Department of the Army awards $35.4M construction contract for EH 2ND FL DESIGN&QAUD A CONSTRUCTION

Contract Overview

Contract Amount: $35,375,826 ($35.4M)

Contractor: Grunley Construction CO., Inc.

Awarding Agency: Department of Defense

Start Date: 2019-09-30

End Date: 2024-08-29

Contract Duration: 1,795 days

Daily Burn Rate: $19.7K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: EH 2ND FL DESIGN&QAUD A CONSTRUCTION

Place of Performance

Location: BETHESDA, MONTGOMERY County, MARYLAND, 20816

State: Maryland Government Spending

Plain-Language Summary

Department of Defense obligated $35.4 million to GRUNLEY CONSTRUCTION CO., INC. for work described as: EH 2ND FL DESIGN&QAUD A CONSTRUCTION Key points: 1. Contract awarded through full and open competition, suggesting a competitive bidding process. 2. The contract is a firm-fixed-price delivery order, providing cost certainty for the government. 3. The duration of the contract is 1795 days, indicating a long-term project. 4. The contract is for construction services, falling under the Commercial and Institutional Building Construction sector. 5. The award was made by the Department of the Army, a major component of the Department of Defense. 6. The contract was awarded to GRUNLEY CONSTRUCTION CO., INC.

Value Assessment

Rating: good

Benchmarking the $35.4 million price tag for this construction project requires detailed cost breakdowns and scope comparisons, which are not fully available in the provided data. However, given the firm-fixed-price nature and the competitive award, it suggests a reasonable price was negotiated. The duration of nearly five years implies a significant scope of work, making direct per-project comparisons challenging without more specific details on the facility and its intended use. The contract's value appears substantial for a single delivery order, but its value-for-money will ultimately depend on the quality of the delivered construction and adherence to the design and quality assurance requirements.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under a 'full and open competition' procurement method. This indicates that the solicitation was made available to all responsible prospective contractors, allowing for the widest possible range of bidders. The specific number of bids received is not provided, but the 'full and open' designation generally implies a robust competitive environment, which is favorable for price discovery and potentially achieving better value.

Taxpayer Impact: A full and open competition process is generally beneficial for taxpayers as it maximizes the potential for competitive pricing and encourages contractors to offer their best value proposals to win the award.

Public Impact

The primary beneficiaries are likely the personnel and operations within the Department of the Army that will utilize the improved or constructed facility. The contract delivers design and quality assurance services for a construction project, ensuring the facility meets specified standards. The geographic impact is localized to Maryland, where the contract is being performed. The project will likely have implications for the construction workforce in the Maryland region, creating employment opportunities.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if unforeseen construction issues arise, despite the fixed-price nature.
Delays in project completion could impact the operational readiness of the facility.
Quality control issues could lead to long-term maintenance problems and increased lifecycle costs.

Positive Signals

Firm-fixed-price contract provides budget certainty for the government.
Full and open competition suggests a competitive pricing environment.
Long contract duration allows for thorough execution and quality assurance.

Sector Analysis

The construction sector is a significant part of the federal procurement landscape, encompassing a wide range of projects from infrastructure to facility upgrades. This contract falls under Commercial and Institutional Building Construction, a sub-sector that includes the building of offices, educational facilities, and other non-residential structures. Federal spending in this area is often driven by the need to maintain, modernize, or expand government facilities. Comparable spending benchmarks would typically involve analyzing the cost per square foot for similar government construction projects in the same geographic region.

Small Business Impact

The provided data indicates that this contract was not set aside for small businesses (ss: false, sb: false). Therefore, there are no direct subcontracting implications specifically mandated for small businesses through a set-aside. However, the prime contractor, GRUNLEY CONSTRUCTION CO., INC., may still engage small businesses as subcontractors to fulfill portions of the work, depending on their own subcontracting plans and the availability of qualified small business firms in the market.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and the project's technical representatives within the Department of the Army. Accountability measures are embedded in the firm-fixed-price contract terms, requiring delivery of specified services and construction quality. Transparency is facilitated through contract award databases like FPDS, which provide basic information on contract value, type, and parties involved. Inspector General jurisdiction would apply if any fraud, waste, or abuse is suspected.

Related Government Programs

Department of Defense Construction Contracts
Army Facilities Engineering
Commercial Building Construction
Design and Quality Assurance Services
Firm Fixed Price Contracts

Risk Flags

Long contract duration may increase exposure to market volatility.
Potential for scope creep if design and QA requirements are not clearly defined.
Reliance on a single contractor for design and construction quality.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $35.4 million to GRUNLEY CONSTRUCTION CO., INC.. EH 2ND FL DESIGN&QAUD A CONSTRUCTION

Who is the contractor on this award?

The obligated recipient is GRUNLEY CONSTRUCTION CO., 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 $35.4 million.

What is the period of performance?

Start: 2019-09-30. End: 2024-08-29.

What is the track record of GRUNLEY CONSTRUCTION CO., INC. with the Department of the Army and similar construction projects?

GRUNLEY CONSTRUCTION CO., INC. has a history of performing construction services for various government agencies, including the Department of the Army. Analyzing their past performance on similar firm-fixed-price contracts, particularly those involving design and quality assurance for institutional buildings, would be crucial. This would involve reviewing past contract awards, performance evaluations (if publicly available), and any history of disputes or contract modifications. A strong track record with the Army suggests familiarity with their processes, requirements, and quality standards, which can be a positive indicator for project success. Conversely, a history of significant delays, cost overruns, or quality issues on comparable projects would raise concerns about their capacity to deliver this specific contract effectively.

How does the awarded amount of $35.4 million compare to similar construction projects for institutional buildings in Maryland?

Comparing the $35.4 million award requires detailed analysis of the project's scope, square footage, complexity, and specific construction elements. Without this granular detail, a direct comparison is difficult. However, general benchmarks for institutional building construction in Maryland can provide context. Factors such as the age and condition of existing facilities, the specific design requirements (e.g., LEED certification, specialized systems), and prevailing labor and material costs in the region influence overall project cost. If this contract covers a substantial renovation or new construction of a large facility, the $35.4 million might be within a reasonable range. Conversely, if it's for a smaller scope or a less complex project, it could indicate potential overpricing or scope creep. Further investigation into the specific deliverables and market rates for similar construction services in Maryland is needed for a definitive value assessment.

What are the primary risks associated with a firm-fixed-price contract of this duration (1795 days)?

The primary risk with a firm-fixed-price (FFP) contract, especially one spanning nearly five years, lies with the contractor's ability to accurately estimate and control costs throughout the project lifecycle. While FFP offers cost certainty to the government, it places the financial risk on the contractor. Risks include unforeseen site conditions, material price escalation beyond what was anticipated, labor shortages, or design changes requested by the government that could lead to claims for equitable adjustments. For the government, the risk is that the contractor may cut corners on quality to maintain profitability, or that significant scope changes could lead to protracted negotiations and potential disputes. Effective government oversight and clear contract terms are crucial to mitigate these risks.

What does the 'FULL AND OPEN COMPETITION' designation imply about the potential for cost savings for the taxpayer?

The 'FULL AND OPEN COMPETITION' designation is a strong positive signal for taxpayers. It means that the solicitation was advertised broadly, allowing any responsible contractor to submit a bid. This maximizes the pool of potential bidders, fostering a competitive environment where contractors are incentivized to offer their most competitive pricing and best value proposals to win the contract. In theory, a wider competition leads to lower prices than a sole-source or limited competition scenario, as contractors must differentiate themselves on price and performance. While the final price is fixed, the initial bidding process under full and open competition is designed to drive down costs through market forces, ultimately benefiting the taxpayer.

How does the contract's focus on 'DESIGN & QAUD' (Design & Quality Assurance) impact the overall project value and risk?

The inclusion of 'DESIGN & QAUD' in the contract title suggests that the scope extends beyond mere construction execution to encompass the design phase and rigorous quality assurance throughout the project. This integration can enhance overall project value by ensuring that the design is constructible, cost-effective, and meets the end-user's requirements from the outset. It also embeds quality control directly into the process, potentially reducing rework and long-term maintenance issues. From a risk perspective, it centralizes responsibility, which can be beneficial. However, it also means the contractor bears responsibility for design errors or omissions, potentially increasing their risk exposure if not managed carefully. The government's role in reviewing and approving designs and QA plans becomes critical.

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: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 15020 SHADY GROVE RD STE 500, ROCKVILLE, MD, 20850

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

Financial Breakdown

Contract Ceiling: $36,422,826

Exercised Options: $35,375,826

Current Obligation: $35,375,826

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: W912DR17D0002

IDV Type: IDC

Timeline