Department of the Navy awards $753.7M construction contract for Naval Support Activity Bethesda

Contract Overview

Contract Amount: $753,732,157 ($753.7M)

Contractor: Clark/Balfour Beatty, a Joint Venture

Awarding Agency: Department of Defense

Start Date: 2008-03-03

End Date: 2012-12-14

Contract Duration: 1,747 days

Daily Burn Rate: $431.4K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: LUMP SUM PRICE

Place of Performance

Location: BETHESDA, MONTGOMERY County, MARYLAND, 20814

State: Maryland Government Spending

Plain-Language Summary

Department of Defense obligated $753.7 million to CLARK/BALFOUR BEATTY, A JOINT VENTURE for work described as: LUMP SUM PRICE Key points: 1. Contract awarded through full and open competition, suggesting a competitive bidding process. 2. The definitive contract type indicates a clear scope and fixed pricing. 3. The contract duration of 1747 days (approx. 4.8 years) suggests a significant, long-term project. 4. The award was made by the Department of the Navy, a major defense spender. 5. The North American Industry Classification System (NAICS) code 236220 points to commercial and institutional building construction. 6. The contract was awarded to a joint venture, CLARK/BALFOUR BEATTY, indicating a large-scale project requiring combined expertise. 7. The contract value of over $750 million positions this as a major federal construction award.

Value Assessment

Rating: good

The contract value of $753.7 million for commercial and institutional building construction appears substantial. Without specific details on the scope of work, it's challenging to benchmark against similar contracts precisely. However, the firm fixed-price nature suggests that the contractor assumed most of the risk for cost overruns. The number of bidders (2) is on the lower side for a full and open competition of this magnitude, which could warrant further investigation into pricing competitiveness.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, meaning all responsible sources were permitted to submit a bid. However, only two bids were received. While 'full and open' is the most competitive category, a low number of bidders can sometimes indicate market limitations, high barriers to entry, or potentially insufficient outreach. This could impact the government's ability to secure the most competitive pricing.

Taxpayer Impact: A low number of bidders, even in a full and open competition, may mean taxpayers did not benefit from the widest possible range of price proposals, potentially leading to a higher-than-optimal award price.

Public Impact

The primary beneficiaries are the Department of the Navy and its personnel stationed at Naval Support Activity Bethesda, who will receive improved facilities. The contract delivers significant construction services, likely involving new buildings, renovations, or infrastructure upgrades at the naval facility. The geographic impact is concentrated at Naval Support Activity Bethesda in Maryland. The project will likely create or sustain jobs in the construction sector, including skilled trades and project management roles, within the Maryland region.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Low number of bidders (2) for a large-value contract awarded under full and open competition could indicate potential issues with market reach or contractor interest.
The definitive contract type, while providing clarity, can sometimes be less flexible if unforeseen issues arise during a long-duration project.
The joint venture structure, while enabling large projects, can sometimes introduce complexities in management and accountability if not clearly defined.

Positive Signals

Awarded under full and open competition, adhering to principles of broad market access.
Firm fixed-price contract type shifts cost risk to the contractor, potentially protecting taxpayer funds from overruns.
The project is managed by the Department of the Navy, a seasoned agency with extensive experience in large-scale construction procurement.
The joint venture partners, CLARK/BALFOUR BEATTY, likely bring significant experience and capacity to execute a project of this scale.

Sector Analysis

This contract falls within the commercial and institutional building construction sector, a significant segment of the broader construction industry. Federal construction spending, particularly for defense installations, represents a substantial portion of this market. Comparable benchmarks would involve other large-scale military base construction or renovation projects, which often run into hundreds of millions of dollars due to scale, security requirements, and specialized needs.

Small Business Impact

The contract details indicate that small business participation was not a specific set-aside (ss: false, sb: false). This suggests that the primary award was not targeted towards small businesses. However, the joint venture partners, CLARK/BALFOUR BEATTY, may have subcontracting plans that include small businesses. Further analysis would be needed to determine the extent of small business involvement through subcontracting opportunities generated by this large prime contract.

Oversight & Accountability

Oversight for this contract would primarily reside with the Department of the Navy's contracting and project management offices. As a definitive contract, its terms and execution are subject to standard federal procurement regulations and oversight. Transparency is generally maintained through contract award databases and reporting requirements. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

Naval Facilities Engineering Command (NAVFAC) Construction Contracts
Department of Defense Military Construction Projects
Federal Building and Infrastructure Projects
Large-Scale Commercial Construction Awards

Risk Flags

Low bidder count for large contract
Potential for cost overruns despite fixed price (if scope changes)
Contractor performance history not detailed

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $753.7 million to CLARK/BALFOUR BEATTY, A JOINT VENTURE. LUMP SUM PRICE

Who is the contractor on this award?

The obligated recipient is CLARK/BALFOUR BEATTY, A JOINT VENTURE.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $753.7 million.

What is the period of performance?

Start: 2008-03-03. End: 2012-12-14.

What specific types of buildings or infrastructure were included in this $753.7 million construction contract?

The provided data indicates the contract falls under NAICS code 236220 (Commercial and Institutional Building Construction) and was awarded by the Department of the Navy for Naval Support Activity Bethesda. While the lump sum price is $753,732,157, the specific scope of work is not detailed. Typically, contracts of this magnitude for a naval support activity could include the construction of new administrative buildings, barracks, training facilities, maintenance structures, or significant upgrades to existing infrastructure, potentially including utilities and site work. The firm fixed-price nature suggests a well-defined scope was established prior to award.

How does the number of bidders (2) compare to similar large-scale federal construction contracts?

For a federal construction contract valued at over $750 million awarded under 'full and open competition,' receiving only two bids is relatively low. Typically, large, high-value contracts, especially those in well-established sectors like military construction, might attract more bidders if the market is robust and barriers to entry are manageable. A low number of bidders can sometimes suggest factors such as high pre-qualification requirements, specialized expertise needed, limited number of capable firms, or potentially insufficient outreach efforts by the agency. This can impact the level of price competition achieved.

What is the significance of the 'definitive contract' type for this award?

A definitive contract, in this context, is a type of contract that is awarded and finalized, specifying all terms and conditions, including price and delivery schedules. For a large construction project like this, it implies that the scope of work, requirements, and pricing were clearly defined and agreed upon by both the government and the contractor (CLARK/BALFOUR BEATTY, A JOINT VENTURE) before the contract was finalized. This contrasts with contract types like 'letter contracts' or 'undefinitized contract actions' (UCAs) which are used when the full details are not yet known. The definitive nature provides certainty and reduces ambiguity for both parties over the project's 1747-day duration.

What does the joint venture structure of CLARK/BALFOUR BEATTY imply for this contract?

The award to 'CLARK/BALFOUR BEATTY, A JOINT VENTURE' indicates that two or more separate companies have joined forces to undertake this large construction project. This is a common practice for major federal contracts, especially in construction, where the combined resources, expertise, and bonding capacity of multiple firms are necessary to meet the project's scale and complexity. It allows for risk sharing and the leveraging of specialized skills. For the government, it can ensure that capable contractors are available for very large projects. However, it also necessitates clear agreements within the joint venture regarding management, responsibilities, and profit distribution.

How does the contract's start and end date (March 2008 - December 2012) reflect the typical lifecycle of major federal construction projects?

The contract duration from March 3, 2008, to December 14, 2012, spans approximately 4 years and 9 months (1747 days). This timeframe is consistent with the lifecycle of major federal construction projects, which often involve extensive planning, design, procurement, construction, and closeout phases. Projects of this scale require significant lead time for mobilization, execution of complex building tasks, and adherence to strict quality and safety standards. The duration reflects the substantial scope of work and the complexities inherent in building or renovating facilities at a major military installation like Naval Support Activity Bethesda.

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: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: N4008007R0004

Offers Received: 2

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Clark Enterprises, Inc. (UEI: 064862345)

Address: 7500 OLD GEORGETOWN RD, BETHESDA, MD, 20814

Business Categories: Category Business, Not Designated a Small Business, Partnership or Limited Liability Partnership, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $753,732,157

Exercised Options: $753,732,157

Current Obligation: $753,732,157

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline