Army awards $33.2M construction contract to M.A. Mortenson Company for Texas facility
Contract Overview
Contract Amount: $33,236,637 ($33.2M)
Contractor: M. a. Mortenson Company
Awarding Agency: Department of Defense
Start Date: 2009-12-30
End Date: 2011-06-11
Contract Duration: 528 days
Daily Burn Rate: $62.9K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 4
Pricing Type: FIRM FIXED PRICE
Sector: Construction
Official Description: CONSTRUCTION
Place of Performance
Location: SAN ANTONIO, BEXAR County, TEXAS, 78234
State: Texas Government Spending
Plain-Language Summary
Department of Defense obligated $33.2 million to M. A. MORTENSON COMPANY for work described as: CONSTRUCTION Key points: 1. Contract awarded through full and open competition, suggesting a competitive bidding process. 2. The firm-fixed-price contract type indicates that the contractor bears the risk of cost overruns. 3. The contract duration of 528 days (approx. 1.4 years) suggests a moderately sized construction project. 4. Awarded by the Department of the Army, this contract falls under defense infrastructure spending. 5. The project is located in Texas, indicating a regional economic impact. 6. The absence of small business set-aside or subcontracting flags suggests a focus on larger prime contractors.
Value Assessment
Rating: fair
The contract value of $33.2 million for a commercial and institutional building construction project in Texas appears within a reasonable range for a project of this nature and duration. Without specific details on the facility's scope, size, and complexity, a precise value-for-money assessment is challenging. However, the firm-fixed-price structure shifts cost risk to the contractor, which can be beneficial for the government if managed effectively. Benchmarking against similar Army construction projects in Texas would provide a more robust comparison.
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 a bid. The presence of 4 bidders suggests a reasonable level of competition for this construction project. A higher number of bidders generally leads to more competitive pricing and a wider range of solutions, but four bidders is often considered adequate for many federal contracts, especially in specialized fields like construction.
Taxpayer Impact: Full and open competition, with multiple bidders, is generally favorable for taxpayers as it increases the likelihood of obtaining the best value and competitive pricing for the services rendered.
Public Impact
The primary beneficiary is the Department of the Army, which will receive a new or improved facility. The contract supports the construction of a commercial and institutional building, likely for military or related personnel use. The geographic impact is concentrated in Texas, potentially creating local jobs and stimulating the regional economy. The project will likely involve a workforce of construction laborers, tradespeople, and project managers.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Potential for cost overruns if the firm-fixed-price contract does not adequately account for all project contingencies.
- Ensuring the quality of construction meets military standards and specifications.
- Managing the project timeline effectively to avoid delays and associated costs.
Positive Signals
- Firm-fixed-price contract shifts cost risk to the contractor.
- Awarded through full and open competition with multiple bidders, suggesting competitive pricing.
- Contractor M.A. Mortenson Company is a known entity in large-scale construction projects.
Sector Analysis
This contract falls within the construction sector, specifically commercial and institutional building construction. The federal government is a significant consumer of construction services for military bases, government facilities, and infrastructure projects. The market for large-scale construction is competitive, with established firms like M.A. Mortenson Company often bidding on substantial government contracts. The value of this contract, approximately $33.2 million, is substantial but not uncommon for major construction projects undertaken by federal agencies.
Small Business Impact
The contract was not awarded as a small business set-aside, and there is no indication of specific subcontracting goals for small businesses in the provided data. This suggests that the primary focus was on securing the best overall bid from qualified contractors, potentially larger firms with the capacity to handle projects of this scale. The absence of explicit small business provisions may limit direct opportunities for small businesses as prime contractors on this specific award, though they could potentially participate as subcontractors if not specified.
Oversight & Accountability
Oversight for this contract would typically be managed by the contracting officer and project management personnel within the Department of the Army. Accountability measures are inherent in the firm-fixed-price contract, which holds the contractor responsible for delivering the project within the agreed-upon price. Transparency is generally maintained through contract award databases, though specific project details and oversight reports may not always be publicly accessible. The Inspector General's office for the Department of Defense could investigate any reported fraud, waste, or abuse related to this contract.
Related Government Programs
- Military Construction
- Department of Defense Facilities
- Army Corps of Engineers Projects
- Federal Building Construction
Risk Flags
- Potential for cost overruns under firm-fixed-price
- Quality control in construction
- Project timeline adherence
Tags
construction, department-of-defense, department-of-the-army, texas, firm-fixed-price, full-and-open-competition, commercial-and-institutional-building-construction, large-contract, defense-infrastructure
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $33.2 million to M. A. MORTENSON COMPANY. CONSTRUCTION
Who is the contractor on this award?
The obligated recipient is M. A. MORTENSON 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 $33.2 million.
What is the period of performance?
Start: 2009-12-30. End: 2011-06-11.
What specific type of facility is being constructed, and what are its primary functions?
The provided data indicates the contract is for 'Commercial and Institutional Building Construction' (NAICS 236220) awarded to M.A. Mortenson Company by the Department of the Army. However, the specific type of facility (e.g., barracks, administrative building, training center, hospital wing) and its precise functions are not detailed in the summary data. This information would be crucial for a comprehensive understanding of the project's scope, its impact on military operations, and a more accurate assessment of its value for money. Further details would likely be found in the contract's statement of work or associated project documentation.
How does the awarded price of $33.2 million compare to similar construction projects undertaken by the Army in Texas?
Benchmarking the $33.2 million award against similar Army construction projects in Texas requires access to a broader dataset of comparable contracts. Factors such as the size (square footage), complexity, specific building type, and prevailing market conditions at the time of award significantly influence construction costs. Without these comparative data points, it's difficult to definitively state whether this contract represents excellent, good, or fair value. However, given the firm-fixed-price nature and the presence of multiple bidders, it suggests an attempt to secure competitive pricing. A detailed analysis would involve identifying projects with similar scope and location and comparing their cost per square foot or total contract value adjusted for inflation and project specifics.
What is the track record of M.A. Mortenson Company with federal construction contracts, particularly with the Department of Defense?
M.A. Mortenson Company is a well-established and reputable construction firm with extensive experience in large-scale projects, including significant work for federal agencies. While specific details of their past performance on Department of Defense contracts are not provided in the summary data, their history typically includes a wide range of projects such as military installations, research facilities, and government buildings. Federal procurement databases often contain past performance ratings and award histories for contractors. Generally, a company of Mortenson's size and reputation undertaking a $33.2 million project suggests a positive track record and capability to meet the government's requirements, though a deeper dive into their specific performance metrics on similar DoD projects would be necessary for a complete assessment.
What are the potential risks associated with a firm-fixed-price construction contract of this magnitude?
The primary risk with a firm-fixed-price (FFP) contract, especially for a large construction project like this ($33.2M), is the potential for the contractor to incur cost overruns if their initial estimates are inaccurate or if unforeseen issues arise during construction. While the FFP structure shifts cost risk to the contractor, significant cost increases could lead to contractor financial distress, potential project delays, or disputes. For the government, risks include the possibility that the contractor may cut corners on quality to maintain profitability if margins are too thin, or that the initial price might not reflect the true market value if competition was limited or bids were unusually low. Effective government oversight is crucial to monitor progress, quality, and adherence to the contract terms to mitigate these risks.
How does the competition level (4 bidders) impact the taxpayer's financial interest in this contract?
Having four bidders for this $33.2 million construction contract generally indicates a healthy level of competition, which is beneficial for taxpayers. More bidders typically drive down prices as companies compete to win the contract, leading to a more favorable final award price. It also increases the likelihood that the government will receive proposals that offer the best combination of price, technical approach, and past performance. While more than four bidders might suggest even greater price pressure, four is often considered a sufficient number to ensure meaningful competition and prevent a situation where a single or very limited number of contractors dictate terms and pricing. This level of competition suggests the government likely secured a fair market price.
What is the historical spending pattern for similar construction contracts by the Department of the Army in Texas?
Analyzing historical spending patterns for similar construction contracts by the Department of the Army in Texas would require access to historical contract data over several fiscal years. This would involve identifying contracts with similar NAICS codes (e.g., 236220), agencies (Department of the Army), and geographic locations (Texas). Key metrics to examine would include the average contract value, the number of bidders per contract, the types of contract vehicles used (e.g., FFP, cost-plus), and the duration of similar projects. Understanding these patterns helps establish a baseline for evaluating the current $33.2 million award, assessing whether spending is increasing or decreasing, and identifying any trends in competition or pricing within the region for defense-related construction.
Industry Classification
NAICS: Construction › Nonresidential Building Construction › Commercial and Institutional Building Construction
Product/Service Code: CONSTRUCT OF STRUCTURES/FACILITIES › CONSTRUCT NONBUILDING FACILITIES
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY
Offers Received: 4
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: M. a. Mortenson Companies, Inc. (UEI: 130731797)
Address: 700 MEADOW LN N, MINNEAPOLIS, MN, 90
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $33,558,637
Exercised Options: $33,236,637
Current Obligation: $33,236,637
Contract Characteristics
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: W912HN08D0035
IDV Type: IDC
Timeline
Start Date: 2009-12-30
Current End Date: 2011-06-11
Potential End Date: 2011-06-11 00:00:00
Last Modified: 2011-07-15
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