Knik Construction awarded $23M for highway, street, and bridge construction by the Department of the Navy

Contract Overview

Contract Amount: $22,999,744 ($23.0M)

Contractor: Knik Construction CO., Inc.

Awarding Agency: Department of Defense

Start Date: 2009-12-17

End Date: 2011-04-30

Contract Duration: 499 days

Daily Burn Rate: $46.1K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: PAVING LINE ITEM PRICING SCHEDULES

Plain-Language Summary

Department of Defense obligated $23.0 million to KNIK CONSTRUCTION CO., INC. for work described as: PAVING LINE ITEM PRICING SCHEDULES Key points: 1. Contract value of $23M for construction services indicates significant investment in infrastructure. 2. Full and open competition suggests a robust bidding process, potentially leading to competitive pricing. 3. The contract duration of 499 days points to a substantial project scope. 4. Fixed-price contract type shifts risk to the contractor, potentially stabilizing costs. 5. The North American Industry Classification System (NAICS) code 237310 identifies the specific sector of highway, street, and bridge construction. 6. Awarded by the Department of the Navy, this contract likely supports military base infrastructure or related transportation needs.

Value Assessment

Rating: good

The contract value of $23 million for highway, street, and bridge construction is substantial. Without specific benchmarks for comparable projects of this exact scope and location, a precise value-for-money assessment is challenging. However, the use of full and open competition suggests that pricing was likely vetted against multiple offers. The firm fixed-price nature of the contract also implies that the contractor bears the risk of cost overruns, which is generally favorable for the government.

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 a bid. The number of bidders is not specified, but this method of procurement generally fosters a competitive environment. A higher number of bidders typically leads to more competitive pricing and a wider range of technical solutions, benefiting the government.

Taxpayer Impact: Full and open competition is the most advantageous for taxpayers as it maximizes the potential for cost savings through a broad base of offers and encourages contractors to submit their best pricing upfront.

Public Impact

The Department of the Navy is the primary beneficiary, receiving infrastructure improvements. Services delivered include highway, street, and bridge construction, enhancing transportation networks. Geographic impact is likely localized to areas where the Navy operates or requires transportation infrastructure. Workforce implications include employment opportunities for construction workers and related trades.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if the fixed-price contract does not adequately account for unforeseen site conditions or material price fluctuations.
Contract duration of 499 days could lead to delays impacting project timelines and associated costs.

Positive Signals

Full and open competition suggests a competitive bidding process that likely secured favorable pricing.
Firm fixed-price contract type transfers cost overrun risk to the contractor.
The specific NAICS code indicates a focused scope of work, allowing for specialized contractor expertise.

Sector Analysis

The construction sector, particularly highway, street, and bridge construction (NAICS 237310), is a significant part of federal spending, especially for agencies like the Department of Defense that maintain extensive physical infrastructure. Federal spending in this area often supports national transportation networks, military readiness, and economic development. Comparable spending benchmarks would typically involve analyzing other large-scale infrastructure projects awarded by federal agencies, considering factors like project complexity, location, and material costs.

Small Business Impact

The data indicates this contract was awarded under full and open competition and does not specify any small business set-aside provisions (ss: false, sb: false). This suggests that small businesses may have participated as subcontractors, but the prime contract was not exclusively reserved for them. Further analysis would be needed to determine the extent of small business subcontracting and its impact on the small business ecosystem.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and the relevant Department of the Navy contracting activity. The firm fixed-price nature of the contract provides a degree of accountability by setting a ceiling on costs. Transparency is generally facilitated through contract award databases like FPDS. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

Military Construction
Federal Highway Administration Projects
Department of Transportation Infrastructure Grants

Risk Flags

Potential for cost overruns if estimates are inaccurate.
Risk of project delays due to unforeseen circumstances or weather.
Ensuring quality standards are met under a fixed-price contract.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $23.0 million to KNIK CONSTRUCTION CO., INC.. PAVING LINE ITEM PRICING SCHEDULES

Who is the contractor on this award?

The obligated recipient is KNIK CONSTRUCTION CO., INC..

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $23.0 million.

What is the period of performance?

Start: 2009-12-17. End: 2011-04-30.

What is the historical spending pattern for Knik Construction Co., Inc. with the Department of Defense?

Analyzing the historical spending patterns of Knik Construction Co., Inc. with the Department of Defense requires accessing comprehensive federal procurement data. Based on the provided data, this specific contract represents a $23 million award. To understand their broader track record, one would need to query databases like the Federal Procurement Data System (FPDS) for all contracts awarded to Knik Construction Co., Inc. by the Department of Defense and its sub-agencies (like the Department of the Navy) over several fiscal years. This would reveal the total value of contracts, the types of services rendered (e.g., construction, maintenance), the agencies they've served within DoD, and their performance history, including any awards or disputes. A trend analysis could highlight if this $23 million award is typical, an outlier, or part of a larger strategic engagement with the DoD.

How does the $23 million contract value compare to similar highway, street, and bridge construction projects awarded by the Navy?

To benchmark the $23 million contract value for highway, street, and bridge construction awarded by the Department of the Navy, we would need to compare it against similar contracts. This involves identifying other contracts with the same NAICS code (237310) awarded by the Navy within a relevant timeframe (e.g., the last 3-5 years) and in comparable geographic regions or for similar types of infrastructure (e.g., airfield paving, bridge repair, road construction). Factors such as project scope, complexity, duration, and specific requirements would need to be considered. If this $23 million award is significantly higher or lower than comparable projects, it could indicate differences in project scale, market conditions, or the competitiveness of the bidding process. Without access to a broader dataset of comparable Navy construction contracts, a precise comparison is difficult, but the value suggests a project of considerable scale.

What are the primary risks associated with a firm fixed-price contract for large-scale construction projects?

Firm fixed-price (FFP) contracts, while generally favorable for the government by capping costs, introduce specific risks, primarily for the contractor. For large-scale construction projects like this $23 million award, the main risk is that the contractor may underestimate costs related to labor, materials, equipment, or unforeseen site conditions. If actual costs exceed the fixed price, the contractor absorbs the loss, potentially impacting their financial stability or leading to disputes. Conversely, the government risks receiving lower quality work if the contractor attempts to cut corners to maintain profitability. Effective risk mitigation for the government involves thorough pre-bid planning, detailed scope definition, robust contractor pre-qualification, and diligent oversight during project execution to ensure quality standards are met despite the fixed-price incentive.

What is the typical duration for highway, street, and bridge construction projects of this magnitude?

The duration of highway, street, and bridge construction projects can vary significantly based on scope, complexity, location, and funding. A 499-day duration (approximately 16-17 months) for a $23 million project is within a reasonable range for substantial infrastructure work. Smaller projects might last a few months, while mega-projects spanning multiple phases could take several years. Factors influencing duration include the extent of earthwork, the number of structures (bridges, overpasses), the need for traffic management during construction, environmental considerations, and weather delays. The Navy's specific requirements and the project's criticality likely influenced the setting of this 499-day timeline.

How does 'full and open competition' impact the pricing and quality of construction services for the Department of the Navy?

Full and open competition is designed to maximize the number of potential bidders, thereby increasing the likelihood of receiving competitive pricing and innovative solutions. For the Department of the Navy, this means that multiple construction firms can vie for the contract, driving down prices as companies compete to offer the best value. This process also encourages contractors to propose high-quality work and efficient methods to win the bid. While it doesn't guarantee the lowest price or highest quality in every instance, it creates a market dynamic that generally favors the government. The effectiveness of full and open competition relies on clear solicitation requirements and a fair evaluation process to ensure the selected contractor provides the best overall value, not just the lowest initial bid.

Industry Classification

NAICS: Construction › Highway, Street, and Bridge Construction › Highway, Street, and Bridge Construction

Product/Service Code: ARCHITECT/ENGINEER SERVICES › ARCH-ENG SVCS - CONSTRUCTION

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: N6945008R1272

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Lynden Inc

Address: 18000 INTL BLVD STE 800, SEATTLE, WA, 98188

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $22,999,744

Exercised Options: $22,999,744

Current Obligation: $22,999,744

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: N6945008D1272

IDV Type: IDC

Timeline