DoD awards $45.7M for USDA lab renovation, Skanska USA Building Inc. secures contract

Contract Overview

Contract Amount: $45,722,892 ($45.7M)

Contractor: Skanska USA Building Inc

Awarding Agency: Department of Defense

Start Date: 2021-11-05

End Date: 2025-03-16

Contract Duration: 1,227 days

Daily Burn Rate: $37.3K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 3

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: CONSTRUCTION AND RENOVATION OF LABORATORY FACILITIES AT THE USDA-ARS KERRVILLE SITE.

Place of Performance

Location: KERRVILLE, KERR County, TEXAS, 78028

State: Texas Government Spending

Plain-Language Summary

Department of Defense obligated $45.7 million to SKANSKA USA BUILDING INC for work described as: CONSTRUCTION AND RENOVATION OF LABORATORY FACILITIES AT THE USDA-ARS KERRVILLE SITE. Key points: 1. Contract value appears reasonable for a large-scale laboratory renovation project. 2. Full and open competition suggests a competitive bidding process. 3. Fixed-price contract type mitigates cost overrun risks for the government. 4. Project duration of over three years indicates a complex undertaking. 5. Geographic focus on Texas may have implications for local construction firms. 6. The contract falls within the broad category of commercial and institutional building construction.

Value Assessment

Rating: good

The contract value of $45.7 million for the renovation of laboratory facilities at the USDA-ARS Kerrville site appears to be within a reasonable range for a project of this scale and complexity. Benchmarking against similar large-scale construction and renovation projects for government facilities suggests that the pricing is competitive. The firm-fixed-price nature of the contract further supports value for money by shifting cost risk to the contractor. Without specific cost breakdowns or detailed comparisons to identical projects, a precise value-for-money assessment is challenging, but initial indicators are positive.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit a bid. The presence of three bidders suggests a moderate level of competition for this project. While more bidders could potentially drive prices lower, three offers generally provide a reasonable basis for price discovery and selection. The government's ability to select from multiple proposals implies that a competitive market exists for this type of specialized construction service.

Taxpayer Impact: Full and open competition, with three bidders, suggests that taxpayers are likely receiving a fair price due to market forces. This approach helps ensure that the government is not overpaying for the construction services.

Public Impact

The primary beneficiary is the USDA Agricultural Research Service (ARS), which will gain modernized laboratory facilities. The project will deliver essential renovations to support scientific research and development at the Kerrville site. The geographic impact is concentrated in Kerrville, Texas, potentially benefiting the local economy through job creation and material sourcing. The construction workforce in the region will likely see increased employment opportunities during the project's duration.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for delays given the multi-year duration and complexity of laboratory renovations.
Ensuring adherence to specialized laboratory construction standards throughout the project.
Managing the impact of construction on ongoing USDA research operations at the site.

Positive Signals

Firm-fixed-price contract limits the government's exposure to cost increases.
Full and open competition suggests a robust bidding process.
Award to a known entity like Skanska USA Building Inc. may indicate a track record of performance.

Sector Analysis

This contract falls within the construction sector, specifically focusing on commercial and institutional building construction. The market for large-scale government facility renovations is substantial, driven by the need to maintain and upgrade aging infrastructure and specialized research environments. Skanska USA Building Inc. is a major player in the construction industry, often undertaking significant public and private projects. This contract represents a typical investment in upgrading critical scientific infrastructure for a federal agency.

Small Business Impact

The data indicates that this contract was not set aside for small businesses and that small business subcontracting was not explicitly mentioned as a requirement (sb: false). This suggests that the primary contract was awarded to a large business, Skanska USA Building Inc. While large prime contracts can sometimes lead to subcontracting opportunities for small businesses, the absence of a specific set-aside or subcontracting goal means that the direct impact on the small business ecosystem for this particular award is likely limited unless the prime contractor voluntarily engages small businesses.

Oversight & Accountability

Oversight for this contract will likely be managed by the contracting officer and relevant personnel within the Department of the Army, overseeing the Department of Defense. The firm-fixed-price nature of the contract provides a degree of accountability for the contractor regarding cost. Transparency is generally maintained through contract award databases and public reporting. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

USDA Research Facilities Construction
Department of Defense Construction Contracts
Laboratory Renovation Projects
Federal Building and Infrastructure Modernization

Risk Flags

Project Duration
Scope Complexity
Potential for Unforeseen Conditions

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $45.7 million to SKANSKA USA BUILDING INC. CONSTRUCTION AND RENOVATION OF LABORATORY FACILITIES AT THE USDA-ARS KERRVILLE SITE.

Who is the contractor on this award?

The obligated recipient is SKANSKA USA BUILDING 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 $45.7 million.

What is the period of performance?

Start: 2021-11-05. End: 2025-03-16.

What is Skanska USA Building Inc.'s track record with similar federal construction contracts, particularly laboratory renovations?

Skanska USA Building Inc. has a significant history of undertaking large-scale construction projects for federal agencies, including laboratory facilities and research centers. Their portfolio often includes complex projects requiring specialized knowledge and adherence to stringent regulatory standards. While specific data on the number and value of past USDA or similar laboratory renovations by Skanska is not provided here, their general profile as a major construction firm suggests they possess the capacity and experience. A deeper dive into federal contract databases (like SAM.gov or FPDS) would reveal specific past performance metrics, past performance evaluations, and any history of disputes or contract modifications on similar projects. This would provide a clearer picture of their reliability and expertise in this niche.

How does the awarded amount of $45.7 million compare to the average cost of similar laboratory renovation projects for federal agencies?

Benchmarking the $45.7 million award requires comparing it to projects of similar scope, size, and complexity. Laboratory renovations can vary widely in cost depending on the specific scientific equipment, environmental controls, safety features, and structural modifications required. Projects involving highly specialized research environments (e.g., biosafety labs, clean rooms) typically command higher costs. Without detailed project specifications, a direct comparison is difficult. However, for a significant renovation of laboratory facilities at a federal research site, $45.7 million is within the expected range for a large-scale undertaking. Factors like location, prevailing labor rates, and material costs also influence the final price. A more precise comparison would involve analyzing cost-per-square-foot data from comparable federal laboratory renovation contracts awarded within the last few years.

What are the primary risks associated with a multi-year construction project like this, and how are they mitigated?

Key risks for a multi-year construction project include potential schedule delays due to unforeseen site conditions, weather, supply chain disruptions, or labor shortages. Cost overruns are another significant risk, particularly in fixed-price contracts if not managed effectively. For this project, the firm-fixed-price contract shifts the primary cost risk to Skanska USA Building Inc., incentivizing them to manage costs efficiently. Mitigation strategies likely include detailed project planning, robust scheduling, contingency planning for potential issues, strong contract oversight by the Army Corps of Engineers or relevant agency, and clear communication protocols. The contractor's experience and the government's project management capabilities are crucial in navigating these risks to ensure timely and budget-conscious completion.

What is the expected impact of these renovated facilities on the USDA-ARS's research capabilities and output?

The renovation of laboratory facilities at the USDA-ARS Kerrville site is expected to significantly enhance the agency's research capabilities. Modernized labs typically offer improved infrastructure for conducting advanced scientific experiments, better environmental controls for sensitive research, enhanced safety features, and potentially more efficient workflows. This upgrade should enable researchers to pursue new lines of inquiry, improve the accuracy and reliability of existing research, and potentially accelerate the pace of scientific discovery and innovation within ARS's mission areas. The specific impact will depend on the nature of the research conducted at Kerrville, but generally, updated facilities are crucial for maintaining a competitive edge in scientific research.

How has federal spending on construction and renovation of research facilities evolved over the past five years?

Federal spending on the construction and renovation of research facilities has generally seen fluctuations driven by infrastructure initiatives, agency budget priorities, and the need to modernize aging government laboratories and scientific infrastructure. While specific aggregate data for 'research facility construction' can be complex to isolate, broader trends in federal construction spending indicate periods of increased investment, particularly following major infrastructure bills or during times when agencies prioritize upgrades to scientific capabilities. Factors such as the COVID-19 pandemic also influenced spending, sometimes redirecting funds or highlighting needs for specific types of research facilities. Analyzing trends across agencies like the National Science Foundation (NSF), National Institutes of Health (NIH), and various Department of Defense (DoD) research arms would provide a more comprehensive view of this spending category over the last five years.

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: W9126G21R0034

Offers Received: 3

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 18615 TUSCANY STONE STE 245, SAN ANTONIO, TX, 78258

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: $52,530,892

Exercised Options: $45,722,892

Current Obligation: $45,722,892

Actual Outlays: $2,813,722

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline