DoD awards $36.7M construction contract to The Nutmeg Companies, Inc. for 980 days

Contract Overview

Contract Amount: $36,730,026 ($36.7M)

Contractor: THE Nutmeg Companies, Inc.

Awarding Agency: Department of Defense

Start Date: 2023-09-08

End Date: 2026-05-15

Contract Duration: 980 days

Daily Burn Rate: $37.5K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: BASE PRICE

Place of Performance

Location: GROTON, NEW LONDON County, CONNECTICUT, 06340

State: Connecticut Government Spending

Plain-Language Summary

Department of Defense obligated $36.7 million to THE NUTMEG COMPANIES, INC. for work described as: BASE PRICE Key points: 1. Contract awarded on a firm-fixed-price basis, indicating clear cost expectations. 2. The contract duration of 980 days suggests a significant, long-term project. 3. Awarded by the Department of the Navy, a major component of the DoD. 4. The Nutmeg Companies, Inc. is the sole awardee. 5. Construction services fall under Commercial and Institutional Building Construction. 6. The base price is $36.7 million, with a potential ceiling of $37.5 million.

Value Assessment

Rating: fair

The base price of $36.7 million for a 980-day construction project requires further benchmarking against similar DoD construction contracts. Without specific details on the scope of work, it is difficult to definitively assess value for money. The difference between the base price and the ceiling price of $37.5 million suggests potential for cost increases, which warrants scrutiny.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that multiple vendors had the opportunity to bid. The presence of two bids suggests a moderate level of competition for this project. While two bidders is better than one, a higher number of bids typically leads to more competitive pricing.

Taxpayer Impact: Full and open competition is generally favorable for taxpayers as it encourages a wider range of offers and can drive down costs through market forces.

Public Impact

The primary beneficiaries are the Department of the Navy, receiving construction services. The contract will likely result in the construction or renovation of institutional buildings. Geographic impact is centered in Connecticut, where the contractor is based. Potential workforce implications include job creation for construction trades in the local area.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if the ceiling price is reached.
Limited competition with only two bids received.
Long contract duration may introduce risks related to material cost fluctuations or unforeseen site conditions.

Positive Signals

Awarded through full and open competition.
Firm-fixed-price contract type provides cost certainty.
Contractor is based in the state where the work is likely to occur (Connecticut).

Sector Analysis

This contract falls within the Commercial and Institutional Building Construction sector, a significant segment of the federal procurement landscape. The Department of Defense is a major consumer of construction services, with substantial annual spending in this area to maintain and expand its infrastructure. Benchmarking this contract's value would require comparison to other similar-sized construction projects awarded by federal agencies, particularly within the DoD.

Small Business Impact

The contract was not set aside for small businesses, and there is no indication of subcontracting requirements for small businesses in the provided data. This suggests that the primary award went to a larger entity, and the direct impact on the small business ecosystem may be limited unless The Nutmeg Companies, Inc. actively engages small businesses as subcontractors.

Oversight & Accountability

Oversight will be provided by the Department of the Navy. As a firm-fixed-price contract, the primary accountability measure is adherence to the agreed-upon scope and price. Transparency is facilitated by the public nature of federal contract awards, though detailed project oversight mechanisms are not specified here.

Related Government Programs

Department of Defense Construction Contracts
Naval Facilities Engineering Command Contracts
Commercial Building Construction Services
Federal Infrastructure Projects

Risk Flags

Potential for cost increases up to the ceiling price.
Limited number of bidders may indicate reduced competition.
Long contract duration introduces schedule and cost volatility risks.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $36.7 million to THE NUTMEG COMPANIES, INC.. BASE PRICE

Who is the contractor on this award?

The obligated recipient is THE NUTMEG COMPANIES, INC..

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Navy).

What is the total obligated amount?

The obligated amount is $36.7 million.

What is the period of performance?

Start: 2023-09-08. End: 2026-05-15.

What is the specific scope of work for this construction contract?

The provided data indicates the contract is for 'Commercial and Institutional Building Construction' under NAICS code 236220. However, the specific details of the scope of work, such as whether it involves new construction, renovation, or maintenance, and the type of facility, are not detailed in the summary data. This information is crucial for a comprehensive value assessment and for comparing it to similar projects. Further details would typically be found in the contract's statement of work (SOW).

How does the $36.7 million base price compare to similar DoD construction projects?

Benchmarking the $36.7 million base price requires comparing it to construction contracts of similar scope, duration, and complexity awarded by the Department of Defense or other federal agencies. Without knowing the specific type of building, its size (square footage), location, and the nature of the work (e.g., new build vs. renovation, specific systems involved), a direct comparison is challenging. However, for a project spanning nearly three years (980 days), this price point suggests a substantial undertaking. A detailed analysis would involve querying federal procurement databases for comparable projects and adjusting for inflation and regional cost differences.

What are the potential risks associated with the $37.5 million ceiling price?

The ceiling price of $37.5 million represents the maximum amount the government could potentially pay under this contract. The difference between the base price ($36.7 million) and the ceiling ($37.5 million) is $800,000. While this is a relatively small percentage of the base price (approx. 2.17%), it indicates that there are provisions for potential cost increases. Risks associated with the ceiling price include the possibility that the contractor may incur costs up to this limit, potentially due to unforeseen issues, scope changes, or escalation clauses. The firm-fixed-price nature suggests that the contractor bears most of the risk, but the ceiling provides a buffer for specific contingencies.

What is the track record of The Nutmeg Companies, Inc. with federal contracts?

Information on The Nutmeg Companies, Inc.'s track record with federal contracts is not provided in the summary data. To assess their performance, one would need to examine their past federal contract awards, including contract values, agencies involved, performance reviews (if publicly available), and any history of disputes or terminations. This would help determine their experience in delivering similar construction projects on time and within budget for government clients.

What does the limited competition (2 bidders) imply for future contract awards of this type?

The fact that only two bids were received for this full and open competition contract suggests that the market for this specific type of construction service, or for this particular project's requirements, may be limited or that potential competitors were deterred for some reason. For future, similar contract awards, this could imply that the government might need to take steps to encourage broader participation, such as refining the solicitation to be more attractive, increasing outreach efforts, or potentially re-evaluating the project's scope or requirements if they are overly restrictive. A consistently low number of bidders can lead to higher prices over time.

How does this contract fit into the Department of the Navy's overall construction spending?

This $36.7 million contract represents a specific investment by the Department of the Navy in construction services. To understand its place within the Navy's overall spending, one would need to analyze historical and current Navy budgets allocated to facilities, infrastructure, and construction projects. This contract's value would be compared against the total annual budget for such expenditures. It's likely one of many construction contracts awarded annually, contributing to the maintenance, modernization, or expansion of naval installations and related infrastructure.

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: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: N4008523R2530

Offers Received: 2

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 1 OHIO AVE, NORWICH, CT, 06360

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Small Business, Special Designations, Subchapter S Corporation, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $36,730,026

Exercised Options: $36,730,026

Current Obligation: $36,730,026

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline