DOD's $114M Construction Contract for Site 4 Awarded to Chugach Government Services, Inc

Contract Overview

Contract Amount: $114,469,305 ($114.5M)

Contractor: Chugach Government Services, Inc.

Awarding Agency: Department of Defense

Start Date: 2008-10-31

End Date: 2009-11-30

Contract Duration: 395 days

Daily Burn Rate: $289.8K/day

Competition Type: NOT AVAILABLE FOR COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: SITE 4

Place of Performance

Location: FORT POLK, VERNON County, LOUISIANA, 71459

State: Louisiana Government Spending

Plain-Language Summary

Department of Defense obligated $114.5 million to CHUGACH GOVERNMENT SERVICES, INC. for work described as: SITE 4 Key points: 1. Contract value of over $114 million indicates a significant investment in infrastructure. 2. Awarded on a firm-fixed-price basis, suggesting cost certainty for the government. 3. The contract duration of 395 days points to a substantial construction project. 4. The North American Industry Classification System (NAICS) code 236220 identifies the sector as Commercial and Institutional Building Construction. 5. The contract was awarded under a 'Not Available for Competition' status, raising questions about the procurement process. 6. The contract was awarded to a single bidder, potentially limiting price negotiation and innovation. 7. The contract was awarded in Louisiana, indicating a specific geographic focus for the construction.

Value Assessment

Rating: questionable

Benchmarking the value of this $114 million construction contract is challenging without specific details on the scope of work and the type of facility being built. However, the 'Not Available for Competition' and sole-source award suggest that a thorough price comparison against market rates or similar contracts may not have been conducted. This lack of competition could lead to a less favorable price for the government compared to a fully competed scenario.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded under a 'Not Available for Competition' status, which typically implies that only one source was capable of fulfilling the requirement. This often occurs in specialized fields or when urgent needs arise that cannot be met through a competitive process. The award to a single bidder, Chugach Government Services, Inc., means there was no opportunity for other companies to bid, potentially impacting price discovery.

Taxpayer Impact: Sole-source awards can result in higher costs for taxpayers as the government does not benefit from the competitive pressure that drives down prices. It also limits opportunities for other businesses to secure government contracts.

Public Impact

The primary beneficiaries of this contract are the Department of Defense and its personnel who will utilize the completed Site 4 facility. The contract delivers construction services for a significant infrastructure project, likely enhancing operational capabilities. The geographic impact is localized to Louisiana, where the construction will take place. The contract will likely create or sustain jobs in the construction sector within Louisiana, benefiting the local workforce.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may have led to a higher price than could have been achieved through a competitive bidding process.
The 'Not Available for Competition' status warrants scrutiny to ensure it was genuinely justified and not a circumvention of competitive procurement rules.
Limited transparency in the justification for sole-source award could obscure potential inefficiencies or cost overruns.
The fixed-price nature of the contract, while offering cost certainty, could penalize the contractor for unforeseen issues, potentially leading to claims or disputes if not managed carefully.

Positive Signals

Awarding to Chugach Government Services, Inc., suggests reliance on a contractor with perceived expertise or existing relationship relevant to the project's needs.
The firm-fixed-price contract structure provides budget certainty for the Department of Defense, simplifying financial planning.
The substantial value of the contract indicates a significant investment in critical infrastructure, likely supporting long-term defense objectives.
The contract's completion within the specified duration (395 days) would signify efficient project management and timely delivery of essential facilities.

Sector Analysis

The construction sector is a vital component of federal spending, encompassing a wide range of projects from building maintenance to large-scale infrastructure development. This contract falls under Commercial and Institutional Building Construction, a broad category that includes the erection of non-residential buildings. Federal spending in this area is often driven by the need to modernize aging facilities, expand capacity, or build new installations to support agency missions. Comparable spending benchmarks would depend heavily on the specific type and scale of the building, but multi-million dollar contracts are common for significant federal construction projects.

Small Business Impact

The provided data indicates that small business participation (ss: false, sb: false) was not a primary consideration or requirement for this specific contract. There is no indication of a small business set-aside. This suggests that the prime contractor, Chugach Government Services, Inc., is likely a large business. The implications for the small business ecosystem are minimal in terms of direct subcontracting opportunities stemming from this award, unless the prime contractor voluntarily engages small businesses.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of the Army's contracting and project management offices. Given the significant value, it is likely subject to regular performance reviews and financial audits. Transparency would depend on the agency's policies regarding the release of contract details and performance reports. Inspector General jurisdiction would apply if any allegations of fraud, waste, or abuse arise during the contract's lifecycle.

Related Government Programs

Department of Defense Construction Contracts
Army Corps of Engineers Projects
Federal Building and Infrastructure Projects
Commercial and Institutional Building Construction Contracts

Risk Flags

Sole-source award raises concerns about competition and potential overpricing.
Lack of detailed scope of work makes value assessment difficult.
Contract awarded under 'Not Available for Competition' requires scrutiny of justification.
Limited information on contractor past performance hinders risk assessment.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $114.5 million to CHUGACH GOVERNMENT SERVICES, INC.. SITE 4

Who is the contractor on this award?

The obligated recipient is CHUGACH GOVERNMENT SERVICES, INC..

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $114.5 million.

What is the period of performance?

Start: 2008-10-31. End: 2009-11-30.

What specific type of facility was constructed under Site 4, and what were the key performance requirements?

The provided data does not specify the exact type of facility constructed under 'SITE 4' or detail its key performance requirements. The NAICS code 236220, 'Commercial and Institutional Building Construction,' suggests it could range from administrative buildings, barracks, training facilities, or support structures. Without further documentation, such as the Statement of Work (SOW) or contract award justification, the precise nature and performance metrics of the construction remain unknown. Understanding these details is crucial for a comprehensive value assessment and for comparing this contract to similar projects.

What was the justification for awarding this contract on a 'Not Available for Competition' basis?

The justification for awarding this contract on a 'Not Available for Competition' basis is not detailed in the provided data. Typically, such designations are made when only one responsible source is available to meet the agency's needs. Reasons can include unique capabilities, urgent and compelling circumstances, or specific government property requirements. A thorough review of the contract's Justification and Approval (J&A) document would be necessary to understand the specific rationale employed by the Department of the Army in this instance. The absence of competition raises concerns about potential price inflation and missed opportunities for broader market engagement.

How does the firm-fixed-price (FFP) contract type impact risk allocation between the government and Chugach Government Services, Inc.?

The firm-fixed-price (FFP) contract type places the majority of the cost risk on the contractor, Chugach Government Services, Inc. This means the contractor is obligated to complete the work for the agreed-upon price, regardless of their actual costs. If their costs exceed the fixed price, their profit margin shrinks or they incur a loss. Conversely, if their costs are lower than anticipated, their profit increases. For the government, an FFP contract offers significant cost certainty, as the final price is known upfront. However, it can incentivize contractors to cut corners on quality if not adequately monitored, and the initial price might be higher to compensate for the contractor's risk.

What is the track record of Chugach Government Services, Inc. in performing similar large-scale construction contracts for the federal government?

The provided data identifies Chugach Government Services, Inc. as the contractor but does not offer details on their specific track record for large-scale construction projects. To assess their performance history, one would need to examine past federal contract awards, performance evaluations (e.g., Contractor Performance Assessment Reporting System - CPARS), and any history of disputes or contract terminations. A contractor's past performance is a critical indicator of their ability to successfully execute current contracts, manage costs, and adhere to schedules. Without this information, evaluating the reliability of Chugach Government Services, Inc. for this $114 million project is speculative.

Are there any comparable federal construction projects in Louisiana awarded around the same period that could serve as a benchmark for this contract's value?

Identifying specific comparable federal construction projects in Louisiana awarded around the 2008-2009 period (contract start/end dates) requires access to a comprehensive federal procurement database and filtering by agency, location, NAICS code, and contract value range. The provided data is insufficient to perform such a comparison. However, general benchmarks for commercial and institutional building construction can be found through industry cost estimating resources. Given the sole-source nature of this award, a direct comparison to competitively bid projects would be most insightful for assessing value for money, but such data is not readily available here.

What are the potential long-term implications of this infrastructure investment for the Department of Defense's operational capabilities in the region?

The long-term implications of this $114 million construction contract for the Department of Defense (DoD) depend entirely on the nature of the facility built under 'SITE 4'. If it's a critical operational hub, training center, or essential support facility, its completion could significantly enhance the DoD's capabilities in the region by providing modern, secure, and functional infrastructure. This could lead to improved readiness, efficiency, and capacity for military operations or support services. Conversely, if the facility is underutilized or becomes obsolete quickly, the long-term impact might be less significant or even represent a suboptimal use of resources.

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: NOT AVAILABLE FOR COMPETITION

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: W9126G08R0244

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Chugach Alaska Corporation (UEI: 071844021)

Address: 3800 CENTERPOINT DR STE 601, ANCHORAGE, AK, 00

Business Categories: 8(a) Program Participant, Alaskan Native Corporation Owned Firm, Category Business, Corporate Entity Not Tax Exempt, Emerging Small Business, Minority Owned Business, Native American Owned Business, Self-Certified Small Disadvantaged Business, Small Business, Special Designations

Financial Breakdown

Contract Ceiling: $114,469,305

Exercised Options: $114,469,305

Current Obligation: $114,469,305

Contract Characteristics

Cost or Pricing Data: NO

Timeline