Army awards $70.6M dredging contract to Manson Construction Co. for Norfolk Harbor improvements

Contract Overview

Contract Amount: $70,627,100 ($70.6M)

Contractor: Manson Construction CO

Awarding Agency: Department of Defense

Start Date: 2023-12-15

End Date: 2025-09-02

Contract Duration: 627 days

Daily Burn Rate: $112.6K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 3

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: NORFOLK HARBOR ATLANTIC OCEAN CHANNEL DREDGING PHASE 2

Place of Performance

Location: NORFOLK, NORFOLK CITY County, VIRGINIA, 23510

State: Virginia Government Spending

Plain-Language Summary

Department of Defense obligated $70.6 million to MANSON CONSTRUCTION CO for work described as: NORFOLK HARBOR ATLANTIC OCEAN CHANNEL DREDGING PHASE 2 Key points: 1. Contract value appears reasonable given the scope of major civil engineering projects. 2. Full and open competition suggests a competitive bidding process was utilized. 3. Fixed-price contract type shifts performance risk to the contractor. 4. Project duration of nearly two years indicates a substantial undertaking. 5. Geographic focus on Virginia highlights critical infrastructure needs in the region.

Value Assessment

Rating: good

The contract value of $70.6 million for dredging Phase 2 of the Norfolk Harbor Atlantic Ocean Channel is within the expected range for large-scale civil engineering projects of this nature. While specific benchmarks for this exact project are not readily available, similar federal dredging contracts for major waterways can range from tens to hundreds of millions of dollars depending on the volume of material, depth, and complexity. The firm-fixed-price structure provides cost certainty for the government, assuming the contractor can manage their expenses effectively. The number of bidders (3) suggests a moderate level of competition, which can influence pricing.

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. Three bids were received, suggesting a moderate level of competition for this significant infrastructure project. While more bidders could potentially drive prices lower, three offers generally allow for some price discovery and comparison among qualified contractors. The agency's decision to proceed with full and open competition is a positive indicator for achieving a fair market price.

Taxpayer Impact: The use of full and open competition is beneficial for taxpayers as it encourages multiple companies to bid, potentially leading to lower prices and better value. A competitive process helps ensure that taxpayer funds are used efficiently by selecting the most cost-effective and capable offeror.

Public Impact

The primary beneficiaries are the U.S. Navy and commercial shipping industries, which rely on deep-water access to Norfolk Naval Station and the Port of Virginia. The project will ensure the continued navigability of a critical U.S. waterway, supporting national security and economic activity. Geographic impact is concentrated in Norfolk, Virginia, with potential indirect benefits to the surrounding Hampton Roads region through sustained port operations. The contract supports jobs in the heavy civil engineering and maritime construction sectors, likely benefiting skilled labor and specialized equipment operators.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if unforeseen subsurface conditions are encountered during dredging.
Risk of schedule delays due to weather, environmental regulations, or equipment availability.
Dependence on a single contractor for a critical infrastructure project requires close monitoring.

Positive Signals

Firm-fixed-price contract shifts cost risk to the contractor.
Full and open competition suggests a robust selection process.
Experienced contractor likely selected based on qualifications and past performance.
Project duration is clearly defined, allowing for planning and resource allocation.

Sector Analysis

This contract falls within the heavy and civil engineering construction sector, specifically focusing on maritime infrastructure. The dredging of major shipping channels is a critical component of national infrastructure, supporting both defense and commerce. The market for such large-scale projects is specialized, involving a limited number of highly capable firms. Comparable spending benchmarks for federal dredging projects vary widely based on scope, but projects of this magnitude often represent significant investments in maintaining and improving port capabilities.

Small Business Impact

This contract was not set aside for small businesses, nor does it appear to have specific subcontracting requirements for small businesses indicated in the provided data. The nature of large-scale federal dredging projects typically requires specialized, heavy equipment and extensive experience, which often favors larger, established prime contractors. This may limit direct opportunities for small businesses to participate as prime contractors on this specific award, though they might be involved as subcontractors if they possess the necessary specialized capabilities.

Oversight & Accountability

Oversight for this contract will likely be managed by the U.S. Army Corps of Engineers, which is responsible for the nation's waterways and harbors. Accountability measures are inherent in the firm-fixed-price contract type, requiring the contractor to complete the work within the agreed-upon price. Transparency is generally maintained through public contract databases and reporting requirements. The Army Corps of Engineers often has internal audit and inspection procedures, and potentially Inspector General oversight, to ensure contract compliance and performance.

Related Government Programs

Norfolk Naval Station Infrastructure Upgrades
Port of Virginia Expansion Projects
Inland Waterways Dredging and Maintenance
Coastal Navigation Channel Improvements

Risk Flags

Potential for unforeseen subsurface conditions impacting cost and schedule.
Environmental compliance risks and potential for regulatory delays.
Dependence on contractor's ability to manage complex logistics and operations.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $70.6 million to MANSON CONSTRUCTION CO. NORFOLK HARBOR ATLANTIC OCEAN CHANNEL DREDGING PHASE 2

Who is the contractor on this award?

The obligated recipient is MANSON CONSTRUCTION CO.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $70.6 million.

What is the period of performance?

Start: 2023-12-15. End: 2025-09-02.

What is the historical spending pattern for Norfolk Harbor dredging projects by the Department of the Army?

Historical spending on Norfolk Harbor dredging by the Department of the Army, particularly the Army Corps of Engineers, has been substantial and ongoing, reflecting the strategic importance of the port. While specific figures for 'Phase 2' are not detailed here, the Army Corps has consistently allocated significant funds over decades for maintenance and deepening of the channels to accommodate larger vessels. For instance, major deepening projects in the early 2000s and subsequent maintenance cycles have involved expenditures in the tens to hundreds of millions of dollars. This contract represents a continuation of these long-term investments in maintaining and enhancing the navigability of this critical East Coast waterway, aligning with historical spending trends for similar infrastructure.

How does the awarded price compare to similar large-scale federal dredging contracts?

The $70.6 million awarded to Manson Construction Co. for Norfolk Harbor dredging appears to be within the typical range for major federal civil engineering and dredging projects. Large-scale channel deepening and maintenance contracts, especially for strategically vital ports like Norfolk, can easily reach or exceed this figure. For example, contracts for deepening channels in other major U.S. ports have ranged from $50 million to over $200 million, depending on the volume of material, required depth, environmental mitigation, and project complexity. Given that this is Phase 2, it implies prior work and potentially complex existing conditions, making the awarded price competitive for the scope of work.

What are the primary risks associated with this specific dredging contract?

The primary risks associated with this dredging contract include potential subsurface geological surprises (e.g., encountering harder-than-expected materials, unexploded ordnance, or contaminated sediments) which could increase costs or cause delays. Environmental risks are also significant, involving compliance with strict regulations regarding sediment disposal, water quality, and protection of marine life, which could lead to stoppages or require costly mitigation. Furthermore, the firm-fixed-price nature means that if Manson Construction Co. underestimates costs or faces unforeseen operational challenges (like equipment failure or labor shortages), their profit margin could be significantly impacted, potentially leading to pressure to cut corners if not closely monitored. Weather delays are also a perennial risk in coastal construction.

What is the track record of Manson Construction Co. on similar federal contracts?

Manson Construction Co. has a substantial track record with federal agencies, particularly the U.S. Army Corps of Engineers, on large-scale marine construction and dredging projects. They have been involved in numerous significant projects across the United States, including channel improvements, port expansions, and breakwater construction. Their experience often includes complex dredging operations in challenging environments. While specific performance metrics for every contract are not publicly detailed, their consistent award of major federal contracts suggests a history of successful project execution and compliance with government requirements. Reviewing their past performance ratings and any documented issues on federal contract databases would provide a more granular assessment.

How will the success of this dredging project impact future federal investments in port infrastructure?

The successful and timely completion of this Norfolk Harbor dredging project is crucial for demonstrating the effectiveness and efficiency of federal investments in port infrastructure. Positive outcomes, such as improved navigability, enhanced port capacity, and adherence to budget and schedule, will bolster confidence in the Army Corps of Engineers' project management and the viability of similar large-scale infrastructure undertakings. Conversely, significant cost overruns or delays could lead to increased scrutiny of future funding requests and potentially impact the prioritization of other port improvement projects. This project serves as a case study for the efficacy of federal funding in maintaining and modernizing critical maritime assets.

Industry Classification

NAICS: Construction › Other Heavy and Civil Engineering Construction › Other Heavy and Civil Engineering Construction

Product/Service Code: CONSTRUCT OF STRUCTURES/FACILITIES › CONSTRUCTION OF BUILDINGS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SEALED BID

Solicitation ID: W9123623B5006

Offers Received: 3

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 5209 E MARGINAL WAY S, SEATTLE, WA, 98134

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: $87,322,100

Exercised Options: $70,627,100

Current Obligation: $70,627,100

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline