Navy awards $3.5M contract for dry dock construction, highlighting significant investment in naval infrastructure

Contract Overview

Contract Amount: $3,525,000 ($3.5M)

Contractor: Dragados/Hawaiian Dredging/Orion JV

Awarding Agency: Department of Defense

Start Date: 2022-12-16

End Date: 2026-12-31

Contract Duration: 1,476 days

Daily Burn Rate: $2.4K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 5

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: P454 MULTI-MISSION DRY DOCK - EARLY CONTRACTOR INVOLVEMENT

Place of Performance

Location: HONOLULU, HONOLULU County, HAWAII, 96813

State: Hawaii Government Spending

Plain-Language Summary

Department of Defense obligated $3.5 million to DRAGADOS/HAWAIIAN DREDGING/ORION JV for work described as: P454 MULTI-MISSION DRY DOCK - EARLY CONTRACTOR INVOLVEMENT Key points: 1. Contract value represents a substantial investment in critical naval facilities. 2. The project is situated in Hawaii, a key strategic location for naval operations. 3. The firm-fixed-price contract type suggests a defined scope and budget. 4. The duration of the contract indicates a long-term commitment to the project. 5. The project falls under heavy and civil engineering construction, a specialized sector.

Value Assessment

Rating: good

The contract value of $3.5 million for a multi-mission dry dock appears reasonable given the specialized nature of such construction. Benchmarking against similar large-scale naval infrastructure projects would provide a more precise value-for-money assessment. The firm-fixed-price structure helps control costs, but the final cost will depend on the execution and any potential change orders.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that multiple bidders had the opportunity to submit proposals. This competitive process is expected to drive fair pricing and ensure the government receives the best value. The presence of 5 bidders suggests a healthy level of interest and capability within the market for this type of specialized construction.

Taxpayer Impact: Full and open competition generally benefits taxpayers by fostering a competitive environment that can lead to lower prices and higher quality services.

Public Impact

The primary beneficiaries are the U.S. Navy, which will gain enhanced operational capabilities through the new dry dock. The contract will deliver a critical piece of infrastructure essential for ship maintenance and repair. The geographic impact is concentrated in Hawaii, supporting naval readiness in the Pacific. The project is likely to create jobs in the construction sector in Hawaii, benefiting the local workforce.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if unforeseen construction challenges arise.
Dependence on the successful performance of the joint venture contractor.
Risk of schedule delays impacting naval operational readiness.

Positive Signals

Firm-fixed-price contract helps manage cost certainty.
Full and open competition suggests a robust selection process.
Long contract duration allows for phased development and quality control.

Sector Analysis

This contract falls within the heavy and civil engineering construction sector, specifically focusing on specialized maritime infrastructure. The market for such projects is often characterized by a limited number of highly qualified firms capable of undertaking complex, large-scale construction. Spending in this sector is crucial for maintaining and modernizing national defense capabilities and supporting maritime commerce.

Small Business Impact

The provided data indicates that small business participation was not a specific set-aside for this contract (ss: false, sb: false). While this contract may not directly involve small business set-asides, large prime contractors are often required to subcontract portions of the work to small businesses, potentially creating opportunities within the broader small business ecosystem.

Oversight & Accountability

Oversight for this contract will likely be managed by the Department of the Navy's contracting and engineering divisions. Accountability measures are inherent in the firm-fixed-price contract type, which places a strong emphasis on the contractor meeting defined cost and performance targets. Transparency is facilitated through the Federal Procurement Data System (FPDS), where contract awards are publicly reported.

Related Government Programs

Naval Shipyard Modernization Programs
Military Construction Projects
Defense Infrastructure Investments
Pacific Fleet Support Contracts

Risk Flags

Potential for schedule delays
Risk of cost overruns
Contractor performance risk

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $3.5 million to DRAGADOS/HAWAIIAN DREDGING/ORION JV. P454 MULTI-MISSION DRY DOCK - EARLY CONTRACTOR INVOLVEMENT

Who is the contractor on this award?

The obligated recipient is DRAGADOS/HAWAIIAN DREDGING/ORION 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 $3.5 million.

What is the period of performance?

Start: 2022-12-16. End: 2026-12-31.

What is the track record of the joint venture partners (DRAGADOS/HAWAIIAN DREDGING/ORION JV) on similar large-scale construction projects, particularly for the Department of Defense?

Assessing the track record of DRAGADOS/HAWAIIAN DREDGING/ORION JV requires a detailed review of their past performance on comparable projects. This would involve examining their experience with constructing dry docks, piers, and other heavy civil engineering works, especially those for military clients. Key performance indicators to scrutinize include adherence to schedule, budget performance, quality of work, and any history of disputes or contract modifications. Information on their past performance can often be found in contract databases, company portfolios, and potentially through agency performance evaluations. A strong track record on similar projects would increase confidence in their ability to successfully deliver this multi-mission dry dock.

How does the awarded amount of $3.5 million compare to the estimated cost or bids received from other competitors?

The awarded amount of $3.5 million represents the final negotiated price for the multi-mission dry dock construction. To assess value for money, this figure should be compared against the government's independent cost estimate (if available) and the bids submitted by the other four competitors. If the awarded amount is significantly lower than the estimate and other bids, it suggests strong price competition. Conversely, if it is higher, it might warrant further investigation into the scope or market conditions. Understanding the range of bids provides insight into the perceived cost of the project by the industry and the effectiveness of the procurement process in achieving a competitive price.

What are the primary risks associated with constructing a multi-mission dry dock in Hawaii, and how are they being mitigated?

Constructing a multi-mission dry dock in Hawaii presents several potential risks. These include logistical challenges due to the island location, potential for encountering unforeseen geological conditions, environmental considerations specific to the marine environment, and the availability of skilled labor. Mitigation strategies would typically involve thorough site investigations, robust project management plans, contingency planning for material delivery and labor, and strict adherence to environmental regulations. The joint venture structure itself can be a risk mitigation strategy, pooling resources and expertise. The firm-fixed-price contract also incentivizes the contractor to manage these risks effectively to avoid cost overruns.

What is the expected impact of this dry dock on the Navy's operational capabilities in the Pacific theater?

The addition of a multi-mission dry dock is expected to significantly enhance the U.S. Navy's operational capabilities in the Pacific theater. Dry docks are essential for the maintenance, repair, and overhaul of naval vessels, allowing for underwater hull work and major structural repairs. A 'multi-mission' dry dock suggests it may be designed to accommodate a variety of vessel types or specialized repair needs, increasing flexibility. This improved maintenance capacity can lead to reduced downtime for ships, increased fleet readiness, and the ability to conduct more complex operations by ensuring vessels are in optimal condition. It supports the Navy's strategic posture in a critical geographic region.

What has been the historical spending trend for similar naval infrastructure projects awarded by the Department of the Navy?

Historical spending on similar naval infrastructure projects by the Department of the Navy has generally been substantial, reflecting the ongoing need to maintain and modernize a global fleet. Budgets for shipbuilding, repair, and shore-based facilities fluctuate based on strategic priorities, geopolitical events, and overall defense appropriations. Projects like dry docks, piers, and maintenance facilities often represent significant capital investments, with costs ranging from millions to hundreds of millions of dollars depending on scale and complexity. Analyzing past spending patterns can reveal trends in investment priorities, the average cost of specific types of infrastructure, and the typical duration and competition levels for such contracts.

Industry Classification

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

Offers Received: 5

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 605 KAPIOLANI BLVD, HONOLULU, HI, 96813

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

Financial Breakdown

Contract Ceiling: $3,525,000

Exercised Options: $3,525,000

Current Obligation: $3,525,000

Actual Outlays: $75,000

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: N6274222D1311

IDV Type: IDC

Timeline