DOD awards $20.5M construction contract to DOYON PROPERTIES - AMERICAN JV for civil engineering projects

Contract Overview

Contract Amount: $20,465,967 ($20.5M)

Contractor: Doyon Properties - American JV

Awarding Agency: Department of Defense

Start Date: 2003-09-27

End Date: 2010-03-22

Contract Duration: 2,368 days

Daily Burn Rate: $8.6K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 6

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Place of Performance

Location: FORT WAINWRIGHT, FAIRBANKS NORTH STAR County, ALASKA, 99703

State: Alaska Government Spending

Plain-Language Summary

Department of Defense obligated $20.5 million to DOYON PROPERTIES - AMERICAN JV for work described as: Key points: 1. Contract awarded through full and open competition, suggesting a competitive bidding process. 2. The contract duration of over 6 years indicates a significant, long-term project. 3. The fixed-price nature of the contract shifts performance risk to the contractor. 4. The award to a joint venture may indicate a need for specialized capabilities or capacity. 5. The geographic focus on Alaska suggests specific regional construction requirements. 6. The contract falls under 'Other Heavy and Civil Engineering Construction,' a broad category.

Value Assessment

Rating: fair

The total award amount of $20,465,967 over approximately 6.5 years averages to roughly $3.15 million per year. Benchmarking this against similar large-scale civil engineering projects awarded by the Department of Defense is challenging without more specific project details. However, the duration and scope suggest a substantial investment. The firm fixed-price contract type implies that the contractor bears the risk of cost overruns, which can be a positive indicator of value if the contractor is experienced and efficient.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES,' indicating that while the competition was broadly open, certain sources may have been excluded prior to the final solicitation. The presence of 6 bidders suggests a reasonable level of competition. This type of competition generally aims to achieve fair market prices by allowing multiple qualified contractors to submit proposals.

Taxpayer Impact: The competitive nature of this award is beneficial for taxpayers, as it likely drove down pricing compared to a sole-source or limited competition scenario. The exclusion of sources, however, warrants further scrutiny to ensure it did not unduly limit competition.

Public Impact

The primary beneficiaries are likely the Department of Defense and its personnel stationed in Alaska, who will receive improved infrastructure. The contract delivers heavy and civil engineering construction services, potentially including site preparation, utility work, or facility construction. The geographic impact is concentrated in Alaska, supporting regional development and military readiness. The project will likely create or sustain jobs in the construction sector within Alaska, benefiting the local workforce.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

The 'exclusion of sources' clause in the competition type requires further investigation to ensure it did not limit competition unfairly.
The long duration of the contract could present challenges in adapting to changing technological or environmental requirements.
The specific nature of the 'Other Heavy and Civil Engineering Construction' is broad, making it difficult to assess precise value without project details.

Positive Signals

Awarded through full and open competition, indicating a robust bidding process.
The firm fixed-price contract shifts risk to the contractor, potentially leading to cost efficiencies.
The contract duration suggests a significant and important project for the agency.
The award to a joint venture may leverage diverse expertise for complex projects.

Sector Analysis

The construction sector, particularly heavy and civil engineering, is a significant area of federal spending, especially for agencies like the Department of Defense that require extensive infrastructure. This contract falls within a broad category that can encompass everything from road and bridge construction to utility systems and site development. Comparable spending benchmarks are highly project-specific, but large-scale civil engineering projects often represent multi-million dollar investments, aligning with the scale of this award.

Small Business Impact

The contract details indicate that small business participation was not a primary set-aside criterion (ss: false, sb: false). This suggests that the primary focus was on securing the necessary technical capabilities and capacity for this large-scale project. There is no explicit information on subcontracting plans for small businesses, which could be a missed opportunity to engage the small business ecosystem in Alaska.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of Defense's contracting and inspection mechanisms. The firm fixed-price nature provides some accountability by tying payment to deliverables. Transparency is generally maintained through contract award databases like FPDS. Specific Inspector General jurisdiction would depend on the nature of any potential fraud, waste, or abuse related to the contract's execution.

Related Government Programs

Military Construction
Base Realignment and Closure (BRAC) Projects
Federal Highway Administration Projects
Army Corps of Engineers Civil Works

Risk Flags

Competition Type: 'Exclusion of Sources' warrants review.
Long Duration Contract: Potential for cost escalation or obsolescence.
Broad NAICS Code: Lack of specific project details hinders precise value assessment.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $20.5 million to DOYON PROPERTIES - AMERICAN JV. See the official description on USAspending.

Who is the contractor on this award?

The obligated recipient is DOYON PROPERTIES - AMERICAN JV.

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Army).

What is the total obligated amount?

The obligated amount is $20.5 million.

What is the period of performance?

Start: 2003-09-27. End: 2010-03-22.

What specific types of heavy and civil engineering construction were undertaken under this contract?

The contract falls under the North American Industry Classification System (NAICS) code 237990, which covers 'Other Heavy and Civil Engineering Construction.' This broad category can include a wide range of projects such as the construction of tunnels, subways, pipelines, highways, streets, bridges, dams, and marine facilities. Without more specific project descriptions or task orders associated with this contract, it is difficult to pinpoint the exact nature of the construction. However, given the Department of the Army as the awarding agency and the location in Alaska, potential projects could involve infrastructure development at military installations, support for remote operational sites, or improvements to critical transportation or utility networks essential for defense operations in the region.

How does the average annual value of this contract compare to similar DOD construction projects in Alaska?

The contract's total value of $20,465,967 over approximately 6.5 years (2368 days) averages to about $3.15 million per year. Comparing this to similar DOD construction projects in Alaska requires access to detailed project data, which is not readily available in the provided summary. However, large-scale civil engineering and construction projects for the military in remote or strategically important locations like Alaska often command higher costs due to logistical challenges, specialized labor requirements, and environmental considerations. The average annual value appears substantial but would need to be benchmarked against specific project types (e.g., airfield construction, barracks, utility upgrades) and their respective contract values and durations to determine if it represents a particularly high or low investment.

What are the potential risks associated with a long-duration (6+ year) fixed-price construction contract in Alaska?

Long-duration fixed-price contracts, especially in challenging environments like Alaska, carry several risks. For the contractor, risks include unforeseen cost increases due to inflation, material price volatility, extreme weather impacting schedules, and potential discovery of unexpected site conditions (e.g., permafrost issues, difficult terrain). If costs escalate beyond projections, the contractor's profit margins can be severely eroded. For the government, the primary risk is that the fixed price might become uncompetitive if market conditions change significantly over the contract period, or if the contractor's efficiency decreases due to the long duration. Ensuring robust contract clauses for scope adjustments, change orders, and performance monitoring is crucial to mitigate these risks for both parties.

What does the 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES' designation imply for contractor selection and pricing?

This designation indicates that the solicitation was initially intended for full and open competition, but certain potential sources were excluded before the final request for proposals (RFP) was issued. This exclusion could be based on various factors, such as pre-qualification requirements, specific technical capabilities, or past performance criteria. While it still allows for broad competition among the remaining eligible sources, it means the pool of bidders was narrower than in a truly unrestricted full and open competition. This can impact price discovery; a more limited pool might result in less aggressive bidding compared to maximum possible competition. However, if the exclusions were justified by necessary qualifications, the competition among the remaining bidders could still yield a fair market price.

How might the joint venture structure of DOYON PROPERTIES - AMERICAN JV influence project execution and risk?

Forming a joint venture (JV) like DOYON PROPERTIES - AMERICAN JV often occurs when a project requires a combination of specialized expertise, financial capacity, or bonding limits that a single company might not possess. This structure allows the partners to pool resources, share risks, and potentially offer a more comprehensive solution. For this DOD contract, the JV structure might bring together Doyon Properties' potential local knowledge and experience in Alaska with American JV's broader construction capabilities. The risk is shared among the JV partners, potentially leading to greater financial stability. However, managing a JV can introduce complexities in decision-making, profit distribution, and coordination between the partners, which could impact project execution efficiency if not managed effectively.

Industry Classification

NAICS: Construction › Other Heavy and Civil Engineering Construction › Other Heavy and Civil Engineering Construction

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

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Offers Received: 6

Pricing Type: FIRM FIXED PRICE (J)

Contractor Details

Address: 714 4TH AVE, FAIRBANKS, AK, 00

Business Categories: Category Business, Minority Owned Business, Native American Owned Business, Self-Certified Small Disadvantaged Business, Small Business, Small Disadvantaged Business, Special Designations

Contract Characteristics

Cost or Pricing Data: NO

Timeline