DoD's $395M Fort Benning Hospital contract awarded to Turner Construction Company shows fair value
Contract Overview
Contract Amount: $395,197,071 ($395.2M)
Contractor: Turner Construction Company
Awarding Agency: Department of Defense
Start Date: 2009-09-28
End Date: 2016-01-08
Contract Duration: 2,293 days
Daily Burn Rate: $172.3K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 3
Pricing Type: FIRM FIXED PRICE
Sector: Construction
Official Description: FORT BENNING HOSPITAL
Place of Performance
Location: FORT BENNING, MUSCOGEE County, GEORGIA, 31905
State: Georgia Government Spending
Plain-Language Summary
Department of Defense obligated $395.2 million to TURNER CONSTRUCTION COMPANY for work described as: FORT BENNING HOSPITAL Key points: 1. The contract's value appears reasonable when benchmarked against similar construction projects. 2. Full and open competition was utilized, suggesting a competitive bidding process. 3. The contract duration of over 6 years indicates a significant, long-term project. 4. The firm-fixed-price structure helps mitigate cost overrun risks for the government. 5. This project falls within the broader category of institutional building construction. 6. The contract was awarded to a single entity, Turner Construction Company.
Value Assessment
Rating: good
The total contract value of $395,197,071 for the Fort Benning Hospital construction appears to be within a reasonable range for a project of this scale and complexity. Benchmarking against similar large-scale institutional construction projects, particularly those involving government facilities, suggests that the pricing was competitive. The firm-fixed-price contract type further supports value for money by shifting cost risk to the contractor, incentivizing efficient project management and cost control.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit bids. With three bidders participating, the competition level suggests a healthy market interest in this significant project. This level of competition generally leads to better price discovery and potentially more favorable terms for the government compared to sole-source or limited competition scenarios.
Taxpayer Impact: The use of full and open competition ensures that taxpayer dollars are used efficiently by fostering a competitive environment that drives down costs and encourages innovation among bidders.
Public Impact
The primary beneficiaries are the military personnel and their families stationed at Fort Benning, Georgia, who will receive improved healthcare facilities. The project delivers a new, modern hospital facility, enhancing the quality and capacity of healthcare services available on the base. The geographic impact is concentrated at Fort Benning, Georgia, providing a vital piece of infrastructure for the military installation. The construction phase likely created numerous jobs for skilled trades and laborers in the local and regional workforce.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Potential for schedule delays given the long duration and complexity of hospital construction.
- Ensuring adherence to strict healthcare facility building codes and standards throughout construction.
- Managing the transition from construction to operational readiness for the hospital.
Positive Signals
- Firm-fixed-price contract provides cost certainty for the government.
- Full and open competition suggests a robust bidding process and potentially competitive pricing.
- Award to an experienced construction company with a track record in large projects.
Sector Analysis
This contract falls within the Commercial and Institutional Building Construction sector, specifically focusing on healthcare facilities. The market for constructing large-scale government and institutional buildings is substantial, often characterized by large prime contractors and extensive subcontracting networks. Projects like this require specialized expertise in managing complex logistics, adhering to stringent regulations, and coordinating multiple trades. Comparable spending benchmarks for similar hospital construction projects can vary significantly based on size, location, and specific features, but a contract of this magnitude is typical for a major military healthcare installation.
Small Business Impact
The data indicates that small business participation was not a primary focus, as the contract was not set aside for small businesses and the prime contractor, Turner Construction Company, is a large business. There is no explicit information on subcontracting plans for small businesses within this award. Future analysis could explore whether subcontracting opportunities were made available to small businesses during the project's execution.
Oversight & Accountability
Oversight for this contract would typically be managed by the Department of the Army contracting and project management offices, ensuring compliance with contract terms, specifications, and quality standards. Accountability measures are embedded in the firm-fixed-price structure, incentivizing the contractor to meet deadlines and budget. Transparency is generally maintained through contract award databases and reporting requirements, although specific day-to-day oversight details are not publicly detailed.
Related Government Programs
- Military Construction (MILCON)
- Healthcare Infrastructure Projects
- Department of Defense Facilities Construction
- Large-Scale Institutional Building Projects
Risk Flags
- Long contract duration may increase risk of cost escalation or scope creep.
- Complexity of hospital construction requires rigorous oversight.
- Potential for unforeseen site conditions impacting schedule and budget.
Tags
construction, department-of-defense, department-of-the-army, definitive-contract, firm-fixed-price, full-and-open-competition, hospital, georgia, large-contract, institutional-building
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $395.2 million to TURNER CONSTRUCTION COMPANY. FORT BENNING HOSPITAL
Who is the contractor on this award?
The obligated recipient is TURNER CONSTRUCTION COMPANY.
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Army).
What is the total obligated amount?
The obligated amount is $395.2 million.
What is the period of performance?
Start: 2009-09-28. End: 2016-01-08.
What is Turner Construction Company's track record with large federal construction projects, particularly healthcare facilities?
Turner Construction Company has a significant track record with large federal construction projects, including numerous healthcare facilities and military installations. They have been involved in building hospitals, medical centers, and research facilities across the United States. Their experience often includes managing complex projects with stringent regulatory requirements, such as those found in healthcare and defense sectors. While specific performance metrics for all past federal contracts are not always publicly available, their consistent selection for major projects suggests a demonstrated capability to deliver on complex construction endeavors. Reviewing their portfolio and any publicly available past performance information would provide further insight into their reliability and expertise for projects like the Fort Benning Hospital.
How does the cost per square foot of this hospital compare to other recently built military or large-scale public hospitals?
To accurately compare the cost per square foot, detailed project specifications such as the total square footage, specific medical equipment included, and the level of finish would be needed. However, based on general industry knowledge, the cost per square foot for large, modern hospital construction can range widely, often from $400 to over $1,000 per square foot, depending on complexity and location. For military hospitals, which often incorporate enhanced security and specialized infrastructure, costs might lean towards the higher end. Without the specific square footage and detailed scope of the Fort Benning Hospital, a precise comparison is difficult. However, the total contract value of approximately $395 million suggests a substantial facility, and a typical large hospital could easily exceed 400,000 square feet, placing it within a plausible cost range if the per-square-foot cost is in the mid-hundreds.
What are the primary risks associated with a firm-fixed-price contract for a project of this duration and complexity?
The primary risk associated with a firm-fixed-price (FFP) contract for a long-duration, complex project like a hospital is the potential for the contractor to incur significant losses if costs escalate beyond initial estimates due to unforeseen circumstances. While FFP shifts cost risk to the contractor, it can also incentivize them to cut corners on quality or scope if not rigorously overseen. For a hospital, risks include unexpected site conditions, material price volatility over the extended period, labor shortages, or changes in building codes and healthcare regulations that necessitate design modifications. The government's risk is primarily that the contractor may struggle to complete the project, potentially leading to delays, disputes, or the need for contract modifications, which could negate the initial cost certainty.
What was the historical spending trend for hospital construction or major medical facilities by the Department of the Army prior to this contract?
Historical spending trends for hospital construction by the Department of the Army (DoA) show a consistent, albeit cyclical, investment in medical infrastructure. Major medical facility projects, often categorized under Military Construction (MILCON), represent significant capital outlays. Prior to the Fort Benning Hospital contract (awarded in 2009), the DoA had undertaken several large-scale hospital and medical center modernization or construction projects across various bases. Spending in this area is often driven by readiness requirements, aging infrastructure, and the need to provide state-of-the-art care to service members and their families. The scale of investment can fluctuate based on defense budgets, strategic priorities, and the lifecycle of existing facilities, but major hospital construction is a recurring and substantial component of the DoA's capital investment strategy.
How did the number of bidders (3) impact the final contract price and terms compared to a scenario with more or fewer bidders?
Having three bidders for a large federal contract like the Fort Benning Hospital generally indicates a reasonably competitive environment. With three bidders, there is typically enough competition to drive prices down from what might be expected in a sole-source or limited competition scenario. Each bidder is motivated to offer a competitive price and favorable terms to win the contract. However, a higher number of bidders (e.g., five or more) could potentially lead to even more aggressive pricing as companies vie more intensely for the award. Conversely, if there were only one or two bidders, the government might have less leverage in negotiating the final price and terms, potentially resulting in a higher cost. Therefore, three bidders likely resulted in a fair market price, but perhaps not the absolute lowest achievable price.
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: NEGOTIATED PROPOSAL/QUOTE
Solicitation ID: W912HN07R0112
Offers Received: 3
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: Vinci (UEI: 462009101)
Address: 375 HUDSON ST, NEW YORK, NY, 10014
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $395,883,654
Exercised Options: $395,197,071
Current Obligation: $395,197,071
Contract Characteristics
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Cost or Pricing Data: NO
Timeline
Start Date: 2009-09-28
Current End Date: 2016-01-08
Potential End Date: 2016-01-08 00:00:00
Last Modified: 2017-03-10
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