DoD's $11.2M Baghdad Police College construction contract awarded to Laguna Construction Company

Contract Overview

Contract Amount: $11,231,374 ($11.2M)

Contractor: Laguna Construction Company, Inc

Awarding Agency: Department of Defense

Start Date: 2007-11-28

End Date: 2010-02-15

Contract Duration: 810 days

Daily Burn Rate: $13.9K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 31

Pricing Type: COST PLUS FIXED FEE

Sector: Construction

Official Description: CONSTRUCT/RENOVATE BILLETING/CLASSRM BAGHDAD POLICE COLLEGE

Plain-Language Summary

Department of Defense obligated $11.2 million to LAGUNA CONSTRUCTION COMPANY, INC for work described as: CONSTRUCT/RENOVATE BILLETING/CLASSRM BAGHDAD POLICE COLLEGE Key points: 1. The contract aimed to construct and renovate facilities at the Baghdad Police College, a critical infrastructure project for security force development. 2. Awarded under full and open competition, the contract saw 31 proposals, suggesting a robust bidding process. 3. The duration of 810 days indicates a significant construction timeline for the project. 4. The contract type, Cost Plus Fixed Fee, can sometimes lead to cost overruns if not closely managed. 5. The project's success is tied to the broader stability and security objectives in Iraq. 6. The absence of small business set-asides means direct impact on this sector is limited.

Value Assessment

Rating: fair

Benchmarking the value of this contract is challenging due to its specific location and the geopolitical context of Iraq in 2007. The Cost Plus Fixed Fee structure, while common for complex projects, carries inherent risks of cost escalation. Without detailed cost breakdowns and comparisons to similar construction projects in similar high-risk environments, it's difficult to definitively assess value for money. The fixed fee component provides some cost certainty for the contractor's profit, but the overall project cost is subject to the actual expenses incurred.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, with 31 proposals received. This high number of bidders indicates significant interest and a competitive market for such construction services in the region at the time. A competitive bidding process generally helps in achieving better pricing and selecting the most capable contractor. The level of competition suggests that the government had a good opportunity to secure favorable terms.

Taxpayer Impact: A high level of competition is beneficial for taxpayers as it typically drives down prices and encourages contractors to offer their best value propositions, potentially saving taxpayer dollars.

Public Impact

The primary beneficiaries are the Iraqi security forces, who would gain improved training facilities. The project delivers essential infrastructure for the Baghdad Police College, enhancing its operational capacity. The geographic impact is concentrated in Baghdad, Iraq, supporting local development and security. The contract likely involved a significant number of construction workers, potentially including local hires, impacting the local workforce.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost Plus Fixed Fee contracts can incentivize higher spending if not meticulously monitored.
Geopolitical instability in Iraq could pose risks to project timelines and costs.
The specific nature of construction in a post-conflict zone presents unique logistical and security challenges.

Positive Signals

Awarded under full and open competition with a substantial number of bidders.
The project addresses a critical need for security force training infrastructure.
The contractor, Laguna Construction Company, has experience in large-scale construction projects.

Sector Analysis

This contract falls within the Commercial and Institutional Building Construction sector. The global market for construction services, particularly in infrastructure development for security and governance, is substantial. This project represents a specific instance of U.S. government spending to support stabilization efforts abroad. Comparable spending benchmarks would typically involve other reconstruction or infrastructure projects in similar geopolitical environments, which are often subject to higher costs due to risk premiums.

Small Business Impact

The contract data indicates that small business participation was not a specific set-aside requirement (ss: false, sb: false). This means the primary contract was not reserved for small businesses. There is no information provided on subcontracting plans or actual performance related to small businesses. Therefore, the direct impact on the small business ecosystem through this specific award is likely minimal, unless the prime contractor voluntarily engaged small businesses for subcontracting.

Oversight & Accountability

Oversight for this Department of Defense contract would typically involve contracting officers, program managers, and potentially inspectors general. The Cost Plus Fixed Fee structure necessitates rigorous oversight of incurred costs to ensure reasonableness and allowability. Transparency would depend on the reporting requirements stipulated in the contract and the DoD's policies on releasing contract details. The effectiveness of oversight is crucial in mitigating risks associated with cost overruns in such complex, high-risk environments.

Related Government Programs

Iraq Security Forces Fund
Department of Defense Construction Contracts
Reconstruction and Stabilization Projects
Foreign Military Construction Contracts

Risk Flags

Cost Overrun Risk (CPFF)
Security Risks in Operational Zone
Logistical Challenges
Geopolitical Instability Impact

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $11.2 million to LAGUNA CONSTRUCTION COMPANY, INC. CONSTRUCT/RENOVATE BILLETING/CLASSRM BAGHDAD POLICE COLLEGE

Who is the contractor on this award?

The obligated recipient is LAGUNA CONSTRUCTION COMPANY, INC.

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Air Force).

What is the total obligated amount?

The obligated amount is $11.2 million.

What is the period of performance?

Start: 2007-11-28. End: 2010-02-15.

What is the track record of Laguna Construction Company on similar government contracts?

Laguna Construction Company, Inc. has a history of performing large-scale construction projects, including those for government entities. While specific details on their track record with the Department of Defense or in similar international, high-risk environments require deeper investigation into contract databases and performance reviews, their ability to win a competitive bid for a project of this magnitude suggests they possess the necessary qualifications and experience. Further analysis would involve examining past performance ratings, any past disputes or contract terminations, and the types of projects they have successfully completed to assess their reliability and capability for complex undertakings like the Baghdad Police College construction.

How does the cost structure (Cost Plus Fixed Fee) compare to other construction contracts of similar scope and risk?

The Cost Plus Fixed Fee (CPFF) contract type is often employed when the scope of work is not precisely defined or when unforeseen circumstances are highly probable, as is common in overseas construction during periods of instability. In a CPFF contract, the contractor is reimbursed for all allowable costs plus a fixed fee representing their profit. This structure incentivizes the contractor to complete the work efficiently to maximize their profit margin relative to the fixed fee. Compared to fixed-price contracts, CPFF can offer greater flexibility but carries a higher risk of cost escalation for the government if cost controls are weak. For similar high-risk, complex construction projects, CPFF is a common, albeit carefully managed, choice.

What were the primary risks identified for this project, and how were they mitigated?

Primary risks for this project likely included security threats to personnel and equipment, logistical challenges in a foreign and potentially unstable region, potential for material shortages or delays, and the inherent uncertainties of construction in a post-conflict environment. Mitigation strategies would typically involve robust security protocols, detailed logistical planning, contingency budgeting, close coordination with local authorities and military forces, and potentially phased construction approaches. The Cost Plus Fixed Fee structure itself can be seen as a way to manage cost uncertainty, but it requires stringent oversight to prevent uncontrolled spending. Specific mitigation plans would be detailed in the contract's statement of work and associated risk management documentation.

What was the overall effectiveness of this contract in achieving its stated goals of improving police training facilities?

Assessing the overall effectiveness requires post-completion evaluation reports, which are not detailed in the provided data. The contract's goal was to construct and renovate facilities at the Baghdad Police College. Success would be measured by the timely completion of quality facilities that meet the intended operational needs of the Iraqi police force, thereby enhancing their training capabilities. Factors contributing to effectiveness would include the quality of the construction, the usability of the facilities, and the subsequent impact on police training output and effectiveness. Without specific performance metrics and outcome data, a definitive assessment of effectiveness remains elusive.

How does the total contract value of $11.2 million compare to historical spending on similar infrastructure projects in Iraq?

The $11.2 million contract value for the Baghdad Police College construction needs to be contextualized within the broader landscape of U.S. reconstruction spending in Iraq. During the period this contract was active (2007-2010), significant funds were allocated to infrastructure development, security force training, and stabilization efforts. While $11.2 million is a substantial sum for a single construction project, it represents a fraction of the overall U.S. investment in Iraq. Comparing it directly requires identifying projects of similar scope (e.g., educational facilities, police academies, barracks) in comparable environments. Costs in Iraq during that era were often inflated due to security premiums, logistical complexities, and the urgency of the mission, making direct comparisons with domestic projects or projects in more stable regions difficult.

Industry Classification

NAICS: Construction › Nonresidential Building Construction › Commercial and Institutional Building Construction

Product/Service Code: MAINT, REPAIR, ALTER REAL PROPERTY › MAINT, ALTER, REPAIR BUILDINGS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 31

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Address: I-40 W EXIT 114, LAGUNA, NM, 02

Business Categories: Category Business, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $11,231,374

Exercised Options: $11,231,374

Current Obligation: $11,231,374

Contract Characteristics

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: FA890306D8515

IDV Type: IDC

Timeline