DoD's $87.6M Corpus Christi Channel Project Awarded to Great Lakes Dredge & Dock Co. for Channel Improvement

Contract Overview

Contract Amount: $87,633,286 ($87.6M)

Contractor: Great Lakes Dredge & Dock CO, LLC

Awarding Agency: Department of Defense

Start Date: 2018-12-31

End Date: 2020-02-20

Contract Duration: 416 days

Daily Burn Rate: $210.7K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: CT::SWG::CT - UNRESTRICTED PROCUREMENT FOR CORPUS CHRISTI SHIP CHANNEL, TEXAS IN NUECES AND ARANSAS COUNTIES, TEXAS, 54 FOOT PROJECT, CHANNEL IMPROVEMENT PROJECT, ENTRANCE CHANNEL WITH EXTENSION, DREDGING

Place of Performance

Location: CORPUS CHRISTI, NUECES County, TEXAS, 78408

State: Texas Government Spending

Plain-Language Summary

Department of Defense obligated $87.6 million to GREAT LAKES DREDGE & DOCK CO, LLC for work described as: CT::SWG::CT - UNRESTRICTED PROCUREMENT FOR CORPUS CHRISTI SHIP CHANNEL, TEXAS IN NUECES AND ARANSAS COUNTIES, TEXAS, 54 FOOT PROJECT, CHANNEL IMPROVEMENT PROJECT, ENTRANCE CHANNEL WITH EXTENSION, DREDGING Key points: 1. The contract represents a significant investment in critical infrastructure for the Corpus Christi Ship Channel. 2. Competition dynamics for this large-scale civil engineering project are crucial for ensuring taxpayer value. 3. Performance monitoring will be key to ensuring timely completion and adherence to project specifications. 4. The project's success is tied to broader economic development and national security interests. 5. Sector positioning highlights the importance of specialized heavy civil engineering capabilities for port infrastructure.

Value Assessment

Rating: good

The contract value of $87.6 million for channel improvement appears reasonable for a project of this scale and complexity, involving extensive dredging and civil engineering. Benchmarking against similar Army Corps of Engineers projects for channel deepening and widening suggests that pricing is within expected ranges, though specific cost breakdowns would allow for a more granular assessment. The firm-fixed-price structure provides cost certainty for the government, assuming the scope of work remains stable.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that multiple qualified bidders had the opportunity to submit proposals. The presence of two bids suggests a competitive environment, which generally benefits price discovery and can lead to more favorable terms for the government. The specific number of bidders is moderate for a project of this magnitude, and further analysis of the bidding process would reveal the intensity of the competition.

Taxpayer Impact: Full and open competition generally leads to better pricing for taxpayers by encouraging multiple firms to offer their best terms to secure the contract.

Public Impact

The primary beneficiaries are the industries reliant on the Corpus Christi Ship Channel, including energy, manufacturing, and agriculture, through improved logistics and reduced shipping costs. The project delivers enhanced navigation capabilities by deepening and widening the channel, accommodating larger vessels. Geographic impact is concentrated in Nueces and Aransas Counties, Texas, but has broader implications for regional and national supply chains. Workforce implications include job creation in the construction and maritime sectors during the project's execution.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for scope creep in large civil engineering projects can lead to cost overruns if not managed tightly.
Environmental impact assessments and mitigation efforts require careful oversight to ensure compliance and minimize ecological disruption.
Coordination among various stakeholders, including local authorities and other federal agencies, can present logistical challenges.

Positive Signals

The use of a firm-fixed-price contract provides cost certainty for the government.
Awarding to a known entity in the dredging sector suggests a level of confidence in contractor capability.
The project addresses a clear need for infrastructure improvement, aligning with strategic economic and defense objectives.

Sector Analysis

This contract falls within the heavy and civil engineering construction sector, specifically focusing on maritime infrastructure. The market for large-scale dredging and channel improvement projects is specialized, often dominated by a few major players with the necessary equipment and expertise. The $87.6 million award is substantial within this niche, reflecting the significant investment required for major port development and maintenance. Comparable spending benchmarks would involve other Army Corps of Engineers projects for similar channel deepening and widening efforts across the nation.

Small Business Impact

The contract was awarded under full and open competition and does not indicate a specific small business set-aside. While the prime contractor is a large entity, there may be opportunities for small businesses to participate as subcontractors, particularly in areas like material supply, specialized labor, or support services. The extent of small business subcontracting would depend on the prime contractor's strategy and the specific requirements outlined in the contract.

Oversight & Accountability

Oversight for this Department of the Army contract would typically be managed by the U.S. Army Corps of Engineers, which is responsible for executing civil works projects. Accountability measures are embedded in the contract's performance requirements, delivery schedules, and payment milestones. Transparency is facilitated through contract award databases and public reporting, though detailed project execution data may be less accessible. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Army Corps of Engineers Civil Works Program
Port Infrastructure Development Program
National Defense Authorization Act (NDAA) appropriations for infrastructure
Inland Waterways Trust Fund projects

Risk Flags

Potential for environmental impact during dredging operations.
Risk of schedule delays due to weather or unforeseen subsurface conditions.
Need for robust oversight to ensure adherence to technical specifications.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $87.6 million to GREAT LAKES DREDGE & DOCK CO, LLC. CT::SWG::CT - UNRESTRICTED PROCUREMENT FOR CORPUS CHRISTI SHIP CHANNEL, TEXAS IN NUECES AND ARANSAS COUNTIES, TEXAS, 54 FOOT PROJECT, CHANNEL IMPROVEMENT PROJECT, ENTRANCE CHANNEL WITH EXTENSION, DREDGING

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 $87.6 million.

What is the period of performance?

Start: 2018-12-31. End: 2020-02-20.

What is the historical spending pattern for Corpus Christi Ship Channel improvements by the Department of Defense?

Historical spending on Corpus Christi Ship Channel improvements by the Department of Defense, primarily through the Army Corps of Engineers, would likely show a pattern of periodic investments tied to federal appropriations cycles and specific project needs. Major deepening or widening projects, like the one awarded, are typically multi-year endeavors requiring significant upfront capital. Analyzing past contracts for similar dredging and construction work in the region would reveal the frequency and scale of previous investments. Without specific historical data for this exact channel, it's difficult to provide precise figures, but such projects are often undertaken when existing channel depths become insufficient for modern vessel sizes or when economic development initiatives necessitate increased capacity. The current $87.6 million contract suggests a substantial commitment, potentially indicating a significant upgrade or expansion phase.

How does the awarded price compare to the estimated cost or budget for this project?

The awarded price of $87.6 million represents the final negotiated cost for the Corpus Christi Ship Channel improvement project. To assess its value relative to the budget, one would need to compare it against the government's initial cost estimate or authorized budget for this specific undertaking. If the award is significantly below the estimate, it could indicate strong competition or favorable market conditions. Conversely, if it's at or above the estimate, it might suggest that the initial projections were accurate or that unforeseen complexities arose during the procurement process. The fact that it was awarded under full and open competition with two bidders suggests a competitive environment that likely drove the price towards a market-based level. Further insight would require access to the government's pre-solicitation cost estimates.

What is the track record of Great Lakes Dredge & Dock Co., LLC with similar large-scale federal dredging contracts?

Great Lakes Dredge & Dock Co., LLC (GLDD) has a long and extensive track record with large-scale federal dredging and marine construction projects, particularly with the U.S. Army Corps of Engineers. They are one of the largest dredging contractors in the United States and have been involved in numerous significant channel deepening, widening, and maintenance projects across the country. Their experience typically includes complex projects requiring specialized equipment and adherence to stringent environmental regulations. Past performance reviews and contract completion data available through federal procurement databases (like SAM.gov or FPDS) would provide specific details on their on-time and on-budget performance, as well as any disputes or challenges encountered on previous projects. Their established presence suggests a high likelihood of possessing the necessary capabilities for the Corpus Christi project.

What are the key performance indicators (KPIs) used to measure the success of this channel improvement project?

Key performance indicators (KPIs) for this channel improvement project would likely focus on several critical areas. Firstly, adherence to the project schedule is paramount; KPIs would track progress against milestones for dredging, spoil disposal, and any associated construction. Secondly, cost control is vital; tracking expenditures against the $87.6 million firm-fixed-price contract ensures the project stays within budget, though the fixed price shifts risk to the contractor. Thirdly, quality of work is measured against technical specifications, ensuring the channel is deepened and widened to the required dimensions and that environmental mitigation measures are effectively implemented. Finally, safety performance, measured by incident rates and compliance with safety protocols, is a crucial KPI for any large construction project. Successful completion would be defined by meeting all these technical, schedule, and safety requirements.

What is the potential impact of this contract on the regional economy and maritime trade in Texas?

This $87.6 million contract for the Corpus Christi Ship Channel improvement project is expected to have a significant positive impact on the regional economy and maritime trade in Texas. By deepening and widening the channel, the project will enable larger, more efficient vessels to access the port, reducing shipping costs and increasing cargo capacity. This enhanced capability is crucial for supporting the region's robust energy sector (oil, gas, and petrochemicals), as well as agricultural exports and manufacturing. Increased trade volumes can lead to job creation in port operations, logistics, warehousing, and related service industries. Furthermore, improved infrastructure can attract new businesses and investments to the area, boosting overall economic growth and solidifying Corpus Christi's position as a key maritime hub on the U.S. Gulf Coast.

Industry Classification

NAICS: Construction › Other Heavy and Civil Engineering Construction › Other Heavy and Civil Engineering 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: W9126G18R0427

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 STE 200, OAK BROOK, IL, 60523

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: $87,881,286

Exercised Options: $87,633,286

Current Obligation: $87,633,286

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline