Sundt Construction awarded $19.9M for Arizona border fence, highlighting highway construction sector spending

Contract Overview

Contract Amount: $19,918,870 ($19.9M)

Contractor: Sundt Construction, Inc.

Awarding Agency: Department of Defense

Start Date: 2008-07-07

End Date: 2008-12-31

Contract Duration: 177 days

Daily Burn Rate: $112.5K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 14

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: TASK ORDER CQ03, D-5B/D-6 DESIGN/CONSTRUCTION OF PRIMARY BORDER BARRIER FENCE, EAST OF NOGALES, AZ

Place of Performance

Location: NOGALES, SANTA CRUZ County, ARIZONA, 85621

State: Arizona Government Spending

Plain-Language Summary

Department of Defense obligated $19.9 million to SUNDT CONSTRUCTION, INC. for work described as: TASK ORDER CQ03, D-5B/D-6 DESIGN/CONSTRUCTION OF PRIMARY BORDER BARRIER FENCE, EAST OF NOGALES, AZ Key points: 1. Contract value represents a significant investment in border infrastructure. 2. Full and open competition suggests a potentially competitive bidding process. 3. Fixed-price contract type shifts risk to the contractor. 4. Short performance period indicates a focused, time-sensitive project. 5. Project location in Arizona points to specific regional security needs. 6. This award falls within the broader category of infrastructure development.

Value Assessment

Rating: fair

The contract value of $19.9 million for approximately 177 days of work appears substantial for a single task order. Benchmarking against similar border barrier construction projects would be necessary to definitively assess value for money. The firm-fixed-price nature suggests that the contractor assumed cost overruns, which can sometimes lead to higher initial bids to compensate for risk. Without detailed cost breakdowns or comparisons to other similar projects, it's difficult to ascertain if this price was optimal.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit bids. With 14 bidders, this suggests a healthy level of interest and competition for this specific task order. A higher number of bidders generally correlates with better price discovery and potentially lower costs for the government, as contractors vie to win the award.

Taxpayer Impact: The robust competition among 14 bidders likely resulted in a more favorable price for taxpayers compared to a sole-source or limited competition scenario.

Public Impact

The primary beneficiaries are the Department of Defense and potentially the Department of Homeland Security through enhanced border security infrastructure. The service delivered is the design and construction of a primary border barrier fence. The geographic impact is localized to the area east of Nogales, Arizona. Workforce implications include employment for construction workers, engineers, and project managers involved in the project.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if initial estimates were inaccurate, though mitigated by fixed-price contract.
Environmental impact of large-scale construction in a sensitive border region.
Long-term maintenance costs of the constructed barrier are not detailed in this award.
Security risks associated with construction in a border zone.

Positive Signals

Awarded under full and open competition, suggesting competitive pricing.
Firm-fixed-price contract transfers cost risk to the contractor.
Clear definition of work (design/construction) for a specific segment.
Defined performance period (177 days) indicates project focus and timeline adherence.

Sector Analysis

This contract falls within the Highway, Street, and Bridge Construction (NAICS 237310) sector, which encompasses the building of roads, bridges, and related infrastructure. Spending in this sector can fluctuate based on government infrastructure initiatives and national security priorities. Border barrier construction represents a specialized segment within this broader industry, often involving significant material and labor costs. Comparable spending benchmarks would typically be found within large-scale civil engineering and construction projects undertaken by federal agencies.

Small Business Impact

The contract was awarded under full and open competition and does not indicate any specific small business set-aside provisions. Sundt Construction, Inc. is a large business. There is no explicit information provided regarding subcontracting plans for small businesses within this specific task order, though large federal construction contracts often include subcontracting goals.

Oversight & Accountability

Oversight for this Department of the Army contract would typically fall under the purview of the contracting agency's Inspector General and relevant program management offices. Transparency is generally maintained through contract award databases like FPDS. Accountability measures are inherent in the firm-fixed-price contract structure, with penalties or remedies for non-performance. Specific oversight details would depend on the Army Corps of Engineers' project management protocols.

Related Government Programs

Border Security Infrastructure
Department of Defense Construction Contracts
Federal Highway and Bridge Construction Spending
Army Corps of Engineers Projects

Risk Flags

Potential for cost overruns if fixed-price bid was too aggressive.
Environmental impact concerns in border region construction.
Security risks associated with construction site location.
Schedule adherence risk due to short performance window.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $19.9 million to SUNDT CONSTRUCTION, INC.. TASK ORDER CQ03, D-5B/D-6 DESIGN/CONSTRUCTION OF PRIMARY BORDER BARRIER FENCE, EAST OF NOGALES, AZ

Who is the contractor on this award?

The obligated recipient is SUNDT CONSTRUCTION, INC..

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Army).

What is the total obligated amount?

The obligated amount is $19.9 million.

What is the period of performance?

Start: 2008-07-07. End: 2008-12-31.

What is Sundt Construction's track record with federal border infrastructure projects?

Sundt Construction, Inc. has a history of performing large-scale civil and infrastructure projects for federal agencies, including military construction and transportation infrastructure. While this specific award is for border barrier construction, their broader experience in heavy civil construction, including projects for the Department of Defense and Department of Transportation, suggests a capability to handle complex projects. A deeper dive into their contract history would reveal the extent and success rate of their direct involvement in border security-related construction, including any past performance issues or commendations. Their experience likely encompasses managing large workforces, complex logistics, and adhering to stringent federal regulations and timelines common in such endeavors.

How does the cost per mile of this fence compare to other border barrier projects?

The provided data does not include the length of the fence constructed, making a direct cost-per-mile comparison impossible. The award is for 'TASK ORDER CQ03, D-5B/D-6 DESIGN/CONSTRUCTION OF PRIMARY BORDER BARRIER FENCE, EAST OF NOGALES, AZ' with a value of $19,918,870 and a duration of 177 days. To perform a cost-per-mile analysis, the total linear footage or mileage of the fence built under this task order would be required. Without this crucial metric, any comparison to other border barrier projects, which vary significantly in terrain, design (e.g., vehicle barriers, pedestrian fencing, wall), and associated costs, would be speculative and potentially misleading. Further information on the project scope regarding the physical extent of the barrier is needed.

What are the primary risks associated with this specific border barrier construction contract?

Key risks for this contract include potential environmental challenges due to the construction site's location in Arizona, which may involve sensitive ecosystems or require specific mitigation measures. Security risks inherent in border zone construction, such as unauthorized crossings or potential disruptions, are also a concern. Given the firm-fixed-price nature, Sundt Construction bears the risk of cost overruns due to unforeseen site conditions, material price fluctuations, or labor shortages, although they likely factored contingencies into their bid. Furthermore, the short performance period (177 days) presents a risk of schedule delays if any of these factors materialize, potentially impacting the timely delivery of the border security asset. Coordination with multiple agencies and stakeholders involved in border operations adds another layer of complexity and potential risk.

What is the historical spending trend for border barrier construction by the Department of Defense?

Historical spending by the Department of Defense (DoD) on border barrier construction has been episodic and often tied to specific national security directives or supplemental funding appropriations. Prior to increased focus on border security, DoD spending in this area was minimal. However, in recent years, the DoD has been directed to allocate funds and resources towards border barrier projects, often utilizing military engineers and construction assets, or contracting with private firms. This spending can surge significantly during periods of heightened border activity or specific policy initiatives, followed by periods of reduced investment. Analyzing specific fiscal years and the legislative authorities under which these funds were appropriated is crucial to understanding the trend, which is generally characterized by reactive, rather than sustained, investment.

How does the number of bidders (14) influence the final contract price for this project?

A higher number of bidders, such as the 14 involved in this task order, generally exerts downward pressure on the final contract price. When multiple companies compete for a contract, they are incentivized to offer their most competitive pricing to secure the award. This competitive environment allows the government to benefit from price discovery, where the market determines a fair price based on supply and demand dynamics. With 14 bidders, it suggests that the market had sufficient capacity and interest, increasing the likelihood that the winning bid reflected a cost-effective solution for the government. Conversely, a low number of bidders might indicate limited competition, potentially leading to higher prices.

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: 14

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: THE Sundt Companies Inc (UEI: 073354982)

Address: 1501 W FOUNTAINHEAD PKWY, TEMPE, AZ, 85282

Business Categories: Category Business, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $19,918,870

Exercised Options: $19,918,870

Current Obligation: $19,918,870

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: W912BV07D2023

IDV Type: IDC

Timeline