DoD's $26.7M Hurricane Irma Recovery Contract Awarded to URS Group, Inc. for Construction Services

Contract Overview

Contract Amount: $26,719,611 ($26.7M)

Contractor: URS Group, Inc.

Awarding Agency: Department of Defense

Start Date: 2017-09-12

End Date: 2019-11-29

Contract Duration: 808 days

Daily Burn Rate: $33.1K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: COST PLUS AWARD FEE

Sector: Construction

Official Description: IGF::OT::IGF HURRICANE IRMA RECOVERY - N FL/S GA

Place of Performance

Location: JACKSONVILLE, DUVAL County, FLORIDA, 32212

State: Florida Government Spending

Plain-Language Summary

Department of Defense obligated $26.7 million to URS GROUP, INC. for work described as: IGF::OT::IGF HURRICANE IRMA RECOVERY - N FL/S GA Key points: 1. Contract awarded via full and open competition, suggesting a competitive bidding process. 2. The contract type is Cost Plus Award Fee, which incentivizes performance but can lead to higher costs. 3. The duration of 808 days indicates a significant, long-term recovery effort. 4. The contract was awarded by the Department of the Navy, a component of the DoD. 5. The base value of the contract is $33.07 million, with the awarded amount being $26.72 million. 6. The contract falls under the Commercial and Institutional Building Construction NAICS code.

Value Assessment

Rating: fair

The awarded amount of $26.72 million is less than the base value of $33.07 million, which could indicate cost savings or a reduction in scope. However, without comparable contracts for similar hurricane recovery efforts in Florida, a definitive value-for-money assessment is challenging. The Cost Plus Award Fee structure means the final cost is dependent on performance, making direct price comparisons difficult. Further analysis of the award fee criteria and achieved performance would be needed to fully assess value.

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 a bid. The number of bidders is not specified, but this method generally promotes price discovery and allows the government to select the best value offer. The open competition suggests a healthy market for these types of construction services.

Taxpayer Impact: Taxpayers benefit from the potential for competitive pricing and the selection of a qualified contractor through a transparent process. Full and open competition aims to ensure that the government receives the most advantageous offer, minimizing the risk of overpayment.

Public Impact

This contract directly benefits residents and businesses in North Florida and South Georgia affected by Hurricane Irma by funding necessary construction and recovery efforts. The services delivered include commercial and institutional building construction, crucial for restoring damaged infrastructure. The geographic impact is focused on the Florida and Georgia regions impacted by Hurricane Irma. The contract supports the construction workforce involved in disaster recovery and rebuilding efforts.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost Plus Award Fee contracts can sometimes lead to higher overall costs if not managed closely, as contractor profit is tied to performance metrics.
The long duration of the contract (808 days) requires sustained oversight to ensure continued adherence to scope and budget.
The specific details of the award fee structure are not provided, making it difficult to assess if the awarded fee truly reflects exceptional performance.
The base value of $33.07 million is a significant amount, necessitating careful monitoring of expenditures.

Positive Signals

Awarded under full and open competition, which typically leads to better pricing and contractor selection.
The awarded amount ($26.72M) is less than the initial base value ($33.07M), suggesting potential cost efficiencies or scope adjustments.
The contract addresses critical post-disaster recovery needs, providing essential construction services.
The Department of the Navy is a reputable agency with experience in managing large construction contracts.

Sector Analysis

This contract falls within the Commercial and Institutional Building Construction sector, a significant part of the broader construction industry. The market for disaster recovery construction is often characterized by rapid mobilization and specialized capabilities. Comparable spending benchmarks are difficult to establish without specific project details, but large-scale recovery efforts following major natural disasters typically involve substantial government investment across various construction and engineering firms.

Small Business Impact

Information regarding small business set-asides or subcontracting plans for this specific contract is not available in the provided data. However, for large federal construction contracts, there is often an expectation or requirement for prime contractors to engage small businesses for subcontracting opportunities. Further investigation into the contractor's subcontracting reports would be necessary to assess the impact on the small business ecosystem.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and their representatives within the Department of the Navy. Accountability measures are embedded in the Cost Plus Award Fee structure, which links contractor payment to performance. Transparency is generally maintained through contract award databases and reporting requirements, though specific details of performance evaluations may be internal. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

Hurricane Recovery Contracts
Disaster Relief Funding
Department of Defense Construction Projects
Naval Facilities Engineering Command Contracts

Risk Flags

Cost Plus Award Fee structure requires careful monitoring.
Long contract duration necessitates sustained oversight.
Potential for cost escalation in disaster recovery environments.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $26.7 million to URS GROUP, INC.. IGF::OT::IGF HURRICANE IRMA RECOVERY - N FL/S GA

Who is the contractor on this award?

The obligated recipient is URS GROUP, 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 $26.7 million.

What is the period of performance?

Start: 2017-09-12. End: 2019-11-29.

What was the specific performance criteria used to determine the award fee for URS Group, Inc. on this contract?

The provided data does not detail the specific performance criteria used for the Cost Plus Award Fee (CPAF) component of this contract. CPAF contracts typically include metrics related to schedule adherence, cost control, quality of work, and customer satisfaction. The 'award fee' portion is determined by the government's evaluation of the contractor's performance against these pre-defined criteria, often assessed through a subjective evaluation process. Without access to the contract's Performance Work Statement (PWS) and the government's award fee determination documentation, it is impossible to ascertain the exact metrics and the contractor's success in meeting them. This information is crucial for understanding how the final cost was influenced by performance and for assessing the true value received.

How does the awarded amount of $26.72 million compare to the initial base value of $33.07 million, and what does this variance suggest?

The awarded amount of $26.72 million is approximately $6.35 million (or 19%) less than the initial base value of $33.07 million. This variance suggests several possibilities. It could indicate that the contractor did not incur costs up to the initially estimated base amount, perhaps due to efficient project execution, scope reductions, or favorable market conditions for materials and labor. Alternatively, it might reflect the government's negotiation or management of the contract, potentially leading to a lower final cost than initially projected. In a Cost Plus Award Fee contract, the final amount paid is a combination of allowable costs and the award fee earned. The difference could also be related to the 'cost' portion of the CPAF structure, where actual incurred costs were less than anticipated, or it could reflect adjustments to the scope of work over the contract's duration.

What are the potential risks associated with a Cost Plus Award Fee (CPAF) contract for hurricane recovery construction?

Cost Plus Award Fee (CPAF) contracts for hurricane recovery construction present several risks. Primarily, the 'cost-plus' nature means the government pays the contractor's allowable costs plus a fee that is earned based on performance. This can lead to cost uncertainty and potentially higher final costs compared to fixed-price contracts, especially if costs escalate due to unforeseen disaster-related challenges (e.g., material shortages, labor disputes, extended timelines). The 'award fee' component, while intended to incentivize performance, relies on subjective government evaluation, which can lead to disputes or perceptions of unfairness. For recovery efforts, where conditions are often chaotic and unpredictable, accurately defining performance metrics and managing costs effectively becomes more challenging. There's also a risk that the contractor may focus on achieving award fee criteria rather than the most critical recovery needs if the metrics are not perfectly aligned.

What is the significance of the NAICS code 236220 (Commercial and Institutional Building Construction) in the context of this contract?

The NAICS code 236220 signifies that the primary business activity for this contract involves the construction or renovation of commercial and institutional buildings. This includes structures like office buildings, retail stores, warehouses, schools, hospitals, and government facilities. For a hurricane recovery contract, this code indicates that the work performed by URS Group, Inc. was focused on repairing or rebuilding these types of structures that were damaged by Hurricane Irma. It helps categorize the contract within the broader construction industry and allows for comparisons with other contracts performing similar types of work. This classification is important for industry analysis, economic statistics, and understanding the specific nature of the services procured by the Department of the Navy.

Given the contract's duration of 808 days, what are the implications for ongoing oversight and accountability?

A contract duration of 808 days (approximately 2.2 years) for hurricane recovery construction necessitates robust and sustained oversight. The Department of the Navy must maintain consistent monitoring of project progress, expenditures, and contractor performance throughout this extended period. Accountability is managed through regular progress reports, site inspections, and the evaluation process tied to the Cost Plus Award Fee structure. Key personnel must remain engaged to ensure continuity in oversight and to address any issues that arise promptly. The long duration also increases the risk of scope creep, cost overruns, and potential contractor performance degradation if oversight falters. Therefore, proactive contract management, clear communication channels, and a dedicated oversight team are critical to ensuring the project's success and accountability to taxpayers.

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: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 1

Pricing Type: COST PLUS AWARD FEE (R)

Evaluated Preference: NONE

Contractor Details

Parent Company: AECOM

Address: 1600 PERIMETER PARK DR STE 400, MORRISVILLE, NC, 27560

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

Financial Breakdown

Contract Ceiling: $26,719,611

Exercised Options: $26,719,611

Current Obligation: $26,719,611

Subaward Activity

Number of Subawards: 1398

Total Subaward Amount: $411,275,295

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: N6247013D6022

IDV Type: IDC

Timeline