Nearly $13M for Wyoming's Beartooth Highway Road Construction, awarded to H-K Contractors

Contract Overview

Contract Amount: $12,983,432 ($13.0M)

Contractor: H-K Contractors, Inc.

Awarding Agency: Department of Transportation

Start Date: 2008-11-25

End Date: 2012-05-04

Contract Duration: 1,256 days

Daily Burn Rate: $10.3K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 4

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: ROAD CONSTRUCTION ON WY HPP 4-1(5), BEARTOOTH HIGHWAY

Place of Performance

Location: CODY, PARK County, WYOMING, 82414, UNITED STATES OF AMERICA

State: Wyoming Government Spending

Plain-Language Summary

Department of Transportation obligated $13.0 million to H-K CONTRACTORS, INC. for work described as: ROAD CONSTRUCTION ON WY HPP 4-1(5), BEARTOOTH HIGHWAY Key points: 1. Contract value appears reasonable for a multi-year, large-scale infrastructure project. 2. Full and open competition suggests a competitive bidding process. 3. Project duration of over three years indicates significant scope and potential for delays. 4. Firm Fixed Price contract type shifts risk to the contractor. 5. Awarded by the Federal Highway Administration, indicating a focus on national transportation infrastructure. 6. The contract is for highway, street, and bridge construction, a critical sector.

Value Assessment

Rating: good

The contract value of approximately $13 million for a multi-year road construction project on a significant highway like the Beartooth Highway is within a reasonable range for such infrastructure work. Benchmarking against similar large-scale highway construction projects in mountainous or remote regions would provide a more precise value-for-money assessment. The firm fixed-price nature of the contract suggests that the initial pricing was deemed acceptable, with the contractor bearing cost overruns.

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. The presence of 4 bidders suggests a healthy level of competition for this project. This competitive environment is generally favorable for price discovery and achieving a fair market price for the government.

Taxpayer Impact: Full and open competition helps ensure that taxpayer dollars are used efficiently by driving down costs through a competitive bidding process.

Public Impact

Benefits travelers and commerce by improving a key scenic and recreational highway. Services delivered include significant road construction and repair. Geographic impact is concentrated in Wyoming, specifically along the Beartooth Highway. Workforce implications include employment for construction workers and related support staff in the region.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Long project duration (1256 days) increases the risk of cost escalation due to inflation or unforeseen site conditions.
Firm Fixed Price contracts can lead to contractor disputes if scope creep occurs or unexpected challenges arise.

Positive Signals

Full and open competition suggests a robust bidding process, likely leading to competitive pricing.
The firm fixed-price contract shifts cost overrun risk to the contractor, protecting the government from unexpected expenses.
Awarded by the Federal Highway Administration, indicating adherence to federal infrastructure standards and oversight.

Sector Analysis

This contract falls within the construction sector, specifically focusing on heavy civil engineering and transportation infrastructure. The market for highway construction is substantial, driven by federal and state funding for maintaining and upgrading the nation's road network. Projects like this are crucial for ensuring the safety and efficiency of transportation corridors, particularly those serving recreational and tourist destinations like the Beartooth Highway.

Small Business Impact

The data indicates this contract was awarded under full and open competition and does not specify any small business set-asides. While H-K Contractors, Inc. is a private entity, the absence of explicit small business participation metrics means direct subcontracting opportunities for small businesses are not detailed here. Further investigation into the contractor's subcontracting plan would be needed to assess the impact on the small business ecosystem.

Oversight & Accountability

The Federal Highway Administration (FHWA) typically provides oversight for such projects, ensuring compliance with federal standards, environmental regulations, and contract terms. The firm fixed-price nature of the contract implies that the contractor is primarily responsible for managing costs and schedule. Transparency would be facilitated through public contract award databases and potentially through FHWA's project reporting mechanisms.

Related Government Programs

Federal Highway Administration Grants
National Highway System Projects
State Infrastructure Improvement Programs

Risk Flags

Extended project duration may increase risk of cost escalation.
Firm Fixed Price contract shifts cost overrun risk to contractor.
Potential for environmental challenges specific to mountainous terrain.

Frequently Asked Questions

What is this federal contract paying for?

Department of Transportation awarded $13.0 million to H-K CONTRACTORS, INC.. ROAD CONSTRUCTION ON WY HPP 4-1(5), BEARTOOTH HIGHWAY

Who is the contractor on this award?

The obligated recipient is H-K CONTRACTORS, INC..

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $13.0 million.

What is the period of performance?

Start: 2008-11-25. End: 2012-05-04.

What is the track record of H-K Contractors, Inc. on similar federal highway projects?

Information regarding H-K Contractors, Inc.'s specific track record on federal highway projects is not detailed in the provided data. A comprehensive assessment would require reviewing their past performance on contracts of similar size, scope, and complexity, including any history of cost overruns, schedule delays, or contract disputes. Examining past performance evaluations and any debriefings from previous federal procurements would offer insight into their reliability and capability to execute large-scale infrastructure projects effectively. Without this specific data, it's difficult to definitively assess their suitability beyond the fact they were the successful bidder in a competitive process.

How does the awarded amount compare to the estimated cost or bids from other competitors?

The provided data indicates that the contract was awarded for $12,983,431.55 after full and open competition with 4 bidders. However, the specific bid amounts from the other three competitors or the government's initial cost estimate are not included. To assess value for money, a comparison of all submitted bids would be necessary. A wide variance in bids could suggest differing interpretations of the scope or risk, while closely clustered bids might indicate a well-defined project and competitive market. Without the full bid spectrum, it's challenging to definitively state if this award represents optimal value.

What are the primary risks associated with this specific road construction project?

Key risks for this road construction project include environmental challenges inherent to the Beartooth Highway, such as extreme weather conditions (snow, ice, high winds), potential for rockslides or landslides, and sensitive ecosystems requiring careful management. The extended duration (1256 days) increases exposure to inflation, material price volatility, and potential labor shortages. Furthermore, the firm fixed-price contract places the burden of managing unforeseen site conditions or cost overruns on the contractor, which could lead to disputes or quality compromises if not managed diligently. Ensuring adequate oversight and contingency planning is crucial.

How effective has the Federal Highway Administration been in overseeing similar large-scale construction contracts?

The Federal Highway Administration (FHWA) generally has a strong track record in overseeing large-scale construction contracts, leveraging established processes for project management, quality assurance, and compliance. Their oversight typically involves regular site inspections, review of progress reports, and ensuring adherence to specifications and safety standards. However, effectiveness can vary depending on the specific project's complexity, the resources allocated for oversight, and the contractor's performance. While FHWA aims for consistent quality, challenges can arise with very large or technically demanding projects, necessitating robust internal controls and potentially independent reviews.

What is the historical spending trend for highway construction in Wyoming by the FHWA?

Historical spending trends for highway construction in Wyoming by the FHWA would typically show cyclical patterns influenced by federal infrastructure funding cycles (e.g., the Fixing America's Surface Transportation Act - FAST Act, or its predecessors and successors), economic conditions, and specific state needs. Wyoming, with its significant mileage of federal and scenic highways, often receives substantial funding for maintenance, repair, and new construction. Analyzing FHWA's historical obligations data for Wyoming's highway construction sector over the past 5-10 years would reveal average annual spending, the proportion allocated to major projects versus routine maintenance, and the types of construction prioritized. This context helps determine if the $13 million award is typical or an outlier.

What are the implications of the 1256-day duration on project costs and potential disruptions?

A duration of 1256 days (approximately 3.5 years) for a road construction project of this magnitude has significant implications. Firstly, it increases the potential for cost escalation due to inflation affecting labor, materials, and equipment over an extended period, even under a fixed-price contract, as contractors factor in contingency. Secondly, it implies a substantial scope of work, potentially involving complex phases, extensive earthmoving, or multiple work zones. Thirdly, prolonged construction can lead to significant and extended disruptions for local communities, businesses, and tourists relying on the Beartooth Highway, impacting access, travel times, and local economies. Careful phasing and traffic management plans are critical.

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: SEALED BID

Solicitation ID: DTFH68-08-B-00023

Offers Received: 4

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Interstate Concrete and Asphalt Company (UEI: 219509155)

Address: 6350 S YELLOWSTONE HWY, IDAHO FALLS, ID, 83402

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

Financial Breakdown

Contract Ceiling: $12,983,432

Exercised Options: $12,983,432

Current Obligation: $12,983,432

Timeline