 00:00:00
Last Modified: 2021-02-26
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