DoD's $9.7M YSK SLOPE STABILIZATION contract awarded to NIPPO CORPORATION shows strong competition

Contract Overview

Contract Amount: $9,675,274 ($9.7M)

Contractor: Nippo Corporation

Awarding Agency: Department of Defense

Start Date: 2024-12-16

End Date: 2027-02-25

Contract Duration: 801 days

Daily Burn Rate: $12.1K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: YSK SLOPE STABILIZATION

Plain-Language Summary

Department of Defense obligated $9.7 million to NIPPO CORPORATION for work described as: YSK SLOPE STABILIZATION Key points: 1. The contract's value of approximately $9.7 million is within a reasonable range for large-scale construction projects. 2. Full and open competition suggests a healthy market with multiple capable bidders. 3. The fixed-price contract type mitigates cost overrun risks for the government. 4. The project duration of 801 days indicates a significant undertaking requiring substantial resources. 5. The contract is positioned within the broader defense construction sector, supporting infrastructure maintenance. 6. The absence of small business set-asides warrants further investigation into subcontracting opportunities.

Value Assessment

Rating: good

The contract value of $9.7 million for slope stabilization is substantial. Benchmarking against similar large-scale construction projects within the Department of Defense, this amount appears to be in line with industry standards for complex infrastructure work. The firm fixed-price nature of the contract provides cost certainty, which is a positive indicator of value. Without specific per-unit cost data, a precise value-for-money assessment is challenging, but the competitive award process suggests a fair market price was likely achieved.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that the solicitation was broadly advertised, allowing all responsible sources to submit bids. The presence of two bidders suggests a competitive environment, though the exact number of proposals received is not detailed. A higher number of bidders typically leads to more competitive pricing and a wider selection of qualified contractors. The fact that it was competed fully is a positive sign for price discovery and taxpayer value.

Taxpayer Impact: Full and open competition generally benefits taxpayers by driving down prices through robust bidding. This ensures that the government is not overpaying for services and that funds are used efficiently.

Public Impact

The primary beneficiaries are the Department of Defense and its operational readiness, as infrastructure stability is crucial. The services delivered include critical slope stabilization, likely to prevent erosion, landslides, or other geological hazards impacting military installations. The geographic impact is localized to the specific military installation where the slope stabilization is being performed. Workforce implications include employment for construction workers, engineers, and project managers involved in the stabilization effort.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of explicit small business participation or subcontracting goals could limit opportunities for smaller firms in this significant project.
The specific nature of 'YSK SLOPE STABILIZATION' is not detailed, potentially obscuring the full scope of work and associated risks.

Positive Signals

Awarded under full and open competition, suggesting a robust selection process and potential for competitive pricing.
Firm fixed-price contract type provides cost certainty and reduces the risk of budget overruns for the government.
The project duration of over two years indicates a substantial and important infrastructure undertaking.

Sector Analysis

The construction sector, particularly within government contracting, is characterized by large-scale projects requiring specialized expertise. This contract for slope stabilization falls under the broader category of heavy and civil engineering construction. The market for such services is competitive, with established firms capable of undertaking complex projects. The Department of Defense is a significant client in this sector, frequently awarding contracts for infrastructure maintenance and development to ensure operational capabilities.

Small Business Impact

The data indicates this contract was not set aside for small businesses (ss: false, sb: false). This means the competition was open to all sizes of firms. While this can lead to the best overall value, it also means that specific provisions for small business subcontracting may not have been a primary focus of this particular award. Further review of the contract details would be needed to ascertain if any subcontracting plans were mandated or voluntarily proposed by the prime contractor, NIPPO CORPORATION.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of the Navy's contracting and project management divisions. As a delivery order under a larger contract vehicle (implied by 'AW: DELIVERY ORDER'), oversight might also be managed by the issuing agency. 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

Department of Defense Infrastructure Projects
Naval Facilities Engineering Command Contracts
Civil Engineering Construction Contracts
Slope and Erosion Control Projects

Risk Flags

Potential for unforeseen geological conditions impacting schedule and cost.
Risk of weather-related delays affecting project timeline.
Environmental compliance challenges.
Limited visibility into small business subcontracting opportunities.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $9.7 million to NIPPO CORPORATION. YSK SLOPE STABILIZATION

Who is the contractor on this award?

The obligated recipient is NIPPO CORPORATION.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $9.7 million.

What is the period of performance?

Start: 2024-12-16. End: 2027-02-25.

What is the track record of NIPPO CORPORATION with the Department of Defense?

NIPPO CORPORATION's track record with the Department of Defense (DoD) is not explicitly detailed in the provided data. However, being awarded a contract of this magnitude suggests they have met the necessary qualifications and demonstrated capability to perform the required work. To fully assess their track record, one would need to examine their past performance on similar DoD contracts, including on-time delivery, budget adherence, and quality of work. Government contract databases and past performance reviews would be the primary sources for this information. A history of successful project completion would indicate reliability, while any past issues could signal potential risks.

How does the value of this contract compare to similar slope stabilization projects?

The contract value of approximately $9.7 million for slope stabilization is substantial. Without specific details on the scope, scale, and complexity of the stabilization required (e.g., linear feet, depth, geological conditions), a direct comparison is difficult. However, large-scale civil engineering projects, especially those involving significant geological challenges or environmental considerations, can easily reach multi-million dollar figures. Benchmarking against similar projects awarded by the Department of Defense or other federal agencies for infrastructure repair or construction would provide a more precise context. Factors like labor costs, material prices, and regional economic conditions also influence project value.

What are the primary risks associated with this slope stabilization contract?

The primary risks associated with this slope stabilization contract likely revolve around unforeseen geological conditions, weather delays, and potential environmental impacts. Unstable soil, unexpected rock formations, or groundwater issues could necessitate changes in the stabilization methods, potentially impacting cost and schedule, although the firm fixed-price contract aims to mitigate cost overruns for the government. Adverse weather conditions, particularly during critical phases of construction, could lead to delays. Furthermore, environmental regulations related to soil disturbance, water runoff, or protected habitats could introduce complexities and compliance risks. The contractor's experience and contingency planning are key to managing these risks.

How effective is full and open competition in ensuring value for taxpayer money in construction contracts?

Full and open competition is widely considered the most effective method for ensuring value for taxpayer money in construction contracts. By allowing all responsible sources to bid, it fosters a competitive environment where contractors are incentivized to offer their best pricing and most efficient solutions to win the contract. This process typically leads to lower prices than sole-source or limited competition awards. Furthermore, it allows the government to select from a wider pool of qualified contractors, increasing the likelihood of choosing a firm with the best technical capabilities and proven track record, thereby reducing the risk of project failure or subpar quality. The transparency inherent in this process also aids in accountability.

What is the historical spending pattern for slope stabilization projects within the Department of Defense?

Historical spending patterns for slope stabilization projects within the Department of Defense are not provided in the current data. However, it is reasonable to assume that such projects are a recurring necessity due to the vastness and varied terrain of military installations. Spending on these projects would likely fluctuate based on infrastructure age, environmental factors (e.g., increased rainfall leading to erosion), and budget allocations for facilities maintenance and upgrades. Analyzing past DoD budgets and contract awards specifically for civil engineering and infrastructure repair would reveal trends in investment for geological stabilization efforts. This specific $9.7 million award represents a significant, but likely not isolated, investment in maintaining critical infrastructure.

What are the implications of the 801-day duration for project management and oversight?

The 801-day duration (approximately 2.2 years) for this slope stabilization project implies a complex and extensive undertaking. This extended timeline necessitates robust project management from both the contractor and the government oversight team. Key implications include the need for sustained resource allocation, detailed scheduling to manage dependencies and milestones, and continuous monitoring to ensure progress aligns with the plan. For oversight, it means longer-term engagement from contracting officers' representatives (CORs) and potentially quality assurance personnel. The extended duration also increases the exposure to external factors like changing environmental regulations or economic shifts, requiring adaptive management strategies. Regular progress reviews and clear communication channels are critical to maintaining control and ensuring successful completion.

Industry Classification

NAICS: Construction › Nonresidential Building Construction › Commercial and Institutional Building Construction

Product/Service Code: MAINT, REPAIR, ALTER REAL PROPERTY › MAINT, ALTER, REPAIR NONBUILDINGS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: N4008422R0077

Offers Received: 2

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 1-19-11, KYOBASHI, CHUO-KU

Business Categories: Category Business, Corporate Entity Tax Exempt, Foreign Owned, Not Designated a Small Business, Special Designations

Financial Breakdown

Contract Ceiling: $9,675,274

Exercised Options: $9,675,274

Current Obligation: $9,675,274

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: N4008423D0082

IDV Type: IDC

Timeline