DHS awards $178.5M for border infrastructure construction, with Granite Construction Company winning the largest share

Contract Overview

Contract Amount: $178,541,401 ($178.5M)

Contractor: Granite Construction Company

Awarding Agency: Department of Homeland Security

Start Date: 2025-03-14

End Date: 2028-11-28

Contract Duration: 1,355 days

Daily Burn Rate: $131.8K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 5

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: BORDER INFRASTRUCTURE-BARRIER GAPS DESIGN BUILD CONSTRUCTION

Place of Performance

Location: WESLACO, HIDALGO County, TEXAS, 78596

State: Texas Government Spending

Plain-Language Summary

Department of Homeland Security obligated $178.5 million to GRANITE CONSTRUCTION COMPANY for work described as: BORDER INFRASTRUCTURE-BARRIER GAPS DESIGN BUILD CONSTRUCTION Key points: 1. The contract value represents a significant investment in border security infrastructure. 2. Competition dynamics for this large-scale project are crucial for ensuring taxpayer value. 3. Performance risk is moderate given the construction nature and multi-year duration. 4. This project aligns with broader national security and immigration policy objectives. 5. The sector is dominated by large construction firms capable of handling such extensive projects. 6. The firm-fixed-price structure aims to control costs, but scope creep remains a potential risk.

Value Assessment

Rating: good

The contract value of $178.5 million for border infrastructure construction appears to be within a reasonable range for a project of this magnitude and complexity. Benchmarking against similar large-scale construction projects for federal agencies would provide a more precise assessment of value for money. The firm-fixed-price contract type suggests an effort to establish cost certainty, which is positive for value assessment. However, without detailed cost breakdowns or comparisons to industry standards for similar construction scopes, a definitive value-for-money judgment is challenging.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that multiple bidders were likely solicited and considered. This approach is generally favorable for price discovery and ensuring that the government receives competitive pricing. The fact that there were 5 bids received suggests a healthy level of interest and competition for this significant project. A robust competitive process helps mitigate the risk of overpayment and encourages contractors to offer their best value.

Taxpayer Impact: Full and open competition is the most advantageous for taxpayers as it drives down prices through market forces, ensuring that federal funds are used efficiently and effectively for critical infrastructure needs.

Public Impact

The primary beneficiaries are U.S. Customs and Border Protection (CBP) and the Department of Homeland Security (DHS), receiving enhanced border security infrastructure. The services delivered include the design and construction of border infrastructure, likely focusing on barrier gaps and related facilities. The geographic impact is concentrated in Texas, a key border state, contributing to national border management efforts. The project will likely create or sustain jobs in the construction sector, particularly in Texas, and potentially in related supply chains.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if unforeseen site conditions or material price escalations occur.
Schedule delays due to weather, permitting, or supply chain disruptions are common in large construction projects.
Ensuring consistent quality and adherence to specifications across a large-scale construction project requires diligent oversight.

Positive Signals

The firm-fixed-price contract type provides cost certainty for the government, assuming the scope remains well-defined.
Awarding to a single, experienced contractor like Granite Construction Company can streamline project management and execution.
The multi-year duration allows for phased construction and potentially better resource allocation.

Sector Analysis

This contract falls within the Commercial and Institutional Building Construction sector, a broad category encompassing the erection of non-residential buildings. The market for large federal construction projects is often characterized by a few dominant players with the capacity, bonding, and experience to undertake such complex and high-value endeavors. Federal spending in this sector is driven by infrastructure needs, national security requirements, and agency modernization efforts. Comparable spending benchmarks would involve analyzing other large federal construction contracts awarded by agencies like the Army Corps of Engineers or GSA.

Small Business Impact

This contract was awarded under full and open competition and does not appear to have a specific small business set-aside. While the prime contractor, Granite Construction Company, is a large entity, there may be opportunities for small businesses to participate as subcontractors. The extent of small business subcontracting will depend on the prime contractor's strategy and the specific requirements outlined in the contract. Analysis of subcontracting plans would be necessary to fully assess the impact on the small business ecosystem.

Oversight & Accountability

Oversight for this contract will primarily be managed by the U.S. Customs and Border Protection (CBP) contracting officers and program managers within DHS. Accountability measures are embedded in the firm-fixed-price contract terms, requiring delivery of specified construction services. Transparency is facilitated through contract award databases like FPDS. The Inspector General for DHS would have jurisdiction to investigate any allegations of fraud, waste, or abuse related to this contract.

Related Government Programs

Border Security Infrastructure
Federal Construction Projects
Department of Homeland Security Contracts
Large-Scale Infrastructure Development
Texas Infrastructure Projects

Risk Flags

Potential for scope creep in large construction projects.
Risk of schedule delays due to external factors.
Ensuring long-term durability and effectiveness of constructed barriers.
Dependency on contractor performance for successful project completion.

Frequently Asked Questions

What is this federal contract paying for?

Department of Homeland Security awarded $178.5 million to GRANITE CONSTRUCTION COMPANY. BORDER INFRASTRUCTURE-BARRIER GAPS DESIGN BUILD CONSTRUCTION

Who is the contractor on this award?

The obligated recipient is GRANITE CONSTRUCTION COMPANY.

Which agency awarded this contract?

Awarding agency: Department of Homeland Security (U.S. Customs and Border Protection).

What is the total obligated amount?

The obligated amount is $178.5 million.

What is the period of performance?

Start: 2025-03-14. End: 2028-11-28.

What is Granite Construction Company's track record with large federal infrastructure projects, particularly for DHS or CBP?

Granite Construction Company has a significant history of undertaking large-scale construction projects, including those for federal agencies. While specific details on their past DHS or CBP contracts require deeper database searches, their general profile suggests experience with complex civil engineering and infrastructure development. They have been involved in projects such as highway construction, bridges, and other public works. A thorough review would involve examining their past performance evaluations (e.g., CPARS) for similar federal contracts to assess their reliability, quality of work, and adherence to schedule and budget on previous government engagements. Their size and market position indicate they are accustomed to the rigorous demands of federal contracting.

How does the $178.5 million award compare to historical spending on similar border infrastructure projects?

Comparing the $178.5 million award requires identifying specific, comparable border infrastructure projects in terms of scope, location, and duration. Historical data from agencies like CBP and the Army Corps of Engineers would be essential. For instance, if previous barrier construction projects of similar length and complexity in Texas cost significantly less, it might indicate a higher current price. Conversely, if inflation, material costs, or increased security requirements have driven up prices, this award might be in line with market trends. A detailed analysis would involve looking at contracts awarded over the past 5-10 years for similar types of construction (e.g., physical barriers, access roads, related facilities) to establish a relevant benchmark.

What are the primary risks associated with the 'design build construction' aspect of this contract?

The 'design-build-construct' nature of this contract consolidates design and construction responsibilities under a single entity, Granite Construction Company. Key risks include potential conflicts between design intent and constructability, especially if the design team is not fully integrated with the construction team. There's also a risk that the contractor might prioritize cost-saving measures during construction that compromise the long-term durability or effectiveness of the design. Furthermore, if the initial design is flawed or incomplete, it can lead to significant change orders and cost increases during the construction phase. Effective oversight is crucial to ensure the design meets requirements and the construction adheres to that design and quality standards.

What is the expected impact of this contract on border security effectiveness in the designated region of Texas?

The primary impact of this contract on border security effectiveness is expected to be the physical enhancement of border infrastructure, specifically addressing 'barrier gaps.' This could involve the construction or reinforcement of physical barriers, potentially improving the ability of U.S. Customs and Border Protection (CBP) agents to detect and interdict illegal crossings. The effectiveness will depend on the specific design, the terrain, and how the new infrastructure integrates with existing surveillance and patrol operations. Improved infrastructure can channel movement, provide better vantage points for surveillance, and create physical impediments, thereby contributing to a more controlled border environment in the targeted areas of Texas.

Are there any specific performance metrics or milestones tied to the $178.5 million award that indicate program effectiveness?

While the provided data does not detail specific performance metrics or milestones, federal construction contracts of this magnitude typically include such provisions. These are usually outlined in the contract's Statement of Work (SOW) or Performance Work Statement (PWS). Common metrics might include completion of design phases by certain dates, adherence to construction schedules for specific segments, quality control reports, safety compliance records, and final acceptance of completed work. Program effectiveness would be measured by the successful completion of these milestones within the allocated budget and timeframe, and ultimately, by how well the constructed infrastructure meets the operational requirements of CBP for border security.

What is the historical spending trend for border infrastructure construction by DHS over the last five years?

Analyzing historical spending trends for border infrastructure construction by DHS over the last five years would require accessing and aggregating data from sources like the Federal Procurement Data System (FPDS) or agency budget reports. This would involve filtering for contracts related to border barriers, infrastructure, and construction awarded by DHS and its components (like CBP). Trends could reveal whether spending has been increasing, decreasing, or remaining stable, and identify any significant shifts in procurement strategies or project types. Such an analysis would provide context for the current $178.5 million award, indicating if it represents a continuation of past investment levels or a significant deviation.

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: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 5

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Granite Construction Company Guam

Address: 585 W BEACH ST, WATSONVILLE, CA, 95076

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

Financial Breakdown

Contract Ceiling: $178,541,401

Exercised Options: $178,541,401

Current Obligation: $178,541,401

Actual Outlays: $14,389,377

Contract Characteristics

Multi-Year Contract: Yes

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: 70B01C23D00000011

IDV Type: IDC

Timeline