DoD Army Awards $14.2M for Building Construction, Facing Potential Overruns
Contract Overview
Contract Amount: $14,249,666 ($14.2M)
Contractor: Gkkworks Construction Services
Awarding Agency: Department of Defense
Start Date: 2008-09-30
End Date: 2014-04-30
Contract Duration: 2,038 days
Daily Burn Rate: $7.0K/day
Competition Type: FULL AND OPEN COMPETITION
Pricing Type: FIRM FIXED PRICE
Sector: Construction
Official Description: REPAIR/RENEWAL/CONSTRUCTION
Place of Performance
Location: OKLAHOMA CITY, OKLAHOMA County, OKLAHOMA, 73104
State: Oklahoma Government Spending
Plain-Language Summary
Department of Defense obligated $14.2 million to GKKWORKS CONSTRUCTION SERVICES for work described as: REPAIR/RENEWAL/CONSTRUCTION Key points: 1. Significant contract value of $14.2 million for construction services. 2. Competition was full and open, suggesting a competitive bidding process. 3. Risk of cost overruns exists due to the long duration and potential for unforeseen issues. 4. The sector is Commercial and Institutional Building Construction, a common area for government spending.
Value Assessment
Rating: fair
The contract value of $14.2 million is substantial for construction services. Benchmarking against similar contracts is difficult without more specific project details, but the duration suggests potential for cost escalation.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under full and open competition, which typically leads to better price discovery. However, the long duration and fixed-price nature could still lead to cost issues if not managed carefully.
Taxpayer Impact: Taxpayer funds are being used for essential building repair and renewal. While competition is positive, the long-term nature of the contract warrants close monitoring for cost efficiency.
Public Impact
Ensures maintenance and upgrades of critical Department of the Army facilities. Supports the construction industry and associated labor in Oklahoma. Long-term commitment may provide stability for the awarded contractor.
Waste & Efficiency Indicators
Waste Risk Score: 69 / 10
Warning Flags
- Long contract duration (2038 end date) increases risk of cost overruns and scope creep.
- Potential for unforeseen site conditions or material price fluctuations over the contract's life.
- Fixed-price contract may not adequately account for extended inflation or labor cost increases.
Positive Signals
- Awarded under full and open competition, maximizing potential for competitive pricing.
- Contract addresses essential repair and renewal needs for military infrastructure.
- Contractor is GKKWORKS CONSTRUCTION SERVICES, a known entity in the construction sector.
Sector Analysis
This contract falls within the Commercial and Institutional Building Construction sector, a significant area of government expenditure. Benchmarks for similar large-scale, long-duration construction projects vary widely based on scope and location.
Small Business Impact
The data indicates this contract was not awarded to a small business (ss: false, sb: false). Therefore, there is no direct benefit to small businesses through this specific award.
Oversight & Accountability
Oversight will be crucial given the contract's long duration and fixed-price nature. The Department of the Army must ensure diligent project management and financial oversight to mitigate risks and ensure value for money.
Related Government Programs
- Commercial and Institutional Building Construction
- Department of Defense Contracting
- Department of the Army Programs
Risk Flags
- Long contract duration (2008-2014 award, 2038 end date) presents significant risk.
- Fixed-price contract with a very long term may not adequately protect against inflation.
- Lack of specific project details makes comprehensive risk assessment difficult.
- No small business participation noted.
- Potential for scope creep over the extended period.
Tags
commercial-and-institutional-building-co, department-of-defense, ok, delivery-order, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $14.2 million to GKKWORKS CONSTRUCTION SERVICES. REPAIR/RENEWAL/CONSTRUCTION
Who is the contractor on this award?
The obligated recipient is GKKWORKS CONSTRUCTION SERVICES.
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Army).
What is the total obligated amount?
The obligated amount is $14.2 million.
What is the period of performance?
Start: 2008-09-30. End: 2014-04-30.
What specific repair or renewal activities are covered under this contract, and how were the costs estimated given the long duration?
The contract covers 'REPAIR/RENEWAL/CONSTRUCTION' for unspecified facilities. Estimating costs for a project extending to 2038 is inherently challenging. A detailed breakdown of anticipated work, material costs, labor projections, and contingency planning would be necessary to justify the $14.2 million award and ensure value.
What mechanisms are in place to manage cost risks associated with potential inflation and unforeseen issues over the 16-year contract period?
Given the fixed-price nature and long duration, specific risk mitigation strategies are critical. This could include clauses for economic price adjustments, strict change order controls, regular performance reviews, and robust contingency planning. Without these, the risk of cost overruns impacting taxpayer funds is significant.
How effectively does this contract ensure the long-term value and operational readiness of the Department of the Army's facilities?
The contract's effectiveness hinges on the quality of the executed work and its alignment with evolving military needs. While addressing immediate repair/renewal needs, the long timeframe necessitates flexibility. Successful execution, timely completion, and adherence to quality standards will ultimately determine the long-term value and contribution to operational readiness.
Industry Classification
NAICS: Construction › Nonresidential Building Construction › Commercial and Institutional Building Construction
Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › PROFESSIONAL SERVICES
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation ID: W912DY06R0028
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Address: 2355 MAIN ST STE 220, IRVINE, CA, 92614
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Minority Owned Business, Not Designated a Small Business, Indian (Subcontinent) American Owned Business
Financial Breakdown
Contract Ceiling: $14,249,666
Exercised Options: $14,249,666
Current Obligation: $14,249,666
Contract Characteristics
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: W912DY08D0021
IDV Type: IDC
Timeline
Start Date: 2008-09-30
Current End Date: 2014-04-30
Potential End Date: 2014-04-30 00:00:00
Last Modified: 2014-02-06
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