DHS awards $20.8M construction contract for NAC facilities, highlighting infrastructure needs

Contract Overview

Contract Amount: $20,873,983 ($20.9M)

Contractor: Tetra Tech Tesoro, Inc.

Awarding Agency: Department of Homeland Security

Start Date: 2007-11-21

End Date: 2009-06-23

Contract Duration: 580 days

Daily Burn Rate: $36.0K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: CONSTRUCTION OF BUILDING 61 AND BASEMENT RENOVATION OF BUILDIGN 19, DEPARTMENT OF HOMELAND SECURITY, NEBRASKA AVENUE COMPLEX (NAC), WASHINGTON, DC

Place of Performance

Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20001

State: District of Columbia Government Spending

Plain-Language Summary

Department of Homeland Security obligated $20.9 million to TETRA TECH TESORO, INC. for work described as: CONSTRUCTION OF BUILDING 61 AND BASEMENT RENOVATION OF BUILDIGN 19, DEPARTMENT OF HOMELAND SECURITY, NEBRASKA AVENUE COMPLEX (NAC), WASHINGTON, DC Key points: 1. Contract value of $20.8 million addresses critical infrastructure upgrades. 2. Full and open competition suggests a robust bidding process. 3. Firm-fixed-price contract type indicates defined cost expectations. 4. Project duration of 580 days points to a significant construction timeline. 5. Geographic focus on Washington D.C. impacts local construction resources. 6. Contract awarded to Tetra Tech Tesoro, Inc. with a history of federal work.

Value Assessment

Rating: good

The contract value of $20.8 million for building construction and renovation appears reasonable for a project of this scope within the Washington D.C. metropolitan area. Benchmarking against similar federal construction projects of comparable size and complexity would provide a more precise value-for-money assessment. The firm-fixed-price structure helps control costs, but the final expenditure will depend on the contractor's efficiency and any unforeseen site conditions.

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. This approach typically fosters a competitive environment, potentially leading to better pricing and quality. The presence of two bids suggests a moderate level of competition for this specific project, which is generally positive for price discovery.

Taxpayer Impact: Full and open competition is beneficial for taxpayers as it encourages multiple companies to bid, driving down costs and ensuring the government receives competitive pricing for construction services.

Public Impact

The primary beneficiaries are the Department of Homeland Security and the U.S. Coast Guard, who will gain improved facilities. The project delivers essential construction and renovation services for critical government infrastructure. The geographic impact is concentrated in Washington D.C., potentially benefiting local construction firms and labor. Workforce implications include employment opportunities for construction workers, engineers, and project managers in the D.C. area.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if unforeseen site conditions arise during renovation.
Dependence on the contractor's ability to meet the project timeline and quality standards.
Limited competition (two bidders) might reduce the pressure for the absolute lowest price.

Positive Signals

Firm-fixed-price contract provides cost certainty for the government.
Full and open competition generally leads to better value.
Award to an established contractor like Tetra Tech Tesoro, Inc. suggests a degree of reliability.

Sector Analysis

This contract falls within the construction sector, specifically for government facilities. The federal government is a significant consumer of construction services, with spending often driven by infrastructure modernization, new facility requirements, and renovation needs. Comparable spending benchmarks would involve analyzing other large-scale federal building projects, particularly those managed by agencies like DHS or the General Services Administration (GSA).

Small Business Impact

The contract data indicates that small business participation was not a specific set-aside. Given the full and open competition, it's possible that small businesses could have bid directly or participated as subcontractors. Further analysis would be needed to determine if subcontracting opportunities were pursued or if the prime contractor has a history of engaging small businesses.

Oversight & Accountability

Oversight for this contract would typically be managed by the U.S. Coast Guard contracting office within DHS. Accountability measures are embedded in the firm-fixed-price contract terms, requiring delivery of specified services within the agreed budget and timeframe. Transparency is generally maintained through contract award databases, though specific project progress reports may not be publicly available.

Related Government Programs

Department of Homeland Security Facilities Management
U.S. Coast Guard Infrastructure Projects
Federal Building Construction
Nebraska Avenue Complex (NAC) Operations

Risk Flags

Potential for unforeseen site conditions impacting cost and schedule.
Risk of contractor performance issues affecting quality or timely completion.
Limited competition may reduce price negotiation leverage.

Frequently Asked Questions

What is this federal contract paying for?

Department of Homeland Security awarded $20.9 million to TETRA TECH TESORO, INC.. CONSTRUCTION OF BUILDING 61 AND BASEMENT RENOVATION OF BUILDIGN 19, DEPARTMENT OF HOMELAND SECURITY, NEBRASKA AVENUE COMPLEX (NAC), WASHINGTON, DC

Who is the contractor on this award?

The obligated recipient is TETRA TECH TESORO, INC..

Which agency awarded this contract?

Awarding agency: Department of Homeland Security (U.S. Coast Guard).

What is the total obligated amount?

The obligated amount is $20.9 million.

What is the period of performance?

Start: 2007-11-21. End: 2009-06-23.

What is the track record of Tetra Tech Tesoro, Inc. with federal construction contracts?

Tetra Tech Tesoro, Inc. has a history of performing federal construction contracts. Analyzing their past performance, including contract values, types of projects, and any reported issues or successes, would provide insight into their reliability and capability. Federal procurement data often details past awards and performance ratings, which can be cross-referenced to assess their suitability for projects like the NAC facilities. A review of their portfolio would reveal if they have successfully managed similar-sized projects with firm-fixed-price structures and within government-specified timelines.

How does the $20.8 million cost compare to similar federal construction projects?

To benchmark the $20.8 million cost, one would compare it to similar federal construction projects awarded by agencies like DHS, GSA, or the Department of Defense over the past few years. Key comparison points include project scope (new construction vs. renovation), facility type, square footage, location (cost of labor and materials varies significantly by region), and contract type. For instance, a similar-sized renovation of an existing federal building in a high-cost-of-living area might have a comparable or higher price tag. Conversely, a new build of a simpler structure in a lower-cost area could be less expensive. Without specific comparable project data, it's difficult to definitively state if this contract represents excellent or questionable value.

What are the primary risks associated with this firm-fixed-price construction contract?

The primary risks with a firm-fixed-price construction contract, especially for renovation, often revolve around unforeseen site conditions. If the project uncovers hazardous materials, structural issues not apparent during the initial assessment, or requires extensive utility rerouting, the contractor may seek change orders, potentially increasing the total cost. Another risk is the contractor's ability to manage the project efficiently within the fixed price and timeline. Delays due to weather, labor shortages, or supply chain disruptions can also pose risks, potentially impacting project completion and the government's operational continuity. Contractor performance and quality control are also key risk areas.

How effective are firm-fixed-price contracts in controlling costs for federal construction?

Firm-fixed-price (FFP) contracts are generally considered effective tools for controlling costs in federal construction, particularly when the scope of work is well-defined and risks are understood. Under an FFP contract, the contractor assumes most of the risk for cost overruns, as they are obligated to complete the work for the agreed-upon price. This incentivizes the contractor to manage their costs efficiently and accurately estimate expenses. However, their effectiveness can be diminished if the initial scope is poorly defined, leading to numerous change orders that can escalate costs. For complex renovations with inherent uncertainties, FFP contracts require meticulous planning and contingency management to remain cost-effective.

What is the historical spending trend for construction at the Nebraska Avenue Complex (NAC)?

Analyzing historical spending trends for construction at the Nebraska Avenue Complex (NAC) would require accessing detailed federal procurement databases and agency budget reports. This specific contract represents a significant investment ($20.8 million) in the NAC's infrastructure. Understanding past investments in similar projects (renovations, new construction, maintenance) at the NAC would provide context for this award. Trends might reveal patterns of deferred maintenance, ongoing modernization efforts, or expansion plans. Without access to historical NAC-specific construction spending data, it's challenging to place this current award within a broader financial context for the facility.

What are the implications of awarding a construction contract in Washington D.C. for local small businesses?

Awarding a large construction contract like this in Washington D.C. can have mixed implications for local small businesses. On one hand, it presents potential subcontracting opportunities if the prime contractor, Tetra Tech Tesoro, Inc., actively seeks out and engages local small businesses for specialized services (e.g., electrical, plumbing, HVAC, material supply). On the other hand, if the prime contractor relies heavily on its own established supply chains or larger subcontractors, local small businesses might be bypassed. The overall impact also depends on the specific requirements of the contract and whether small business participation goals were established or encouraged during the bidding process.

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Offers Received: 2

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Tetra Tech, Inc.

Address: 520 S INDEPENDENCE BLVD #, VIRGINIA BEACH, VA, 23452

Business Categories: 8(a) Program Participant, Category Business, Self-Certified Small Disadvantaged Business, Small Business, Small Disadvantaged Business, Special Designations

Financial Breakdown

Contract Ceiling: $20,873,983

Exercised Options: $20,873,983

Current Obligation: $20,873,983

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Parent Contract

Parent Award PIID: DTCG4702D3EFK11

IDV Type: IDC

Timeline