DoD awards $77.9M for formal training unit construction, with 5 bidders competing

Contract Overview

Contract Amount: $77,895,558 ($77.9M)

Contractor: Federal Contracting Inc

Awarding Agency: Department of Defense

Start Date: 2022-06-24

End Date: 2026-01-22

Contract Duration: 1,308 days

Daily Burn Rate: $59.6K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 5

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: CONSTRUCT FORMAL TRAINING UNIT

Place of Performance

Location: ELLSWORTH AFB, MEADE County, SOUTH DAKOTA, 57706

State: South Dakota Government Spending

Plain-Language Summary

Department of Defense obligated $77.9 million to FEDERAL CONTRACTING INC for work described as: CONSTRUCT FORMAL TRAINING UNIT Key points: 1. Contract value appears reasonable given the scope of constructing a formal training unit. 2. Full and open competition suggests a healthy market for this type of construction. 3. Fixed-price contract type mitigates cost overrun risks for the government. 4. The contract duration of 1308 days indicates a substantial and complex project. 5. Project located in South Dakota may have specific regional labor and material cost considerations.

Value Assessment

Rating: good

The contract value of approximately $77.9 million for constructing a formal training unit is within a typical range for such large-scale government construction projects. Benchmarking against similar projects for military training facilities would provide a more precise value-for-money assessment. The firm fixed-price structure is generally favorable for the government, locking in costs early. However, without detailed cost breakdowns or comparisons to private sector construction of equivalent facilities, a definitive value assessment is challenging.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, with five bidders submitting proposals. This level of competition is a positive indicator, suggesting that multiple firms were interested and capable of performing the work. A competitive environment typically drives down prices and encourages better quality and service delivery as contractors vie for the award. The presence of five bidders indicates a robust market for this type of construction service.

Taxpayer Impact: The full and open competition with multiple bidders is beneficial for taxpayers as it likely resulted in a more competitive price than a sole-source or limited competition award. This process helps ensure that government funds are used efficiently by leveraging market forces.

Public Impact

The primary beneficiaries are the Department of Defense and its personnel who will utilize the new formal training unit. The contract delivers essential infrastructure for military training and readiness. The project's geographic impact is centered in South Dakota, potentially creating local jobs and economic activity. Workforce implications include employment opportunities for construction workers, engineers, and project managers in the region.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if unforeseen site conditions arise, despite fixed-price contract.
Dependence on regional labor availability and potential for wage inflation.
Supply chain disruptions for specialized construction materials could impact schedule.
Environmental compliance and permitting challenges specific to the South Dakota location.

Positive Signals

Firm fixed-price contract provides cost certainty for the government.
Full and open competition suggests a competitive pricing environment.
Experienced contractor (assuming Federal Contracting Inc. has a strong track record).
Clear project scope defined for a formal training unit.
Long-term need for military training infrastructure ensures program relevance.

Sector Analysis

This contract falls within the construction sector, specifically commercial and institutional building construction. The market for large-scale government construction, particularly for defense facilities, is substantial. Federal Contracting Inc. is positioned to compete in this segment. Comparable spending benchmarks would involve analyzing other military base construction projects or large institutional building projects awarded by federal agencies, considering factors like size, complexity, and location.

Small Business Impact

The data indicates that small business participation was not a primary focus for this specific contract, as the 'sb' field is false. There is no explicit small business set-aside mentioned. Subcontracting opportunities for small businesses may arise during the execution of the project, but this is not guaranteed or mandated by the contract terms provided. The impact on the small business ecosystem would depend on the extent to which the prime contractor, Federal Contracting Inc., chooses to engage small businesses for specialized services or materials.

Oversight & Accountability

Oversight for this contract will likely be managed by the Department of the Army contracting and project management offices. Accountability measures are inherent in the firm fixed-price contract, which penalizes the contractor for cost overruns. Transparency is facilitated by the public nature of federal contract awards, allowing for scrutiny. Inspector General jurisdiction would apply if any fraud, waste, or abuse is suspected during the contract's lifecycle.

Related Government Programs

Military Base Construction
Defense Infrastructure Projects
Federal Building Construction
Training Facility Development
Department of Defense Procurement

Risk Flags

Potential for cost escalation despite fixed-price contract due to unforeseen site conditions.
Risk of contractor performance issues impacting project timeline or quality.
Dependence on regional economic factors (labor, materials) in South Dakota.
Long-term operational and maintenance costs not detailed in this award.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $77.9 million to FEDERAL CONTRACTING INC. CONSTRUCT FORMAL TRAINING UNIT

Who is the contractor on this award?

The obligated recipient is FEDERAL CONTRACTING 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 $77.9 million.

What is the period of performance?

Start: 2022-06-24. End: 2026-01-22.

What is the track record of Federal Contracting Inc. in completing large-scale construction projects for the Department of Defense?

Assessing the track record of Federal Contracting Inc. is crucial for understanding their capability to deliver this $77.9 million formal training unit construction project. A review of their past performance on similar government contracts, particularly those with the Department of Defense, would reveal their history of on-time and on-budget delivery, quality of work, and any past disputes or contract terminations. Data on their financial stability and bonding capacity would also be relevant. Without specific past performance data, it's difficult to definitively assess their reliability for this significant undertaking. However, the award itself suggests they met the minimum requirements during the solicitation process.

How does the awarded price of $77.9 million compare to similar formal training unit construction projects?

Benchmarking the $77.9 million contract value against similar formal training unit construction projects is essential for evaluating value for money. This comparison should account for project size (square footage), complexity of facilities, geographic location (which impacts labor and material costs), and the specific training capabilities to be housed. For instance, a training unit requiring specialized simulation equipment or advanced technological infrastructure would naturally command a higher price than a basic barracks or classroom facility. Analyzing historical data from the General Services Administration (GSA) or the Department of Defense's own construction cost databases can provide relevant benchmarks. A preliminary assessment suggests the price is within a reasonable range for a large federal construction project, but detailed comparative analysis is needed.

What are the primary risks associated with the firm fixed-price contract type for this project?

While a firm fixed-price (FFP) contract is generally advantageous for the government by providing cost certainty, it shifts the risk of cost overruns to the contractor. For this $77.9 million construction project, the primary risks associated with an FFP contract include the contractor potentially cutting corners on quality to maintain profitability if costs escalate unexpectedly. There's also a risk that the contractor may have underestimated certain project complexities, leading to disputes or a desire to seek change orders, which can increase the overall cost. Furthermore, if the contractor lacks sufficient financial reserves or contingency planning, unforeseen issues could lead to financial distress for the contractor, potentially impacting project completion. The government's risk is primarily in ensuring robust contract administration and quality assurance to mitigate these potential downsides.

What is the expected impact of this contract on military training readiness and capabilities?

The construction of a new formal training unit is directly intended to enhance military training readiness and capabilities. This facility will likely provide modern infrastructure, potentially incorporating advanced simulation technologies, updated learning environments, and increased capacity for training personnel. By replacing or augmenting existing facilities, it can support more effective and efficient training programs, ensuring service members are adequately prepared for their roles. The specific impact will depend on the type of training conducted at the unit, but generally, such investments are critical for maintaining a high level of military preparedness in response to evolving operational demands and technological advancements.

How has federal spending on construction projects for military training facilities trended over the past five years?

Analyzing the trend in federal spending on construction projects for military training facilities over the past five years would provide valuable context for the $77.9 million award. This trend analysis would involve examining aggregate spending data from agencies like the Department of Defense, looking at the number and value of awarded contracts for similar facilities. An increasing trend might indicate a strategic focus on modernizing training infrastructure, potentially driven by new military doctrines or technological requirements. Conversely, a decreasing trend could suggest budget constraints or a shift in investment priorities. Understanding this historical spending pattern helps assess whether this current contract represents a typical investment or a significant deviation.

What are the potential long-term operational and maintenance costs associated with the new training unit?

While this contract covers the initial construction of the formal training unit, the government must also consider the long-term operational and maintenance (O&M) costs. These costs can be substantial and include utilities, staffing, routine repairs, and periodic upgrades. The design and materials chosen during construction can significantly influence future O&M expenses; for example, energy-efficient systems may reduce utility bills, while durable materials might lower repair costs. A comprehensive lifecycle cost analysis, which estimates total ownership costs over the facility's lifespan, should ideally inform the initial construction decisions to ensure long-term affordability and sustainability of the training unit.

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: W9128F21R0079

Offers Received: 5

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 5475 TECH CENTER DR STE 300, COLORADO SPRINGS, CO, 80919

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $78,008,558

Exercised Options: $77,895,558

Current Obligation: $77,895,558

Actual Outlays: $6,101,229

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline