DoD's $67.1M Pearl Harbor sewer project awarded to Kiewit Infrastructure West Co. shows strong competition

Contract Overview

Contract Amount: $67,124,415 ($67.1M)

Contractor: Kiewit Infrastructure West CO

Awarding Agency: Department of Defense

Start Date: 2019-03-12

End Date: 2021-07-21

Contract Duration: 862 days

Daily Burn Rate: $77.9K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 5

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: FY18 MCON PROJECT P-704 SEWER LIFT STATION AND RELIEF SEWER LINES JOINT BASE PEARL HARBOR-HICKAM, HAWAII

Place of Performance

Location: PEARL HARBOR, HONOLULU County, HAWAII, 96860

State: Hawaii Government Spending

Plain-Language Summary

Department of Defense obligated $67.1 million to KIEWIT INFRASTRUCTURE WEST CO for work described as: FY18 MCON PROJECT P-704 SEWER LIFT STATION AND RELIEF SEWER LINES JOINT BASE PEARL HARBOR-HICKAM, HAWAII Key points: 1. The contract's firm-fixed-price structure aims to control costs and transfer risk to the contractor. 2. Awarded under full and open competition, this suggests a robust bidding process. 3. The project's duration of 862 days indicates a significant, long-term infrastructure undertaking. 4. The North American Industry Classification System (NAICS) code 237110 points to specialized construction services. 5. The contract was awarded by the Department of the Navy, a major component of the DoD. 6. The project is located in Hawaii, potentially impacting local labor and resources.

Value Assessment

Rating: good

Benchmarking the value of this specific project is challenging without comparable sewer line construction contracts of similar scale and complexity. However, the firm-fixed-price (FFP) award type suggests that the government sought to lock in costs, which can be a good indicator of value if the contractor's bid was competitive. The contract value of approximately $67.1 million for a project spanning over two years implies a substantial investment in critical infrastructure. Further analysis would require comparing the per-unit costs of specific construction elements (e.g., linear feet of pipe, lift station components) against industry standards or similar government projects.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under 'full and open competition,' indicating that all responsible sources were permitted to submit bids. The presence of 5 bidders suggests a healthy level of competition for this significant infrastructure project. A higher number of bidders generally leads to more competitive pricing and a wider range of technical solutions, benefiting the government.

Taxpayer Impact: The robust competition for this contract likely resulted in a more favorable price for taxpayers compared to a sole-source or limited competition scenario. It ensures that the government is receiving the best possible value for its investment.

Public Impact

The primary beneficiaries are the residents and personnel at Joint Base Pearl Harbor-Hickam, who will receive improved wastewater management services. The project delivers essential upgrades to the sewer lift station and relief sewer lines, ensuring operational reliability and environmental compliance. The geographic impact is localized to Joint Base Pearl Harbor-Hickam in Hawaii. The construction activities will likely create temporary employment opportunities for skilled labor in the Hawaii region.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if unforeseen site conditions arise, despite the FFP structure.
Delays in project completion could impact base operations and incur additional costs.
Contractor performance risk, though mitigated by FFP, still exists.
Environmental compliance during construction needs careful monitoring.

Positive Signals

Firm-fixed-price contract type helps control costs and manage budget predictability.
Full and open competition suggests a competitive bidding process, likely leading to better pricing.
The award to a single, established contractor (Kiewit) may indicate confidence in their ability to execute complex projects.
The project addresses critical infrastructure needs, ensuring long-term operational stability for the base.

Sector Analysis

This contract falls within the heavy and civil engineering construction sector, specifically focusing on water and sewer infrastructure. The market for such projects is often characterized by large, specialized firms capable of handling complex, large-scale public works. Government spending in this area is driven by the need to maintain and upgrade aging infrastructure, ensure environmental compliance, and support military readiness. Comparable spending benchmarks would typically involve other large-scale utility construction projects awarded by federal agencies or state and local governments.

Small Business Impact

The data indicates that this contract was not set aside for small businesses (ss: false, sb: false). Therefore, there are no direct subcontracting implications for small businesses stemming from a set-aside provision. However, the prime contractor, Kiewit Infrastructure West Co., may engage small businesses as subcontractors for specialized services or materials, which would be detailed in their subcontracting plan, if applicable.

Oversight & Accountability

Oversight for this project would typically be managed by the Department of the Navy's contracting and engineering divisions. Accountability measures are embedded in the firm-fixed-price contract, which holds the contractor responsible for delivering the specified work within the agreed-upon price. Transparency is generally maintained through contract award databases and public reporting, although specific day-to-day oversight details are not publicly available. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

Military Construction (MILCON)
Naval Facilities Engineering Command (NAVFAC) Projects
Department of Defense Infrastructure Modernization
Wastewater Treatment and Infrastructure Construction

Risk Flags

Potential for unforeseen site conditions impacting cost and schedule.
Environmental compliance during construction activities.
Coordination with ongoing base operations.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $67.1 million to KIEWIT INFRASTRUCTURE WEST CO. FY18 MCON PROJECT P-704 SEWER LIFT STATION AND RELIEF SEWER LINES JOINT BASE PEARL HARBOR-HICKAM, HAWAII

Who is the contractor on this award?

The obligated recipient is KIEWIT INFRASTRUCTURE WEST CO.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $67.1 million.

What is the period of performance?

Start: 2019-03-12. End: 2021-07-21.

What is Kiewit Infrastructure West Co.'s track record with similar large-scale civil infrastructure projects for the Department of Defense?

Kiewit Infrastructure West Co. has a significant history of undertaking large-scale civil engineering and construction projects, including many for the Department of Defense and other federal agencies. Their portfolio often includes complex infrastructure such as bridges, highways, dams, and utility systems. While specific project details and performance metrics for past DoD contracts are not readily available in this dataset, their status as a major player in the heavy construction industry suggests they possess the experience and capacity to manage projects like the Pearl Harbor sewer upgrade. A deeper dive into their contract history with the Navy or other DoD entities would reveal specific past performance ratings and any notable successes or challenges.

How does the $67.1 million cost compare to similar sewer infrastructure projects undertaken by the DoD or other federal agencies?

Directly comparing the $67.1 million cost without detailed project specifications (e.g., linear footage of pipe, complexity of lift station, soil conditions, specific materials) is difficult. However, large-scale municipal and federal sewer infrastructure projects can range from tens to hundreds of millions of dollars. The firm-fixed-price nature of this contract suggests an effort to contain costs. To benchmark effectively, one would need to analyze the cost per linear foot of sewer line installed, the cost per cubic yard of excavation, and the cost of the lift station components relative to similar projects awarded under comparable market conditions and geographic locations. The number of bidders (5) suggests competitive pricing was sought.

What are the primary risks associated with this specific sewer construction project, and how are they mitigated?

Key risks for this project include unforeseen subsurface conditions (e.g., encountering unexpected rock, groundwater issues), potential environmental impacts during excavation and construction, and the possibility of construction delays due to weather or logistical challenges. The firm-fixed-price (FFP) contract structure is a primary mitigation strategy, transferring much of the cost overrun risk to Kiewit Infrastructure West Co. The contract's defined duration (862 days) and specific scope of work also help manage expectations. The Department of the Navy's oversight and the contractor's own quality control and safety protocols are crucial for mitigating performance and compliance risks.

How effective is the 'full and open competition' strategy in ensuring value for money for taxpayer-funded infrastructure projects like this one?

The 'full and open competition' strategy is generally considered highly effective in ensuring value for money for taxpayer-funded projects. By allowing all responsible sources to bid, it fosters a competitive environment that typically drives down prices and encourages innovation. The fact that five bids were received for this $67.1 million project indicates that the strategy successfully attracted multiple capable contractors. This competition likely pressured bidders to offer their most competitive pricing and technical solutions, thereby maximizing the value the government receives for the allocated funds. It also provides a broader pool of potential contractors, increasing the likelihood of finding the best fit for the project's requirements.

What is the historical spending trend for water and sewer line construction projects within the Department of the Navy or Joint Base Pearl Harbor-Hickam?

Analyzing historical spending trends for water and sewer line construction specifically within the Department of the Navy or at Joint Base Pearl Harbor-Hickam would require access to detailed historical contract databases. However, it is generally understood that military installations require continuous investment in maintaining and upgrading their aging infrastructure, including essential utilities like sewer systems. Spending in this category can fluctuate based on infrastructure condition assessments, modernization initiatives, and specific project needs. Projects like P-704 are often part of larger, long-term capital improvement plans aimed at ensuring operational readiness and compliance with environmental regulations. Without specific historical data, it's presumed that such projects are recurring necessities.

Industry Classification

NAICS: Construction › Utility System Construction › Water and Sewer Line and Related Structures 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: N6247818R1515

Offers Received: 5

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Peter Kiewit Sons Inc

Address: 707 RICHARDS ST STE 750, HONOLULU, HI, 96813

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

Financial Breakdown

Contract Ceiling: $67,124,415

Exercised Options: $67,124,415

Current Obligation: $67,124,415

Subaward Activity

Number of Subawards: 43

Total Subaward Amount: $21,677,227

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline