Naval Air Station Whidbey Island Hangar Modernization Contract Awarded for Over $52.8 Million

Contract Overview

Contract Amount: $52,808,817 ($52.8M)

Contractor: Korte Construction Company

Awarding Agency: Department of Defense

Start Date: 2014-07-31

End Date: 2017-09-30

Contract Duration: 1,157 days

Daily Burn Rate: $45.6K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 12

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: IGF::OT::IGF SOLICITATION N44255-13-R-4006; P-251(B) EXTEND HANGAR 6 TO ACCOMMODATE P-8 AIRCRAFT AND EXTEND HANGAR 9 TO ACCOMMODATE P-3 AIRCRAFT, NAVAL AIR STATION WHIDBEY ISLAND, WA; SPECIAL PROJECT RM 1112627 REPAIR AND MODERNIZE HANGAR 6 INCLUDING SEISMIC UPGRADES, NAVAL AIR STATION WHIDBEY ISLAND, WASHINGTON

Place of Performance

Location: OAK HARBOR, ISLAND County, WASHINGTON, 98278

State: Washington Government Spending

Plain-Language Summary

Department of Defense obligated $52.8 million to KORTE CONSTRUCTION COMPANY for work described as: IGF::OT::IGF SOLICITATION N44255-13-R-4006; P-251(B) EXTEND HANGAR 6 TO ACCOMMODATE P-8 AIRCRAFT AND EXTEND HANGAR 9 TO ACCOMMODATE P-3 AIRCRAFT, NAVAL AIR STATION WHIDBEY ISLAND, WA; SPECIAL PROJECT RM 1112627 REPAIR AND MODERNIZE HANGAR 6 INCLUDING SEISMIC UPGRADES, NAVAL AIR … Key points: 1. Contract focused on critical infrastructure upgrades for P-8 and P-3 aircraft. 2. Significant investment in seismic retrofitting and modernization of hangar facilities. 3. Awarded to Korte Construction Company, a single prime contractor. 4. Project duration spanned over three years, indicating a substantial scope of work. 5. The contract was procured through full and open competition. 6. Fixed-price contract type suggests defined project scope and cost controls.

Value Assessment

Rating: good

The contract value of over $52.8 million for hangar modernization and seismic upgrades appears reasonable given the scope of work, which includes extending two large hangars and performing significant repairs and modernizations. Benchmarking against similar large-scale construction projects for military aviation facilities suggests that costs can vary widely based on location, specific requirements, and complexity. Without detailed cost breakdowns or comparable project data, a precise value-for-money assessment is challenging, but the fixed-price nature of the contract provides some assurance against cost overruns.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that multiple interested contractors had the opportunity to bid. The solicitation attracted 12 bids, suggesting a healthy level of competition for this significant construction project. A competitive bidding process generally leads to better price discovery and can result in more favorable terms for the government.

Taxpayer Impact: The robust competition for this contract likely resulted in a more cost-effective outcome for taxpayers, as contractors vied to offer their best pricing and value propositions.

Public Impact

Naval Air Station Whidbey Island benefits from modernized and seismically upgraded hangar facilities. The project supports the operational readiness of P-8 and P-3 aircraft squadrons. Construction activities likely provided employment opportunities in the Whidbey Island, Washington area. Enhanced infrastructure ensures the long-term viability of critical naval aviation operations at the base.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if unforeseen structural issues arise during seismic upgrades.
Schedule delays could impact aircraft readiness if construction timelines are not met.
Dependence on a single prime contractor for all aspects of the project.

Positive Signals

Fixed-price contract helps mitigate cost escalation risks.
Full and open competition with multiple bidders suggests competitive pricing.
Clear project scope for hangar extensions and modernization.
Long contract duration allows for thorough execution of complex tasks.

Sector Analysis

This contract falls within the Commercial and Institutional Building Construction sector, specifically supporting defense infrastructure. The market for large-scale military construction projects is specialized, often requiring contractors with experience in secure environments and specific military standards. The value of this contract is significant within its niche, reflecting the substantial investment required for maintaining and upgrading critical aviation facilities. Comparable spending benchmarks for similar hangar construction or renovation projects at other naval or air force bases would provide further context.

Small Business Impact

While this contract was awarded through full and open competition and does not appear to have a specific small business set-aside, the prime contractor, Korte Construction Company, may engage small businesses for subcontracting opportunities. The scale and specialized nature of the work could limit the direct participation of small businesses as prime contractors, but they may play a role in specific trades or material supply. Further analysis of subcontracting plans would be needed to fully assess the impact on the small business ecosystem.

Oversight & Accountability

The contract is subject to standard Department of Defense oversight mechanisms for construction projects. Accountability is managed through contract milestones, inspections, and payment schedules. Transparency is generally maintained through contract award databases and public reporting. The Inspector General's office for the Department of Defense would have jurisdiction over any investigations into fraud, waste, or abuse related to this contract.

Related Government Programs

Naval Air Station Infrastructure Modernization
Military Hangar Construction and Repair
Seismic Retrofitting Projects
Defense Aviation Support Facilities
Department of the Navy Capital Improvements

Risk Flags

Potential for unforeseen conditions during seismic upgrades.
Risk of schedule delays impacting operational readiness.
Dependence on prime contractor's ability to manage complex construction.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $52.8 million to KORTE CONSTRUCTION COMPANY. IGF::OT::IGF SOLICITATION N44255-13-R-4006; P-251(B) EXTEND HANGAR 6 TO ACCOMMODATE P-8 AIRCRAFT AND EXTEND HANGAR 9 TO ACCOMMODATE P-3 AIRCRAFT, NAVAL AIR STATION WHIDBEY ISLAND, WA; SPECIAL PROJECT RM 1112627 REPAIR AND MODERNIZE HANGAR 6 INCLUDING SEISMIC UPGRADES, NAVAL AIR STATION WHIDBEY ISLAND, WASHINGTON

Who is the contractor on this award?

The obligated recipient is KORTE CONSTRUCTION COMPANY.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $52.8 million.

What is the period of performance?

Start: 2014-07-31. End: 2017-09-30.

What is the track record of Korte Construction Company in performing large-scale federal construction projects, particularly for the Department of Defense?

Korte Construction Company has a significant history of working with the federal government, including numerous projects for the Department of Defense and other agencies. Their portfolio often includes military construction, aviation facilities, and institutional buildings. While specific details on past performance for similar hangar projects would require deeper investigation into contract histories and performance evaluations, their sustained engagement with federal clients suggests a capacity to manage complex projects. Reviewing past performance reports and any documented issues or commendations on previous DoD contracts would provide a clearer picture of their reliability and expertise in executing projects of this magnitude and technical requirement.

How does the cost per square foot or per unit of hangar space for this project compare to similar military hangar construction projects?

Determining a precise cost per square foot or per unit for this project is challenging without detailed architectural plans and final build-out specifications. The contract value of over $52.8 million covers the extension and modernization of two hangars, including seismic upgrades, which adds significant complexity beyond basic construction. To benchmark effectively, one would need to identify comparable projects at other naval air stations or military installations that involved similar square footage, aircraft accommodation (P-8 and P-3), and seismic retrofitting requirements. Such comparisons are often proprietary or require access to specialized construction cost databases. However, the competitive bidding process suggests the price was deemed fair by the market at the time of award.

What are the primary risks associated with the seismic upgrades and modernization of Hangar 6 and Hangar 9?

The primary risks associated with seismic upgrades and modernization of these hangars include unforeseen structural issues discovered during demolition or renovation, which could lead to scope changes and cost increases. The age of the facilities may reveal hidden defects or require more extensive work than initially anticipated. Schedule risks are also significant, as construction delays could impact aircraft operational readiness. Furthermore, working with specialized materials and techniques for seismic retrofitting requires skilled labor, and any shortages or quality control issues could pose risks. Ensuring minimal disruption to ongoing base operations during construction is another critical risk factor that needs careful management.

How effective are hangar modernization and seismic upgrades in enhancing the long-term operational effectiveness and safety of naval aviation at NAS Whidbey Island?

Modernizing hangars and implementing seismic upgrades are crucial for enhancing the long-term operational effectiveness and safety of naval aviation. These upgrades ensure that critical aircraft, such as the P-8 and P-3, are housed in facilities that can withstand seismic events, thereby protecting valuable assets and preventing mission-critical downtime. Modernized hangars often incorporate improved environmental controls, lighting, and maintenance support systems, which contribute to crew safety and efficiency. By extending the lifespan of these facilities and ensuring they meet current operational and safety standards, the Navy maintains its readiness posture and reduces the long-term costs associated with aging infrastructure, ultimately supporting sustained aviation operations.

What has been the historical spending trend for hangar construction and maintenance at Naval Air Station Whidbey Island over the past decade?

Analyzing historical spending trends for hangar construction and maintenance at NAS Whidbey Island over the past decade would require accessing detailed budget and contract award data specific to the installation. This contract, valued at over $52.8 million, represents a significant single investment in infrastructure modernization. It is likely that spending patterns would fluctuate based on military readiness requirements, aircraft platform changes (like the introduction of P-8s), and the aging of existing facilities. Periods of major platform transition or significant infrastructure assessment often precede large capital improvement projects like this one. Without specific historical data, it's difficult to establish a precise trend, but this award suggests a focus on upgrading critical aviation support infrastructure.

What are the potential implications of extending Hangar 6 and Hangar 9 for future aircraft deployments or modifications at NAS Whidbey Island?

The extension of Hangar 6 and Hangar 9 to accommodate P-8 and P-3 aircraft respectively has direct implications for current and future deployments and modifications. These extensions ensure that the base can properly house, maintain, and support these specific aircraft types, which are vital for maritime patrol and reconnaissance missions. By providing adequate space, the Navy enhances the operational readiness and efficiency of these squadrons. Furthermore, the modernized facilities may be designed with future adaptability in mind, potentially accommodating next-generation aircraft or evolving mission requirements with fewer modifications. This investment solidifies NAS Whidbey Island's role as a key hub for these critical aviation assets.

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: N4425513R4006

Offers Received: 12

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 5700 OAKLAND AVE STE 200, SAINT LOUIS, MO, 63110

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

Financial Breakdown

Contract Ceiling: $52,809,267

Exercised Options: $52,809,267

Current Obligation: $52,808,817

Subaward Activity

Number of Subawards: 108

Total Subaward Amount: $188,652,256

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline