Surety Completes Interior Contract for $7.7M Amidst Uncompeted Construction
Contract Overview
Contract Amount: $7,692,765 ($7.7M)
Contractor: Berkley Insurance Company
Awarding Agency: Department of the Interior
Start Date: 2022-09-13
End Date: 2025-10-31
Contract Duration: 1,144 days
Daily Burn Rate: $6.7K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: Construction
Official Description: SURETY TAKING OVER AND COMPLETING THE WORK REQUIRED BY CONTRACT R16PC00143, AS MODIFIED, IN ACCORDANCE WITH ALL THE TERMS AND CONDITIONS OF THE CONTRACT UPON THE EXPRESS CONDITION THAT THE GOVERNMENT WILL PAY TO SURETY, IN THE MANNER PROVIDED IN THE
Place of Performance
Location: GRAND COULEE, GRANT County, WASHINGTON, 99133
Plain-Language Summary
Department of the Interior obligated $7.7 million to BERKLEY INSURANCE COMPANY for work described as: SURETY TAKING OVER AND COMPLETING THE WORK REQUIRED BY CONTRACT R16PC00143, AS MODIFIED, IN ACCORDANCE WITH ALL THE TERMS AND CONDITIONS OF THE CONTRACT UPON THE EXPRESS CONDITION THAT THE GOVERNMENT WILL PAY TO SURETY, IN THE MANNER PROVIDED IN THE Key points: 1. The contract involves commercial and institutional building construction in Washington. 2. A surety is taking over completion, indicating potential contractor default or performance issues. 3. The lack of competition raises concerns about price discovery and potential overpayment. 4. The firm fixed price contract type offers some cost certainty if managed effectively.
Value Assessment
Rating: questionable
The contract value of $7.7M for building construction needs comparison to similar projects in Washington. Without competitive bids, it's difficult to assess if this price is reasonable.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
The contract was not competed, suggesting a sole-source award. This limits price discovery and may lead to higher costs for taxpayers.
Taxpayer Impact: The lack of competition could result in the government paying more than necessary for the construction services.
Public Impact
Taxpayers may be paying a premium due to the absence of competitive bidding. The surety takeover suggests potential project delays and increased administrative burden. The effectiveness of the construction completion under surety management needs close monitoring. Transparency in the surety's cost and completion process is crucial for accountability.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Lack of competition
- Surety takeover implies contractor performance issues
- Potential for cost overruns during surety completion
Positive Signals
- Firm fixed price contract
- Defined completion date provides a target
Sector Analysis
This contract falls under Commercial and Institutional Building Construction. Benchmarks for similar projects in Washington state would be needed to assess value for money, especially given the non-competitive nature.
Small Business Impact
The data does not indicate if small businesses were involved in this contract or if opportunities were provided. Further investigation is needed to assess small business participation.
Oversight & Accountability
Oversight is critical to ensure the surety completes the work according to contract terms and that costs incurred are reasonable and justified, especially given the non-competitive award.
Related Government Programs
- Commercial and Institutional Building Construction
- Department of the Interior Contracting
- Bureau of Reclamation Programs
Risk Flags
- Lack of competition
- Surety takeover indicates potential contractor failure
- Potential for cost escalation during surety completion
- Uncertainty regarding project timeline due to takeover
- Limited transparency on pricing without competition
Tags
commercial-and-institutional-building-co, department-of-the-interior, wa, definitive-contract, 1m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of the Interior awarded $7.7 million to BERKLEY INSURANCE COMPANY. SURETY TAKING OVER AND COMPLETING THE WORK REQUIRED BY CONTRACT R16PC00143, AS MODIFIED, IN ACCORDANCE WITH ALL THE TERMS AND CONDITIONS OF THE CONTRACT UPON THE EXPRESS CONDITION THAT THE GOVERNMENT WILL PAY TO SURETY, IN THE MANNER PROVIDED IN THE
Who is the contractor on this award?
The obligated recipient is BERKLEY INSURANCE COMPANY.
Which agency awarded this contract?
Awarding agency: Department of the Interior (Bureau of Reclamation).
What is the total obligated amount?
The obligated amount is $7.7 million.
What is the period of performance?
Start: 2022-09-13. End: 2025-10-31.
What was the justification for not competing this contract, and how was the initial price determined to be fair and reasonable?
The justification for not competing this contract is not provided in the data. Typically, sole-source awards require a documented justification, such as a lack of available sources or urgent and compelling needs. Without this information, it's impossible to assess the initial price determination process and whether it truly represented fair market value.
What are the specific risks associated with the surety taking over the contract, and how are these risks being mitigated?
Risks include potential cost overruns as the surety may have higher overhead or profit margins, project delays if the surety struggles with management, and quality control issues. Mitigation strategies should involve rigorous government oversight of the surety's work, detailed cost tracking, and clear performance standards outlined in the takeover agreement.
How will the government ensure the effectiveness and value for money of the construction work completed by the surety?
Effectiveness and value will be ensured through stringent contract administration and quality assurance. The government must closely monitor the surety's progress, inspect the work for compliance with specifications, and scrutinize all costs incurred during the takeover. Benchmarking against similar completed projects and ensuring the final product meets all requirements are key.
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: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Offers Received: 1
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Address: 475 STEAMBOAT RD, GREENWICH, CT, 06836
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $7,692,765
Exercised Options: $7,692,765
Current Obligation: $7,692,765
Actual Outlays: $7,692,765
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Timeline
Start Date: 2022-09-13
Current End Date: 2025-10-31
Potential End Date: 2026-09-01 00:00:00
Last Modified: 2026-01-29
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