Pentacon, LLC awarded $22.2M for Fort Hood training center construction, highlighting firm fixed-price contract

Contract Overview

Contract Amount: $22,221,719 ($22.2M)

Contractor: Pentacon, LLC

Awarding Agency: Department of Defense

Start Date: 2013-08-20

End Date: 2016-05-24

Contract Duration: 1,008 days

Daily Burn Rate: $22.0K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 4

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: IGF::OT::IGF CONSTRUCTION OF TRAINING SUPPORT CENTER FORT HOOD TX,

Place of Performance

Location: FORT HOOD, BELL County, TEXAS, 76544

State: Texas Government Spending

Plain-Language Summary

Department of Defense obligated $22.2 million to PENTACON, LLC for work described as: IGF::OT::IGF CONSTRUCTION OF TRAINING SUPPORT CENTER FORT HOOD TX, Key points: 1. The contract utilized a firm fixed-price structure, which shifts cost risk to the contractor. 2. Competition was conducted under 'full and open competition after exclusion of sources,' suggesting a potentially limited but justified bidding process. 3. The contract duration of 1008 days indicates a significant construction project. 4. The award was a delivery order, implying it was part of a larger indefinite-delivery/indefinite-quantity (IDIQ) contract. 5. The project's focus on training support center construction aligns with military readiness needs. 6. The geographic location in Texas may offer insights into regional construction market dynamics.

Value Assessment

Rating: fair

Benchmarking the value of this specific construction contract is challenging without comparable project data for similar training support centers. The firm fixed-price nature suggests the government aimed for cost certainty. However, the final cost relative to initial estimates or industry benchmarks for similar square footage and complexity would be needed for a more definitive value assessment. The absence of detailed cost breakdowns makes it difficult to assess pricing reasonableness.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

The contract was awarded under 'full and open competition after exclusion of sources.' This procurement method typically involves a solicitation that is broadly advertised, but specific sources may be excluded based on pre-qualification or other criteria. While not strictly sole-source, it indicates a narrower field of potential bidders than a completely unrestricted full and open competition. The number of bidders (4) suggests some level of competition, but the exclusion criteria could have limited the pool.

Taxpayer Impact: This procurement method, while allowing for some competition, may result in higher prices compared to a truly unrestricted full and open competition if the exclusion criteria significantly reduced the number of qualified bidders.

Public Impact

Military personnel at Fort Hood, Texas, will benefit from improved training facilities. The contract supports the construction of a training support center, enhancing military operational readiness. The project's geographic impact is localized to Fort Hood, Texas. The construction activities likely created temporary employment opportunities for skilled trades and laborers in the region.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if initial estimates did not fully capture project complexities, despite fixed-price structure.
Risk of contractor performance issues impacting project timelines or quality, common in large construction projects.
Limited competition could potentially lead to less favorable pricing than a broader solicitation.

Positive Signals

Firm fixed-price contract shifts cost risk to the contractor, promoting cost control.
Award to a single contractor (Pentacon, LLC) allows for clear accountability.
Delivery order structure suggests integration into a larger strategic procurement vehicle.

Sector Analysis

This contract falls within the Commercial and Institutional Building Construction sector. The construction of military facilities like training centers is a significant segment of the federal construction market. Spending in this area is often driven by modernization efforts, base realignments, and readiness requirements. Comparable benchmarks would include other large-scale government construction projects, particularly those for defense installations.

Small Business Impact

The provided data indicates that small business participation (sb) was false, and there was no indication of a small business set-aside (ss). This suggests the contract was not specifically targeted towards small businesses. Subcontracting opportunities for small businesses may exist at the discretion of the prime contractor, Pentacon, LLC, but are not explicitly mandated by the contract details provided.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of the Army, likely through contracting officers and project managers responsible for construction oversight at Fort Hood. Inspector General (IG) jurisdiction would apply in cases of fraud, waste, or abuse. Transparency is generally facilitated through contract award databases like FPDS, though detailed project progress and specific cost justifications may not always be publicly available.

Related Government Programs

Military Construction (MILCON)
Base Operations Support
Federal Building Construction
Department of Defense Procurement

Risk Flags

Potential for cost increases due to change orders.
Risk of contractor performance issues impacting schedule.
Limited competition may affect price optimization.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $22.2 million to PENTACON, LLC. IGF::OT::IGF CONSTRUCTION OF TRAINING SUPPORT CENTER FORT HOOD TX,

Who is the contractor on this award?

The obligated recipient is PENTACON, LLC.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $22.2 million.

What is the period of performance?

Start: 2013-08-20. End: 2016-05-24.

What is the track record of Pentacon, LLC in performing similar federal construction contracts?

Assessing Pentacon, LLC's track record requires a review of their past performance on federal contracts, particularly those involving military construction or training facilities. This would involve examining contract databases for previous awards, performance evaluations (e.g., Contractor Performance Assessment Reporting System - CPARS), and any history of contract disputes or terminations. A positive track record with similar projects would indicate a lower risk for successful project completion. Conversely, a history of delays, cost overruns, or quality issues would raise concerns about their capability to deliver this specific training support center effectively.

How does the awarded amount compare to industry benchmarks for similar construction projects?

To benchmark the $22.2 million award, one would need to compare it against the cost per square foot or per unit of similar training support centers or institutional buildings constructed in Texas or comparable regions. Factors such as building complexity, specialized equipment requirements, and prevailing labor costs would need to be considered. Without specific details on the size and scope of the training support center, a precise comparison is difficult. However, data from construction cost estimating services or government cost databases for similar facility types could provide a range for evaluation.

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

The primary risk indicator for a firm fixed-price contract is the potential for the contractor to cut corners on quality or scope to maintain profitability if costs exceed initial projections. While the government benefits from cost certainty, unforeseen site conditions or design changes could lead to change orders, potentially increasing the overall cost. Another risk is contractor default or poor performance, which, despite the fixed price, can lead to significant delays and the need for contract re-competition or termination, incurring additional costs and schedule impacts.

How effective is the 'full and open competition after exclusion of sources' method in ensuring value for taxpayers?

The effectiveness of 'full and open competition after exclusion of sources' in ensuring value for taxpayers is nuanced. It aims to balance broad competition with the need to ensure only qualified and capable contractors participate. If the exclusion criteria are well-justified and still permit a reasonable number of bidders (like the 4 in this case), it can lead to competitive pricing while mitigating risks associated with unqualified bidders. However, if the exclusion criteria are overly restrictive or poorly defined, it can limit competition, potentially leading to higher prices than a truly unrestricted solicitation and thus diminishing taxpayer value.

What are the historical spending patterns for training support centers at Fort Hood or similar installations?

Analyzing historical spending patterns for training support centers at Fort Hood or similar installations would involve examining past contract awards for similar facilities over several years. This would reveal trends in contract values, types of contractors awarded, and the duration of construction projects. Understanding these patterns can help identify cost escalation, typical project scopes, and the average number of bidders for such projects. It also provides a baseline against which the current $22.2 million award can be assessed for reasonableness in terms of cost and scale.

What are the implications of the contract duration (1008 days) on project management and cost?

A contract duration of 1008 days (approximately 2.76 years) for a training support center construction project suggests a substantial undertaking with multiple phases. This extended timeline increases the potential for cost escalation due to inflation, material price fluctuations, and labor market changes, even under a fixed-price contract, if not adequately accounted for in the initial pricing. It also requires robust project management to ensure milestones are met, quality is maintained throughout, and coordination with base operations is seamless. Longer durations can also tie up significant capital and resources for both the contractor and the government.

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 AFTER EXCLUSION OF SOURCES

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: W9126G13U1003

Offers Received: 4

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 5236 STATE HIGHWAY 167, CATOOSA, OK, 74015

Business Categories: American Indian Owned Business, Category Business, Economically Disadvantaged Women Owned Small Business, Emerging Small Business, HUBZone Firm, Limited Liability Corporation, Minority Owned Business, Native American Owned Business, Self-Certified Small Disadvantaged Business, Small Business, Special Designations, Woman Owned Business, Women Owned Small Business

Financial Breakdown

Contract Ceiling: $22,221,719

Exercised Options: $22,221,719

Current Obligation: $22,221,719

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: W912DY12D0030

IDV Type: IDC

Timeline