Agriculture awards $2.5M construction contract for CRRD Work Center, highlighting firm fixed-price terms

Contract Overview

Contract Amount: $2,527,063 ($2.5M)

Contractor: Aiko Enterprises, Inc

Awarding Agency: Department of Agriculture

Start Date: 2024-09-13

End Date: 2026-05-31

Contract Duration: 625 days

Daily Burn Rate: $4.0K/day

Competition Type: COMPETED UNDER SAP

Number of Offers Received: 3

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: CRRD WORK CENTER CONSTRUCTION PROJECT

Place of Performance

Location: LAKEMONT, RABUN County, GEORGIA, 30552

State: Georgia Government Spending

Plain-Language Summary

Department of Agriculture obligated $2.5 million to AIKO ENTERPRISES, INC for work described as: CRRD WORK CENTER CONSTRUCTION PROJECT Key points: 1. The contract value of $2.5 million appears reasonable for a construction project of this nature, pending detailed benchmarking. 2. Competition dynamics are favorable, with the contract being competed under SAP, suggesting a healthy bidding environment. 3. Risk indicators are moderate, with a firm fixed-price contract type generally transferring cost risk to the contractor. 4. Performance context will be crucial, as the project spans over 600 days, requiring sustained oversight. 5. The project falls within the Commercial and Institutional Building Construction sector, a common area for federal procurement.

Value Assessment

Rating: good

The contract value of $2.5 million for the CRRD Work Center construction project is within a typical range for similar federal building projects. Benchmarking against other commercial and institutional building construction contracts awarded by the Forest Service or other agencies of similar size would provide a clearer picture of value for money. The firm fixed-price (FFP) contract type suggests that the pricing was determined upfront, and any cost overruns are the responsibility of the contractor, which is generally favorable for the government.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

The contract was competed under SAP (Simplified Acquisition Procedures), which typically involves a smaller number of bidders compared to full and open competition. While this method can expedite the procurement process for smaller value contracts, it may limit the breadth of competition. The fact that there were 3 bidders indicates some level of competition, but it's important to understand the specific SAP thresholds and any limitations on bidder participation that might have been in place.

Taxpayer Impact: Limited competition under SAP can sometimes lead to less aggressive pricing than a broader competition. However, for contracts within SAP thresholds, it often represents a balance between achieving fair market prices and efficient procurement.

Public Impact

The primary beneficiaries are the Department of Agriculture's Forest Service, which will gain an improved work center facility. The project will deliver new or renovated construction services for a critical federal facility. The geographic impact is localized to Georgia, where the CRRD Work Center is situated. The contract will likely involve a workforce of construction laborers, tradespeople, and project managers, contributing to local employment.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for scope creep if initial requirements are not clearly defined for a long-duration project.
Ensuring contractor adherence to all building codes and environmental regulations throughout the construction process.
Managing potential delays due to unforeseen site conditions or material availability issues.

Positive Signals

Firm fixed-price contract structure mitigates cost overrun risk for the government.
Award to AIKO ENTERPRISES, INC. suggests they met the technical and performance requirements.
The project's duration is clearly defined, allowing for structured planning and oversight.

Sector Analysis

The Commercial and Institutional Building Construction sector encompasses a wide range of projects, from small renovations to large-scale new builds. Federal agencies are significant clients in this sector, procuring construction services for offices, research facilities, operational centers, and more. The market is characterized by numerous small, medium, and large construction firms. This contract fits within the typical scope of federal building construction, where agencies aim to secure cost-effective and reliable construction services for their infrastructure needs.

Small Business Impact

The data indicates that this contract was not set aside for small businesses (ss: false, sb: false). Therefore, the primary impact on the small business ecosystem would be through potential subcontracting opportunities if AIKO ENTERPRISES, INC. chooses to engage small businesses for specialized services. Without specific subcontracting plans detailed in the award, it's difficult to assess the direct impact on small businesses.

Oversight & Accountability

Oversight for this contract will likely be managed by the Forest Service contracting officer and project managers. Accountability measures are embedded in the firm fixed-price contract terms, requiring the contractor to deliver the specified construction within the agreed-upon price and schedule. Transparency is generally maintained through contract award databases and public reporting, though specific project progress reports may not always be publicly available. Inspector General jurisdiction would apply if any fraud, waste, or abuse is suspected.

Related Government Programs

Federal Buildings and Facilities Construction
Department of Agriculture Construction Projects
Forest Service Infrastructure
Commercial Building Construction Contracts

Risk Flags

Long contract duration requires sustained oversight.
SAP competition may limit broader price discovery.
Need to verify contractor's past performance.

Frequently Asked Questions

What is this federal contract paying for?

Department of Agriculture awarded $2.5 million to AIKO ENTERPRISES, INC. CRRD WORK CENTER CONSTRUCTION PROJECT

Who is the contractor on this award?

The obligated recipient is AIKO ENTERPRISES, INC.

Which agency awarded this contract?

Awarding agency: Department of Agriculture (Forest Service).

What is the total obligated amount?

The obligated amount is $2.5 million.

What is the period of performance?

Start: 2024-09-13. End: 2026-05-31.

What is the track record of AIKO ENTERPRISES, INC. with federal construction contracts, particularly with the Department of Agriculture?

A review of federal procurement data would be necessary to fully assess AIKO ENTERPRISES, INC.'s track record. Key metrics to examine include the number and value of previous federal contracts, performance ratings on past projects, and any history of contract disputes or terminations. Understanding their experience with similar-sized construction projects and their performance specifically with the Department of Agriculture or the Forest Service would provide valuable context for this current award. Without this specific historical data, it is difficult to definitively assess their reliability and past performance.

How does the awarded price of $2.5 million compare to similar construction projects for federal work centers?

Benchmarking this $2.5 million contract against similar federal work center construction projects requires access to a comprehensive database of past federal awards. Factors such as project scope, square footage, location, complexity of work (e.g., specialized systems, environmental considerations), and the year of award all influence cost. A preliminary assessment suggests the amount is within a reasonable range for a project of this type, but a detailed comparison with contracts of similar size, complexity, and geographic region awarded within the last 1-2 years would be needed to confirm if it represents excellent, good, or fair value for money.

What are the primary risks associated with a firm fixed-price contract for a construction project of this duration?

The primary risk with a firm fixed-price (FFP) contract, especially for a project spanning over 600 days, is the potential for the contractor to cut corners on quality or safety to maintain profitability if costs escalate unexpectedly. While the FFP shifts cost risk to the contractor, the government bears the risk of incomplete or substandard work if oversight is insufficient. Other risks include contractor default, delays due to unforeseen circumstances (which may lead to change orders if not managed contractually), and potential disputes over contract interpretation. Robust project management and diligent oversight by the government are critical to mitigate these risks.

What is the significance of the contract being competed under Simplified Acquisition Procedures (SAP)?

Competing this contract under Simplified Acquisition Procedures (SAP) indicates that its value likely falls within specific dollar thresholds set by the government for expedited procurement. SAP is designed for smaller purchases, allowing for less formal solicitation and evaluation processes compared to full and open competition. This can lead to faster award times. However, it may also result in fewer bidders participating, potentially limiting the breadth of competition and price discovery. The fact that there were three bidders suggests some level of competition was achieved within the SAP framework.

What are the potential implications of the 625-day contract duration on project oversight and performance?

A contract duration of 625 days (approximately 21 months) for a construction project necessitates sustained and diligent oversight from the Forest Service. This extended timeline increases the potential for scope creep, changes in personnel, and the need to manage evolving site conditions or regulatory requirements. Effective project management will require regular progress reviews, clear communication channels, and proactive identification and resolution of issues. The longer duration also means that performance monitoring must be consistent throughout the project lifecycle to ensure quality and adherence to the contract terms.

Industry Classification

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

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

Competition & Pricing

Extent Competed: COMPETED UNDER SAP

Solicitation Procedures: SIMPLIFIED ACQUISITION

Solicitation ID: 12445224R0011

Offers Received: 3

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 4250 LAKESIDE DR STE 213, JACKSONVILLE, FL, 32210

Business Categories: 8(a) Program Participant, Asian Pacific American Owned Business, Category Business, Corporate Entity Not Tax Exempt, Minority Owned Business, Self-Certified Small Disadvantaged Business, Small Business, Special Designations, Subchapter S Corporation, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $2,527,063

Exercised Options: $2,527,063

Current Obligation: $2,527,063

Actual Outlays: $1,721,562

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline