DoD's $64.7M P404 Reserve Center construction contract awarded to Archer Western Federal JV

Contract Overview

Contract Amount: $64,765,013 ($64.8M)

Contractor: Archer Western Federal JV

Awarding Agency: Department of Defense

Start Date: 2021-09-21

End Date: 2025-12-04

Contract Duration: 1,535 days

Daily Burn Rate: $42.2K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 3

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: P404 RESERVE CENTER & VEHICLE MAINTENANCE FACILITY, BATTLE CREEK, MI

Place of Performance

Location: BATTLE CREEK, CALHOUN County, MICHIGAN, 49014

State: Michigan Government Spending

Plain-Language Summary

Department of Defense obligated $64.8 million to ARCHER WESTERN FEDERAL JV for work described as: P404 RESERVE CENTER & VEHICLE MAINTENANCE FACILITY, BATTLE CREEK, MI Key points: 1. Contract value appears reasonable for a large-scale construction project of this nature. 2. Full and open competition suggests a competitive bidding process was utilized. 3. Project duration of over 4 years indicates a significant and complex undertaking. 4. Fixed-price contract type shifts cost risk to the contractor. 5. Location in Battle Creek, MI, suggests a focus on regional military readiness infrastructure. 6. The award to a joint venture may indicate a need for specialized expertise or capacity.

Value Assessment

Rating: good

The contract value of approximately $64.7 million for the P404 Reserve Center and Vehicle Maintenance Facility is substantial. Benchmarking against similar large-scale military construction projects, this figure appears to be within a reasonable range, considering the scope of building a new facility and vehicle maintenance capabilities. The firm fixed-price structure suggests that the contractor is responsible for managing costs to meet the agreed-upon price, which can be advantageous for the government if managed effectively. Without specific cost breakdowns or detailed comparisons to identical projects, a precise value-for-money assessment is challenging, but the initial award amount does not immediately raise red flags for overpricing.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit bids. The presence of 3 bidders suggests a moderate level of competition for this significant construction project. While more bidders could potentially drive prices lower, three offers generally provide a basis for price comparison and negotiation. The government's ability to select the best value offer from these submissions is a positive outcome of the competitive process.

Taxpayer Impact: Full and open competition is beneficial for taxpayers as it encourages multiple companies to bid, potentially leading to lower prices and better quality services. This process ensures that the government is not limited to a single provider, maximizing the chances of securing a cost-effective solution.

Public Impact

The primary beneficiaries are the U.S. Navy Reserve personnel who will utilize the new facility for training and operations. The project will deliver a new Reserve Center and vehicle maintenance facility, enhancing military readiness in the Battle Creek area. Geographic impact is concentrated in Battle Creek, Michigan, supporting local military infrastructure. Construction activities will likely create temporary jobs for skilled trades and laborers in the region. The facility will support the maintenance and operational readiness of military vehicles.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if unforeseen construction challenges arise, despite the fixed-price contract.
Ensuring timely completion within the 1535-day duration is critical to avoid operational delays.
Quality control during construction needs rigorous oversight to meet military standards.

Positive Signals

The firm fixed-price contract shifts cost risk to the contractor, potentially saving taxpayer money if costs are controlled.
Awarding to a joint venture (Archer Western Federal JV) may indicate a robust and capable team assembled for the project.
The project's long duration suggests a comprehensive and well-planned construction effort.

Sector Analysis

This contract falls within the Commercial and Institutional Building Construction sector, specifically for government facilities. The Department of Defense is a major client in this sector, frequently awarding large contracts for infrastructure development and maintenance. The market for federal construction is competitive, with many firms specializing in government projects. The size of this contract, over $64 million, places it among significant federal construction awards, requiring substantial capacity and experience from the contractor.

Small Business Impact

The data indicates that small business participation (sb) is false, and there is no specific small business set-aside (ss) noted for this contract. This suggests the contract was not specifically targeted towards small businesses. While the prime contractor is a joint venture, it's unclear if they have subcontracting plans that would involve small businesses. Further investigation into subcontracting goals would be necessary to assess the impact on the small business ecosystem.

Oversight & Accountability

Oversight for this contract would typically be managed by the Department of the Navy's contracting and engineering divisions. Accountability measures are embedded in the firm fixed-price contract terms, requiring the contractor to deliver the specified facility within budget and schedule. Transparency is generally maintained through contract award databases and reporting requirements. The Inspector General's office for the Department of Defense would have jurisdiction to investigate any allegations of fraud, waste, or abuse related to this contract.

Related Government Programs

Military Construction Program (MILCON)
Naval Facilities Engineering Command (NAVFAC) Contracts
Department of Defense Construction Projects
Reserve Component Facilities

Risk Flags

Potential for cost overruns due to unforeseen site conditions.
Risk of schedule delays impacting operational readiness.
Ensuring compliance with stringent military construction standards.
Contractor performance and financial stability.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $64.8 million to ARCHER WESTERN FEDERAL JV. P404 RESERVE CENTER & VEHICLE MAINTENANCE FACILITY, BATTLE CREEK, MI

Who is the contractor on this award?

The obligated recipient is ARCHER WESTERN FEDERAL JV.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $64.8 million.

What is the period of performance?

Start: 2021-09-21. End: 2025-12-04.

What is the track record of Archer Western Federal JV in completing large-scale federal construction projects on time and within budget?

Archer Western Federal JV is a joint venture that combines the expertise of Archer Western Contractors and The Walsh Group. Both parent companies have extensive experience in large-scale federal construction, including military facilities. Archer Western Contractors has a history of completing complex projects for various government agencies, often involving significant infrastructure and building construction. The Walsh Group is also a major player in the construction industry with a strong portfolio of federal projects. While specific performance data for the joint venture itself may be limited, the combined experience of its constituent companies suggests a strong capability. However, a detailed review of past performance reports and any past performance issues for both entities would be necessary for a comprehensive assessment of their track record on similar federal contracts.

How does the awarded price of $64.7 million compare to similar Reserve Center construction projects in the past five years?

Comparing the $64.7 million award for the P404 Reserve Center and Vehicle Maintenance Facility requires access to a database of similar federal construction projects, including their scope, location, and final awarded prices. Projects of similar scale (e.g., new construction of military facilities, vehicle maintenance depots) awarded by the Department of Defense or other federal agencies in the last five years would serve as benchmarks. Factors such as square footage, complexity of systems (HVAC, electrical, plumbing), site preparation requirements, and regional construction cost indices would need to be considered for an accurate comparison. Without this specific comparative data, it is difficult to definitively state whether $64.7 million represents a high, low, or average cost. However, for a facility of this nature, the amount suggests a significant investment typical for new military infrastructure.

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

The primary risk indicator for a firm fixed-price (FFP) contract is the potential for contractor cost overruns, which, if not managed effectively by the contractor, could lead to quality compromises or contractor default. While the FFP shifts cost risk to the contractor, significant unforeseen issues (e.g., subsurface conditions, material price escalations beyond contract provisions, labor shortages) could still impact project completion. Another risk is the potential for scope creep if changes are not managed through formal change order processes. Delays in government-provided information or site access can also pose risks. The contractor's financial stability and technical capacity to execute a project of this magnitude are also critical risk factors. Finally, ensuring adherence to stringent military construction standards and security requirements presents inherent risks that must be meticulously managed.

What is the expected effectiveness of the new Reserve Center and Vehicle Maintenance Facility in enhancing Navy Reserve operational readiness?

The effectiveness of the new P404 Reserve Center and Vehicle Maintenance Facility in enhancing Navy Reserve operational readiness is expected to be significant, provided the facility is completed as designed and meets all operational requirements. A modern, purpose-built facility typically offers improved training spaces, administrative areas, and logistical support compared to older or shared facilities. The inclusion of a dedicated vehicle maintenance capability is crucial for ensuring that reserve component vehicles are operational and ready for deployment or training exercises. This reduces reliance on external maintenance providers and improves turnaround times. The facility's location in Battle Creek, MI, suggests it is strategically placed to support reserve units in that region, thereby improving their ability to mobilize and train effectively, ultimately contributing to overall Navy Reserve force readiness.

How has historical spending by the Department of the Navy on similar construction projects in Michigan trended over the past decade?

Analyzing historical spending by the Department of the Navy (DoN) on similar construction projects in Michigan over the past decade would involve examining contract awards for military construction, facility upgrades, and maintenance projects within the state. This would likely reveal a pattern of investment aimed at maintaining and modernizing naval infrastructure to support active duty, reserve, and training commands. Trends might include fluctuations based on military readiness requirements, budget allocations, and specific infrastructure needs identified by the Navy. Factors such as the number of facilities, troop presence, and strategic importance of installations in Michigan would influence spending levels. A detailed analysis would require accessing DoN contract databases and filtering for projects within Michigan, categorized by construction type and value, to identify any significant trends or shifts in investment priorities.

What are the potential implications of the 3-bidder competition on the final cost and quality of the delivered facility?

A competition with three bidders generally suggests a healthy level of market interest and a reasonable chance for the government to obtain competitive pricing and quality. With three offers, the government has multiple options to compare based on technical merit, past performance, and price, allowing for a more informed selection process. This level of competition typically incentivizes bidders to offer their best terms to win the contract. However, it is less competitive than a scenario with numerous bidders, which could potentially drive prices even lower. The quality aspect is influenced by the evaluation criteria used; if the government prioritizes technical solutions and past performance alongside price, quality should be well-protected. Conversely, if the award is heavily price-driven, there could be a slight risk to quality if not rigorously overseen.

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: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: N4008519R9048

Offers Received: 3

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 929 W ADAMS ST, CHICAGO, IL, 60607

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $64,765,013

Exercised Options: $64,765,013

Current Obligation: $64,765,013

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: N4008520D0033

IDV Type: IDC

Timeline