Department of Defense awards $20.19M contract for building repair at Schofield Barracks, Hawaii

Contract Overview

Contract Amount: $20,180,950 ($20.2M)

Contractor: D7, LLC

Awarding Agency: Department of Defense

Start Date: 2022-09-30

End Date: 2024-12-09

Contract Duration: 801 days

Daily Burn Rate: $25.2K/day

Competition Type: NOT AVAILABLE FOR COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: PN011165 REPAIR BUILDING 759 FOR IEW BN, SCHOFIELD BARRACKS, OAHU, HAWAII

Place of Performance

Location: FORT SHAFTER, HONOLULU County, HAWAII, 96858

State: Hawaii Government Spending

Plain-Language Summary

Department of Defense obligated $20.2 million to D7, LLC for work described as: PN011165 REPAIR BUILDING 759 FOR IEW BN, SCHOFIELD BARRACKS, OAHU, HAWAII Key points: 1. The contract value of $20.19 million for building repair suggests a significant investment in infrastructure maintenance. 2. The 'NOT AVAILABLE FOR COMPETITION' status raises questions about the procurement process and potential for cost savings through competition. 3. The duration of 801 days indicates a complex or extensive repair project. 4. The firm-fixed-price contract type shifts cost risk to the contractor, which can be beneficial for budget certainty. 5. The award to D7, LLC, a single entity, warrants scrutiny regarding contractor capacity and past performance. 6. The project's location in Hawaii may imply higher construction costs due to logistics and local market conditions.

Value Assessment

Rating: fair

The contract value of $20.19 million for building repair appears substantial. Without specific details on the scope of work for Building 759, direct comparison to similar contracts is challenging. However, for a definitive contract of this size and duration, the pricing would need to be benchmarked against average construction costs per square foot for similar facilities in Hawaii, considering potential logistical premiums. The firm-fixed-price nature provides budget certainty but requires careful initial pricing by the contractor.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded as 'NOT AVAILABLE FOR COMPETITION,' indicating a sole-source procurement. This means the Department of the Army did not solicit bids from multiple contractors. The lack of competition limits price discovery and may result in a higher price than if multiple firms had competed. The justification for this sole-source award would need to be examined to understand why full and open competition was not feasible.

Taxpayer Impact: Taxpayers may have paid a premium due to the absence of competitive bidding, as the government did not benefit from the price reductions typically driven by a competitive environment.

Public Impact

The primary beneficiaries are the U.S. Army and its personnel stationed at Schofield Barracks, Oahu, Hawaii, who will gain access to a repaired and functional Building 759. The contract delivers essential building repair services, ensuring the structural integrity and operational readiness of a key facility. The geographic impact is localized to Schofield Barracks, Oahu, Hawaii, supporting the military installation's infrastructure. The project will likely involve local construction labor and potentially local material suppliers, providing economic stimulus within the Hawaii region.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits price competition, potentially leading to higher costs for taxpayers.
Lack of transparency in the justification for sole-sourcing requires further investigation.
The significant contract value necessitates robust oversight to ensure quality and prevent cost overruns, despite the fixed-price nature.

Positive Signals

Firm-fixed-price contract provides budget certainty for the government.
Award to a single contractor (D7, LLC) can streamline project management if the contractor is capable.
The project addresses critical infrastructure needs at a major military installation.

Sector Analysis

This contract falls within the Commercial and Institutional Building Construction sector, a vital part of the broader construction industry. This sector encompasses the building and renovation of non-residential structures. Spending in this area is often driven by government infrastructure needs, military base maintenance, and the development of public facilities. Comparable spending benchmarks would typically involve analyzing the average cost of similar military construction or renovation projects across different regions, factoring in material costs, labor rates, and logistical challenges specific to island locations like Hawaii.

Small Business Impact

The data indicates that this contract was not set aside for small businesses (ss: false, sb: false). As a sole-source award, there were no subcontracting opportunities explicitly mandated through a competitive bidding process. The impact on the small business ecosystem is neutral in terms of direct set-asides, but the prime contractor, D7, LLC, may engage small businesses for specialized services or materials, though this is not guaranteed by the contract terms.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of the Army's contracting and project management offices. Accountability measures are inherent in the firm-fixed-price structure, which holds the contractor responsible for delivering the specified work within the agreed price. Transparency is limited due to the sole-source nature; however, contract award details are publicly available. Inspector General jurisdiction would apply if any allegations of fraud, waste, or abuse arise during the contract performance.

Related Government Programs

Military Construction
Base Realignment and Closure (BRAC) related projects
Federal Building and Facilities Maintenance
Department of Defense Infrastructure Projects

Risk Flags

Sole-source award requires justification and may limit price competition.
Contract duration is lengthy (801 days), increasing exposure to potential changes or issues.
Lack of detailed scope of work in provided data hinders full value assessment.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $20.2 million to D7, LLC. PN011165 REPAIR BUILDING 759 FOR IEW BN, SCHOFIELD BARRACKS, OAHU, HAWAII

Who is the contractor on this award?

The obligated recipient is D7, LLC.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $20.2 million.

What is the period of performance?

Start: 2022-09-30. End: 2024-12-09.

What is the specific scope of work for the repair of Building 759, and what justifies the $20.19 million cost?

The provided data does not detail the specific scope of work for the repair of Building 759. However, the contract value of $20.19 million suggests a significant undertaking, potentially involving structural repairs, system upgrades (HVAC, electrical, plumbing), interior renovations, or a combination thereof. The justification for this cost would typically be outlined in the contract's Statement of Work (SOW) and associated cost estimates. Factors influencing the price could include the building's size, age, condition, the complexity of the required repairs, material costs, labor rates in Hawaii, and any specific military or security requirements. Without the SOW, a precise cost justification is not possible.

Why was this contract awarded on a sole-source basis, and what was the justification for not seeking competitive bids?

The data explicitly states the contract was awarded as 'NOT AVAILABLE FOR COMPETITION,' indicating a sole-source procurement. The specific justification for this decision is not provided in the given data. Generally, sole-source awards are made when only one responsible source can provide the required supplies or services, often due to unique capabilities, urgent needs, or compatibility requirements with existing systems. The Department of the Army would have had to document and approve a justification and approval (J&A) for this sole-source award, outlining why full and open competition was not feasible or not in the government's best interest. This documentation is crucial for ensuring proper procurement practices.

What is the track record of D7, LLC in performing similar building repair contracts for the federal government?

Information regarding the track record of D7, LLC in performing similar building repair contracts for the federal government is not included in the provided data. To assess their capabilities and past performance, one would typically consult federal procurement databases such as the Federal Procurement Data System (FPDS) or the Contractor Performance Assessment Reporting System (CPARS). These systems contain records of past contracts, performance evaluations, and any disputes or corrective actions. A review of these sources would be necessary to determine if D7, LLC has a history of successful project completion, adherence to schedule and budget, and overall client satisfaction on comparable projects.

How does the $20.19 million contract value compare to typical federal building repair projects of similar scope and location?

Comparing the $20.19 million contract value requires knowledge of the specific scope of work, which is not detailed here. However, for a significant building repair project at a military installation in Hawaii, this figure is substantial. Construction costs in Hawaii are generally higher than in the continental U.S. due to logistical challenges, transportation of materials, and local labor rates. Benchmarking would involve looking at per-square-foot costs for similar military facility renovations or repairs. Without more specific project details (e.g., square footage, type of building, extent of repairs), it's difficult to definitively state if this represents a high or low value, but it indicates a major infrastructure investment.

What are the potential risks associated with a sole-source contract of this magnitude, and what mitigation strategies are in place?

The primary risk of a sole-source contract of this magnitude is the potential for inflated pricing due to the lack of competitive pressure. Without competing bids, the government may not achieve the best possible price. Other risks include potential contractor performance issues if the chosen contractor lacks sufficient experience or resources, and reduced transparency in the procurement process. Mitigation strategies typically involve rigorous negotiation of the contract terms and price, thorough pre-award due diligence on the contractor's capabilities and past performance, and robust contract administration and oversight during performance to ensure quality and adherence to the SOW. The government may also require detailed cost breakdowns and justifications from the contractor.

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: W9128A22R0015

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 1755 TELSTAR DR, COLORADO SPRINGS, CO, 80920

Business Categories: 8(a) Program Participant, Category Business, Corporate Entity Not Tax Exempt, Limited Liability Corporation, Minority Owned Business, Native American Owned Business, Native Hawaiian Organization Owned Firm, Self-Certified Small Disadvantaged Business, Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $20,180,950

Exercised Options: $20,180,950

Current Obligation: $20,180,950

Subaward Activity

Number of Subawards: 8

Total Subaward Amount: $10,804,092

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline