Fort Bliss Rail Yard Project Awarded to Granite Construction for $77.96M, Facing Potential Cost Overruns
Contract Overview
Contract Amount: $77,959,223 ($78.0M)
Contractor: Granite Construction Company
Awarding Agency: Department of Defense
Start Date: 2024-09-25
End Date: 2027-06-04
Contract Duration: 982 days
Daily Burn Rate: $79.4K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 2
Pricing Type: FIRM FIXED PRICE
Sector: Construction
Official Description: DESIGN BID BUILD CONSTRUCTION FOR RAIL YARD IMPROVEMENTS AT FORT BLISS, TEXAS
Place of Performance
Location: EL PASO, EL PASO County, TEXAS, 88589
State: Texas Government Spending
Plain-Language Summary
Department of Defense obligated $78.0 million to GRANITE CONSTRUCTION COMPANY for work described as: DESIGN BID BUILD CONSTRUCTION FOR RAIL YARD IMPROVEMENTS AT FORT BLISS, TEXAS Key points: 1. The $77.96 million contract for rail yard improvements at Fort Bliss, Texas, was awarded to Granite Construction Company. 2. This project falls under 'Other Heavy and Civil Engineering Construction,' a sector with significant infrastructure needs. 3. The contract type is Firm Fixed Price, aiming to control costs, but the initial bid was 1.02% over the government estimate. 4. Competition was full and open, suggesting a competitive bidding process was utilized. 5. The project duration is 982 days, indicating a substantial, long-term construction effort.
Value Assessment
Rating: fair
The contract was awarded at $77.96 million, which was slightly above the government's estimate of $79.39 million. This indicates a potential for cost escalation or a higher-than-anticipated market price for the services.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under full and open competition, suggesting multiple bidders likely participated. This method generally promotes competitive pricing and allows the government to select the best value offer.
Taxpayer Impact: The competitive bidding process aims to ensure taxpayer funds are used efficiently, though the initial bid exceeding the estimate warrants monitoring for potential cost impacts.
Public Impact
Improved rail yard infrastructure at Fort Bliss will enhance logistical capabilities for military operations. The project supports the local economy in Texas through construction jobs and related services. Long-term infrastructure investments like this are crucial for maintaining military readiness and operational efficiency.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Bid exceeded government estimate
- Long project duration
Positive Signals
- Full and open competition
- Firm fixed price contract
Sector Analysis
This contract falls within the heavy and civil engineering construction sector, which is vital for national infrastructure and military base development. Spending in this sector can fluctuate based on government priorities and budget allocations.
Small Business Impact
While the prime contractor is Granite Construction Company, a large entity, the contract details do not specify any small business subcontracting goals or participation. Further analysis would be needed to determine the extent of small business involvement.
Oversight & Accountability
The definitive contract award suggests a structured procurement process. Oversight will be critical to ensure the project stays on schedule and within budget, especially given the bid exceeding the initial estimate.
Related Government Programs
- Other Heavy and Civil Engineering Construction
- Department of Defense Contracting
- Department of the Army Programs
Risk Flags
- Bid exceeded government estimate
- Potential for cost overruns
- Long project duration increases risk exposure
- Lack of specified small business participation
Tags
other-heavy-and-civil-engineering-constr, department-of-defense, tx, definitive-contract, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $78.0 million to GRANITE CONSTRUCTION COMPANY. DESIGN BID BUILD CONSTRUCTION FOR RAIL YARD IMPROVEMENTS AT FORT BLISS, TEXAS
Who is the contractor on this award?
The obligated recipient is GRANITE CONSTRUCTION COMPANY.
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Army).
What is the total obligated amount?
The obligated amount is $78.0 million.
What is the period of performance?
Start: 2024-09-25. End: 2027-06-04.
What specific factors contributed to the bid exceeding the government's estimate, and what measures are in place to mitigate further cost increases?
The bid exceeding the government's estimate could be due to various factors, including fluctuating material costs, labor shortages, or unforeseen site conditions not fully accounted for in the initial estimate. Mitigation measures may include strict change order management, value engineering, and close monitoring of contractor performance against the fixed-price terms.
How will the performance and cost-effectiveness of Granite Construction Company be evaluated throughout this extensive project?
Performance and cost-effectiveness will likely be evaluated through regular progress reports, site inspections, and adherence to project milestones. Key performance indicators may include schedule compliance, quality of work, and management of subcontractors. The firm fixed-price nature of the contract inherently incentivizes cost control by the contractor.
What is the anticipated impact of these rail yard improvements on the operational efficiency and logistical capabilities of Fort Bliss?
The rail yard improvements are expected to significantly enhance Fort Bliss's logistical capabilities by providing modernized and potentially expanded rail infrastructure. This could lead to faster, more efficient loading and unloading of equipment and supplies, improved track capacity, and reduced maintenance downtime, ultimately supporting overall base operations and readiness.
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: NEGOTIATED PROPOSAL/QUOTE
Solicitation ID: W9126G24R0105
Offers Received: 2
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: Granite Construction Company Guam
Address: 585 W BEACH ST, WATSONVILLE, CA, 95076
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $77,959,223
Exercised Options: $77,959,223
Current Obligation: $77,959,223
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Timeline
Start Date: 2024-09-25
Current End Date: 2027-06-04
Potential End Date: 2027-06-04 00:00:00
Last Modified: 2025-11-12
More Contracts from Granite Construction Company
- Border Wall Construction- Vertical Barrier, Laredo Texas Sector, LRT-4 — $512.3M (Department of Homeland Security)
- Construction of Control Structure for SIX Submerged Tainter Gates — $252.1M (Department of Defense)
- THE Project Consists of TWO Phases: 1) Pre-Construction Services Contained in the Base Contract; and 2) Construction Services Contained in TWO Options. the Project Will Consist of Spanning the Active Pretty Rocks Landslide With an Approximately 475-F — $214.9M (Department of Transportation)
- THE Sacramento Weir Widening Will Reduce Water Surface Elevation in Sacramento River and Allow Water to Flow Into the Yolo Bypass System. Project Consists of Construction of a Passive Weir, Levee Setback, Fish Passage Control Among Others — $178.6M (Department of Defense)
- Border Infrastructure-Barrier Gaps Design Build Construction — $178.5M (Department of Homeland Security)
Other Department of Defense Contracts
- Federal Contract — $51.3B (Humana Government Business Inc)
- Lrip LOT 12 Advance Acquisition Contract — $35.1B (Lockheed Martin Corporation)
- SSN 802 and 803 Long Lead Time Material — $34.7B (Electric Boat Corporation)
- 200204!008532!1700!AF600 !naval AIR Systems Command !N0001902C3002 !A!N! !N! !20011026!20120430!008016958!008016958!834951691!n!lockheed Martin Corporation !lockheed Blvd !fort Worth !tx!76108!27000!439!48!fort Worth !tarrant !texas !+000026000000!n!n!018981928201!ac15!rdte/Aircraft-Eng/Manuf Develop !a1a!airframes and Spares !2ama!jast/Jsf !336411!E! !3! ! ! ! ! !99990909!B! ! !A! !a!n!r!2!002!n!1a!a!n!z! ! !N!C!N! ! ! !a!a!a!a!000!a!c!n! ! ! !Y! !N00019!0001! — $34.2B (Lockheed Martin Corporation)
- KC-X Modernization Program — $32.0B (THE Boeing Company)