DoD awards $20.2M contract for Palm Beach beach renourishment, with potential for significant cost growth

Contract Overview

Contract Amount: $20,244,400 ($20.2M)

Contractor: Great Lakes Dredge & Dock CO, LLC

Awarding Agency: Department of Defense

Start Date: 2025-12-15

End Date: 2026-04-27

Contract Duration: 133 days

Daily Burn Rate: $152.2K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: BEACH RENOURISHMENT PALM BEACH MIDTOWN PALM BEACH COUNTY, FLORIDA

Place of Performance

Location: PALM BEACH, PALM BEACH County, FLORIDA, 33480

State: Florida Government Spending

Plain-Language Summary

Department of Defense obligated $20.2 million to GREAT LAKES DREDGE & DOCK CO, LLC for work described as: BEACH RENOURISHMENT PALM BEACH MIDTOWN PALM BEACH COUNTY, FLORIDA Key points: 1. The contract's firm-fixed-price structure aims to control costs, but the duration and scope present inherent risks. 2. Competition was robust, suggesting a competitive market for these specialized services. 3. The base award amount is substantial, requiring careful monitoring of any modifications or task orders. 4. This project addresses critical coastal resilience needs for a populated area. 5. The contractor has a significant presence in large-scale marine construction projects. 6. The contract's value places it in the mid-to-large tier for similar federal construction awards.

Value Assessment

Rating: fair

The base award of $20.2 million for beach renourishment is a significant investment. Benchmarking against similar large-scale coastal restoration projects is challenging due to unique site conditions and material requirements. However, the firm-fixed-price contract type provides a degree of cost certainty. The contract's duration and the potential for modifications warrant close observation to ensure value for money is maintained throughout its lifecycle.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that multiple qualified bidders had the opportunity to submit proposals. This level of competition is generally favorable for price discovery and can lead to more competitive pricing. The specific number of bids received is not detailed, but the designation suggests a healthy market response for this type of specialized civil engineering service.

Taxpayer Impact: Full and open competition typically benefits taxpayers by driving down prices through market forces, ensuring the government receives the best possible value for its investment in critical infrastructure projects.

Public Impact

Residents and businesses in Midtown Palm Beach, Florida, will benefit from enhanced coastal protection and improved beach aesthetics. The project will deliver essential beach renourishment services, crucial for mitigating erosion and storm surge impacts. The geographic impact is localized to Palm Beach County, Florida, specifically the Midtown area. While direct workforce implications are not detailed, the project will likely support jobs in the marine construction and engineering sectors.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if unforeseen environmental conditions or scope changes arise.
Dependence on a single large contractor for a critical infrastructure project.
The long duration of the contract increases the risk of market price fluctuations impacting final costs.
Limited transparency on the specific metrics for successful completion beyond renourishment.

Positive Signals

Firm-fixed-price contract type provides cost certainty for the base award.
Awarded through full and open competition, suggesting competitive pricing.
Contractor is experienced in large-scale civil engineering and marine construction.
Project addresses a critical need for coastal resilience and environmental protection.

Sector Analysis

This contract falls within the Heavy and Civil Engineering Construction sector, specifically focusing on coastal infrastructure. The market for large-scale beach renourishment and dredging is specialized, often dominated by a few key players with the necessary equipment and expertise. Federal spending in this area is often driven by environmental regulations, disaster recovery, and coastal management initiatives. Comparable projects can vary widely in cost depending on volume of material, distance of haul, and site-specific challenges.

Small Business Impact

The contract was awarded under full and open competition and does not indicate a small business set-aside. There is no explicit mention of subcontracting goals for small businesses within the provided data. This suggests that the primary contract is likely to be performed by the large prime contractor, with potential for small business involvement being dependent on the prime's subcontracting strategy, which is not detailed here.

Oversight & Accountability

Oversight will likely be managed by the Department of the Army contracting and project management offices. Accountability measures will be tied to the contract's performance work statement and delivery schedules. Transparency is generally facilitated through federal contract databases like FPDS, where award details are published. Inspector General jurisdiction would apply if any fraud, waste, or abuse is suspected.

Related Government Programs

Coastal Zone Management Programs
Beach Erosion Control Projects
Army Corps of Engineers Civil Works Projects
Hurricane and Storm Damage Reduction Projects

Risk Flags

Potential for cost growth due to contract duration and scope.
Reliance on contractor's cost estimation accuracy for FFP.
Environmental or unforeseen site conditions could lead to change orders.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $20.2 million to GREAT LAKES DREDGE & DOCK CO, LLC. BEACH RENOURISHMENT PALM BEACH MIDTOWN PALM BEACH COUNTY, FLORIDA

Who is the contractor on this award?

The obligated recipient is GREAT LAKES DREDGE & DOCK CO, 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 $20.2 million.

What is the period of performance?

Start: 2025-12-15. End: 2026-04-27.

What is the historical spending pattern for beach renourishment projects by the Department of Defense in Florida?

Historical spending by the Department of Defense (DoD) on beach renourishment projects in Florida is substantial, reflecting the state's extensive coastline and vulnerability to erosion and storm events. While specific aggregate data for 'beach renourishment' alone can be difficult to isolate from broader civil works or coastal defense projects, the Army Corps of Engineers (USACE), which falls under the DoD, is a primary agency involved. USACE projects often involve significant multi-year funding allocations for coastal storm risk management and ecosystem restoration, which frequently include beach nourishment components. Annual obligations can range from tens to hundreds of millions of dollars nationally for such activities, with Florida consistently being a major recipient due to its environmental and economic importance. Analyzing specific contract awards over the past 5-10 years would reveal a pattern of recurring needs and significant investment in maintaining and restoring Florida's beaches.

How does the awarded price compare to similar beach renourishment contracts in terms of cost per cubic yard of sand placed?

Determining a precise cost per cubic yard benchmark for this $20.2 million contract is challenging without knowing the total volume of sand to be placed and the associated project complexities (e.g., borrow site distance, material quality, placement methods). However, typical costs for beach renourishment can range broadly from $20 to $60 per cubic yard, sometimes higher for specialized projects or difficult access. If this contract involves placing approximately 500,000 to 1 million cubic yards of sand, the price would fall within a plausible range. Factors like mobilization, demobilization, environmental monitoring, and permitting costs are often bundled, making direct per-cubic-yard comparisons difficult without detailed project specifications. Further analysis would require access to the contract's detailed scope of work and quantity estimates.

What is the track record of GREAT LAKES DREDGE & DOCK CO, LLC on similar federal contracts?

GREAT LAKES DREDGE & DOCK CO, LLC (GLDD) has a substantial track record with federal agencies, particularly the Department of the Army Corps of Engineers, for large-scale dredging and marine construction projects, including beach renourishment. They are one of the largest dredging contractors in the United States and have been awarded numerous contracts for coastal protection, port deepening, and environmental restoration. Their past performance typically involves projects of similar or larger magnitude, often with firm-fixed-price or cost-plus-fixed-fee structures. Reviewing their contract history would likely show successful completion of complex projects, though like any large contractor, there may be instances of contract modifications, claims, or performance reviews that warrant examination. Their extensive experience suggests a high likelihood of technical capability for this Palm Beach project.

What are the primary risks associated with a firm-fixed-price contract for a project of this duration and scope?

The primary risks associated with a firm-fixed-price (FFP) contract for a project spanning over a year and involving significant physical work like beach renourishment include: 1) Contractor Risk: If costs escalate beyond the contractor's projections (e.g., fuel price spikes, unexpected material issues, labor shortages), the contractor absorbs the loss, potentially impacting their financial stability or willingness to bid competitively in the future. Conversely, if costs are lower than anticipated, the contractor realizes higher profit margins. 2) Government Risk: The government is locked into the price, meaning it cannot benefit from cost savings if market conditions improve or efficiencies are found. If unforeseen conditions arise that necessitate scope changes, the government may face significant change order costs, potentially negating the FFP benefit. 3) Performance Risk: A contractor facing unexpected cost increases might be tempted to cut corners on quality or schedule adherence to protect their profit, requiring diligent government oversight. For this specific project, the long duration increases the likelihood of encountering unforeseen subsurface conditions or environmental factors that could lead to costly change orders.

How does this contract's value compare to the overall federal spending on coastal resilience and infrastructure?

This $20.2 million contract represents a specific investment in beach renourishment for a particular location. When compared to the overall federal spending on coastal resilience and infrastructure, it is a moderately sized project. Federal agencies like the Army Corps of Engineers, FEMA, and NOAA manage billions of dollars annually for a wide array of coastal initiatives. These include large-scale hurricane protection projects, ecosystem restoration, flood mitigation studies, and grants to states. While $20.2 million is a significant sum for a single project, it is one component within a much larger federal portfolio aimed at addressing the multifaceted challenges of coastal erosion, sea-level rise, and storm impacts across the nation. The cumulative federal investment in coastal resilience is substantial and ongoing.

Industry Classification

NAICS: Construction › Other Heavy and Civil Engineering Construction › Other Heavy and Civil Engineering Construction

Product/Service Code: MAINT, REPAIR, ALTER REAL PROPERTY › MAINT, ALTER, REPAIR NONBUILDINGS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SEALED BID

Solicitation ID: W912EP25BA013

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Great Lakes Dredge & Dock Corporation

Address: 9811 KATY FWY STE 1200, HOUSTON, TX, 77024

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: $20,244,400

Exercised Options: $20,244,400

Current Obligation: $20,244,400

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline