Kentucky Lock and Dam project awarded to Thalle Construction for $110M, focusing on concrete construction for navigation lock expansion

Contract Overview

Contract Amount: $110,191,666 ($110.2M)

Contractor: Thalle Construction CO Inc

Awarding Agency: Department of Defense

Start Date: 2010-01-29

End Date: 2017-05-29

Contract Duration: 2,677 days

Daily Burn Rate: $41.2K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 8

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: TAS::96 3134::TAS RECOVERY PROJECT NUMBER 116941 KENTUCKY LOCK AND DAM, TN RIVER, KY CONCRETE CONSTRUCTION OF 9 UPSTREAM MONOLITHS AT THE NEW 1200 FOOT LONG NAVIGATION LOCK LANDWARD AND ADJACENT TO THE EXISTING 600 FOOT LONG KY LOCK AT MILE 22.4 OF THE TN RIVER

Place of Performance

Location: GRAND RIVERS, LIVINGSTON County, KENTUCKY, 42045

State: Kentucky Government Spending

Plain-Language Summary

Department of Defense obligated $110.2 million to THALLE CONSTRUCTION CO INC for work described as: TAS::96 3134::TAS RECOVERY PROJECT NUMBER 116941 KENTUCKY LOCK AND DAM, TN RIVER, KY CONCRETE CONSTRUCTION OF 9 UPSTREAM MONOLITHS AT THE NEW 1200 FOOT LONG NAVIGATION LOCK LANDWARD AND ADJACENT TO THE EXISTING 600 FOOT LONG KY LOCK AT MILE 22.4 OF THE TN RIVER Key points: 1. The contract represents a significant investment in critical infrastructure for the Tennessee River. 2. Competition dynamics for this large-scale civil engineering project are crucial for ensuring taxpayer value. 3. Performance risks are associated with the complexity of constructing multiple concrete monoliths adjacent to an active lock. 4. The project's duration and firm fixed-price nature suggest an attempt to control costs and schedule. 5. This contract falls within the 'Other Heavy and Civil Engineering Construction' sector, highlighting specialized construction needs.

Value Assessment

Rating: fair

The total award amount of $110,191,665.59 for the construction of 9 upstream monoliths at the Kentucky Lock and Dam appears substantial. Benchmarking against similar large-scale civil engineering projects is necessary to fully assess value for money. The firm fixed-price contract type suggests a defined scope and budget, but the long duration could introduce unforeseen cost pressures. Without detailed cost breakdowns or comparisons to similar projects, a definitive value assessment is challenging.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that multiple bidders were likely solicited. The presence of 8 bids suggests a competitive environment, which is generally favorable for price discovery and achieving a reasonable contract value. The specific details of the bidding process and the number of responsive bids would provide further insight into the intensity of the competition.

Taxpayer Impact: Full and open competition with multiple bidders typically leads to more competitive pricing, potentially saving taxpayer dollars compared to sole-source or limited competition scenarios.

Public Impact

The primary beneficiaries are likely commercial entities relying on the Tennessee River for barge transportation, enabling more efficient movement of goods. The project delivers essential upgrades to navigation infrastructure, enhancing the capacity and reliability of the Kentucky Lock. The geographic impact is concentrated in Kentucky, specifically along the Tennessee River, supporting regional economic activity. Workforce implications include job creation for skilled construction labor in the region during the project's execution.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns due to the extended project duration and complexity of construction.
Risk of schedule delays impacting the intended operational benefits of the expanded lock.
Ensuring quality control for the concrete construction of multiple critical structural elements.

Positive Signals

Awarded under full and open competition, suggesting a competitive bidding process.
Firm fixed-price contract type helps to establish cost certainty.
The project addresses a critical need for infrastructure improvement, enhancing navigation efficiency.

Sector Analysis

This contract falls within the 'Other Heavy and Civil Engineering Construction' sector, which includes the construction of infrastructure projects such as dams, waterways, and bridges. The market for such projects is characterized by large, specialized firms capable of undertaking complex, high-value undertakings. Spending in this sector is often driven by government investment in public works and infrastructure modernization. Comparable spending benchmarks would involve analyzing other large-scale lock and dam construction or riverine infrastructure projects undertaken by federal agencies.

Small Business Impact

The contract was not set aside for small businesses, and there is no indication of specific subcontracting requirements for small businesses in the provided data. This suggests that the primary contractor, Thalle Construction Co. Inc., is likely a large entity. The absence of small business set-asides means that opportunities for small businesses would primarily be through subcontracting, if any are offered by the prime contractor.

Oversight & Accountability

Oversight for this project would typically be managed by the U.S. Army Corps of Engineers, the contracting agency. Mechanisms likely include regular site inspections, progress reporting, and quality assurance reviews. Accountability measures are embedded in the contract terms, including performance standards and payment schedules tied to milestones. Transparency is generally facilitated through public contract databases and reporting requirements, though specific oversight details are not provided.

Related Government Programs

Tennessee River Navigation Improvements
Inland Waterways Infrastructure Projects
U.S. Army Corps of Engineers Civil Works Programs
Kentucky Lock Replacement Project

Risk Flags

Potential for schedule delays due to project complexity.
Risk of cost escalation despite fixed-price contract over a long duration.
Ensuring adequate quality control for critical concrete structures.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $110.2 million to THALLE CONSTRUCTION CO INC. TAS::96 3134::TAS RECOVERY PROJECT NUMBER 116941 KENTUCKY LOCK AND DAM, TN RIVER, KY CONCRETE CONSTRUCTION OF 9 UPSTREAM MONOLITHS AT THE NEW 1200 FOOT LONG NAVIGATION LOCK LANDWARD AND ADJACENT TO THE EXISTING 600 FOOT LONG KY LOCK AT MILE 22.4 OF THE TN RIVER

Who is the contractor on this award?

The obligated recipient is THALLE CONSTRUCTION CO INC.

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Army).

What is the total obligated amount?

The obligated amount is $110.2 million.

What is the period of performance?

Start: 2010-01-29. End: 2017-05-29.

What is the track record of Thalle Construction Co. Inc. on similar large-scale civil engineering projects?

Thalle Construction Co. Inc. has a history of undertaking significant civil engineering and construction projects. While specific details on past performance for projects of identical scale and complexity to the Kentucky Lock and Dam expansion are not provided in this data snippet, their involvement in such a large federal contract suggests they possess the necessary experience and capacity. A deeper dive into their project portfolio, including past performance reviews, safety records, and on-time completion rates for comparable federal or state infrastructure projects, would be necessary for a comprehensive assessment of their track record. Examining their financial stability and bonding capacity would also be relevant for a project of this magnitude.

How does the awarded amount compare to the estimated cost or budget for the Kentucky Lock and Dam expansion?

The provided data indicates an awarded amount of $110,191,665.59. However, without access to the original contract solicitation, the government's estimated cost, or any pre-award budget information, it is impossible to definitively state whether this award represents a favorable or unfavorable outcome relative to expectations. The fact that it was awarded under full and open competition with 8 bids suggests that the pricing was competitive within the market. Further analysis would require comparing this award to the government's independent cost estimate and potentially to the bids submitted by other competitors, if that information were publicly available.

What are the primary risks associated with the construction of 9 upstream monoliths at an active navigation lock?

The primary risks associated with constructing 9 upstream monoliths at an active navigation lock are multifaceted. Firstly, there is a significant risk of disrupting ongoing navigation operations, which could lead to delays and economic impacts for river commerce. Maintaining the functionality of the existing 600-foot lock while constructing adjacent new structures requires meticulous planning and execution to avoid structural damage or operational failures. Secondly, the concrete construction itself presents risks related to material quality, curing processes, and potential environmental factors (e.g., weather). Thirdly, the sheer scale and duration of the project (2677 days) increase the likelihood of encountering unforeseen geological conditions, supply chain disruptions, or labor challenges. Finally, ensuring the long-term structural integrity and performance of the new monoliths under heavy use is a critical risk that requires rigorous quality control and engineering oversight.

What is the historical spending pattern for the Kentucky Lock and Dam project or similar infrastructure upgrades?

Historical spending data for the Kentucky Lock and Dam project itself, or for similar large-scale lock and dam upgrades managed by the U.S. Army Corps of Engineers, is not provided in this data snippet. However, it is generally understood that projects of this nature represent substantial, long-term investments. Federal spending on inland waterway infrastructure is cyclical and often tied to appropriations bills, infrastructure initiatives, and the prioritization of maintenance and modernization needs. To understand historical patterns, one would need to examine multi-year budget allocations and contract awards for the Army Corps of Engineers' civil works program, specifically focusing on navigation projects within the Tennessee River system or comparable river basins.

How does the firm fixed-price contract type influence the risk allocation between the government and the contractor?

A firm fixed-price (FFP) contract type generally places the majority of the cost risk on the contractor. Under an FFP agreement, the contractor agrees to perform a specified scope of work for a predetermined price, regardless of their actual costs incurred. This means that if the contractor's expenses exceed the agreed-upon price due to inefficiencies, material cost increases, or unforeseen challenges, the contractor absorbs those losses. Conversely, if the contractor manages costs effectively and completes the work for less than the fixed price, they retain the profit. For the government, an FFP contract offers the highest degree of cost certainty, making budgeting more predictable. However, it can also lead to higher initial bid prices as contractors factor in risk premiums. For a project like the Kentucky Lock and Dam, the FFP structure incentivizes the contractor to control costs and adhere to the schedule to maximize their profit margin.

Industry Classification

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

Product/Service Code: CONSTRUCT OF STRUCTURES/FACILITIES › CONSTRUCT NONBUILDING FACILITIES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SEALED BID

Solicitation ID: W912P510B0001

Offers Received: 8

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 900 NC HWY 86 N, HILLSBOROUGH, NC, 27278

Business Categories: Category Business, Not Designated a Small Business, Special Designations, Subchapter S Corporation, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $119,115,057

Exercised Options: $110,191,666

Current Obligation: $110,191,666

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline