DoD awards $23.9M for reservoir renovation, highlighting need for infrastructure upgrades

Contract Overview

Contract Amount: $23,943,837 ($23.9M)

Contractor: Cherokee CRC LLC

Awarding Agency: Department of Defense

Start Date: 2024-09-24

End Date: 2027-03-17

Contract Duration: 904 days

Daily Burn Rate: $26.5K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 2

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: DESIGN-BUILD CONSTRUCTION FOR DOMESTIC RESERVOIR RENOVATION

Place of Performance

Location: FAIRFIELD, ADAMS County, PENNSYLVANIA, 17320

State: Pennsylvania Government Spending

Plain-Language Summary

Department of Defense obligated $23.9 million to CHEROKEE CRC LLC for work described as: DESIGN-BUILD CONSTRUCTION FOR DOMESTIC RESERVOIR RENOVATION Key points: 1. Contract value represents a significant investment in critical domestic infrastructure. 2. Competition dynamics suggest a potentially competitive bidding environment for similar projects. 3. Project duration of 904 days indicates a complex and lengthy construction undertaking. 4. The firm-fixed-price structure aims to control costs and manage contractor risk. 5. This award falls within the broader category of institutional building construction.

Value Assessment

Rating: good

The contract value of $23.9 million for reservoir renovation appears reasonable given the scope of a design-build construction project. Benchmarking against similar large-scale infrastructure projects managed by the Department of Defense would provide a more precise value-for-money assessment. The firm-fixed-price contract type suggests an effort to establish a clear cost ceiling, which is a positive indicator for budget predictability.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

The contract was awarded under 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES,' indicating that while competition was sought, certain sources were excluded. This suggests a potentially less broad competitive landscape than full and open competition. The presence of two bidders, as indicated by 'no': 2, further supports a limited competition scenario, which could impact price discovery and potentially lead to higher costs compared to a more robust bidding process.

Taxpayer Impact: Limited competition may mean taxpayers did not benefit from the lowest possible price achievable through a wider range of bids. The exclusion of certain sources warrants scrutiny to ensure fairness and maximize taxpayer value.

Public Impact

The primary beneficiaries are the Department of Defense and its personnel who rely on the renovated reservoir for essential services. The project will deliver design and construction services for a critical water infrastructure asset. Geographic impact is concentrated in Pennsylvania, where the reservoir is located. Workforce implications include employment opportunities for construction workers, engineers, and project managers in the region.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Limited competition could lead to suboptimal pricing for taxpayers.
Exclusion of sources in the competition process raises questions about fairness and market access.

Positive Signals

Firm-fixed-price contract provides cost certainty for the government.
Design-build approach can streamline project delivery and potentially reduce overall timelines.
Investment in critical infrastructure enhances operational readiness and resilience.

Sector Analysis

This contract falls within the Commercial and Institutional Building Construction sector, a vital part of the broader construction industry. This sector encompasses a wide range of projects, from government facilities to private commercial buildings. The market size for federal construction projects is substantial, driven by the need to maintain and upgrade aging infrastructure and facilities across various agencies. This specific award contributes to the ongoing efforts to modernize essential government assets.

Small Business Impact

The data indicates that this contract was not set aside for small businesses ('sb': false). There is no explicit information regarding subcontracting plans for small businesses. Without specific set-aside requirements or reported subcontracting goals, the direct impact on the small business ecosystem for this particular award is likely minimal, though larger prime contractors may engage small businesses in their supply chain.

Oversight & Accountability

Oversight for this contract will likely be managed by the Department of Defense's contracting and project management offices. Accountability measures are inherent in the firm-fixed-price contract, which holds the contractor responsible for delivering the project within the agreed-upon cost. Transparency is facilitated through federal contract databases, though specific project-level oversight details are not provided. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Department of Defense Facilities Construction
Infrastructure Improvement Projects
Water Resource Management Contracts
Design-Build Construction Services

Risk Flags

Limited competition may result in higher costs.
Exclusion of sources warrants further investigation.
Potential for schedule delays in large construction projects.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $23.9 million to CHEROKEE CRC LLC. DESIGN-BUILD CONSTRUCTION FOR DOMESTIC RESERVOIR RENOVATION

Who is the contractor on this award?

The obligated recipient is CHEROKEE CRC LLC.

Which agency awarded this contract?

Awarding agency: Department of Defense (Washington Headquarters Services).

What is the total obligated amount?

The obligated amount is $23.9 million.

What is the period of performance?

Start: 2024-09-24. End: 2027-03-17.

What is the track record of Cherokee CRC LLC in performing similar design-build construction projects for the federal government?

A review of federal procurement data would be necessary to fully assess Cherokee CRC LLC's track record. Key indicators to examine include past performance evaluations on similar contracts, any history of contract disputes or terminations, and the successful completion of projects within budget and schedule. Understanding their experience with large-scale infrastructure, particularly water-related facilities, would be crucial. Without specific past performance data readily available in this summary, it's difficult to definitively gauge their capabilities and reliability for this significant $23.9 million project.

How does the awarded price of $23.9 million compare to similar reservoir renovation projects undertaken by the DoD or other federal agencies?

Benchmarking this $23.9 million award against comparable federal reservoir renovation projects is essential for a value-for-money assessment. Factors such as project scope, size, complexity, location, and the specific services included (e.g., design, environmental remediation, structural upgrades) must be considered. A preliminary comparison suggests that for a design-build project of this magnitude, the price is within a plausible range, but a detailed analysis would require access to a database of similar federal contracts. Variations in regional construction costs and specific site challenges can significantly influence pricing, making direct comparisons challenging without granular data.

What are the primary risks associated with this design-build construction contract, and how are they being mitigated?

Key risks for this design-build contract include potential cost overruns (despite the fixed-price nature, scope creep is a risk), schedule delays due to unforeseen site conditions or weather, contractor performance issues, and potential design deficiencies. Mitigation strategies likely include robust government oversight, clear contract specifications, performance bonds, liquidated damages clauses for delays, and thorough review processes for design submissions. The firm-fixed-price contract itself shifts much of the cost risk to the contractor, incentivizing efficient project management. However, the limited competition might reduce the pressure on the contractor to aggressively manage these risks.

How effective is the 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES' approach in ensuring competitive pricing for infrastructure projects?

The effectiveness of 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES' in ensuring competitive pricing is debatable and context-dependent. While it allows for competition among a defined set of qualified sources, the exclusion of others inherently limits the pool of potential bidders. This can reduce the downward pressure on prices that a truly open market might generate. If the exclusions were based on specific technical requirements or security clearances essential for the project, the approach might be justified. However, if exclusions were arbitrary, it could lead to higher costs for taxpayers compared to a broader competition. The fact that only two bids were received suggests the limited nature of the competition.

What is the historical spending trend for reservoir renovation and similar infrastructure projects within the Department of Defense?

Analyzing historical spending trends for reservoir renovation and similar infrastructure projects within the Department of Defense is crucial for understanding budget allocation and identifying patterns. This requires examining multi-year spending data for relevant categories, such as facilities maintenance, construction, and water infrastructure. Trends might reveal increasing or decreasing investment levels, shifts in contracting strategies (e.g., more design-build awards), and the average cost per project over time. Such analysis helps in forecasting future needs, justifying budget requests, and identifying potential areas for cost savings or efficiency improvements in infrastructure management.

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 AFTER EXCLUSION OF SOURCES

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: HQ003421R0003

Offers Received: 2

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Cherokee Nation RED Wing, L.L.C.

Address: 10838 E MARSHALL STE 220, TULSA, OK, 74116

Business Categories: American Indian Owned Business, Category Business, Corporate Entity Not Tax Exempt, HUBZone Firm, Limited Liability Corporation, Minority Owned Business, Native American Owned Business, Self-Certified Small Disadvantaged Business, Small Business, Special Designations, Tribally Owned Firm, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $23,943,837

Exercised Options: $23,943,837

Current Obligation: $23,943,837

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: HQ003422D0017

IDV Type: IDC

Timeline