DoD's $265M Naval Shipyard Dry Dock and Crane Contract Awarded to Cianbro Corporation

Contract Overview

Contract Amount: $264,619,814 ($264.6M)

Contractor: Cianbro Corporation

Awarding Agency: Department of Defense

Start Date: 2019-11-20

End Date: 2024-12-31

Contract Duration: 1,868 days

Daily Burn Rate: $141.7K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: P-310 DRY DOCK 1 SUPER FLOOD BASIN&P-1074 EXTEND PORTAL CRANE, PORTSMOUTH NAVAL SHIPYARD, KITTERY, ME

Place of Performance

Location: KITTERY, YORK County, MAINE, 03904

State: Maine Government Spending

Plain-Language Summary

Department of Defense obligated $264.6 million to CIANBRO CORPORATION for work described as: P-310 DRY DOCK 1 SUPER FLOOD BASIN&P-1074 EXTEND PORTAL CRANE, PORTSMOUTH NAVAL SHIPYARD, KITTERY, ME Key points: 1. Contract awarded for critical infrastructure upgrades at Portsmouth Naval Shipyard. 2. Significant investment in maintaining naval fleet readiness and operational capacity. 3. Definitive contract type suggests a long-term, established relationship or project scope. 4. Firm Fixed Price award aims to control costs and provide budget certainty. 5. Project duration of over 1800 days indicates a substantial, multi-year undertaking. 6. Geographic focus on Maine highlights regional economic impact and specialized labor needs.

Value Assessment

Rating: good

The contract value of $264.6 million for dry dock and crane upgrades at a major naval shipyard appears reasonable given the scale and complexity of the work. While direct comparisons are difficult without specific project details, similar large-scale heavy civil engineering projects for defense infrastructure often run into the hundreds of millions. The firm fixed-price structure is a positive indicator for cost control. Benchmarking against other naval shipyard modernization projects would provide further insight into value for money.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that multiple qualified bidders had the opportunity to submit proposals. This competitive process is designed to foster price discovery and ensure the government receives the best value. The number of bidders and the specific evaluation criteria would further illuminate the strength of the competition. A robust competition typically leads to more favorable pricing for the government.

Taxpayer Impact: Full and open competition generally benefits taxpayers by driving down costs through market forces, ensuring that public funds are used efficiently for essential defense infrastructure.

Public Impact

Naval fleet readiness and operational capabilities are enhanced through modernized infrastructure. The project supports critical maintenance and repair functions for submarines and surface vessels. Economic benefits are realized in Kittery, Maine, and surrounding regions through job creation and local spending. Specialized construction and engineering workforce in Maine will be engaged. The project ensures the long-term viability of the Portsmouth Naval Shipyard as a key naval asset.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if unforeseen site conditions arise during extensive construction.
Schedule delays could impact naval operational readiness if the project timeline is not met.
Dependence on a single contractor for such a critical, long-term project carries inherent risk.
Availability of specialized labor and materials could pose challenges over the multi-year duration.

Positive Signals

Firm Fixed Price contract provides cost certainty and limits financial risk for the government.
Full and open competition suggests a strong market evaluation and potential for competitive pricing.
Long project duration allows for phased execution and potential learning curve efficiencies.
Award to a single, experienced contractor can streamline project management and execution.
Focus on essential naval infrastructure ensures strategic alignment with defense priorities.

Sector Analysis

This contract falls within the heavy and civil engineering construction sector, specifically supporting defense infrastructure. The market for large-scale naval shipyard construction and modernization is specialized, often dominated by a few large firms with the requisite experience and bonding capacity. Spending in this area is driven by defense budgets and the need to maintain aging naval assets and facilities. Comparable benchmarks would include other major shipyard upgrades or large-scale military construction projects.

Small Business Impact

The contract data indicates that small business participation was not a primary set-aside consideration (ss: false, sb: false). While the prime contractor, Cianbro Corporation, is a large entity, there may be opportunities for small businesses to participate as subcontractors. The extent of subcontracting to small businesses will be crucial in determining the broader impact on the small business ecosystem within the construction sector in Maine and beyond.

Oversight & Accountability

Oversight for this definitive contract will likely be managed by the Department of the Navy's contracting and project management offices. Accountability measures are inherent in the firm fixed-price structure, which incentivizes the contractor to meet cost targets. Transparency will depend on the agency's reporting practices regarding project milestones, expenditures, and any potential modifications or disputes. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Naval Shipyard Infrastructure Modernization Programs
Defense Construction and Facilities Projects
Heavy Civil Engineering Contracts
Port and Harbor Infrastructure Development
Public Works and Military Base Support

Risk Flags

Potential for schedule delays impacting naval readiness.
Risk of unforeseen site conditions impacting cost and schedule.
Contractor performance and quality control over a long duration.
Dependence on specialized labor and material availability.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $264.6 million to CIANBRO CORPORATION. P-310 DRY DOCK 1 SUPER FLOOD BASIN&P-1074 EXTEND PORTAL CRANE, PORTSMOUTH NAVAL SHIPYARD, KITTERY, ME

Who is the contractor on this award?

The obligated recipient is CIANBRO 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 $264.6 million.

What is the period of performance?

Start: 2019-11-20. End: 2024-12-31.

What is Cianbro Corporation's track record with large-scale federal construction projects, particularly for the Department of Defense?

Cianbro Corporation has a significant history of undertaking large-scale construction and industrial projects, including substantial work for the Department of Defense and other federal agencies. Their portfolio often includes complex projects involving heavy industrial facilities, infrastructure, and specialized maritime construction. While specific details on past performance metrics for similar naval shipyard projects would require deeper analysis, their established presence suggests they possess the experience and capacity to manage contracts of this magnitude. Reviewing past performance evaluations and any documented issues on previous DoD contracts would provide a more comprehensive understanding of their reliability and execution capabilities.

How does the awarded amount compare to the estimated cost or budget for this specific dry dock and crane upgrade project?

The awarded contract value of $264,619,814 represents the final negotiated price for the P-310 Dry Dock 1 Super Flood Basin and P-1074 Extend Portal Crane project. Without access to the government's initial cost estimates or the detailed breakdown of the winning bid, a direct comparison is challenging. However, the fact that it was awarded under full and open competition suggests that the bids received were evaluated against the government's independent cost estimates. If the award was significantly below the estimate, it could indicate strong competition or efficient bidding. Conversely, if it was at or above the estimate, it might suggest realistic budgeting or a highly competitive but costly undertaking.

What are the primary risks associated with a multi-year, firm-fixed-price contract for complex shipyard infrastructure?

The primary risks for a multi-year, firm-fixed-price contract of this nature include potential cost overruns if unforeseen site conditions or material price escalations occur beyond what the fixed price accounts for, although the contractor bears most of this risk. Schedule delays are another significant risk, which could impact naval operational readiness and incur penalties or liquidated damages. Contractor performance issues, such as quality control problems or labor disputes, can also arise. Furthermore, the long duration increases the risk of scope creep if requirements change, necessitating contract modifications that could alter the original cost and schedule assumptions. The government's risk is primarily tied to ensuring adequate oversight and managing potential contractor failures.

What is the historical spending pattern for similar infrastructure upgrades at naval shipyards?

Historical spending on naval shipyard infrastructure upgrades has been substantial and often cyclical, driven by modernization needs, aging facilities, and evolving naval requirements. Projects typically involve significant capital investments, frequently ranging from tens to hundreds of millions of dollars, depending on the scope. Dry dock construction and upgrades, along with heavy crane installations, are among the most critical and costly infrastructure components. Spending patterns are influenced by defense budget allocations, strategic priorities (e.g., submarine force expansion), and the condition of existing facilities. Analyzing past appropriations and contract awards for shipyards like Norfolk, Puget Sound, or Pearl Harbor would reveal trends in investment levels and project types.

How will the performance of this contract be measured, and what are the key performance indicators (KPIs)?

Performance measurement for this contract will likely involve a combination of technical, schedule, and cost metrics, managed through the contract's Quality Assurance Surveillance Plan (QASP) and administered by the Contracting Officer's Representative (COR). Key Performance Indicators (KPIs) would typically include adherence to the project schedule (e.g., completion of major milestones on time), quality of work (e.g., compliance with specifications, defect rates), safety performance (e.g., incident rates), and adherence to budget. For a firm-fixed-price contract, meeting the defined scope and specifications within the agreed-upon price and timeframe are paramount. Regular progress reports, site inspections, and potentially independent testing will be used to monitor performance against these KPIs.

Industry Classification

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

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

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: N4008519R9022

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 101 CIANBRO SQUARE, PITTSFIELD, ME, 04967

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

Financial Breakdown

Contract Ceiling: $271,734,434

Exercised Options: $264,619,814

Current Obligation: $264,619,814

Subaward Activity

Number of Subawards: 57

Total Subaward Amount: $48,850,041

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline