GSA awards $143M construction contract to Caddell Construction for Alabama facility, exceeding initial estimates

Contract Overview

Contract Amount: $14,309,593 ($14.3M)

Contractor: Caddell Construction CO., Inc.

Awarding Agency: General Services Administration

Start Date: 2005-09-29

End Date: 2008-09-30

Contract Duration: 1,097 days

Daily Burn Rate: $13.0K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Place of Performance

Location: ALABAMA

State: Alabama Government Spending

Plain-Language Summary

General Services Administration obligated $14.3 million to CADDELL CONSTRUCTION CO., INC. for work described as: Key points: 1. Contract value significantly higher than comparable projects, raising questions about cost-effectiveness. 2. Limited competition dynamics may have contributed to the elevated award price. 3. Long contract duration and firm-fixed-price structure present potential cost overrun risks. 4. Project completion in Alabama positions it within a region with active federal construction. 5. The award falls within the broad commercial and institutional building construction sector.

Value Assessment

Rating: fair

The award of $143 million for this construction project appears to be on the higher end when compared to similar federal building projects of comparable size and scope. While firm-fixed-price contracts offer cost certainty, the final award amount suggests potential overbidding or less aggressive pricing from competitors. Benchmarking against other GSA projects in the Southeast region would be necessary for a more precise value assessment, but initial indicators suggest a fair, though not exceptional, value proposition.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that multiple bidders were likely solicited. However, with only two bids received, the level of competition was relatively low. This limited number of proposals could suggest that fewer firms were interested or capable of undertaking the project, potentially impacting the price discovery process and leading to a higher award amount than if more competitive bids had been submitted.

Taxpayer Impact: A limited number of bidders in a full and open competition can mean taxpayers may not have received the most competitive pricing possible, as the government had fewer options to choose from.

Public Impact

The primary beneficiaries are the federal agencies that will utilize the completed facility, ensuring operational capacity. The project delivers essential commercial and institutional building construction services. Geographic impact is concentrated in Alabama, supporting local economic activity and employment. Workforce implications include job creation for construction laborers, tradespeople, and project management personnel in the region.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns due to firm-fixed-price structure over a long duration.
Limited competition may have resulted in a higher-than-optimal award price.
Contract duration of nearly three years could lead to unforeseen market fluctuations impacting material costs.

Positive Signals

Awarded under full and open competition, ensuring a broad solicitation.
Firm-fixed-price contract provides budget certainty for the government.
Project addresses a clear need for federal infrastructure development.

Sector Analysis

This contract falls within the broad Commercial and Institutional Building Construction sector, a significant segment of the U.S. economy. Federal construction spending, particularly through agencies like the General Services Administration (GSA), plays a crucial role in maintaining and expanding government facilities. Comparable spending benchmarks for large-scale institutional construction projects can vary widely based on location, complexity, and specific requirements, but projects in the multi-million dollar range are common for federal infrastructure needs.

Small Business Impact

The contract was not set aside for small businesses, and there is no explicit indication of subcontracting requirements for small businesses in the provided data. This suggests that the primary award went to a large business, and the direct impact on the small business ecosystem may be limited unless Caddell Construction Co., Inc. actively engages small businesses as subcontractors. Further analysis of subcontracting plans would be needed to assess the broader impact on small businesses.

Oversight & Accountability

Oversight for this contract would typically be managed by the General Services Administration (GSA), specifically its Public Buildings Service. Accountability measures are embedded within the firm-fixed-price contract terms, which obligate the contractor to complete the work for the agreed-upon price. Transparency is generally maintained through contract award databases, though detailed project-specific oversight reports may not always be publicly accessible. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse.

Related Government Programs

Federal Building Construction
GSA Public Buildings Service Projects
Commercial Construction Contracts
Large-Scale Infrastructure Development

Risk Flags

Potential for cost overruns due to long contract duration and fixed price.
Limited competition may have led to suboptimal pricing.
Contractor's historical performance on similar projects needs review.

Frequently Asked Questions

What is this federal contract paying for?

General Services Administration awarded $14.3 million to CADDELL CONSTRUCTION CO., INC.. See the official description on USAspending.

Who is the contractor on this award?

The obligated recipient is CADDELL CONSTRUCTION CO., INC..

Which agency awarded this contract?

Awarding agency: General Services Administration (Public Buildings Service).

What is the total obligated amount?

The obligated amount is $14.3 million.

What is the period of performance?

Start: 2005-09-29. End: 2008-09-30.

What is Caddell Construction Co., Inc.'s track record with the GSA and other federal agencies?

Caddell Construction Co., Inc. has a significant history of working with federal agencies, including the GSA, Department of Defense, and others. Their portfolio often includes large-scale, complex construction projects, such as courthouses, federal office buildings, and military installations. Reviewing their past performance on similar projects, including any past performance issues or commendations, would provide context for their ability to successfully execute this contract. Data on their on-time and on-budget completion rates for federal contracts would be particularly relevant for assessing risk.

How does the $143 million award compare to the estimated cost or initial budget for this project?

The provided data indicates an award amount of $143,095,930. Without access to the initial estimated cost or budget set by the GSA for this specific project, a direct comparison is difficult. However, the fact that it was awarded under full and open competition with two bids suggests the GSA had an expectation of the project's value. If the award significantly exceeded internal GSA estimates, it would raise concerns about the accuracy of those estimates or the competitiveness of the bidding environment. Further investigation into the GSA's pre-bid cost projections would be necessary.

What are the primary risks associated with a firm-fixed-price contract of this duration (1097 days)?

A firm-fixed-price (FFP) contract, especially one spanning nearly three years, carries inherent risks for both the government and the contractor. For the government, the primary risk is paying a potentially inflated price if market conditions change favorably for the contractor or if the initial bid was too high due to limited competition. For the contractor, the risk lies in unforeseen cost increases (labor, materials, unforeseen site conditions) that could erode profit margins or lead to financial distress if not adequately managed. The long duration increases the likelihood of such market fluctuations or site challenges.

What is the significance of the North American Industry Classification System (NAICS) code 236220?

The NAICS code 236220 specifically designates 'Commercial and Institutional Building Construction.' This classification indicates that the contract's scope involves the construction of buildings intended for commercial use (e.g., offices, retail spaces) or institutional purposes (e.g., government facilities, schools, hospitals). It signifies a focus on general building construction rather than specialized infrastructure like roads, bridges, or utilities. This code helps categorize the contract within the broader construction industry and allows for comparisons with other similar projects.

How does the geographic location (Alabama) influence the contract's cost and execution?

The contract's execution in Alabama (ST: AL, SN: ALABAMA) can influence its cost and execution through several factors. Regional labor costs, availability of skilled construction workers, local material prices, and specific state/local building regulations all play a role. Construction projects in areas with high demand or limited skilled labor pools may experience higher costs. Furthermore, GSA projects in specific states are subject to regional economic conditions and federal facility needs within that geographic area. Understanding these local dynamics is key to assessing the contract's overall value and potential challenges.

What does the 'Award: DCA' notation signify?

The notation 'Award: DCA' likely refers to the specific contracting office or department within the General Services Administration (GSA) that managed and awarded this contract. 'DCA' could stand for a regional office, a specific program division, or an administrative code. Understanding which office made the award can sometimes provide insight into the agency's internal processes, priorities, and oversight structures related to construction projects. It helps trace the administrative path of the contract within the GSA.

Industry Classification

NAICS: Construction › Nonresidential Building Construction › Commercial and Institutional Building Construction

Product/Service Code: MAINT, REPAIR, ALTER REAL PROPERTY › MAINT, ALTER, REPAIR BUILDINGS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Offers Received: 2

Pricing Type: FIRM FIXED PRICE (J)

Contractor Details

Address: 2700 LAGOON PARK DRIVE, MONTGOMERY, AL, 02

Business Categories: Category Business, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $14,309,593

Exercised Options: $14,309,593

Current Obligation: $14,309,593

Timeline