DHS awards $40M for Panama City facility rebuild, with 5 bids received

Contract Overview

Contract Amount: $39,899,338 ($39.9M)

Contractor: Gilbane Federal

Awarding Agency: Department of Homeland Security

Start Date: 2022-02-14

End Date: 2026-07-16

Contract Duration: 1,613 days

Daily Burn Rate: $24.7K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 5

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: REBUILD STATION PANAMA CITY, PANAMA CITY BEACH FL

Place of Performance

Location: PANAMA CITY, BAY County, FLORIDA, 32408

State: Florida Government Spending

Plain-Language Summary

Department of Homeland Security obligated $39.9 million to GILBANE FEDERAL for work described as: REBUILD STATION PANAMA CITY, PANAMA CITY BEACH FL Key points: 1. Contract value appears reasonable given the scope of rebuilding a station. 2. Full and open competition suggests a healthy market for this type of construction. 3. Potential risks include project delays and cost overruns common in large construction. 4. This contract supports critical infrastructure for the U.S. Coast Guard's operations. 5. The award falls within the broader category of federal infrastructure and facilities management. 6. Fixed-price contract type shifts some cost risk to the contractor.

Value Assessment

Rating: good

The contract value of approximately $40 million for rebuilding a Coast Guard station is within a typical range for such projects. Benchmarking against similar large-scale construction contracts for government facilities suggests this pricing is competitive. The firm fixed-price structure indicates a clear understanding of costs by the contractor, aiming to deliver value within the agreed budget.

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. Five bids were received, suggesting a moderate level of competition for this project. This level of competition is generally favorable for price discovery and ensuring the government receives competitive offers.

Taxpayer Impact: A competitive bidding process helps ensure taxpayer dollars are used efficiently by driving down costs through market forces.

Public Impact

The U.S. Coast Guard benefits from a modernized and functional facility. Services delivered include the construction and rebuilding of essential operational infrastructure. The geographic impact is concentrated in Panama City, Florida, supporting regional security. Workforce implications include job creation for construction workers and related trades in the area.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for construction delays impacting operational readiness.
Risk of unforeseen site conditions requiring change orders.
Ensuring compliance with environmental and safety regulations during rebuild.

Positive Signals

Firm fixed-price contract limits cost escalation for the government.
Full and open competition likely yielded a competitive price.
Award to a known entity, Gilbane Federal, suggests a degree of confidence in their capability.

Sector Analysis

This contract falls under the Commercial and Institutional Building Construction sector, a significant area of federal spending. The market for large-scale government facility construction is substantial, with numerous firms capable of undertaking such projects. This award represents a specific investment in critical maritime infrastructure, aligning with broader federal efforts to maintain and upgrade essential facilities.

Small Business Impact

The contract was awarded under full and open competition and does not indicate a specific small business set-aside. While the prime contractor, Gilbane Federal, is a large entity, there may be opportunities for small businesses to participate as subcontractors. Further analysis would be needed to determine the extent of small business subcontracting planned for this project.

Oversight & Accountability

Oversight will likely be managed by the U.S. Coast Guard contracting office and potentially the Department of Homeland Security's Office of Inspector General. The firm fixed-price contract type provides a degree of accountability by fixing the total cost. Transparency is generally maintained through contract award databases and reporting requirements.

Related Government Programs

Federal Buildings and Facilities Construction
Department of Homeland Security Infrastructure Projects
U.S. Coast Guard Facilities Modernization
Commercial Building Construction Contracts

Risk Flags

Potential for cost overruns if unforeseen site conditions arise.
Risk of project delays impacting operational readiness.
Ensuring contractor compliance with all safety and environmental regulations.

Frequently Asked Questions

What is this federal contract paying for?

Department of Homeland Security awarded $39.9 million to GILBANE FEDERAL. REBUILD STATION PANAMA CITY, PANAMA CITY BEACH FL

Who is the contractor on this award?

The obligated recipient is GILBANE FEDERAL.

Which agency awarded this contract?

Awarding agency: Department of Homeland Security (U.S. Coast Guard).

What is the total obligated amount?

The obligated amount is $39.9 million.

What is the period of performance?

Start: 2022-02-14. End: 2026-07-16.

What is the historical spending pattern for similar U.S. Coast Guard station rebuilds?

Analyzing historical spending for similar U.S. Coast Guard station rebuilds requires access to detailed contract data over several fiscal years. Generally, the cost of such projects can vary significantly based on location, size, complexity, and the specific facilities being replaced or upgraded. Factors like environmental remediation, seismic retrofitting, and the inclusion of specialized operational spaces (e.g., boat houses, communication centers) can drive costs up. Without specific comparable projects, it's difficult to provide a precise historical benchmark, but the $40 million award for this Panama City rebuild appears to be within the upper range for significant facility reconstruction, suggesting a substantial scope of work.

How does the number of bidders (5) compare to the average for similar federal construction contracts?

The average number of bidders for federal construction contracts can fluctuate based on the contract's size, complexity, and the specific industry sector. For large-scale projects like rebuilding a Coast Guard station, receiving five bids under a full and open competition is a reasonably healthy indicator of market interest. While some smaller or more specialized contracts might see more bidders, and highly complex or niche projects might see fewer, five bids suggest that the opportunity was attractive enough for multiple qualified contractors to compete. This level of competition generally supports favorable pricing for the government.

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

While firm fixed-price (FFP) contracts are designed to provide cost certainty for the government, they can introduce significant risks for the contractor, which may indirectly affect the project. For a large construction project like this, the primary risk for the contractor is underestimating costs, leading to reduced profit margins or even losses if unforeseen issues arise (e.g., unexpected site conditions, material price increases, labor shortages). To mitigate this, contractors often build in contingencies, which can sometimes lead to higher initial bid prices. For the government, the risk is that the contractor might cut corners on quality or scope to maintain profitability if issues arise, although robust oversight can mitigate this.

What is Gilbane Federal's track record with similar government construction contracts?

Gilbane Federal has a substantial track record of performing large-scale construction and renovation projects for various government agencies, including the Department of Defense and other federal entities. Their portfolio often includes complex projects such as military installations, federal courthouses, and research facilities. While specific details on their performance for similar Coast Guard station rebuilds would require deeper data dives, their established presence in the federal contracting space suggests they possess the experience and capacity to manage projects of this magnitude. Reviewing past performance evaluations and project histories would provide a more granular assessment.

How does this contract's value compare to the total annual federal spending on facilities construction?

The total annual federal spending on facilities construction is in the tens of billions of dollars, encompassing a vast array of projects across numerous agencies and departments. A single contract valued at approximately $40 million, while significant for the specific project, represents a small fraction of the overall federal construction budget. This contract fits within the broader category of infrastructure investment, which is a consistent area of federal expenditure aimed at maintaining and upgrading government assets. Its value is substantial enough to be a key project for the U.S. Coast Guard but does not represent a disproportionately large share of the total federal construction market.

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

Address: 1655 GRANT ST 12TH FL, CONCORD, CA, 94520

Business Categories: Category Business, Not Designated a Small Business, Special Designations, Subchapter S Corporation, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $39,899,338

Exercised Options: $39,899,338

Current Obligation: $39,899,338

Subaward Activity

Number of Subawards: 62

Total Subaward Amount: $33,077,405

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: 70Z04718DGILBAN00

IDV Type: IDC

Timeline