Naval Station Kings Bay Clinic Modernization Contract Exceeds $37.5M, Awarded to Korte Construction

Contract Overview

Contract Amount: $37,520,233 ($37.5M)

Contractor: Korte Construction Company

Awarding Agency: Department of Defense

Start Date: 2015-09-28

End Date: 2020-06-30

Contract Duration: 1,737 days

Daily Burn Rate: $21.6K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 14

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: IGF::OT::IGF BRANCH HEALTH CLINIC MODERNIZATION, BUILDING 1028, NAVAL STATION KINGS BAY, GEORGIA

Place of Performance

Location: KINGS BAY, CAMDEN County, GEORGIA, 31547

State: Georgia Government Spending

Plain-Language Summary

Department of Defense obligated $37.5 million to KORTE CONSTRUCTION COMPANY for work described as: IGF::OT::IGF BRANCH HEALTH CLINIC MODERNIZATION, BUILDING 1028, NAVAL STATION KINGS BAY, GEORGIA Key points: 1. The contract for the IGF Branch Health Clinic Modernization at Naval Station Kings Bay, Georgia, totals $37,520,232.88. 2. Awarded to Korte Construction Company, this project falls under the Commercial and Institutional Building Construction sector. 3. The contract was secured through full and open competition, indicating a competitive bidding process. 4. The project duration was 1737 days, spanning from September 28, 2015, to June 30, 2020. 5. The contract type is Firm Fixed Price, which shifts cost risk to the contractor.

Value Assessment

Rating: fair

The contract value of $37.5 million for a clinic modernization project requires comparison with similar-sized construction projects. Without specific per-unit cost data or benchmarks for military construction of this type, a precise value assessment is difficult. However, the duration and scope suggest a significant investment.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded through full and open competition, suggesting multiple bidders participated. This method generally promotes competitive pricing and allows the government to select the best value offer. The final price reflects the outcome of this competitive process.

Taxpayer Impact: Taxpayer funds were used for this project. The use of full and open competition aims to ensure a fair price, but the total cost of over $37.5 million represents a substantial expenditure.

Public Impact

Modernization of a critical health facility at a naval base, improving healthcare access for service members and their families. Significant construction investment in Georgia, potentially creating local jobs and economic activity during the project's execution. The project's completion impacts the operational readiness and quality of life at Naval Station Kings Bay.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns in large-scale construction projects.
Contract duration of nearly 5 years could indicate complexity or unforeseen delays.
Lack of specific performance metrics makes it hard to gauge project success beyond completion.

Positive Signals

Awarded through full and open competition, suggesting competitive pricing.
Firm Fixed Price contract shifts cost risk to the contractor.
Modernization of a key healthcare facility enhances service delivery.

Sector Analysis

This project falls within the Commercial and Institutional Building Construction sector, specifically for a government facility. Spending in this sector can vary widely based on infrastructure needs, defense spending priorities, and economic conditions. Benchmarks for similar military clinic modernizations would be needed for precise comparison.

Small Business Impact

The data indicates that neither small business nor socio-economic set-asides were utilized for this contract (ss: false, sb: false). This suggests the contract was likely awarded to a larger firm capable of handling the project's scale and complexity.

Oversight & Accountability

Oversight would typically be provided by the Department of the Navy's contracting and engineering divisions. Ensuring adherence to the firm fixed price, managing scope changes, and verifying quality are key oversight functions for projects of this magnitude.

Related Government Programs

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

Risk Flags

Contract duration significantly exceeds typical construction timelines.
Lack of detailed cost breakdowns hinders granular value analysis.
No clear indication of small business participation.
Absence of performance metrics makes effectiveness assessment difficult.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $37.5 million to KORTE CONSTRUCTION COMPANY. IGF::OT::IGF BRANCH HEALTH CLINIC MODERNIZATION, BUILDING 1028, NAVAL STATION KINGS BAY, GEORGIA

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 $37.5 million.

What is the period of performance?

Start: 2015-09-28. End: 2020-06-30.

What was the final cost per square foot for the clinic modernization, and how does it compare to industry benchmarks for similar government facilities?

The provided data does not include the square footage of the modernized clinic, making a cost per square foot calculation impossible. Without this crucial metric, a direct comparison to industry benchmarks for similar government facilities cannot be made. Further analysis would require detailed project specifications including the building's size.

Were there any significant cost changes or contract modifications during the project's nearly five-year duration, and what were the primary drivers?

The data indicates a Firm Fixed Price contract, which typically aims to minimize cost changes. However, a duration of 1737 days (nearly 5 years) for a construction project raises questions about potential delays or scope adjustments. Investigating contract modifications, change orders, and their justifications would be necessary to understand if costs deviated from the initial plan and why.

How did the competitive bidding process for this full and open competition influence the final contract price compared to a sole-source or limited competition scenario?

Full and open competition generally leads to lower prices due to multiple bidders vying for the contract. This process allows the government to leverage market competition to achieve a more favorable price. While the exact savings compared to other methods aren't quantifiable from this data, the method chosen suggests an effort to secure competitive pricing for the $37.5 million project.

Industry Classification

NAICS: Construction › Nonresidential Building Construction › Commercial and Institutional Building Construction

Product/Service Code: MAINT, REPAIR, ALTER REAL PROPERTY › MAINT, ALTER, REPAIR NONBUILDINGS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: TWO STEP

Solicitation ID: N6247015R5009

Offers Received: 14

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 5700 OAKLAND AVE STE 275, 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: $37,520,233

Exercised Options: $37,520,233

Current Obligation: $37,520,233

Actual Outlays: $18,700

Subaward Activity

Number of Subawards: 135

Total Subaward Amount: $147,987,714

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline