Department of Defense awards $69.7M contract for correctional facility construction to Balfour Beatty Construction

Contract Overview

Contract Amount: $69,689,520 ($69.7M)

Contractor: Balfour Beatty Construction, LLC

Awarding Agency: Department of Defense

Start Date: 2009-08-21

End Date: 2011-06-15

Contract Duration: 663 days

Daily Burn Rate: $105.1K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 13

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: P208V JOINT REGIONAL CORRECTION FACILITY

Place of Performance

Location: NORFOLK, NORFOLK (CITY) County, VIRGINIA, 23511

State: Virginia Government Spending

Plain-Language Summary

Department of Defense obligated $69.7 million to BALFOUR BEATTY CONSTRUCTION, LLC for work described as: P208V JOINT REGIONAL CORRECTION FACILITY Key points: 1. Contract awarded through full and open competition, suggesting a competitive bidding process. 2. The contract duration of 663 days indicates a significant construction project timeline. 3. Fixed-price contract type may offer cost certainty but could limit flexibility for unforeseen issues. 4. The project is located in Virginia, potentially impacting the local construction workforce and economy. 5. The North American Industry Classification System (NAICS) code 236220 points to commercial and institutional building construction. 6. The absence of small business set-aside flags suggests the primary contractor is not a small business.

Value Assessment

Rating: fair

The total award amount of $69.7 million for a joint regional correctional facility is substantial. Without specific details on the facility's size, scope, and features, a direct comparison to similar contracts is challenging. However, the fixed-price nature of the contract suggests an attempt to control costs, but the final expenditure could be influenced by change orders or unforeseen site conditions. Benchmarking the value would require detailed cost breakdowns and comparisons with other correctional facility projects of similar scale and complexity.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit bids. The presence of 13 bidders suggests a robust level of competition for this project. A higher number of bidders generally leads to more competitive pricing and a greater likelihood of selecting the best value proposal for the government.

Taxpayer Impact: The extensive competition for this contract is beneficial for taxpayers, as it likely drove down the overall cost of the project through aggressive bidding.

Public Impact

The primary beneficiaries are the Department of Defense and potentially federal or state correctional agencies requiring secure detention facilities. The service delivered is the construction of a joint regional correctional facility, a critical infrastructure project. The geographic impact is concentrated in Virginia, where the facility will be built. The project will likely have implications for the local construction workforce, creating jobs for skilled trades and laborers.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if the fixed-price contract does not adequately account for all construction variables.
Risk of delays due to the complexity of large-scale construction projects and potential supply chain issues.
Ensuring the facility meets all security and operational requirements post-construction.

Positive Signals

Awarded through full and open competition, indicating a competitive market.
Fixed-price contract type provides a degree of cost predictability.
The project addresses a specific infrastructure need for the Department of Defense.

Sector Analysis

The construction sector, particularly commercial and institutional building, is a significant area of federal spending. This contract falls under the broader category of infrastructure development. The market for large-scale correctional facilities is specialized, often involving stringent security requirements and long construction timelines. Comparable spending benchmarks would typically be found within large government construction projects, such as courthouses, federal prisons, or other secure government buildings.

Small Business Impact

The data indicates that this contract was not set aside for small businesses, and the prime contractor, Balfour Beatty Construction, LLC, is likely a large business. There is no explicit information on subcontracting plans for small businesses within this award notice. The impact on the small business ecosystem would depend on whether Balfour Beatty actively seeks small business subcontractors for specialized services or materials.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and the relevant Department of the Navy contracting activity. Accountability measures are inherent in the fixed-price contract terms, requiring delivery of the specified facility. Transparency is generally provided through contract award databases, though detailed project progress and financial oversight reports may not be publicly available. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

Federal Prison System Construction
Military Base Infrastructure Projects
Department of Justice Facility Contracts
General Services Administration (GSA) Public Buildings Service

Risk Flags

Potential for cost overruns due to fixed-price nature on a complex project.
Risk of project delays impacting operational readiness.
Ensuring long-term operational and security requirements are met post-construction.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $69.7 million to BALFOUR BEATTY CONSTRUCTION, LLC. P208V JOINT REGIONAL CORRECTION FACILITY

Who is the contractor on this award?

The obligated recipient is BALFOUR BEATTY CONSTRUCTION, LLC.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $69.7 million.

What is the period of performance?

Start: 2009-08-21. End: 2011-06-15.

What specific features and capacity will the P208V Joint Regional Correction Facility have?

The provided data does not specify the exact features or capacity of the P208V Joint Regional Correction Facility. Typically, such facilities are designed to house a specific number of inmates and include various security levels, administrative areas, medical facilities, and recreational spaces. The 'Joint Regional' designation suggests it may serve multiple jurisdictions or branches of the military. Detailed specifications would be found in the original contract solicitation documents, which are not included here. Understanding these details is crucial for assessing the project's complexity and the appropriateness of the awarded cost.

How does the $69.7 million cost compare to similar correctional facility construction projects?

Benchmarking the $69.7 million cost requires comparing it to similar projects in terms of size, security features, and location. Correctional facilities vary significantly in cost per square foot or per bed based on these factors. For instance, a high-security federal prison will cost considerably more per bed than a minimum-security regional jail. Without specific details on the P208V facility's capacity and security level, a precise comparison is difficult. However, given it's a substantial award for a significant infrastructure project, it falls within the expected range for large government construction contracts, assuming it meets its intended scope and quality standards.

What are the potential risks associated with a fixed-price contract for this type of construction?

Fixed-price contracts, while offering cost certainty to the buyer, can introduce risks for both parties in complex construction projects like a correctional facility. For the government, the risk is that the contractor may cut corners on quality or materials to maintain profitability if unforeseen issues arise, or that the initial price was inflated to cover potential contractor risks. For the contractor, risks include underestimating costs, encountering unexpected site conditions (e.g., soil issues, hazardous materials), or facing material price escalations, all of which could lead to financial losses if not adequately managed or covered by contingency. Change orders, often necessary in long-term construction, can also lead to disputes and cost increases.

What is Balfour Beatty Construction's track record with large-scale government construction projects?

Balfour Beatty Construction, LLC has a significant track record in large-scale construction projects, including many for government entities. They have been involved in building infrastructure such as transportation systems, healthcare facilities, educational institutions, and defense installations. Their portfolio often includes complex projects requiring high security and specialized construction methods. A review of their past performance on similar federal contracts, including project completion times, budget adherence, and client satisfaction, would provide further insight into their capabilities and reliability for the P208V project.

How has federal spending on correctional facility construction trended in recent years?

Federal spending on correctional facility construction can fluctuate based on federal policy, prison population trends, and infrastructure needs. Historically, there have been periods of significant investment in new facilities and upgrades. However, recent trends have also seen a focus on modernizing existing infrastructure, improving conditions, and exploring alternatives to incarceration. Specific data on recent trends would require analysis of federal budget allocations and contract awards across agencies like the Bureau of Prisons and the Department of Defense over the past 5-10 years. This particular contract represents a specific investment in a regional facility.

What is the significance of the NAICS code 236220 for this contract?

The North American Industry Classification System (NAICS) code 236220, 'Commercial and Institutional Building Construction,' signifies the primary industry classification for the work being performed. This code covers establishments primarily engaged in the construction or remodeling of nonresidential buildings, such as commercial, industrial, and institutional structures. For this contract, it indicates the project involves building a facility that is not residential, and it falls under the category of institutional construction, which aligns with the purpose of a correctional facility. This classification helps in understanding the type of construction services procured and allows for industry-specific benchmarking.

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: N4008508R9695

Offers Received: 13

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Balfour Beatty PLC (UEI: 210042081)

Address: 3924 PENDER DRIVE STE 100, FAIRFAX, VA, 11

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

Financial Breakdown

Contract Ceiling: $69,689,521

Exercised Options: $69,689,520

Current Obligation: $69,689,520

Contract Characteristics

Cost or Pricing Data: NO

Timeline