DoD awards $107.8M contract for MILSTAR satellite communications facilities, with construction by Walsh Federal LLC

Contract Overview

Contract Amount: $107,755,018 ($107.8M)

Contractor: Walsh Federal LLC

Awarding Agency: Department of Defense

Start Date: 2023-07-01

End Date: 2026-07-14

Contract Duration: 1,109 days

Daily Burn Rate: $97.2K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: MILSTAR SATELLITE COMMUNICATIONS STATION/ DESIGN/BID/BUILD CAMPUS FACILITIES.

Place of Performance

Location: BELLEVUE, SARPY County, NEBRASKA, 68005

State: Nebraska Government Spending

Plain-Language Summary

Department of Defense obligated $107.8 million to WALSH FEDERAL LLC for work described as: MILSTAR SATELLITE COMMUNICATIONS STATION/ DESIGN/BID/BUILD CAMPUS FACILITIES. Key points: 1. The contract value of $107.8 million represents a significant investment in critical military infrastructure. 2. Competition dynamics indicate a full and open process, suggesting a potentially competitive bidding environment. 3. The firm-fixed-price contract type aims to control costs and provide predictability for the government. 4. The project's focus on satellite communications facilities highlights its strategic importance for national defense. 5. The duration of 1109 days suggests a complex and substantial construction undertaking. 6. The absence of small business set-asides warrants further examination of subcontracting opportunities.

Value Assessment

Rating: good

The contract value of $107.8 million for the design and build of satellite communication facilities appears reasonable given the scope and complexity. Benchmarking against similar large-scale military construction projects would provide a more precise assessment of value for money. The firm-fixed-price structure is generally favorable for controlling costs on projects of this nature, assuming the initial bid accurately reflects all anticipated expenses.

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 bids. This approach typically fosters a competitive environment, potentially leading to better pricing and innovation. The fact that Walsh Federal LLC was selected suggests they offered the most advantageous proposal based on the criteria outlined in the solicitation.

Taxpayer Impact: A full and open competition is generally beneficial for taxpayers as it maximizes the pool of potential bidders, increasing the likelihood of receiving competitive pricing and ensuring that taxpayer funds are used efficiently.

Public Impact

The Department of Defense will benefit from enhanced MILSTAR satellite communication capabilities. The project will deliver design and build services for critical national defense infrastructure. The geographic impact is concentrated in Nebraska, where the facilities will be constructed. The construction workforce will see implications through job creation and demand for skilled labor in the region.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if unforeseen construction challenges arise, despite the firm-fixed-price contract.
Dependence on a single contractor for the entire design and build process could pose risks if performance issues emerge.
The long duration of the project increases the potential for schedule delays due to external factors.

Positive Signals

The firm-fixed-price contract provides cost certainty for the government.
Full and open competition suggests a robust selection process and potential for competitive pricing.
The project addresses a critical need for advanced military communication infrastructure.

Sector Analysis

This contract falls within the Commercial and Institutional Building Construction sector, specifically supporting critical defense infrastructure. The market for large-scale government construction projects, particularly those involving specialized facilities like satellite communication stations, is competitive but often dominated by a few large firms with the necessary expertise and security clearances. Spending in this sector is driven by modernization efforts, infrastructure upgrades, and national security requirements.

Small Business Impact

The data indicates that this contract was not set aside for small businesses, nor does it appear to have specific subcontracting requirements for small businesses mentioned. This suggests that the primary award went to a large business. Further analysis would be needed to determine if Walsh Federal LLC intends to subcontract portions of the work to small businesses, which could still provide opportunities within the small business ecosystem.

Oversight & Accountability

Oversight for this contract will likely be managed by the Department of the Army contracting officers and program managers. Accountability measures are inherent in the firm-fixed-price contract, which places the financial risk on the contractor. Transparency is typically maintained through contract award databases and reporting requirements. The Inspector General's office may conduct audits or investigations if any irregularities or performance issues are identified.

Related Government Programs

MILSTAR Satellite Communications System
Department of Defense Construction Projects
Military Base Infrastructure
Satellite Ground Stations

Risk Flags

Long project duration increases risk of delays and cost escalation.
Firm-fixed-price contract requires careful management to avoid scope creep.
Lack of explicit small business subcontracting goals needs monitoring.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $107.8 million to WALSH FEDERAL LLC. MILSTAR SATELLITE COMMUNICATIONS STATION/ DESIGN/BID/BUILD CAMPUS FACILITIES.

Who is the contractor on this award?

The obligated recipient is WALSH FEDERAL 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 $107.8 million.

What is the period of performance?

Start: 2023-07-01. End: 2026-07-14.

What is the track record of Walsh Federal LLC in executing large-scale federal construction contracts, particularly those involving specialized facilities?

Walsh Federal LLC, as a subsidiary of The Walsh Group, has a significant history of undertaking large-scale construction projects for federal agencies. Their portfolio includes infrastructure, transportation, and building construction. While specific details on their experience with satellite communication facilities would require a deeper dive into their project history, The Walsh Group has a proven track record in complex government projects. Assessing their past performance on similar firm-fixed-price contracts, adherence to schedules, and budget management would be crucial for evaluating their capability to successfully deliver this MILSTAR facility.

How does the awarded amount of $107.8 million compare to similar MILSTAR facility construction projects or comparable defense infrastructure builds?

Benchmarking the $107.8 million award requires comparing it to similar projects in terms of scope, complexity, and location. Large-scale military construction, especially for specialized facilities like satellite communication stations, can vary significantly in cost due to factors such as site preparation, technological integration, security requirements, and labor costs. A preliminary comparison suggests that this figure is within the expected range for a project of this magnitude, but a detailed analysis would involve examining the square footage, specific technological components, and the duration of construction for comparable projects awarded over the past few years to ensure value for money.

What are the primary risk indicators associated with this contract, considering its firm-fixed-price nature and long duration?

The primary risk indicators for this firm-fixed-price contract include potential for scope creep if not managed tightly, unforeseen site conditions that could lead to change orders (though the contractor bears more risk), and contractor performance issues over the 1109-day duration. The long timeline increases the susceptibility to supply chain disruptions, labor availability fluctuations, and potential material cost increases that could strain the contractor's ability to maintain profitability without impacting quality or schedule. Robust project management and oversight are critical to mitigate these risks.

What is the expected effectiveness of the completed MILSTAR satellite communications facilities in enhancing national defense capabilities?

The effectiveness of the completed facilities will be directly tied to their ability to support and enhance the MILSTAR satellite communications system. This system is a cornerstone of secure, survivable, and global command and control communications for the U.S. military. The new facilities are expected to provide upgraded infrastructure, potentially increasing the system's resilience, capacity, and operational readiness. Their effectiveness will be measured by their uptime, security posture, and ability to facilitate seamless communication during critical operations and contingencies.

How has federal spending on similar defense construction projects evolved over the past five years?

Federal spending on defense construction projects has generally seen fluctuations driven by geopolitical events, military modernization priorities, and budget allocations. Over the past five years, there has been a consistent demand for infrastructure upgrades and new builds to support evolving defense needs, including cybersecurity, advanced communication systems, and readiness initiatives. While specific figures vary annually, the overall trend indicates sustained investment in maintaining and enhancing military facilities. Factors like the Base Realignment and Closure (BRAC) process and specific strategic defense programs also influence spending patterns in this category.

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: W9128F22R0028

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 929 W ADAMS ST, CHICAGO, IL, 60607

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

Financial Breakdown

Contract Ceiling: $108,433,018

Exercised Options: $107,755,018

Current Obligation: $107,755,018

Actual Outlays: $-30,321,936

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline