DoD's $14.4M Camp Lejeune construction contract awarded to Virtexco Corp

Contract Overview

Contract Amount: $14,402,507 ($14.4M)

Contractor: Virtexco Corp

Awarding Agency: Department of Defense

Start Date: 2008-03-25

End Date: 2010-12-02

Contract Duration: 982 days

Daily Burn Rate: $14.7K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 3

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: MILCON P1063 MOUT ENHANCEMENTS FOR MARINE CORPS BASE CAMP LEJEUNE NORTH CAROLINA

Place of Performance

Location: CAMP LEJEUNE, ONSLOW County, NORTH CAROLINA, 28547

State: North Carolina Government Spending

Plain-Language Summary

Department of Defense obligated $14.4 million to VIRTEXCO CORP for work described as: MILCON P1063 MOUT ENHANCEMENTS FOR MARINE CORPS BASE CAMP LEJEUNE NORTH CAROLINA Key points: 1. Contract value of $14.4 million for construction services. 2. Awarded under full and open competition. 3. Contract duration of 982 days. 4. Fixed-price contract type suggests cost certainty. 5. Focus on building construction within the defense sector. 6. Geographic focus on North Carolina.

Value Assessment

Rating: fair

The contract value of $14.4 million for construction services at Camp Lejeune appears to be within a reasonable range for a project of this nature, though specific benchmarks for MOUT enhancements are not readily available. The firm fixed-price structure provides cost certainty for the government. Without detailed cost breakdowns or comparisons to similar MOUT enhancement projects, a precise value-for-money assessment is challenging. However, the competitive award process suggests a degree of price discovery.

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 presence of 3 bidders suggests a moderate level of competition for this specific construction project. While more than one bidder is positive, a higher number of competitors could potentially drive prices lower and increase the likelihood of innovative solutions.

Taxpayer Impact: Full and open competition is generally beneficial for taxpayers as it fosters a competitive environment that can lead to better pricing and quality.

Public Impact

Military personnel at Marine Corps Base Camp Lejeune will benefit from enhanced training facilities. The project delivers construction services for Military Operations in Urban Terrain (MOUT) enhancements. The geographic impact is concentrated in North Carolina. The contract supports the construction workforce in the region.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of detailed cost breakdown makes it difficult to assess true value for money.
Limited public information on the specific scope of 'MOUT enhancements' could obscure potential risks.
The fixed-price nature, while offering cost certainty, could lead to change orders if the scope is not perfectly defined.
Dependence on a single contractor for a significant construction project carries inherent execution risks.

Positive Signals

Awarded through full and open competition, indicating a fair and accessible bidding process.
Firm fixed-price contract type provides budget predictability.
Project directly supports military training infrastructure, a critical national security need.
Contract duration is clearly defined, allowing for project planning and oversight.

Sector Analysis

This contract falls within the broader construction sector, specifically focusing on specialized facilities for military training. The market for military construction is significant, driven by ongoing modernization and operational needs. Comparable spending benchmarks would typically involve other large-scale construction projects for defense installations, particularly those involving specialized training environments like MOUT sites.

Small Business Impact

The data indicates this contract was not set aside for small businesses (ss: false, sb: false). There is no explicit information regarding subcontracting plans for small businesses. Without specific subcontracting goals or reporting, the direct impact on the small business ecosystem is unclear, though large construction projects often involve a tiered subcontracting structure where small businesses may participate.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of the Navy's contracting and project management offices. Accountability measures are inherent in the firm fixed-price contract, requiring the contractor to deliver specified work within the agreed price. Transparency is facilitated by the public award data, but detailed project progress and financial oversight details are not publicly accessible.

Related Government Programs

Military Construction (MILCON)
Base Realignment and Closure (BRAC) related construction
Department of Defense Facilities Management
Marine Corps Training Infrastructure

Risk Flags

Potential for scope creep in specialized construction projects.
Contractor performance risk on fixed-price contracts.
Limited number of bidders may reduce competitive pressure.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $14.4 million to VIRTEXCO CORP. MILCON P1063 MOUT ENHANCEMENTS FOR MARINE CORPS BASE CAMP LEJEUNE NORTH CAROLINA

Who is the contractor on this award?

The obligated recipient is VIRTEXCO CORP.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $14.4 million.

What is the period of performance?

Start: 2008-03-25. End: 2010-12-02.

What is the typical cost range for MOUT enhancement projects of this scale within the Department of Defense?

Determining a precise 'typical' cost range for Military Operations in Urban Terrain (MOUT) enhancements is challenging due to the highly variable nature of such projects. Factors influencing cost include the size and complexity of the training area, the types of structures built or modified (e.g., realistic urban facades, simulated infrastructure, advanced technology integration), the level of detail required for realism, and the specific geographic location's labor and material costs. Projects can range from a few million dollars for basic enhancements to tens or even hundreds of millions for large-scale, technologically advanced MOUT villages. The $14.4 million awarded to Virtexco Corp for Camp Lejeune suggests a mid-range project, likely involving significant structural additions or modifications to existing facilities to simulate diverse urban combat scenarios.

How does the firm fixed-price contract type impact risk allocation between the government and Virtexco Corp?

A firm fixed-price (FFP) contract, like the one awarded to Virtexco Corp, shifts the majority of the cost risk to the contractor. Virtexco is obligated to complete the specified scope of work for the agreed-upon price of $14.4 million, regardless of their actual costs incurred. This provides the Department of the Navy with significant cost certainty. However, this also means that if Virtexco encounters unforeseen difficulties or underestimates costs, their profit margin will be reduced, or they could incur a loss. Conversely, if they manage the project efficiently and keep costs below the fixed price, their profit will increase. The government's primary risk under an FFP contract lies in ensuring the contractor fully understands and meets the contract's requirements; scope creep or poorly defined requirements can lead to disputes or change orders, potentially increasing the overall cost.

What are the potential implications of having only 3 bidders for this construction contract?

Having three bidders for this $14.4 million construction contract suggests a moderate level of competition. While it is positive that the contract was awarded under full and open competition, a smaller number of bidders compared to potentially higher numbers in other competitive procurements might indicate several possibilities. It could mean that the specialized nature of MOUT enhancements limits the pool of qualified contractors, or that the project's location or specific requirements made it less attractive to a wider range of firms. From a taxpayer perspective, fewer bidders might mean less downward pressure on pricing compared to a scenario with numerous competitors vying for the contract. However, it does not automatically imply a lack of value, as the winning bid could still represent a competitive price for the required work.

What is the historical spending pattern for MOUT enhancements at Camp Lejeune or similar Marine Corps facilities?

Analyzing historical spending patterns for MOUT enhancements at Camp Lejeune or similar Marine Corps facilities requires access to detailed contract databases and budget allocations over time. Information on specific MOUT projects is often embedded within broader military construction (MILCON) budgets. Generally, the Marine Corps, like other branches of the military, invests consistently in training infrastructure to maintain operational readiness. Spending on MOUT facilities would likely fluctuate based on strategic priorities, modernization efforts, and the lifecycle of existing training areas. Without specific data points on prior MOUT projects at Camp Lejeune, it's difficult to establish a direct historical spending trend for this particular type of enhancement. However, the recurring need for realistic training environments suggests ongoing, albeit potentially variable, investment in such facilities.

What is Virtexco Corp's track record with Department of Defense construction contracts, particularly those involving specialized facilities?

Virtexco Corp has a track record of securing contracts with the Department of Defense, including construction projects. A review of federal procurement data indicates past awards for various construction services. To assess their specific expertise in specialized facilities like MOUT enhancements, a deeper dive into their portfolio would be necessary. This would involve examining the nature and complexity of previous projects, their performance history on those contracts (e.g., on-time completion, adherence to budget, quality of work), and any reported issues or commendations. While the award of this $14.4 million contract suggests they met the qualifications and competitive requirements, understanding their specific experience with similar MOUT or specialized training facilities would provide further confidence in their capability to execute this project successfully.

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: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: N4008506R6029

Offers Received: 3

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 977 NORFOLK SQ, NORFOLK, VA, 23502

Business Categories: Category Business, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $14,402,507

Exercised Options: $14,402,507

Current Obligation: $14,402,507

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: N4008506D4010

IDV Type: IDC

Timeline