DoD's $19.7M Army barracks construction contract awarded to M.A. Mortenson Company shows fair value
Contract Overview
Contract Amount: $19,731,034 ($19.7M)
Contractor: M. a. Mortenson Company
Awarding Agency: Department of Defense
Start Date: 2012-06-28
End Date: 2013-11-17
Contract Duration: 507 days
Daily Burn Rate: $38.9K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 3
Pricing Type: FIRM FIXED PRICE
Sector: Construction
Official Description: CONSTRUCTION OF THE CHEMICAL BATTALION COMPLEX UEPH PN64014 AT JBLM
Place of Performance
Location: JOINT BASE LEWIS MCCHORD, PIERCE County, WASHINGTON, 98433
Plain-Language Summary
Department of Defense obligated $19.7 million to M. A. MORTENSON COMPANY for work described as: CONSTRUCTION OF THE CHEMICAL BATTALION COMPLEX UEPH PN64014 AT JBLM Key points: 1. The contract was awarded under full and open competition, suggesting a competitive bidding process. 2. The firm-fixed-price contract type indicates that the contractor assumes the risk for cost overruns. 3. The project duration of 507 days aligns with typical construction timelines for similar facilities. 4. The awarded amount of $19.7 million falls within a reasonable range for barracks construction of this scale. 5. The contract was awarded to a single bidder, which warrants further investigation into the competitive landscape. 6. The absence of small business set-asides means direct opportunities for small businesses were limited.
Value Assessment
Rating: good
The awarded price of $19.7 million for the Chemical Battalion Complex UEPH PN64014 at JBLM appears reasonable when benchmarked against similar military construction projects. While specific comparable data is not provided, the firm-fixed-price structure generally promotes cost control. The contractor, M.A. Mortenson Company, has a track record in large-scale construction, suggesting they can deliver within budget. The contract duration of 507 days also seems appropriate for the scope of work.
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. However, the data shows only three bids were received, and the award went to a single bidder. This suggests that while the process was open, the actual competition may have been limited, potentially impacting price discovery. Further analysis would be needed to understand why more bidders did not participate.
Taxpayer Impact: A competitive bidding process, even with a limited number of bidders, generally benefits taxpayers by encouraging lower prices. However, a single awardee from a small pool of bidders could indicate potential market concentration or barriers to entry, which might not fully optimize taxpayer value.
Public Impact
The primary beneficiaries are U.S. Army personnel stationed at Joint Base Lewis-McChord (JBLM), who will receive modern barracks facilities. The contract delivers essential infrastructure for troop housing, contributing to readiness and morale. The project's geographic impact is localized to JBLM in Washington state. The construction activities will likely involve a local workforce, providing employment opportunities in the Washington area.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Limited number of bidders (3) for a full and open competition could indicate potential barriers to entry or lack of market interest.
- Award to a single bidder from the received proposals warrants scrutiny to ensure fair pricing and prevent potential future sole-source situations.
- No small business subcontracting goals were explicitly mentioned, potentially limiting direct economic benefit to small businesses in this specific contract.
Positive Signals
- Firm-fixed-price contract type shifts cost risk to the contractor, protecting the government from unexpected cost increases.
- M.A. Mortenson Company is an established construction firm with experience in large projects, suggesting a higher likelihood of successful execution.
- The project addresses a critical need for troop housing infrastructure, directly supporting military readiness.
Sector Analysis
This contract falls within the commercial and institutional building construction sector, a significant segment of the broader construction industry. The Department of Defense is a major client for construction services, with substantial annual spending on infrastructure projects like barracks, training facilities, and administrative buildings. Benchmarking this contract's value against other military construction projects of similar scale and complexity would provide further context on its cost-effectiveness.
Small Business Impact
The contract data indicates that this was not a small business set-aside, and the 'sb' field is false. This means that small businesses were not specifically targeted for this award. While M.A. Mortenson Company may utilize small businesses as subcontractors, the primary contract award did not prioritize them. This limits direct opportunities for small businesses to secure the prime contract and may reduce their overall share of the work compared to a set-aside contract.
Oversight & Accountability
Oversight for this Department of the Army contract would typically be managed by the Army Corps of Engineers or a designated contracting officer's representative (COR). Accountability measures are embedded in the firm-fixed-price contract, requiring the contractor to complete the work to specifications within the agreed price. Transparency is generally maintained through contract award databases like FPDS. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.
Related Government Programs
- Military Construction, Army
- Barracks Construction
- Department of Defense Facilities
- Base Realignment and Closure (BRAC) Projects
- Army Corps of Engineers Construction Contracts
Risk Flags
- Limited competition despite full and open solicitation.
- Award to a single bidder.
- Lack of explicit small business subcontracting goals.
Tags
construction, department-of-defense, department-of-the-army, firm-fixed-price, full-and-open-competition, washington, jblm, barracks, military-construction, large-contract
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $19.7 million to M. A. MORTENSON COMPANY. CONSTRUCTION OF THE CHEMICAL BATTALION COMPLEX UEPH PN64014 AT JBLM
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 $19.7 million.
What is the period of performance?
Start: 2012-06-28. End: 2013-11-17.
What is the track record of M.A. Mortenson Company with federal construction contracts, particularly with the Department of Defense?
M.A. Mortenson Company has a significant history of securing and executing federal construction contracts, including numerous projects for the Department of Defense. Their portfolio includes a wide range of facilities, from military housing and training centers to research laboratories and administrative buildings. They have demonstrated experience in large-scale, complex projects often located on active military installations. Their past performance on similar DoD contracts suggests a capability to manage the technical, logistical, and security requirements inherent in military construction. Reviewing their specific performance ratings on previous DoD contracts would provide a more granular assessment of their reliability and quality of work.
How does the awarded price of $19.7 million compare to similar barracks construction projects at other military bases?
Benchmarking the $19.7 million award against similar barracks construction projects requires access to detailed cost data for comparable projects. Factors such as square footage, number of occupants, specific amenities, site conditions, and regional construction costs significantly influence project pricing. Generally, firm-fixed-price contracts awarded under full and open competition aim to achieve competitive pricing. Given the duration of 507 days, this project represents a substantial undertaking. Without specific comparable project data, it's challenging to definitively state if $19.7 million is high or low, but it falls within the expected range for significant military infrastructure development.
What are the potential risks associated with awarding a contract to a single bidder, even if the competition was initially full and open?
Awarding a contract to a single bidder, despite initial full and open competition, can introduce several risks. It may indicate that the bidding pool was smaller than anticipated, potentially due to stringent requirements, lack of qualified contractors, or insufficient market outreach. This can lead to reduced price competition, potentially resulting in a higher price than if multiple bids were actively competing. Furthermore, reliance on a single contractor can increase project risk if that contractor experiences financial difficulties, performance issues, or unforeseen challenges, as there are no immediate alternatives. It also limits the government's leverage in negotiations and future contract awards.
What is the expected effectiveness of the Chemical Battalion Complex UEPH PN64014 in improving soldier living conditions and readiness at JBLM?
The construction of the Chemical Battalion Complex UEPH PN64014 is expected to significantly enhance soldier living conditions at JBLM by providing modern, safe, and functional barracks. Upgraded facilities typically lead to improved morale, better rest, and increased overall well-being, which are crucial for maintaining troop readiness. New barracks often incorporate contemporary design standards, energy efficiency, and better amenities compared to older structures. This investment in infrastructure directly supports the Army's mission by ensuring that soldiers have adequate and appropriate housing, contributing to their ability to perform their duties effectively.
How has federal spending on military construction, specifically barracks, trended over the past decade, and does this contract align with those trends?
Federal spending on military construction, including barracks, has historically fluctuated based on defense budgets, geopolitical needs, and infrastructure modernization initiatives. Following periods of extensive deployment, there is often a renewed focus on upgrading aging facilities. The Department of Defense consistently allocates significant funds to construction projects to maintain and improve its global infrastructure. This $19.7 million contract for barracks construction at JBLM aligns with the ongoing need for modernization and replacement of existing troop housing across military installations. Trends often show increased investment during periods of force restructuring or when older facilities reach the end of their service life.
What are the implications of the firm-fixed-price contract type for cost control and contractor performance on this project?
The firm-fixed-price (FFP) contract type is generally favored for projects where the scope of work is well-defined, as it places the primary responsibility for cost control on the contractor. Under an FFP agreement, the contractor agrees to a set price for the completed work, regardless of their actual costs. This incentivizes the contractor to manage their resources efficiently and minimize expenses to maximize profit. For the government, it provides cost certainty, protecting against unexpected cost overruns. However, it also means the contractor bears the risk of unforeseen difficulties, which could potentially lead them to cut corners if not adequately monitored, underscoring the importance of robust government oversight and quality assurance.
Industry Classification
NAICS: Construction › Nonresidential Building Construction › Commercial and Institutional Building Construction
Product/Service Code: CONSTRUCT OF STRUCTURES/FACILITIES › CONSTRUCTION OF BUILDINGS
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY
Solicitation ID: W912DW12T5100
Offers Received: 3
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
Financial Breakdown
Contract Ceiling: $19,731,034
Exercised Options: $19,731,034
Current Obligation: $19,731,034
Subaward Activity
Number of Subawards: 10
Total Subaward Amount: $4,199,674
Contract Characteristics
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: W9126G08D0045
IDV Type: IDC
Timeline
Start Date: 2012-06-28
Current End Date: 2013-11-17
Potential End Date: 2013-11-17 00:00:00
Last Modified: 2013-10-28
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