Transportation contract for Montana road construction awarded to KH Civil Contractors for over $7.1 million

Contract Overview

Contract Amount: $7,137,926 ($7.1M)

Contractor: KH Civil Contractors, Inc.

Awarding Agency: Department of Transportation

Start Date: 2025-07-31

End Date: 2026-09-25

Contract Duration: 421 days

Daily Burn Rate: $17.0K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 4

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: FUNDS CONSTRUCTION PROJECT MT DAR MALM 2025(1), DEFENSE ACCESS ROADS FY 2025

Place of Performance

Location: WINIFRED, FERGUS County, MONTANA, 59489

State: Montana Government Spending

Plain-Language Summary

Department of Transportation obligated $7.1 million to KH CIVIL CONTRACTORS, INC. for work described as: FUNDS CONSTRUCTION PROJECT MT DAR MALM 2025(1), DEFENSE ACCESS ROADS FY 2025 Key points: 1. Contract value appears reasonable for a multi-year infrastructure project of this scope. 2. Full and open competition suggests a competitive bidding process, potentially leading to better pricing. 3. Project duration of 421 days indicates a significant undertaking requiring substantial resources. 4. Fixed-price contract type shifts risk to the contractor, potentially stabilizing costs for the government. 5. The project is located in Montana, impacting local infrastructure and potentially the regional economy.

Value Assessment

Rating: good

The contract value of approximately $7.1 million for a highway construction project in Montana seems aligned with typical infrastructure investments. Benchmarking against similar projects in the region or for similar scope (e.g., bridge repair, road widening) would provide a more precise value-for-money assessment. The firm fixed-price structure is a positive indicator for cost control, provided the scope is well-defined.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit bids. With four bids received, the level of competition appears moderate. This suggests that while multiple companies were interested, the market may not be saturated, which could influence pricing dynamics.

Taxpayer Impact: A competitive bidding process generally benefits taxpayers by encouraging lower prices and better quality as contractors vie for the award.

Public Impact

Residents and businesses in Montana will benefit from improved transportation infrastructure. The project will deliver construction services for the Defense Access Road program. Geographic impact is concentrated in Montana, specifically within the MT DAR MALM 2025(1) area. The construction activities will likely create temporary employment opportunities for skilled labor in the region.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Positive Signals

Awarded under full and open competition.
Firm fixed-price contract type helps manage cost certainty.
Project aligns with federal goals for infrastructure improvement.

Sector Analysis

This contract falls within the Highway, Street, and Bridge Construction sector, a significant part of the broader construction industry. Federal spending in this area supports national transportation networks and economic development. Comparable projects often involve substantial capital outlays, with costs varying based on project complexity, location, and material prices. The Defense Access Roads program specifically aims to improve infrastructure supporting military installations.

Small Business Impact

The contract was not set aside for small businesses, and there is no indication of subcontracting requirements for small businesses in the provided data. This means that larger firms were the primary participants in the competition. Further analysis would be needed to determine if any small business subcontracting opportunities are anticipated or mandated through other means.

Oversight & Accountability

Oversight for this contract will likely be managed by the Federal Highway Administration, a division of the Department of Transportation. Accountability measures are inherent in the contract terms, particularly the firm fixed-price structure. Transparency is generally maintained through federal contract databases, though specific project-level oversight details are not provided.

Related Government Programs

Defense Access Roads Program
Federal Highway Administration Projects
Montana Department of Transportation Contracts

Risk Flags

Potential for unforeseen site conditions impacting schedule and cost.
Risk of scope creep if project requirements are not clearly defined.
Contractor's past performance needs verification for project success.
Dependence on timely material procurement and labor availability.

Frequently Asked Questions

What is this federal contract paying for?

Department of Transportation awarded $7.1 million to KH CIVIL CONTRACTORS, INC.. FUNDS CONSTRUCTION PROJECT MT DAR MALM 2025(1), DEFENSE ACCESS ROADS FY 2025

Who is the contractor on this award?

The obligated recipient is KH CIVIL CONTRACTORS, INC..

Which agency awarded this contract?

Awarding agency: Department of Transportation (Federal Highway Administration).

What is the total obligated amount?

The obligated amount is $7.1 million.

What is the period of performance?

Start: 2025-07-31. End: 2026-09-25.

What is the track record of KH Civil Contractors, Inc. with federal contracts?

Information regarding KH Civil Contractors, Inc.'s specific track record with federal contracts is not detailed in the provided data. A comprehensive assessment would require reviewing their past performance on similar government projects, including contract history, any past performance evaluations (e.g., CPARS), and any history of disputes or contract terminations. This information is typically available through federal procurement databases and agency records. Understanding their experience with large-scale infrastructure projects, particularly those involving road construction and adherence to federal standards, is crucial for evaluating their capability to successfully execute this contract.

How does the awarded amount compare to similar highway construction projects in Montana?

The awarded amount of approximately $7.1 million for this highway construction project in Montana needs to be benchmarked against similar projects to assess value for money. Factors such as project scope (e.g., miles of road, type of construction, complexity of terrain), duration, and specific materials used significantly influence costs. A comparison with other Defense Access Road projects or similar state-funded highway initiatives in Montana or comparable states would provide context. Without specific data on comparable projects, it's difficult to definitively state if this contract represents excellent or fair value, but the amount appears within a reasonable range for a multi-year infrastructure undertaking.

What are the primary risks associated with this firm fixed-price contract?

The primary risks associated with this firm fixed-price contract, while generally favorable for cost control, lie in potential scope creep and unforeseen conditions. If the project scope is not meticulously defined, the contractor may request additional compensation for work deemed outside the original agreement. Furthermore, unforeseen site conditions (e.g., unexpected geological issues, environmental discoveries) could lead to cost overruns that, depending on contract clauses, may still necessitate adjustments or claims from the contractor. The government's risk is mitigated by thorough pre-award planning and robust contract administration to manage any changes effectively.

How effective is the Defense Access Roads program in supporting military readiness?

The Defense Access Roads (DAR) program aims to improve transportation infrastructure that supports access to and from military installations. Its effectiveness is measured by its contribution to enhancing logistical capabilities, improving safety for military personnel and civilian commuters, and facilitating the movement of personnel and equipment. By funding projects like the one in Montana, the program directly addresses infrastructure deficiencies that could otherwise impede military operations or readiness. The success of the program is often evaluated through the completion of projects on time and within budget, and their tangible impact on the accessibility and functionality of routes critical to defense activities.

What is the historical spending trend for the Defense Access Roads program?

Historical spending trends for the Defense Access Roads (DAR) program can provide insight into the program's scale and consistency. While specific annual figures for the DAR program are not provided here, federal infrastructure spending, in general, tends to fluctuate based on economic conditions, congressional appropriations, and national priorities. Programs like DAR are often funded through specific appropriations or as part of larger transportation bills. Analyzing past DAR budgets would reveal whether funding has been increasing, decreasing, or remaining stable, indicating the program's sustained importance and the government's commitment to improving defense-related transportation infrastructure over time.

What is the potential impact of this contract on the local Montana economy?

This $7.1 million construction contract is expected to have a positive impact on the local Montana economy. It will directly create jobs for construction workers, engineers, and project managers employed by KH Civil Contractors, Inc. and potentially its subcontractors. Indirectly, the spending on materials, equipment rentals, and local services will stimulate economic activity in related industries. Furthermore, the completed road improvements will enhance transportation efficiency, potentially benefiting local businesses and residents by reducing travel times and improving access to resources and markets.

Industry Classification

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

Product/Service Code: CONSTRUCT OF STRUCTURES/FACILITIES › CONSTRUCTION OF BUILDINGS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SEALED BID

Solicitation ID: 69056725B000007

Offers Received: 4

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 28 ROBINSON WAY, LEWISTOWN, MT, 59457

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

Financial Breakdown

Contract Ceiling: $7,137,926

Exercised Options: $7,137,926

Current Obligation: $7,137,926

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline