State Department awards $2.89M construction contract for Mexico City embassy, highlighting engineering services

Contract Overview

Contract Amount: $2,893,938 ($2.9M)

Contractor: RMF Engineering, Inc., P.C.

Awarding Agency: Department of State

Start Date: 2018-03-06

End Date: 2026-10-31

Contract Duration: 3,161 days

Daily Burn Rate: $916/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: CONSTRUCTION PHASE FOR COMMISSIONING SERVICES LOCATED AT THE NEW EMBASSY COMPOUND IN NUEVO POLANCO DISTRICT MEXICO CITY, MEXICO.

Plain-Language Summary

Department of State obligated $2.9 million to RMF ENGINEERING, INC., P.C. for work described as: CONSTRUCTION PHASE FOR COMMISSIONING SERVICES LOCATED AT THE NEW EMBASSY COMPOUND IN NUEVO POLANCO DISTRICT MEXICO CITY, MEXICO. Key points: 1. Contract awarded through full and open competition, suggesting a competitive bidding process. 2. The contract duration of over 8 years indicates a long-term commitment to the project. 3. Firm Fixed Price contract type aims to control costs and provide budget certainty. 4. The project involves construction phase services for a new embassy compound. 5. The awardee, RMF ENGINEERING, INC., P.C., is responsible for delivering these critical engineering services. 6. The contract is a delivery order, implying it's part of a larger indefinite-delivery/indefinite-quantity (IDIQ) contract.

Value Assessment

Rating: good

The contract value of $2.89 million for engineering services related to embassy construction appears reasonable given the project's scope and long duration. Benchmarking against similar large-scale construction projects for diplomatic facilities suggests that costs for specialized engineering and project management are typically significant. The firm fixed price structure helps in managing potential cost overruns, providing a degree of value certainty 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 bids. The specific number of bidders is not provided, but this procurement method generally fosters a competitive environment, which can lead to better pricing and service offerings for the government. The agency likely sought to maximize competition to ensure the best value was obtained.

Taxpayer Impact: Full and open competition is beneficial for taxpayers as it increases the likelihood of receiving competitive pricing and high-quality services, preventing potential overpayment that could occur with less competitive methods.

Public Impact

The primary beneficiaries are the Department of State and U.S. diplomatic personnel who will utilize the new embassy compound. The services delivered include crucial engineering support for the construction phase of a major diplomatic facility. The geographic impact is localized to Mexico City, Mexico, where the new embassy compound is being built. The contract supports the engineering and construction workforce involved in building and commissioning the facility.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for scope creep given the long duration of the contract, which could impact final costs if not managed effectively.
Reliance on a single awardee for a critical, long-term project may present risks if the contractor faces performance issues or financial instability.
Geopolitical risks associated with construction in a foreign country could impact project timelines and costs.

Positive Signals

The firm fixed price contract type provides cost certainty and protects against inflation over the long project timeline.
Award through full and open competition suggests a robust vetting process and competitive pricing.
The long duration allows for sustained focus and expertise application throughout the complex construction process.

Sector Analysis

This contract falls within the Engineering Services sector, specifically supporting large-scale construction and infrastructure development. The market for such services is characterized by specialized firms capable of handling complex, high-value projects, often for government clients. Comparable spending benchmarks for diplomatic facility construction and associated engineering services can vary widely based on location, security requirements, and scale, but typically represent significant investments.

Small Business Impact

The data indicates this contract was not set aside for small businesses (ss: false, sb: false). Given the nature and scale of constructing an embassy compound, it is likely that the prime contract requires specialized expertise and resources typically found in larger firms. There is no explicit information on subcontracting plans for small businesses, which could be a missed opportunity to engage the small business ecosystem.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of State's contracting officers and program managers. Accountability measures are inherent in the firm fixed price contract type, which incentivizes the contractor to meet specifications within budget. Transparency is generally maintained through contract award databases and reporting requirements, though specific oversight activities and Inspector General jurisdiction would depend on the agency's internal policies and the contract's specific clauses.

Related Government Programs

Embassy Construction Projects
Engineering and Architectural Services
Department of State Facilities Management
Overseas Infrastructure Development

Risk Flags

Long contract duration may increase exposure to market volatility and unforeseen costs.
Potential for scope creep given the extended timeline and complexity of embassy construction.
Reliance on a single contractor for a critical, long-term project.

Frequently Asked Questions

What is this federal contract paying for?

Department of State awarded $2.9 million to RMF ENGINEERING, INC., P.C.. CONSTRUCTION PHASE FOR COMMISSIONING SERVICES LOCATED AT THE NEW EMBASSY COMPOUND IN NUEVO POLANCO DISTRICT MEXICO CITY, MEXICO.

Who is the contractor on this award?

The obligated recipient is RMF ENGINEERING, INC., P.C..

Which agency awarded this contract?

Awarding agency: Department of State (Department of State).

What is the total obligated amount?

The obligated amount is $2.9 million.

What is the period of performance?

Start: 2018-03-06. End: 2026-10-31.

What is the track record of RMF ENGINEERING, INC., P.C. with the Department of State or similar federal agencies on large-scale construction projects?

Information regarding RMF ENGINEERING, INC., P.C.'s specific track record with the Department of State on large-scale construction projects is not detailed in the provided data. However, the award of this contract suggests they possess the necessary qualifications and experience deemed sufficient by the agency. A deeper analysis would require reviewing past performance evaluations, contract history, and any reported issues or successes on similar federal contracts. Federal procurement databases like SAM.gov or FPDS can provide more granular details on their contract history, including past performance ratings and any debriefings or disputes.

How does the $2.89 million contract value compare to similar embassy construction engineering service contracts awarded by the State Department?

Direct comparison of the $2.89 million contract value for engineering services is challenging without specific details on the scope, location, and complexity of other embassy construction projects. However, the value appears to be a significant investment, consistent with the specialized nature of engineering for diplomatic facilities. The State Department's Bureau of Overseas Buildings Operations (OBO) manages numerous construction and renovation projects globally, with engineering service costs varying widely. Factors such as security requirements, site conditions, and the scale of the new compound would influence the overall cost. This contract's value should be assessed against the specific deliverables and the extended timeline (over 8 years) to determine its relative cost-effectiveness.

What are the primary risks associated with a construction phase contract for an embassy compound in Mexico City?

Key risks for this contract include geopolitical instability in Mexico City, potential security threats impacting personnel and operations, and logistical challenges related to importing materials and equipment. Environmental factors, such as seismic activity or extreme weather, could also pose risks to construction timelines and structural integrity. Furthermore, labor availability and relations with local workforce unions can affect project progress. The long duration of the contract (over 8 years) increases the exposure to these risks, necessitating robust risk management and contingency planning by both the contractor and the Department of State.

How effective is the firm fixed price (FFP) contract type in managing costs for long-term construction projects like this embassy compound?

The Firm Fixed Price (FFP) contract type is generally effective in managing costs for long-term construction projects by shifting the risk of cost overruns to the contractor. This provides budget certainty for the government, as the price is fixed regardless of the contractor's actual costs. However, for very long-duration projects, there's a risk that the initial fixed price may not adequately account for unforeseen inflation or significant changes in material costs. To mitigate this, contracts may include escalation clauses or require careful negotiation of the base price to reflect anticipated market conditions over the project's lifespan. The success of FFP in this case depends on the thoroughness of the initial cost estimation and the contractor's ability to manage their own expenses efficiently.

What is the historical spending pattern for engineering services related to overseas embassy construction by the Department of State?

Historical spending patterns for engineering services related to overseas embassy construction by the Department of State are substantial, reflecting the ongoing need to maintain and upgrade diplomatic facilities worldwide. The Bureau of Overseas Buildings Operations (OBO) is responsible for a significant portfolio of construction and renovation projects, often involving multi-year efforts. Annual budgets allocated to OBO for capital construction and related services typically run into hundreds of millions, if not billions, of dollars. Spending on engineering services is a critical component of these projects, covering design, planning, oversight, and commissioning. The specific amount spent on engineering services can fluctuate year-to-year based on project pipelines and priorities.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Architectural, Engineering, and Related Services › Engineering Services

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

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 5520 RESEARCH PK DR, CATONSVILLE, MD, 21228

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

Financial Breakdown

Contract Ceiling: $2,893,938

Exercised Options: $2,893,938

Current Obligation: $2,893,938

Actual Outlays: $384,977

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: SAQMMA13D0039

IDV Type: IDC

Timeline