DOD's $73.3M Archer Western Contract for Building Construction Shows Moderate Competition and Long Duration

Contract Overview

Contract Amount: $73,339,586 ($73.3M)

Contractor: Archer Western Contractors, LLC

Awarding Agency: Department of Defense

Start Date: 2004-06-30

End Date: 2007-11-29

Contract Duration: 1,247 days

Daily Burn Rate: $58.8K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 5

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Place of Performance

Location: FORT BRAGG, CUMBERLAND County, NORTH CAROLINA, 28307

State: North Carolina Government Spending

Plain-Language Summary

Department of Defense obligated $73.3 million to ARCHER WESTERN CONTRACTORS, LLC for work described as: Key points: 1. Contract awarded for commercial and institutional building construction, indicating a need for infrastructure development. 2. The contract duration of 1247 days suggests a complex or lengthy construction project. 3. Full and open competition was utilized, implying a broad market solicitation. 4. The contract value of $73.3 million places it in the mid-to-large tier for construction projects. 5. Fixed-price contract type suggests cost certainty for the government, shifting risk to the contractor. 6. The absence of small business set-asides may indicate a lack of specific opportunities or contractor capability limitations.

Value Assessment

Rating: fair

The contract value of $73.3 million for building construction is substantial. Without specific benchmarks for the type and scope of buildings constructed, a direct value-for-money assessment is challenging. However, the duration of the contract (over three years) and the firm fixed-price nature suggest that the contractor assumed significant risk, which is generally a positive sign for the government in terms of cost control. Further analysis would require comparing the final cost against the initial scope and market rates for similar construction projects in North Carolina.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that the solicitation was broadly advertised to all responsible prospective contractors. With 5 bids received, this suggests a reasonable level of competition for this project. While not an exceptionally high number of bidders, it is sufficient to provide a basis for price discovery and ensure that the government received proposals from multiple sources. This approach generally leads to more competitive pricing than limited or sole-source procurements.

Taxpayer Impact: The use of full and open competition with multiple bids helps ensure that taxpayer dollars are used efficiently by driving down prices through market forces. It reduces the risk of overpayment that can occur with less competitive contract awards.

Public Impact

The primary beneficiaries are the Department of Defense and its personnel, who will gain access to new or improved facilities. The contract delivers essential building construction services, likely for military bases or related infrastructure. The geographic impact is concentrated in North Carolina, where the construction activities will take place. The project will likely involve a significant construction workforce, including skilled trades and laborers, contributing to local employment.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Long contract duration (1247 days) could lead to potential cost overruns if not managed effectively.
Firm fixed-price contracts can sometimes lead to scope creep issues if change orders are not rigorously controlled.
Lack of specific details on the type of construction makes it difficult to assess if the price is truly competitive.
No indication of small business subcontracting goals could mean limited opportunities for smaller firms in this project.

Positive Signals

Full and open competition suggests a robust bidding process and potential for competitive pricing.
Firm fixed-price contract shifts cost risk to the contractor, which is generally favorable for the government.
Award to Archer Western Contractors, LLC, a known entity in the construction sector, may imply a level of established capability.
The contract was awarded by the Department of the Army, a major federal agency with established procurement processes.

Sector Analysis

The construction industry is a significant sector for federal spending, encompassing a wide range of projects from infrastructure to facility maintenance. This contract falls under commercial and institutional building construction, a segment that includes the building of offices, barracks, training facilities, and other structures essential for government operations. Federal spending in construction is often driven by modernization needs, base realignments, and new mission requirements. Benchmarks for similar projects would typically consider square footage, complexity of design, and location-specific labor and material costs.

Small Business Impact

This contract does not appear to have been specifically set aside for small businesses, nor is there an indication of mandatory small business subcontracting goals. The award to Archer Western Contractors, LLC, a company that may not be classified as a small business, suggests that the primary contract was competed broadly. This could mean fewer direct opportunities for small businesses to participate as prime contractors on this specific award. However, the prime contractor might engage small businesses for subcontracting work, though this is not explicitly detailed in the provided data.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and the relevant program/project managers within the Department of the Army. Accountability measures are inherent in the firm fixed-price contract type, which penalizes the contractor for cost overruns. Transparency is facilitated by the contract award data being publicly available. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected during the contract's lifecycle.

Related Government Programs

Military Construction Projects
Department of Defense Facilities Management
General Services Administration (GSA) Building Construction
Army Corps of Engineers Construction Contracts

Risk Flags

Long contract duration may increase risk of cost escalation or performance issues.
Lack of explicit small business subcontracting goals could limit opportunities for smaller firms.
Firm fixed-price contracts require careful management to prevent scope creep or contractor financial distress.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $73.3 million to ARCHER WESTERN CONTRACTORS, LLC. See the official description on USAspending.

Who is the contractor on this award?

The obligated recipient is ARCHER WESTERN CONTRACTORS, 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 $73.3 million.

What is the period of performance?

Start: 2004-06-30. End: 2007-11-29.

What is the typical cost per square foot for similar commercial and institutional building construction projects awarded by the Department of Defense in North Carolina during the contract period?

Determining the exact cost per square foot for this $73.3 million contract is challenging without knowing the total square footage and specific type of facilities constructed. However, general benchmarks for commercial and institutional building construction in the US can range widely, from $200 to $500+ per square foot, heavily influenced by factors like building complexity, materials, labor costs, and specific government requirements (e.g., security, specialized systems). For projects in North Carolina during the 2004-2007 period, costs would align with regional economic conditions. To provide a precise comparison, one would need detailed project specifications and access to construction cost databases that track federal projects by region and building type.

How does the number of bids (5) compare to the average number of bids received for similar-sized Department of the Army construction contracts awarded under full and open competition?

Receiving 5 bids for a $73.3 million construction contract awarded under full and open competition by the Department of the Army is a reasonable outcome. While the average number of bids can fluctuate based on market conditions, project complexity, and the specific industry sector, 5 bidders generally indicates sufficient competition. For large-scale construction projects, it's not uncommon to see fewer bidders than for smaller, more standardized procurements due to the specialized capabilities and bonding requirements involved. A higher number of bids (e.g., 8-10+) might suggest even stronger competition, potentially leading to lower prices, but 5 bids still provides a solid basis for price discovery and selection.

What are the potential risks associated with a firm fixed-price contract lasting over three years (1247 days)?

A firm fixed-price (FFP) contract, while generally favorable for the government by capping costs, carries specific risks when extended over a long duration like 1247 days. The primary risk is that the contractor may face unforeseen increases in material costs, labor rates, or regulatory compliance requirements over the extended period. If these increases are significant and not adequately accounted for in the initial pricing, the contractor could experience reduced profit margins or even losses, potentially impacting their motivation or ability to complete the project to the required standards. Conversely, if the contractor significantly overestimates costs to buffer against these risks, the government might end up paying a premium. Effective contract management, including rigorous change order control and monitoring of economic price adjustments (if applicable), is crucial to mitigate these risks.

What specific types of commercial and institutional buildings are typically constructed under contracts of this nature for the Department of the Army?

Contracts like this one for the Department of the Army typically involve the construction of facilities essential for military operations and personnel support. This can include barracks for enlisted soldiers, administrative buildings for command staff, training facilities (e.g., classrooms, simulators), maintenance and logistics buildings, vehicle storage depots, and potentially specialized structures related to mission requirements. The term 'commercial and institutional' is broad, but in a military context, it encompasses the vast majority of non-combat infrastructure needed to maintain readiness and support the force. The specific type would depend on the installation's needs and strategic priorities at the time of procurement.

How has federal spending on commercial and institutional building construction by the Department of Defense trended in the years surrounding this contract's award (2004-2007)?

During the period of 2004-2007, federal spending on construction, particularly by the Department of Defense (DoD), was significantly influenced by ongoing military operations in Iraq and Afghanistan, as well as base realignment and closure (BRAC) initiatives. Spending on facilities, including barracks, operational support buildings, and infrastructure, generally saw robust levels to support troop presence and evolving mission requirements. While specific figures for 'commercial and institutional building construction' as a distinct category are hard to isolate without detailed budget breakdowns, overall DoD construction budgets were substantial. This period likely represented a high point or sustained high level of construction spending due to global security demands and domestic infrastructure modernization efforts.

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

Offers Received: 5

Pricing Type: FIRM FIXED PRICE (J)

Contractor Details

Parent Company: Walsh Group Ltd., the (UEI: 121476675)

Address: 3715 NORTHSIDE PARKWAY, NW, ATLANTA, GA, 90

Business Categories: Category Business, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $13,112

Exercised Options: $13,112

Current Obligation: $73,339,586

Contract Characteristics

Cost or Pricing Data: NO

Timeline