Department of Defense awards $26.6M for Phase II construction at Beltsville Agricultural Research Center

Contract Overview

Contract Amount: $26,557,270 ($26.6M)

Contractor: Grunley Construction CO., Inc.

Awarding Agency: Department of Defense

Start Date: 2022-04-22

End Date: 2026-02-01

Contract Duration: 1,381 days

Daily Burn Rate: $19.2K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 6

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: USDA-ARS BELTSVILLE AGRICULTURAL RESEARCH CENTER, 002, BELTSVILLE, MD. CONTRACT AWARD FOR PHASE II.

Place of Performance

Location: BELTSVILLE, PRINCE GEORGES County, MARYLAND, 20705

State: Maryland Government Spending

Plain-Language Summary

Department of Defense obligated $26.6 million to GRUNLEY CONSTRUCTION CO., INC. for work described as: USDA-ARS BELTSVILLE AGRICULTURAL RESEARCH CENTER, 002, BELTSVILLE, MD. CONTRACT AWARD FOR PHASE II. Key points: 1. Contract awarded to Grunley Construction Co., Inc. for commercial and institutional building construction. 2. Project is a definitive contract with a firm fixed price, indicating clear cost expectations. 3. The contract duration is 1381 days, suggesting a significant, multi-year undertaking. 4. Awarded under full and open competition, implying a broad range of potential bidders. 5. The contract is not set aside for small businesses, with no reported subcontracting goals. 6. The project is located in Beltsville, Maryland, impacting the local and regional economy.

Value Assessment

Rating: good

The contract value of $26.6 million for Phase II construction appears reasonable for a large-scale research facility project. Benchmarking against similar institutional building projects of this size and complexity would provide a more precise value-for-money assessment. The firm fixed-price structure suggests that the contractor bears the risk of cost overruns, which is generally favorable for the government. However, without detailed project specifications and scope, a definitive comparison to market rates for similar construction services is challenging.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded through full and open competition, indicating that all responsible sources were permitted to submit a bid. With six bidders participating, the competition level suggests a healthy market interest in this type of government construction work. A higher number of bidders generally leads to more competitive pricing and a greater likelihood of the government securing the best value. The presence of multiple bids allows for a robust comparison of proposals and pricing.

Taxpayer Impact: The full and open competition process is beneficial for taxpayers as it fosters a competitive environment, driving down costs and ensuring that the government receives a fair price for the construction services rendered.

Public Impact

The primary beneficiaries are the USDA-ARS researchers and staff who will utilize the improved facilities at the Beltsville Agricultural Research Center. The contract delivers essential construction services for Phase II of the research center's development, enhancing its operational capabilities. The geographic impact is concentrated in Beltsville, Maryland, with potential ripple effects on local suppliers and labor markets. The project is expected to create or sustain jobs in the construction sector within the Maryland region.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if unforeseen site conditions or material price escalations occur, despite the fixed-price contract.
Dependence on the contractor's ability to manage complex construction schedules and deliver by the specified end date.
Risk of delays if permitting or regulatory approvals are not secured in a timely manner.
Potential for scope creep if project requirements evolve significantly during the construction phase.

Positive Signals

Awarded under full and open competition, suggesting a competitive bidding process that likely secured favorable pricing.
Firm fixed-price contract structure shifts cost overrun risk to the contractor, protecting government funds.
Long contract duration allows for phased execution and potentially better resource allocation.
The contractor, Grunley Construction Co., Inc., likely has a track record with similar large-scale construction projects.
The project is for a critical research facility, indicating a commitment to advancing scientific endeavors.

Sector Analysis

This contract falls within the Commercial and Institutional Building Construction sector, a significant segment of the broader construction industry. The market for government construction projects is substantial, with agencies like the Department of Defense and the Department of Agriculture frequently investing in infrastructure and research facilities. Comparable spending benchmarks would involve analyzing the cost per square foot or per project for similar research centers or large institutional buildings constructed by federal agencies or in the private sector. The size of this contract suggests it is a major project within its specific sub-sector.

Small Business Impact

This contract was not set aside for small businesses, and there is no indication of subcontracting requirements or goals. This means that opportunities for small businesses to participate in this project are limited to those that might be engaged as subcontractors by the prime contractor, Grunley Construction Co., Inc. The absence of a small business set-aside suggests that the contracting agency did not prioritize small business participation for this specific procurement, which could limit the direct economic impact on the small business ecosystem for this particular contract.

Oversight & Accountability

Oversight for this contract will likely be managed by the contracting officer and relevant project managers within the Department of the Army or the USDA-ARS. Accountability measures are embedded in the firm fixed-price contract terms, which stipulate performance requirements and delivery schedules. Transparency is generally facilitated through contract award databases and public reporting, though detailed project-specific oversight mechanisms are typically internal. Inspector General jurisdiction would apply if any fraud, waste, or abuse is suspected.

Related Government Programs

USDA-ARS Research Facilities Construction
Department of Defense Military Construction Projects
Federal Building and Infrastructure Development
Large-Scale Institutional Construction Contracts

Risk Flags

Potential for schedule delays
Risk of unforeseen site conditions
Contractor performance risk
Material price volatility

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $26.6 million to GRUNLEY CONSTRUCTION CO., INC.. USDA-ARS BELTSVILLE AGRICULTURAL RESEARCH CENTER, 002, BELTSVILLE, MD. CONTRACT AWARD FOR PHASE II.

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 $26.6 million.

What is the period of performance?

Start: 2022-04-22. End: 2026-02-01.

What is Grunley Construction Co., Inc.'s track record with large federal construction projects, particularly research facilities?

Grunley Construction Co., Inc. has a significant history of undertaking large-scale construction projects, including those for federal agencies and institutional clients. While specific details on their experience with USDA research facilities are not provided in this data, their involvement in commercial and institutional building construction suggests they possess the capabilities for such projects. A deeper dive into their past performance, client references, and project completion history, especially for projects of similar scope and complexity, would be necessary to fully assess their track record. Federal procurement databases and past performance reviews would offer more granular insights into their reliability and expertise in delivering complex federal construction contracts.

How does the $26.6 million contract value compare to similar Phase II construction projects for agricultural research centers?

Benchmarking the $26.6 million contract value requires comparing it to similar Phase II construction projects for agricultural research centers. Without specific data on comparable projects, it's difficult to provide a precise comparison. However, the value suggests a substantial undertaking, likely involving significant infrastructure development, specialized laboratory spaces, and advanced building systems. Factors influencing this cost include the size of the facility, the complexity of the research requirements, the chosen construction methods, and prevailing market rates for labor and materials in the Beltsville, Maryland area. A comprehensive analysis would involve examining the cost per square foot or per functional unit of research space for recently awarded contracts of similar nature.

What are the primary risks associated with this firm fixed-price contract for Phase II construction?

The primary risks associated with this firm fixed-price contract, despite shifting cost overrun liability to the contractor, include potential for scope creep if project requirements evolve, unforeseen site conditions that could lead to change orders (though less likely to impact the government's price significantly), and contractor performance issues. If the contractor fails to meet quality standards or schedule milestones, the government may face delays or require corrective actions, potentially impacting the research center's operational readiness. Material price volatility, while largely borne by the contractor, could incentivize them to seek efficiencies that might compromise quality if not closely monitored. Furthermore, the complexity of research facility construction introduces unique risks related to specialized systems and equipment integration.

How effective is full and open competition in ensuring value for money for large federal construction contracts like this one?

Full and open competition is generally considered a highly effective mechanism for ensuring value for money in large federal construction contracts. By allowing all responsible sources to bid, it maximizes the pool of potential contractors, thereby increasing the likelihood of receiving competitive pricing and innovative solutions. The presence of multiple bidders, as seen with six bidders in this case, intensifies this competition, forcing contractors to offer their best terms. This process allows the government to compare a wider range of proposals, evaluate technical capabilities alongside price, and select the offer that represents the best overall value. While effective, the success also depends on a well-defined scope of work and a robust evaluation process to prevent the lowest price from overriding critical performance or quality considerations.

What are the historical spending patterns for construction at USDA-ARS research centers, and how does this award fit?

Historical spending patterns for construction at USDA-ARS research centers can vary significantly based on the agency's modernization needs, research priorities, and available appropriations. Large-scale projects like the Beltsville Agricultural Research Center's Phase II construction represent substantial investments, often occurring over multiple fiscal years. This $26.6 million award for Phase II suggests a continuation or expansion of a larger, multi-phase development plan. Analyzing past awards for similar facilities would reveal trends in contract values, project durations, and the types of construction services procured. This specific award appears to be a significant allocation for a key research infrastructure upgrade, aligning with the agency's mission to support agricultural science and innovation.

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: TWO STEP

Solicitation ID: W912DR21R0024

Offers Received: 6

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: $26,557,270

Exercised Options: $26,557,270

Current Obligation: $26,557,270

Actual Outlays: $461,259

Subaward Activity

Number of Subawards: 25

Total Subaward Amount: $15,802,293

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline