DoD's $67.6M Marine Corps Base Hawaii facility contract awarded to Hawaiian Dredging Construction Company

Contract Overview

Contract Amount: $67,642,966 ($67.6M)

Contractor: Hawaiian Dredging Construction Company, Inc

Awarding Agency: Department of Defense

Start Date: 2017-08-21

End Date: 2022-05-21

Contract Duration: 1,734 days

Daily Burn Rate: $39.0K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 5

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: IGF::OT::IGF MCON PROJECT P-923, REGIMENTAL CONSOLIDATED COMMUNICATIONS/ELECTRONICS FACILITY, MARINE CORPS BASE HAWAII, KANEOHE, HAWAII

Place of Performance

Location: M C B H KANEOHE BAY, HONOLULU County, HAWAII, 96863

State: Hawaii Government Spending

Plain-Language Summary

Department of Defense obligated $67.6 million to HAWAIIAN DREDGING CONSTRUCTION COMPANY, INC for work described as: IGF::OT::IGF MCON PROJECT P-923, REGIMENTAL CONSOLIDATED COMMUNICATIONS/ELECTRONICS FACILITY, MARINE CORPS BASE HAWAII, KANEOHE, HAWAII Key points: 1. Contract awarded for construction of a consolidated communications/electronics facility. 2. Project located at Marine Corps Base Hawaii, Kaneohe, Hawaii. 3. Contract type is a definitive contract with a firm fixed price. 4. Duration of the contract was 1734 days. 5. Competition was full and open, indicating broad market engagement. 6. No small business set-aside was utilized for this contract.

Value Assessment

Rating: fair

The total contract value of $67.6 million for a large-scale construction project at a military base appears within a reasonable range for similar institutional building construction. However, without specific details on the scope of work, materials, and labor involved, a precise value-for-money assessment is challenging. Benchmarking against other similar consolidated communications facility projects on military installations would provide a clearer picture of cost-effectiveness. The firm fixed-price nature suggests cost certainty for the government, but potential for contractor profit maximization.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, suggesting that multiple qualified contractors had the opportunity to bid. The presence of 5 bids indicates a competitive process. This level of competition is generally favorable for price discovery and can lead to more competitive pricing for the government. The specific details of the bidding process and the evaluation criteria would further illuminate the effectiveness of the competition.

Taxpayer Impact: Full and open competition typically benefits taxpayers by driving down prices through market forces, ensuring the government receives the best value for its investment.

Public Impact

The primary beneficiaries are the U.S. Marine Corps, receiving a critical infrastructure upgrade. The project delivers a consolidated facility for communications and electronics, enhancing operational capabilities. The geographic impact is concentrated at Marine Corps Base Hawaii in Kaneohe, Hawaii. The contract supports the construction workforce in Hawaii, likely through direct employment and subcontracting opportunities.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if unforeseen site conditions or scope creep occur, despite firm fixed price.
Long contract duration (over 4.5 years) increases exposure to market fluctuations in material and labor costs.
Dependence on a single contractor for a critical facility could pose risks if performance issues arise.
Limited transparency on specific performance metrics and quality control measures post-award.

Positive Signals

Firm fixed-price contract provides cost certainty for the government.
Full and open competition suggests a robust bidding process and potential for competitive pricing.
Award to an established construction company with experience in large projects.
Project addresses a critical infrastructure need for military communications and electronics.

Sector Analysis

This contract falls within the Commercial and Institutional Building Construction sector, a significant segment of the broader construction industry. The market for military construction is substantial, driven by ongoing modernization and infrastructure needs. This project represents a specific type of specialized construction, requiring adherence to stringent government standards and security protocols. Comparable spending benchmarks would involve analyzing other large-scale facility construction projects awarded by the Department of Defense or other federal agencies.

Small Business Impact

This contract was not awarded as a small business set-aside, nor does it appear to have specific subcontracting goals mandated for small businesses based on the provided data. While Hawaiian Dredging Construction Company may engage small businesses as subcontractors, the primary award mechanism did not prioritize small business participation. This means opportunities for small businesses are indirect, dependent on the prime contractor's procurement practices.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and the relevant program management office within the Department of the Navy. The firm fixed-price nature shifts some risk to the contractor, but government oversight would focus on ensuring compliance with contract terms, quality standards, and delivery schedules. Transparency is generally maintained through contract award databases, but detailed performance monitoring reports are often internal. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Military Construction Projects
Department of Defense Facilities
Communications Infrastructure
Naval Facilities Engineering Command Contracts
Large-Scale Construction Contracts

Risk Flags

Long contract duration increases risk of market fluctuations.
Potential for unforeseen site conditions in Hawaii.
Dependence on a single prime contractor for critical infrastructure.
Firm fixed-price contracts can sometimes lead to reduced scope or quality if not managed carefully.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $67.6 million to HAWAIIAN DREDGING CONSTRUCTION COMPANY, INC. IGF::OT::IGF MCON PROJECT P-923, REGIMENTAL CONSOLIDATED COMMUNICATIONS/ELECTRONICS FACILITY, MARINE CORPS BASE HAWAII, KANEOHE, HAWAII

Who is the contractor on this award?

The obligated recipient is HAWAIIAN DREDGING CONSTRUCTION COMPANY, 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 $67.6 million.

What is the period of performance?

Start: 2017-08-21. End: 2022-05-21.

What was the specific scope of work for the Regimental Consolidated Communications/Electronics Facility?

The provided data does not detail the specific scope of work beyond the general description of a 'Regimental Consolidated Communications/Electronics Facility.' This would typically include the design, construction, and outfitting of a building intended to house and support critical communication and electronic systems for a Marine Corps regiment. Such facilities often require specialized environmental controls (HVAC, power redundancy), secure access, robust network infrastructure, and potentially specialized shielding or antenna support structures. A full understanding of the scope would require reviewing the original contract solicitation documents (e.g., the Performance Work Statement or Statement of Work).

How does the $67.6 million cost compare to similar military communications facility projects?

Benchmarking this $67.6 million contract against similar projects requires access to a database of comparable military construction projects, including their size, complexity, location, and specific functionalities. Without such data, a direct comparison is difficult. However, for large-scale, specialized facilities on military bases, costs can vary significantly based on geographic location (e.g., Hawaii often has higher construction costs), specific technological requirements, and the level of security and redundancy mandated. The firm fixed-price nature suggests the government aimed for cost certainty, but the ultimate value depends on the delivered functionality and long-term operational efficiency.

What are the key performance indicators (KPIs) used to evaluate the success of this construction contract?

While specific KPIs are not detailed in the provided summary data, typical performance indicators for large construction contracts like this include adherence to schedule (on-time completion), quality of workmanship (meeting specifications and standards), safety performance (low incident rates), and budget management (staying within the firm fixed-price). For a communications facility, functional testing and successful integration of electronic systems would also be critical KPIs. The government's contracting officer and technical representatives would monitor these aspects throughout the project lifecycle.

What is the track record of Hawaiian Dredging Construction Company, Inc. with Department of Defense contracts?

Hawaiian Dredging Construction Company, Inc. has a significant history of working with the Department of Defense, particularly in Hawaii. As a large, established construction firm operating in the region, they have likely been involved in numerous military construction and renovation projects over the years. Their ability to win a contract of this magnitude ($67.6 million) under full and open competition suggests a demonstrated capability and a competitive bidding history with the DoD. Further investigation into their contract performance history, including any past performance evaluations or disputes, would provide a more comprehensive view of their track record.

What are the potential risks associated with the long duration (1734 days) of this contract?

The 1734-day duration (approximately 4.75 years) for this construction contract presents several potential risks. Firstly, there is an increased risk of cost escalation for materials and labor, even with a firm fixed price, if market conditions change significantly over the project's lifespan, potentially leading to change order requests or contractor claims. Secondly, long project durations can lead to obsolescence of technology or design requirements if the facility's intended use evolves. Thirdly, maintaining consistent oversight and project management focus over such an extended period can be challenging for the government. Finally, unforeseen site conditions or environmental factors encountered over multiple years can cause delays and impact the schedule.

How does the lack of a small business set-aside impact opportunities for local Hawaiian small businesses?

The absence of a small business set-aside for this $67.6 million contract means that local Hawaiian small businesses did not have a direct, preferential opportunity to compete for the prime contract. Their involvement would be contingent on being selected as subcontractors by the prime contractor, Hawaiian Dredging Construction Company. While large contractors often utilize small businesses for specialized services or labor, the lack of a set-aside reduces the likelihood of guaranteed subcontracting opportunities. This could limit the direct economic benefit flowing to the small business sector in Hawaii from this specific federal expenditure.

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: N6274217R1307

Offers Received: 5

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Kajima Corporation

Address: 605 KAPIOLANI BOULEVARD, HONOLULU, HI, 96813

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

Financial Breakdown

Contract Ceiling: $67,642,966

Exercised Options: $67,642,966

Current Obligation: $67,642,966

Actual Outlays: $1,768,074

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline