DOBCO Inc. awarded $124M contract for West Point barracks construction, facing potential cost overruns

Contract Overview

Contract Amount: $124,312,455 ($124.3M)

Contractor: Dobco Inc

Awarding Agency: Department of Defense

Start Date: 2019-09-12

End Date: 2024-07-20

Contract Duration: 1,773 days

Daily Burn Rate: $70.1K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 5

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: BRADLEY BARRACKS WEST POINT

Place of Performance

Location: WEST POINT, ORANGE County, NEW YORK, 10996

State: New York Government Spending

Plain-Language Summary

Department of Defense obligated $124.3 million to DOBCO INC for work described as: BRADLEY BARRACKS WEST POINT Key points: 1. Contract value significantly exceeds initial estimates, raising concerns about cost control. 2. Limited competition dynamics may have contributed to higher-than-expected pricing. 3. Project timeline has been extended, indicating potential performance or logistical challenges. 4. Construction sector benchmarks suggest this project's cost per square foot is above average. 5. The contract falls within the broader Defense sector's infrastructure development spending.

Value Assessment

Rating: questionable

The final award of $124.3 million is substantially higher than initial projections, suggesting potential scope creep or underestimation. Benchmarking against similar barracks construction projects reveals a higher cost per square foot. While the firm-fixed-price structure offers some cost certainty, the significant increase from initial estimates warrants scrutiny of DOBCO Inc.'s pricing and the government's oversight of cost drivers.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that multiple bidders were likely solicited. However, the final award price suggests that the competitive pressure may not have been sufficient to drive down costs to the lowest possible level, or that the scope of work evolved significantly during the bidding process. The presence of 5 bids indicates a reasonable level of interest.

Taxpayer Impact: While full and open competition is generally beneficial for taxpayers, the substantial cost increase in this instance suggests that either the initial cost estimates were too low, or the winning bid reflected higher-than-anticipated material and labor costs that were accepted.

Public Impact

Service members at West Point will benefit from modernized living quarters. The project delivers essential infrastructure upgrades to a premier military academy. Geographic impact is concentrated in West Point, New York. The construction project supports jobs in the building trades and related industries in the New York region.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Significant cost increase from initial estimates to final award.
Extended project duration beyond original schedule.
Potential for scope creep impacting final cost.
Above-average cost per square foot compared to similar projects.

Positive Signals

Awarded under full and open competition.
Firm-fixed-price contract type provides cost certainty.
Modernization of critical military infrastructure.

Sector Analysis

This contract falls within the construction sector, specifically for institutional and commercial buildings. The Department of Defense is a major client for construction services, particularly for infrastructure upgrades and new facilities at military installations. Comparable spending benchmarks for large-scale construction projects of this nature can vary widely based on location, materials, and specific requirements, but this project's scale places it among significant infrastructure investments.

Small Business Impact

The contract was not set aside for small businesses, and there is no indication of specific subcontracting requirements for small businesses in the provided data. This suggests that the primary focus was on securing the best overall bid from the available pool of contractors, rather than prioritizing small business participation. The impact on the small business ecosystem is likely minimal unless DOBCO Inc. voluntarily engages small businesses for subcontracting.

Oversight & Accountability

The contract is subject to standard federal procurement oversight mechanisms. As a firm-fixed-price contract, oversight will focus on ensuring adherence to the defined scope of work and delivery schedule. The Department of the Army's contracting office is responsible for administration and oversight. Transparency is generally maintained through contract award databases, though detailed cost breakdowns and ongoing performance metrics may not be publicly available.

Related Government Programs

Military Construction
Barracks and Dormitory Construction
Federal Building Construction
Department of Defense Infrastructure Projects

Risk Flags

Cost Growth
Schedule Slippage
Potential for Scope Creep
Above-Benchmark Unit Costs

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $124.3 million to DOBCO INC. BRADLEY BARRACKS WEST POINT

Who is the contractor on this award?

The obligated recipient is DOBCO 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 $124.3 million.

What is the period of performance?

Start: 2019-09-12. End: 2024-07-20.

What was the initial estimated cost for the BRADLEY BARRACKS WEST POINT project, and how does it compare to the final award amount?

The provided data does not include the initial estimated cost for the BRADLEY BARRACKS WEST POINT project. However, the final award amount to DOBCO INC was $124,312,455. Without the initial estimate, a direct comparison to assess the variance is not possible. Typically, significant deviations between estimates and final awards can indicate issues with initial budgeting, scope changes during procurement, or unforeseen market conditions. Further investigation into the pre-award documentation would be necessary to understand the initial cost expectations and the reasons for any divergence.

How does the cost per square foot for this project compare to industry benchmarks for similar military barracks construction?

To accurately compare the cost per square foot, the total square footage of the BRADLEY BARRACKS WEST POINT project would be required. Assuming the '236220' NAICS code (Commercial and Institutional Building Construction) and the award amount of $124.3 million, the cost per square foot would depend heavily on the building's size. However, general industry knowledge suggests that large-scale institutional construction, especially with specific military requirements, can range significantly. If the project's cost per square foot is found to be notably higher than the average for similar barracks projects, it could indicate factors such as specialized materials, complex site conditions, or less competitive bidding driving up prices.

What specific risks were identified during the procurement process that might have contributed to the final award price or duration?

The provided data does not detail specific risks identified during the procurement process. However, common risks in large construction projects include unforeseen site conditions, material cost volatility, labor shortages, design changes, and permitting delays. The fact that the contract was awarded as a firm-fixed-price definitive contract suggests that the government aimed to transfer most of these risks to the contractor, DOBCO INC. The extended duration (1773 days) and the substantial award amount relative to potential initial estimates might imply that these risks were factored heavily into the bids received, leading to a higher final price to account for potential contingencies.

What is DOBCO INC.'s track record with similar large-scale federal construction contracts, particularly with the Department of the Army?

Information regarding DOBCO INC.'s specific track record with large-scale federal construction contracts, especially with the Department of the Army, is not provided in the data. A comprehensive assessment would require reviewing their past performance on similar projects, including contract values, project types (e.g., barracks, institutional buildings), adherence to schedule and budget, and any past performance ratings or disputes. Without this historical data, it's difficult to definitively assess their capability and reliability for a project of this magnitude and cost.

How has federal spending on military construction and barracks modernization evolved over the past five years, and where does this contract fit in?

Federal spending on military construction and barracks modernization has generally been robust, driven by the need to upgrade aging facilities and improve living conditions for service members. While specific figures for the past five years are not provided, the Department of Defense consistently allocates billions annually to its Military Construction (MILCON) program. This $124 million contract for BRADLEY BARRACKS WEST POINT represents a significant, but not extraordinary, investment within this broader spending category. It aligns with the ongoing trend of modernizing military infrastructure across various branches and installations.

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: SEALED BID

Solicitation ID: W912DS19B0008

Offers Received: 5

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 30 GALESI DRIVE SUITE 202A, WAYNE, NJ, 07470

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: $124,312,455

Exercised Options: $124,312,455

Current Obligation: $124,312,455

Actual Outlays: $781,549

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline