Kiewit Federal Group awarded $54.5M for heavy civil engineering construction, with 7 bids received

Contract Overview

Contract Amount: $54,506,850 ($54.5M)

Contractor: Kiewit Federal Group Inc.

Awarding Agency: Department of Defense

Start Date: 2010-05-05

End Date: 2010-10-31

Contract Duration: 179 days

Daily Burn Rate: $304.5K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 7

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: TASK ORDER NO. 0002

Place of Performance

Location: ANNAPOLIS JUNCTION, HOWARD County, MARYLAND, 20701

State: Maryland Government Spending

Plain-Language Summary

Department of Defense obligated $54.5 million to KIEWIT FEDERAL GROUP INC. for work described as: TASK ORDER NO. 0002 Key points: 1. The contract value represents a significant investment in heavy civil engineering. 2. A competitive bidding process with 7 offers suggests a healthy market for these services. 3. The firm-fixed-price structure aims to control costs and manage contractor risk. 4. Performance duration of 179 days indicates a focused, short-term project scope. 5. The contract falls under the 'Other Heavy and Civil Engineering Construction' NAICS code. 6. The award was made by the Department of the Army, a major federal client.

Value Assessment

Rating: good

The contract value of approximately $54.5 million for heavy civil engineering construction appears reasonable given the scope. Benchmarking against similar large-scale construction projects awarded by the Department of Defense would provide further context. The firm-fixed-price contract type suggests that the contractor bears the primary risk for cost overruns, which can be advantageous for the government if managed effectively. The relatively short performance period of 179 days for a project of this magnitude might indicate a well-defined scope or a specific phase of a larger undertaking.

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 bids. The receipt of 7 bids suggests a robust level of competition for this particular heavy and civil engineering construction requirement. A higher number of bidders generally leads to more competitive pricing and a wider selection of qualified contractors, potentially resulting in better value for the government.

Taxpayer Impact: The full and open competition with multiple bidders is beneficial for taxpayers as it drives down prices through market forces and ensures that the government is receiving services at a competitive rate.

Public Impact

The primary beneficiaries are likely the Department of the Army and its operational readiness, through the construction or repair of critical infrastructure. Services delivered include heavy and civil engineering construction, which could encompass a wide range of projects like roads, bridges, airfields, or other base facilities. The geographic impact is localized to the area where the construction takes place, likely within Maryland based on the 'ST' and 'SN' fields. Workforce implications include the creation of construction jobs, potentially benefiting skilled laborers, engineers, and project managers in the region.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for scope creep if the project is not tightly managed, given the fixed-price nature.
Ensuring timely completion within the 179-day window is crucial to avoid potential cost escalations or delays in military operations.
Quality control and adherence to construction standards are paramount for the longevity and safety of the infrastructure.

Positive Signals

The firm-fixed-price contract type provides cost certainty for the government.
Full and open competition with 7 bidders indicates a competitive market and potential for good value.
The contractor, Kiewit Federal Group Inc., is a known entity in large-scale construction projects.

Sector Analysis

The heavy and civil engineering construction sector is a critical component of national infrastructure development and maintenance. This contract falls under NAICS code 237990, 'Other Heavy and Civil Engineering Construction,' which includes establishments primarily engaged in constructing heavy and civil engineering projects not elsewhere classified, such as flood control projects, canals, dams, and pipelines. The federal government is a significant consumer of these services for military installations, transportation networks, and other public works. Market size for federal heavy civil construction can fluctuate based on infrastructure spending initiatives and defense priorities.

Small Business Impact

The data indicates that this contract was not set aside for small businesses ('ss': false, 'sb': false). Therefore, there are no direct subcontracting implications specifically mandated for small businesses through a set-aside program for this particular award. However, the prime contractor, Kiewit Federal Group Inc., may still engage small businesses as subcontractors based on their own procurement strategies and the availability of specialized services required for the project. The absence of a small business set-aside means the opportunity was open to all qualified bidders, regardless of size.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and the relevant program office within the Department of the Army. The firm-fixed-price contract type places a significant portion of the cost risk on the contractor, incentivizing them to manage the project efficiently. Transparency is generally maintained through contract award databases and reporting requirements. Inspector General (IG) jurisdiction would apply if any allegations of fraud, waste, or abuse arise during the contract's performance or closeout.

Related Government Programs

Military Construction
Base Realignment and Closure (BRAC) Projects
Federal Highway Administration Construction Contracts
Army Corps of Engineers Civil Works Projects

Risk Flags

Potential for cost overruns borne by contractor under FFP
Risk of schedule delays impacting operational readiness
Ensuring quality and compliance with construction standards
Contractor's financial stability and capacity for large projects

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $54.5 million to KIEWIT FEDERAL GROUP INC.. TASK ORDER NO. 0002

Who is the contractor on this award?

The obligated recipient is KIEWIT FEDERAL GROUP 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 $54.5 million.

What is the period of performance?

Start: 2010-05-05. End: 2010-10-31.

What is the historical spending pattern for Kiewit Federal Group Inc. with the Department of Defense?

Analyzing Kiewit Federal Group Inc.'s historical spending with the Department of Defense (DoD) requires access to comprehensive federal procurement data. Generally, Kiewit is a large, established construction firm with a significant track record of winning federal contracts, particularly in infrastructure and heavy civil projects. Their awards with the DoD often span various military branches and encompass a wide range of construction services, from building new facilities to repairing and upgrading existing infrastructure. To provide a precise historical spending pattern, one would need to query databases like FPDS or USASpending for all contracts awarded to Kiewit Federal Group Inc. by the DoD over a specific period, categorizing them by agency, type of service, and value. This would reveal trends in contract volume, average award values, and the types of projects most frequently undertaken.

How does the $54.5 million award compare to other heavy civil engineering contracts awarded by the Army in the last five years?

The $54.5 million award to Kiewit Federal Group Inc. for heavy civil engineering construction falls within a moderate to large range for individual task orders or delivery orders. The Department of the Army awards numerous contracts in this sector annually, with values varying significantly based on project scope, complexity, and location. Larger, multi-year programs or major construction initiatives can easily exceed hundreds of millions or even billions of dollars. Conversely, smaller repair or specific component construction tasks might be awarded for sums in the low millions. Therefore, while $54.5 million is a substantial sum, it is not exceptionally large in the context of the Army's overall heavy civil engineering portfolio, which includes major infrastructure upgrades and new base development.

What are the key performance indicators (KPIs) typically associated with this type of construction contract?

Key performance indicators (KPIs) for a firm-fixed-price heavy civil engineering construction contract like this typically focus on schedule adherence, cost control (within the fixed price), quality of workmanship, safety compliance, and environmental protection. Schedule adherence is critical, especially with a defined performance period of 179 days, ensuring the project is completed on time to avoid impacting military operations or other dependent activities. Quality is measured by adherence to specifications, building codes, and industry standards, often verified through inspections and testing. Safety KPIs involve tracking incident rates (e.g., lost time injuries) and ensuring compliance with all safety regulations. Environmental KPIs might include waste management, pollution control, and adherence to any environmental impact mitigation plans.

What is the risk profile of a firm-fixed-price contract for heavy civil engineering construction?

The risk profile of a firm-fixed-price (FFP) contract for heavy civil engineering construction is generally considered moderate to high for the contractor and lower for the government, assuming effective management. The primary risk for the contractor is cost overrun. If unforeseen site conditions, material price increases, labor shortages, or design issues arise, the contractor is responsible for absorbing those additional costs, as the price is fixed. This can lead to reduced profit margins or even losses for the contractor. For the government, the main risks are contractor default, poor quality work, or delays if the contractor struggles financially or operationally. However, the FFP structure provides significant cost certainty for the government, as the final price is known upfront, barring any contract modifications.

How does the number of bidders (7) influence the potential value for money in this contract?

A full and open competition that yields 7 bids for a heavy civil engineering construction contract generally indicates a healthy and competitive market for the services required. With multiple bidders vying for the contract, there is increased pressure on each company to offer competitive pricing and demonstrate superior technical capabilities to win the award. This competitive dynamic typically leads to better value for the government, as the price is driven down by market forces. A higher number of bidders reduces the likelihood of collusion and increases the probability that the government selects the most capable and cost-effective solution. Conversely, if only one or two bids were received, it might suggest limited competition, potentially leading to higher prices or a less optimal selection.

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: W912DR08R0057

Offers Received: 7

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Peter Kiewit Sons Inc (UEI: 070729517)

Address: 1800 SOUTH BELL STREET STE 300, ARLINGTON, VA, 22202

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $54,506,850

Exercised Options: $54,506,850

Current Obligation: $54,506,850

Contract Characteristics

Multi-Year Contract: Yes

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: W912DR10D0004

IDV Type: IDC

Timeline