DoD awards $21.7M for Fort Belvoir elevator upgrades, with Nichols Contracting Inc. securing the firm-fixed-price contract

Contract Overview

Contract Amount: $21,749,000 ($21.7M)

Contractor: Nichols Contracting, Inc.

Awarding Agency: Department of Defense

Start Date: 2024-09-27

End Date: 2028-07-13

Contract Duration: 1,385 days

Daily Burn Rate: $15.7K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 3

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: ELEVATOR F/G & ELEVATORS H/J - FT. BELVOIR, VA

Place of Performance

Location: FORT BELVOIR, FAIRFAX County, VIRGINIA, 22060

State: Virginia Government Spending

Plain-Language Summary

Department of Defense obligated $21.7 million to NICHOLS CONTRACTING, INC. for work described as: ELEVATOR F/G & ELEVATORS H/J - FT. BELVOIR, VA Key points: 1. The contract value of $21.7 million for elevator modernization appears substantial, necessitating a close review of scope and market rates. 2. Competition was conducted under 'full and open competition after exclusion of sources,' indicating a potentially limited but justified bidding process. 3. The definitive contract type suggests a flexible arrangement, but requires monitoring for scope creep and cost control. 4. Performance is situated in Virginia, a region with significant construction activity and established pricing benchmarks. 5. The project falls within the Commercial and Institutional Building Construction sector, a mature market with predictable cost structures. 6. The duration of 1385 days (approx. 3.8 years) suggests a complex, multi-phase project requiring sustained oversight.

Value Assessment

Rating: fair

The contract value of $21.7 million for elevator modernization at Fort Belvoir requires careful benchmarking against similar projects. Without specific details on the scope of work (e.g., number of elevators, complexity of upgrades, modernization level), it's challenging to definitively assess value for money. However, for a project of this scale and duration, the price point warrants scrutiny to ensure it aligns with industry standards for commercial and institutional building construction. Comparisons to other federal or large-scale private sector elevator modernization projects would be necessary for a more precise valuation.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

The contract was awarded under 'full and open competition after exclusion of sources.' This procurement method suggests that while the competition was intended to be open, certain sources were excluded, potentially limiting the number of bidders. The presence of 3 bids indicates some level of competition, but the exclusion criteria need to be understood to gauge its true breadth. This approach can sometimes lead to higher prices if the pool of qualified bidders is significantly reduced.

Taxpayer Impact: The limited competition may mean taxpayers did not benefit from the lowest possible price achievable through a broader bidding process. Understanding the rationale for excluding sources is crucial to determine if this limitation was justified and did not unduly inflate costs.

Public Impact

Military personnel and civilian staff at Fort Belvoir, Virginia, will benefit from improved accessibility and safety through modernized elevators. The project delivers essential infrastructure upgrades, ensuring reliable vertical transportation within key facilities. The geographic impact is localized to Fort Belvoir, Virginia, supporting the operational readiness of the base. The contract supports jobs in the construction sector, particularly for skilled trades involved in elevator installation and modernization.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if scope creep occurs due to the definitive contract type.
Risk of schedule delays given the multi-year duration and complexity of elevator modernization.
Ensuring compliance with all safety and accessibility standards throughout the project lifecycle.
The 'exclusion of sources' clause requires clear justification to ensure fair competition.

Positive Signals

Firm-fixed-price contract structure provides cost certainty for the government.
Award to a single contractor streamlines management and accountability.
The project addresses critical infrastructure needs, enhancing facility functionality.
The contractor has a defined period to complete the work, allowing for phased execution.

Sector Analysis

This contract falls within the Commercial and Institutional Building Construction sector, specifically focusing on elevator modernization. This is a mature industry with established players and pricing models. Federal spending in this area often involves upgrades to aging infrastructure in government buildings, similar to private sector needs. Benchmarks for elevator modernization can vary widely based on building type, number of elevators, and the extent of technological upgrades, but typically involve significant capital investment.

Small Business Impact

The data indicates this contract was not set aside for small businesses (ss: false, sb: false). While Nichols Contracting, Inc. is the prime contractor, there is no explicit information on subcontracting plans for small businesses. The scale of this project might offer opportunities for small businesses in specialized construction trades or material supply, but this would depend on the prime contractor's subcontracting strategy and the specific requirements of the Army.

Oversight & Accountability

Oversight will likely be managed by the Department of the Army, potentially through contracting officers' representatives (CORs) and quality assurance personnel. The firm-fixed-price nature of the contract provides a degree of cost control. Transparency regarding project progress and any change orders would be expected through contract reporting mechanisms. Inspector General involvement would typically be triggered by allegations of fraud, waste, or abuse.

Related Government Programs

Federal Buildings and Facilities Construction
Military Base Infrastructure Modernization
Elevator and Escalator Maintenance and Repair
Department of Defense Construction Contracts
General Services Administration (GSA) Building Projects

Risk Flags

Limited competition due to source exclusion.
Potential for scope creep with definitive contract type.
Long project duration increases risk of delays and cost escalation.
Need for detailed value analysis against market rates.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $21.7 million to NICHOLS CONTRACTING, INC.. ELEVATOR F/G & ELEVATORS H/J - FT. BELVOIR, VA

Who is the contractor on this award?

The obligated recipient is NICHOLS 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 $21.7 million.

What is the period of performance?

Start: 2024-09-27. End: 2028-07-13.

What specific elevator systems are being modernized, and what are the key technological upgrades included in the scope of work?

The provided data does not detail the specific elevator systems or technological upgrades. The contract, 'ELEVATOR F/G & ELEVATORS H/J - FT. BELVOIR, VA,' suggests modernization of multiple elevator banks. Typical upgrades in such projects can include replacing outdated control systems with modern, energy-efficient ones, installing new cab interiors, upgrading safety features like emergency communication and fire service controls, and potentially integrating smart elevator technology for improved performance and predictive maintenance. A thorough review of the contract's Statement of Work (SOW) would be necessary to ascertain the precise scope and technological advancements.

How does the $21.7 million contract value compare to industry benchmarks for similar elevator modernization projects in the Mid-Atlantic region?

Benchmarking the $21.7 million contract value requires detailed comparison points not present in the summary data. Factors influencing cost include the number of elevators, their size and capacity, the complexity of the building's infrastructure, the extent of modernization (e.g., full replacement vs. component upgrades), and the specific technologies implemented. For a project involving multiple elevator banks over nearly four years, this value could be reasonable if it encompasses significant structural work, advanced controls, and aesthetic upgrades. However, without a detailed scope of work and comparison to similar federal or large commercial projects in Virginia, a definitive value assessment is difficult. Industry reports or cost estimating databases would be needed for a precise comparison.

What was the specific justification for excluding certain sources in the 'full and open competition after exclusion of sources' award process?

The justification for excluding sources under this procurement method is not provided in the summary data. Typically, such exclusions are based on specific technical requirements, past performance, security clearances, or unique capabilities that only a limited number of contractors possess. The Department of the Army would have documented the rationale for these exclusions, likely related to the specialized nature of elevator modernization or specific site conditions at Fort Belvoir. Understanding this justification is critical to assessing whether the exclusion was necessary and did not unduly restrict competition, potentially impacting the final price paid by taxpayers.

What are the key performance indicators (KPIs) and milestones for this contract, and how will performance be measured?

The provided data does not specify the key performance indicators (KPIs) or detailed milestones for this contract. However, given the project's nature and duration (1385 days), performance measurement would likely focus on adherence to the project schedule, quality of workmanship, compliance with safety regulations, successful testing and commissioning of modernized elevators, and completion of deliverables as outlined in the contract's Statement of Work. The firm-fixed-price structure implies that meeting these requirements within budget is paramount. The contracting officer's representative (COR) would typically be responsible for monitoring progress against these metrics.

What is the historical spending pattern for elevator maintenance and modernization at Fort Belvoir or within the Department of the Army?

The provided data does not include historical spending patterns for elevator maintenance and modernization at Fort Belvoir or within the Department of the Army. To assess this, one would need to analyze past contracts awarded for similar services at this installation or across the Army. Such an analysis would reveal trends in contract values, types of services procured (maintenance vs. modernization), competition levels, and contractor performance over time. Understanding historical spending can help contextualize the current $21.7 million award, identifying whether it represents an increase, decrease, or consistent level of investment in elevator infrastructure.

What are the potential risks associated with a definitive contract type for a project of this duration and scope?

Definitive contracts, while offering flexibility, carry inherent risks for long-term, complex projects like elevator modernization. A primary risk is scope creep, where the project's requirements may expand beyond the initial agreement, potentially leading to cost increases if not managed tightly. Without clear, fixed deliverables defined upfront, there's a risk of disagreements over what constitutes 'complete' work. Furthermore, the contractor might have less incentive to control costs aggressively compared to a firm-fixed-price contract with detailed specifications, as adjustments can be negotiated. Robust oversight, clear communication, and strict change control processes are essential to mitigate these risks.

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 AFTER EXCLUSION OF SOURCES

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: W912DR22R0028

Offers Received: 3

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Nichols Contracting Inc.

Address: 9190 RED BRANCH RD, COLUMBIA, MD, 21045

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

Financial Breakdown

Contract Ceiling: $27,640,000

Exercised Options: $21,749,000

Current Obligation: $21,749,000

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline