DoD's $23.4M Portsmouth Naval Shipyard Perimeter Security Project Faces Potential Cost Overruns

Contract Overview

Contract Amount: $23,412,000 ($23.4M)

Contractor: J & J Contractors, Inc.

Awarding Agency: Department of Defense

Start Date: 2025-09-03

End Date: 2028-03-01

Contract Duration: 910 days

Daily Burn Rate: $25.7K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 3

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: THIS PROJECT IS A DESIGN-BID-BUILD CONSTRUCTION PROJECT FOR P-347 PERIMETER SECURITY IMPROVEMENTS, AT PORTSMOUTH NAVAL SHIPYARD (PNSY), NAVAL COMPUTER AND TELECOMMUNICATION STATION (NCTS), CUTLER, MAINE.

Place of Performance

Location: CUTLER, WASHINGTON County, MAINE, 04626

State: Maine Government Spending

Plain-Language Summary

Department of Defense obligated $23.4 million to J & J CONTRACTORS, INC. for work described as: THIS PROJECT IS A DESIGN-BID-BUILD CONSTRUCTION PROJECT FOR P-347 PERIMETER SECURITY IMPROVEMENTS, AT PORTSMOUTH NAVAL SHIPYARD (PNSY), NAVAL COMPUTER AND TELECOMMUNICATION STATION (NCTS), CUTLER, MAINE. Key points: 1. The project aims to improve perimeter security at Portsmouth Naval Shipyard. 2. J & J Contractors, Inc. was awarded the contract. 3. The contract is a Firm Fixed Price, awarded under Full and Open Competition. 4. The project duration is 910 days, with an estimated completion date of March 2028. 5. The awarded amount is $23,412,000.

Value Assessment

Rating: questionable

The awarded amount of $23,412,000 appears to be 9.7% lower than the benchmark of $25,727,000. However, the benchmark may not be directly comparable due to potential differences in project scope, location, or specific security requirements.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, suggesting a robust price discovery process. The low bid was $23,412,000, which is below the benchmark, indicating potentially competitive pricing.

Taxpayer Impact: The competitive bidding process likely resulted in a fair price for taxpayers, though the benchmark comparison warrants further investigation.

Public Impact

Enhances national security by upgrading critical infrastructure at a naval shipyard. Supports the local economy in Maine through construction jobs and contractor engagement. Potential for ripple effects on other government construction projects regarding security standards. Ensures operational continuity and safety for personnel at the Portsmouth Naval Shipyard.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for scope creep given the long duration.
Risk of unforeseen site conditions impacting cost and schedule.
Dependence on a single contractor for a critical security upgrade.

Positive Signals

Awarded under full and open competition.
Firm Fixed Price contract limits cost uncertainty.
Project addresses a clear national security need.

Sector Analysis

This project falls under Commercial and Institutional Building Construction, a sector that can be subject to fluctuations in material costs and labor availability. Benchmarks for similar naval shipyard construction projects are essential for accurate cost assessment.

Small Business Impact

The data indicates that small businesses were not directly involved as the prime contractor, as the award went to J & J Contractors, Inc. Further analysis would be needed to determine if small businesses participated as subcontractors.

Oversight & Accountability

The Department of the Navy, under the Department of Defense, is responsible for oversight. The use of a Firm Fixed Price contract provides some cost control, but diligent monitoring of progress and potential change orders is crucial.

Related Government Programs

Commercial and Institutional Building Construction
Department of Defense Contracting
Department of the Navy Programs

Risk Flags

Potential for cost escalation due to long project duration.
Risk of unforeseen site conditions impacting schedule and budget.
Dependence on a single contractor for critical infrastructure.
Benchmark comparison suggests potential for cost savings, but requires further validation.
Lack of explicit small business participation as prime contractor.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $23.4 million to J & J CONTRACTORS, INC.. THIS PROJECT IS A DESIGN-BID-BUILD CONSTRUCTION PROJECT FOR P-347 PERIMETER SECURITY IMPROVEMENTS, AT PORTSMOUTH NAVAL SHIPYARD (PNSY), NAVAL COMPUTER AND TELECOMMUNICATION STATION (NCTS), CUTLER, MAINE.

Who is the contractor on this award?

The obligated recipient is J & J CONTRACTORS, 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 $23.4 million.

What is the period of performance?

Start: 2025-09-03. End: 2028-03-01.

What specific security enhancements are included in this project, and how do they align with current threat assessments for naval facilities?

The project details for P-347 Perimeter Security Improvements are not fully specified in the provided data. However, typical enhancements at naval shipyards include upgraded fencing, intrusion detection systems, access control points, and surveillance technology. These are intended to meet evolving threat assessments and ensure the physical security of critical assets and personnel. A detailed review of the project's scope of work would be necessary to confirm specific technologies and their alignment with current security doctrines.

Given the 910-day duration, what are the primary risks associated with schedule delays and potential cost increases for this construction project?

The primary risks for a 910-day construction project include potential delays due to weather, unforeseen site conditions (e.g., hazardous materials, underground utilities), supply chain disruptions for materials, and labor shortages. These delays can lead to increased costs through extended overhead, escalation clauses, and potential change orders. The Firm Fixed Price contract aims to mitigate cost increases, but significant unforeseen issues could still necessitate contract modifications, impacting the overall taxpayer investment.

How effectively does the benchmark of $25,727,000 compare to the awarded price of $23,412,000, and what factors might explain the difference?

The awarded price is approximately 9.7% lower than the benchmark. This difference could be attributed to several factors: the benchmark might represent a higher-end estimate, include different scope elements, or be based on older data. Conversely, J & J Contractors, Inc. may have submitted a particularly aggressive bid to secure the contract, or the benchmark might not accurately reflect current market conditions or the specific complexities of the Portsmouth Naval Shipyard environment. A detailed comparison of project specifications is needed for a definitive assessment.

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: N4008525R2609

Offers Received: 3

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 101 BILLERICA AVE BLDG 5 STE 205, NORTH BILLERICA, MA, 01862

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Minority Owned Business, Not Designated a Small Business, Special Designations, Subchapter S Corporation, Indian (Subcontinent) American Owned Business, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $25,127,500

Exercised Options: $23,412,000

Current Obligation: $23,412,000

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline