Department of the Army awards $24.5M dredging contract to Great Lakes Dredge & Dock Co. for Atkinson Island

Contract Overview

Contract Amount: $24,538,600 ($24.5M)

Contractor: Great Lakes Dredge & Dock CO, LLC

Awarding Agency: Department of Defense

Start Date: 2007-07-31

End Date: 2011-12-07

Contract Duration: 1,590 days

Daily Burn Rate: $15.4K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: DREDGING HGNC, ATKINSON ISLAND CELL M5/M6

Place of Performance

Location: HOUSTON, HARRIS County, TEXAS, 77051

State: Texas Government Spending

Plain-Language Summary

Department of Defense obligated $24.5 million to GREAT LAKES DREDGE & DOCK CO, LLC for work described as: DREDGING HGNC, ATKINSON ISLAND CELL M5/M6 Key points: 1. Contract value appears reasonable given the scope of major civil engineering projects. 2. Full and open competition suggests a healthy market for dredging services. 3. Contract type is firm fixed price, which transfers risk to the contractor. 4. Project duration of 1590 days indicates a long-term, significant undertaking. 5. The award was made to a single contractor, Great Lakes Dredge & Dock Co., LLC. 6. The contract falls under 'Other Heavy and Civil Engineering Construction' NAICS code.

Value Assessment

Rating: good

The contract value of $24.5 million for dredging services at Atkinson Island appears to be within a reasonable range for a project of this scale and duration. Benchmarking against similar large-scale civil engineering and dredging projects, the price seems competitive, especially considering it was awarded under full and open competition. The firm fixed-price nature of the contract further suggests that the contractor has assessed risks and costs thoroughly, aiming for a predictable outcome for the government.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit a bid. The presence of two bids suggests a moderate level of competition for this specialized dredging service. While two bidders is not extensive, it does provide a basis for price comparison and ensures that the government is not solely reliant on a single provider.

Taxpayer Impact: Full and open competition generally leads to better price discovery and potentially lower costs for taxpayers, as multiple companies vie for the contract. The existence of two bids suggests a competitive environment that likely benefited the government in securing a fair price.

Public Impact

The primary beneficiary is the Department of the Army, ensuring critical infrastructure maintenance and operational readiness. The services delivered include extensive dredging to maintain or improve navigational channels and water depths at Atkinson Island. The geographic impact is localized to the Atkinson Island area, likely within Texas, affecting local waterways and potentially port access. Workforce implications include employment opportunities for skilled labor in dredging operations, engineering, and project management.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if unforeseen subsurface conditions are encountered, despite fixed-price terms.
Dependence on a single contractor for the duration of a long-term project could lead to performance issues if not managed closely.

Positive Signals

Firm fixed-price contract structure shifts cost risk to the contractor.
Awarded under full and open competition, suggesting a competitive bidding process.
The contractor, Great Lakes Dredge & Dock Co., LLC, is a known entity in the dredging industry, implying experience.

Sector Analysis

This contract falls within the heavy and civil engineering construction sector, specifically focusing on dredging. This is a critical sub-sector for maintaining navigable waterways, supporting commerce, and enabling military operations. The market for large-scale dredging is specialized, often dominated by a few key players. The value of this contract is significant within its niche, reflecting the substantial investment required for major waterway infrastructure projects.

Small Business Impact

The data indicates that this contract was not set aside for small businesses, and there is no explicit mention of small business subcontracting requirements. Given the specialized nature and large scale of major dredging projects, they are often awarded to larger, established firms with the necessary equipment and expertise. This contract is unlikely to have direct subcontracting opportunities for small businesses unless the prime contractor opts to engage them for specific support services.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer's representative (COR) within the Department of the Army. Accountability measures are embedded in the firm fixed-price contract terms, requiring the contractor to deliver specified services within the agreed budget. Transparency is generally maintained through contract award databases, although detailed project performance reports may not always be publicly accessible. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Army Corps of Engineers Civil Works Programs
Inland Waterways Navigation Projects
Port and Harbor Deepening Projects
Coastal Protection and Restoration Projects

Risk Flags

Potential for unforeseen subsurface conditions impacting cost and schedule.
Environmental compliance risks, especially if contaminated materials are encountered.
Contractor performance risk over the long duration of the project.
Weather-related delays impacting project timelines.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $24.5 million to GREAT LAKES DREDGE & DOCK CO, LLC. DREDGING HGNC, ATKINSON ISLAND CELL M5/M6

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 $24.5 million.

What is the period of performance?

Start: 2007-07-31. End: 2011-12-07.

What is the track record of Great Lakes Dredge & Dock Co., LLC with the Department of Defense?

Great Lakes Dredge & Dock Co., LLC has a significant history of performing dredging and marine construction services for various government agencies, including the Department of Defense and the Army Corps of Engineers. Their track record typically involves large-scale projects related to navigation, environmental restoration, and infrastructure development. While specific performance metrics for individual contracts are not always publicly detailed, their continued selection for major projects suggests a generally satisfactory performance history. Analyzing past contract awards and any associated performance reviews or disputes would provide a more granular understanding of their reliability and quality of work for the DoD.

How does the awarded amount compare to similar dredging projects by the Army?

The $24.5 million awarded to Great Lakes Dredge & Dock Co., LLC for the Atkinson Island dredging project is a substantial sum, indicative of a large-scale undertaking. To benchmark this value, one would compare it to other major dredging contracts awarded by the Army Corps of Engineers or other DoD entities for similar scopes of work, such as channel maintenance, port deepening, or environmental remediation. Factors like geographic location, specific dredging requirements (e.g., material type, depth, distance of spoil disposal), and contract duration heavily influence pricing. Without direct comparisons of projects with identical parameters, it's challenging to definitively state if this is high or low, but it aligns with the expected investment for significant civil engineering projects in waterway management.

What are the primary risks associated with this type of dredging contract?

The primary risks associated with this firm fixed-price dredging contract include unforeseen subsurface conditions (e.g., encountering harder materials than anticipated, buried obstructions), environmental compliance issues (e.g., discovery of contaminated sediments requiring special handling), and potential delays due to weather or regulatory hurdles. While the fixed-price nature transfers cost risk to the contractor, significant scope changes or unforeseen conditions could lead to claims or disputes. Performance risk also exists, where the contractor may struggle to meet schedule or quality requirements, necessitating government intervention or corrective actions. The long duration of the contract (1590 days) amplifies these risks.

How effective is full and open competition in ensuring value for taxpayer money in specialized construction contracts?

Full and open competition is generally considered the most effective method for ensuring value for taxpayer money, as it theoretically allows the widest possible pool of qualified contractors to bid, fostering a competitive environment that drives down prices and encourages innovation. For specialized construction contracts like dredging, however, the market may be limited to a few highly qualified firms. In such cases, while competition is present, the number of bidders might be smaller. The effectiveness then relies on the government's ability to clearly define requirements and evaluate bids rigorously. Even with a limited number of bidders, the process still provides a benchmark and prevents sole-source awards, which are often more expensive.

What is the historical spending trend for dredging services by the Department of Defense?

Historical spending by the Department of Defense on dredging services has been significant, driven primarily by the Army Corps of Engineers' mission to maintain and improve navigable waterways for both commercial and military purposes. Spending fluctuates based on infrastructure needs, environmental regulations, and national priorities. Major dredging projects are often multi-year and substantial in value, contributing to overall DoD construction and maintenance budgets. Analyzing aggregated spending data over several fiscal years would reveal trends, identify peak periods of investment, and highlight the consistent requirement for these services to support national infrastructure and defense readiness.

What are the implications of a firm fixed-price contract for government oversight?

A firm fixed-price (FFP) contract shifts the majority of cost risk from the government to the contractor. This means the contractor is obligated to complete the work for a predetermined price, regardless of their actual costs. For government oversight, this implies a focus on ensuring the contractor adheres to the contract's scope, schedule, and quality standards, rather than scrutinizing detailed cost breakdowns during performance. Oversight efforts will concentrate on monitoring progress, verifying deliverables, managing contract modifications (if necessary), and ensuring compliance with technical specifications and safety regulations. While cost is fixed, ensuring the contractor performs efficiently and effectively to avoid performance failures remains crucial.

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: W912HY07B0013

Offers Received: 2

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Great Lakes Dredge & Dock Corporation (UEI: 362899130)

Address: 2122 YORK RD 2ND FL, OAK BROOK, IL, 60523

Business Categories: Category Business, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $25,386,729

Exercised Options: $25,386,729

Current Obligation: $24,538,600

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline