USAID awards $24.3M for educational institution construction/rehabilitation to CDM Constructors Inc

Contract Overview

Contract Amount: $24,341,487 ($24.3M)

Contractor: CDM Constructors Inc.

Awarding Agency: Agency for International Development

Start Date: 2011-08-25

End Date: 2014-11-30

Contract Duration: 1,193 days

Daily Burn Rate: $20.4K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 4

Pricing Type: COST PLUS FIXED FEE

Sector: Construction

Official Description: TO AWARD TASK ORDER 21 TO CDM FOR THE CONSTRUCTION/REHABILITATION OF FIVE EDUCATIONAL INSTITUTIONS

Plain-Language Summary

Agency for International Development obligated $24.3 million to CDM CONSTRUCTORS INC. for work described as: TO AWARD TASK ORDER 21 TO CDM FOR THE CONSTRUCTION/REHABILITATION OF FIVE EDUCATIONAL INSTITUTIONS Key points: 1. Contract awarded via full and open competition, suggesting a competitive bidding process. 2. The contract type is Cost Plus Fixed Fee, which can incentivize cost overruns if not managed carefully. 3. The duration of 1193 days (approx. 3.2 years) indicates a significant, long-term project. 4. The North American Industry Classification System (NAICS) code 541618 points to management consulting services, which seems incongruent with construction/rehabilitation. 5. The contract was awarded as a Delivery Order, implying it's part of a larger indefinite-delivery/indefinite-quantity (IDIQ) contract. 6. The absence of small business set-aside flags suggests large business participation.

Value Assessment

Rating: fair

Benchmarking the value of this contract is challenging without knowing the scope of services and the specific educational institutions involved. The Cost Plus Fixed Fee structure requires careful oversight to ensure costs remain reasonable. Comparing this to similar construction/rehabilitation projects for educational facilities would be necessary for a more precise value assessment. The fixed fee component provides some cost certainty, but the cost-reimbursement aspect necessitates vigilance.

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 a bid. The number of bidders is not specified, but this method generally promotes price discovery and allows the government to select the best value offer. The competitive nature should theoretically lead to more favorable pricing for the government.

Taxpayer Impact: Taxpayers benefit from a competitive process that aims to secure the best possible price and quality for the construction and rehabilitation services.

Public Impact

Beneficiaries include students and faculty at five educational institutions receiving improved facilities. Services delivered encompass the construction and rehabilitation of educational infrastructure. The geographic impact is localized to the areas where the five educational institutions are located. Workforce implications may include job creation for construction workers, project managers, and support staff.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns due to Cost Plus Fixed Fee structure.
Ambiguity between NAICS code (management consulting) and stated service (construction/rehabilitation).
Lack of specific details on the scope of rehabilitation and construction work.
Duration of the contract may lead to potential delays or scope creep if not managed effectively.

Positive Signals

Awarded through full and open competition, suggesting a robust bidding process.
The fixed fee component provides a degree of cost predictability.
The project aims to improve educational infrastructure, a positive societal impact.

Sector Analysis

This contract falls within the broader construction and facilities management sector. The market for educational facility construction and renovation is substantial, driven by the need for modern learning environments and infrastructure upgrades. Comparable spending benchmarks would involve analyzing other government contracts for similar educational facility projects, considering factors like project scale, location, and specific construction needs.

Small Business Impact

The data indicates that this contract was not set aside for small businesses (ss: false, sb: false). This suggests that the competition was likely dominated by larger firms. There is no explicit information on subcontracting plans, but in the absence of a small business set-aside, the prime contractor has more flexibility in awarding subcontracts, which may or may not involve small businesses.

Oversight & Accountability

Oversight would typically be managed by the Agency for International Development (USAID) contracting officers and program managers. Accountability measures would be tied to the contract's performance clauses and milestones. Transparency is facilitated by contract award data, but detailed project progress and financial reporting would be internal to the agency and contractor unless otherwise stipulated.

Related Government Programs

USAID Construction Projects
Educational Facility Modernization
Cost Plus Fixed Fee Contracts
Delivery Orders under IDIQs

Risk Flags

NAICS Code Mismatch
Cost Plus Fixed Fee Risk
Lack of Scope Specificity

Frequently Asked Questions

What is this federal contract paying for?

Agency for International Development awarded $24.3 million to CDM CONSTRUCTORS INC.. TO AWARD TASK ORDER 21 TO CDM FOR THE CONSTRUCTION/REHABILITATION OF FIVE EDUCATIONAL INSTITUTIONS

Who is the contractor on this award?

The obligated recipient is CDM CONSTRUCTORS INC..

Which agency awarded this contract?

Awarding agency: Agency for International Development (Agency for International Development).

What is the total obligated amount?

The obligated amount is $24.3 million.

What is the period of performance?

Start: 2011-08-25. End: 2014-11-30.

What is the specific nature of the construction and rehabilitation work to be performed at the five educational institutions?

The provided data is limited and does not detail the specific scope of construction and rehabilitation. It only states the objective: 'TO AWARD TASK ORDER 21 TO CDM FOR THE CONSTRUCTION/REHABILITATION OF FIVE EDUCATIONAL INSTITUTIONS.' To understand the specifics, one would need to review the task order details, including statements of work, architectural plans, and any associated technical specifications. This would clarify whether the work involves new construction, major renovations, system upgrades (e.g., HVAC, electrical), or minor repairs, and the extent of each.

How does the Cost Plus Fixed Fee (CPFF) structure compare to other contract types for similar construction projects, and what are the associated risks?

The Cost Plus Fixed Fee (CPFF) contract type is often used when the scope of work is not precisely defined or when there is a high degree of uncertainty. The contractor is reimbursed for allowable costs plus a predetermined fixed fee representing profit. Compared to fixed-price contracts, CPFF offers less cost certainty for the government but can be advantageous when innovation or flexibility is required. The primary risk for the government is that costs can escalate beyond initial estimates, as the contractor is incentivized to incur costs to achieve the fixed fee. Effective oversight, detailed cost tracking, and clear definition of allowable costs are crucial to mitigate this risk and ensure value for money.

What is the track record of CDM Constructors Inc. in performing similar government construction and rehabilitation projects, particularly for educational facilities?

Assessing CDM Constructors Inc.'s track record requires accessing historical contract data, performance reviews (e.g., Contractor Performance Assessment Reporting System - CPARS), and any publicly available project portfolios. Without this specific data, it's difficult to evaluate their past performance. Key indicators would include their history of completing projects on time and within budget, the quality of their work, and their experience with projects of similar scale and complexity, especially those involving educational institutions. A review of their past performance would inform the risk assessment for this current task order.

How does the awarded amount of $24.3 million compare to the average cost of constructing or rehabilitating educational institutions of similar scale?

Directly comparing the $24.3 million award to average costs is challenging without knowing the specifics of the five institutions (size, condition, location, scope of work). However, the average cost per institution would be approximately $4.86 million. This figure needs to be contextualized by factors such as the type of educational institution (e.g., primary school, university), the extent of rehabilitation versus new construction, and regional construction cost indices. Benchmarking against similar USAID or Department of State projects for educational infrastructure could provide a more relevant comparison.

What are the potential implications of the NAICS code 541618 (Other Management Consulting Services) being associated with a construction/rehabilitation contract?

The discrepancy between the stated service (construction/rehabilitation) and the assigned NAICS code (Other Management Consulting Services) is a significant point of concern. NAICS codes are intended to classify the primary business activity. If CDM Constructors Inc. is primarily a construction firm, this code might be an error or reflect a specific consulting aspect of the project management. However, it could also indicate that the contract's primary focus, as classified by the government, is on management and consulting related to the construction, rather than the physical construction itself. This ambiguity warrants clarification to understand the true nature and oversight requirements of the contract.

What oversight mechanisms are in place to manage the Cost Plus Fixed Fee aspect and ensure efficient use of taxpayer funds over the 1193-day duration?

Effective oversight for a CPFF contract of this duration typically involves rigorous financial monitoring, regular audits of contractor costs, and performance reviews against defined milestones. The Agency for International Development (USAID) would assign contracting officers and potentially technical monitors to oversee the project. Key oversight activities include verifying the allowability, allocability, and reasonableness of incurred costs, ensuring the fixed fee is earned only upon satisfactory completion of the agreed-upon scope, and managing any changes to the contract scope through formal modification procedures. Regular progress reports and site inspections are also critical.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Management, Scientific, and Technical Consulting Services › Other Management Consulting Services

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

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: ARCHITECT-ENGINEER FAR 6.102

Offers Received: 4

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Parent Company: CDM Smith Inc. (UEI: 055990261)

Address: 1 CAMBRIDGE PL 50 HAMPSHIRE ST, CAMBRIDGE, MA, 02139

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $24,341,487

Exercised Options: $24,341,487

Current Obligation: $24,341,487

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Parent Contract

Parent Award PIID: AID391I000701088

IDV Type: IDC

Timeline