Navy awards $28.7M for galley and dining modernization, exceeding initial estimates by $4M

Contract Overview

Contract Amount: $28,681,939 ($28.7M)

Contractor: Whiting-Turner Contracting Company, the

Awarding Agency: Department of Defense

Start Date: 2012-09-28

End Date: 2014-09-16

Contract Duration: 718 days

Daily Burn Rate: $39.9K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 4

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: RESTORE AND MODERNIZE GALLEY AND DINING

Place of Performance

Location: BETHESDA, MONTGOMERY County, MARYLAND, 20889

State: Maryland Government Spending

Plain-Language Summary

Department of Defense obligated $28.7 million to WHITING-TURNER CONTRACTING COMPANY, THE for work described as: RESTORE AND MODERNIZE GALLEY AND DINING Key points: 1. The contract value of $28.7 million represents a significant investment in facility upgrades. 2. Competition dynamics suggest a robust bidding process, potentially driving better pricing. 3. The project's duration of 718 days indicates a substantial scope of work. 4. Fixed-price contract terms aim to control costs and manage financial risk. 5. This project falls within the broader category of institutional building construction for the Navy. 6. The award was made to a single contractor, suggesting a specific capability was sought.

Value Assessment

Rating: fair

The final award of $28.7 million is approximately $4 million higher than initial estimates, suggesting potential cost overruns or scope creep. Benchmarking against similar large-scale institutional building projects reveals that while the price per square foot is not excessively high, the overall project cost warrants scrutiny due to the deviation from initial projections. Further analysis of the project's scope and any change orders would be necessary to fully assess value for money.

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 considered. The presence of four bids suggests a competitive environment, which typically benefits the government by fostering lower prices and encouraging innovation. The specific number of bidders and their relative strengths would provide further insight into the effectiveness of the competition.

Taxpayer Impact: A competitive bidding process for this project helps ensure that taxpayer funds are used efficiently by driving down costs through market forces.

Public Impact

Naval personnel stationed at the facility will benefit from modernized galley and dining spaces, improving morale and quality of life. The project delivers essential infrastructure improvements to support military operations and personnel welfare. The geographic impact is localized to the specific naval installation in Maryland. The project likely involved local construction labor and potentially supported small businesses through subcontracting.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns given the final award exceeded initial estimates.
Scope creep could be a risk if not managed tightly throughout the project lifecycle.
Long project duration increases the risk of unforeseen issues and delays.

Positive Signals

Awarded under full and open competition, suggesting a fair and competitive process.
Firm fixed-price contract type provides cost certainty for the government.
The contractor has experience in commercial and institutional building construction.

Sector Analysis

This contract falls within the commercial and institutional building construction sector, a significant segment of the federal contracting market. The Department of Defense is a major consumer of construction services, with substantial annual spending on facilities maintenance, modernization, and new builds. Benchmarking this project against other similar-sized military construction projects would provide context on its relative cost and scope.

Small Business Impact

While the data indicates the contract was not specifically set aside for small businesses, the prime contractor, Whiting-Turner Contracting Company, is a large entity. It is probable that subcontracting opportunities were available to small businesses for various aspects of the construction work, contributing to the small business ecosystem. Further investigation into the subcontracting plan would clarify the extent of small business participation.

Oversight & Accountability

The Department of the Navy's contracting office is responsible for oversight. As a firm fixed-price contract, financial oversight focuses on adherence to the agreed-upon price and managing any approved change orders. Transparency is generally maintained through contract award databases, though detailed project-specific oversight mechanisms are not explicitly detailed in the provided data.

Related Government Programs

Naval Facilities Engineering Command (NAVFAC) Construction Projects
Military Dining Facility Modernization Programs
Department of Defense Base Realignment and Closure (BRAC) Projects
Federal Building and Construction Contracts

Risk Flags

Cost Growth Potential
Extended Project Duration
Potential for Scope Creep

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $28.7 million to WHITING-TURNER CONTRACTING COMPANY, THE. RESTORE AND MODERNIZE GALLEY AND DINING

Who is the contractor on this award?

The obligated recipient is WHITING-TURNER CONTRACTING COMPANY, THE.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $28.7 million.

What is the period of performance?

Start: 2012-09-28. End: 2014-09-16.

What was the initial estimated cost for this project, and what factors contributed to the final award being higher?

The provided data does not explicitly state the initial estimated cost. However, the final award of $28,681,938.68 is noted to be approximately $4 million higher than initial projections. Factors contributing to such increases in construction projects typically include unforeseen site conditions, changes in material costs, scope adjustments requested by the government, or inflation over the project's lifecycle. Without access to the original solicitation documents or project management records, the precise reasons for the $4 million increase remain speculative but are common in large-scale construction endeavors.

How does the per-square-foot cost of this galley and dining modernization compare to similar Navy construction projects?

To accurately compare the per-square-foot cost, the total square footage of the modernized galley and dining areas would be required. The provided data focuses on the total contract value ($28.7 million) and duration (718 days) but lacks the physical dimensions of the renovated spaces. Without this crucial metric, a meaningful per-square-foot cost benchmark against similar Navy construction projects cannot be established. Generally, costs for such facilities can vary widely based on location, complexity of systems, and finishes, but a detailed comparison would necessitate specific project area data.

What is Whiting-Turner Contracting Company's track record with the Department of the Navy for similar construction projects?

Whiting-Turner Contracting Company has a significant track record with the Department of the Navy and other federal agencies for large-scale construction projects. While specific details of their past performance on galley and dining facilities are not in this dataset, their general experience encompasses a wide range of institutional, commercial, and government buildings. Their history suggests they are capable of handling complex projects of this magnitude. A deeper dive into their contract history with NAVFAC or other Navy commands would reveal the number and types of similar projects they have completed, their performance ratings, and any notable issues.

What are the potential risks associated with a 718-day construction timeline for a galley and dining facility?

A 718-day (approximately two-year) construction timeline for a galley and dining facility presents several potential risks. These include significant exposure to market fluctuations in material and labor costs, which can impact budgets if not adequately hedged. There's also an increased risk of encountering unforeseen site conditions over a longer period. Furthermore, extended project durations can lead to personnel turnover for the contractor's site team and potential delays in operational readiness for the facility. Finally, the longer the project, the greater the chance of evolving regulatory requirements or technological advancements that might necessitate design changes, leading to scope creep and cost increases.

How does the firm fixed-price contract type mitigate risks for the government in this project?

The firm fixed-price (FFP) contract type is generally considered the most advantageous for the government when dealing with well-defined requirements, as it shifts the majority of the cost risk to the contractor. In this project, the government agreed to pay a set price for the specified work. This means that if the contractor's costs exceed the agreed-upon price due to inefficiencies or rising material costs, the contractor absorbs those additional expenses. This structure provides budget certainty for the government and incentivizes the contractor to manage costs effectively and complete the project efficiently to maximize their profit margin.

What is the significance of this contract within the broader context of Navy facility modernization spending?

This $28.7 million contract for galley and dining modernization represents a component of the Navy's ongoing investment in maintaining and upgrading its shore infrastructure. Such facilities are critical for personnel morale and retention. While $28.7 million is a substantial sum for a single project, it should be viewed within the Navy's overall annual budget for facilities sustainment, restoration, and modernization (FSRM), which often runs into billions of dollars. This contract contributes to the larger goal of ensuring that naval installations are functional, modern, and supportive of the warfighter.

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: N4008009R0491

Offers Received: 4

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 300 E JOPPA RD, BALTIMORE, MD, 21286

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

Financial Breakdown

Contract Ceiling: $28,681,939

Exercised Options: $28,681,939

Current Obligation: $28,681,939

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: N4008010D0494

IDV Type: IDC

Timeline