Naval Shipyard Electrical Backbone Project Awarded for $145M to ABSHER CONSTRUCTION CO

Contract Overview

Contract Amount: $145,224,204 ($145.2M)

Contractor: Absher Construction CO

Awarding Agency: Department of Defense

Start Date: 2024-09-16

End Date: 2029-04-13

Contract Duration: 1,670 days

Daily Burn Rate: $87.0K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: P891 SIOP SHIPYARD ELECTRICAL BACKBONE, PUGET SOUND NAVAL SHIPYARD (PSNS), BREMERTON, WA.

Place of Performance

Location: BREMERTON, KITSAP County, WASHINGTON, 98337

State: Washington Government Spending

Plain-Language Summary

Department of Defense obligated $145.2 million to ABSHER CONSTRUCTION CO for work described as: P891 SIOP SHIPYARD ELECTRICAL BACKBONE, PUGET SOUND NAVAL SHIPYARD (PSNS), BREMERTON, WA. Key points: 1. Contract awarded through full and open competition, suggesting a robust market for this type of construction. 2. The firm-fixed-price contract type helps mitigate cost overrun risks for the government. 3. Project duration of approximately 5.5 years indicates a significant, long-term infrastructure investment. 4. The project is located at a key naval facility, highlighting its strategic importance. 5. The awarded amount represents a substantial investment in critical naval infrastructure modernization.

Value Assessment

Rating: good

The contract value of $145.2 million for a shipyard electrical backbone project appears reasonable given the scope and duration. While direct comparisons are difficult without specific project details, large-scale industrial construction and renovation projects of this nature often fall within this range. The firm-fixed-price structure provides cost certainty. Benchmarking against similar naval infrastructure upgrades or large commercial building construction projects would offer further insight into value for money.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that multiple qualified contractors had the opportunity to bid. The presence of two bids suggests a competitive environment, though the exact number of potential bidders is unknown. A higher number of bids typically leads to more competitive pricing and better value for the government. The specific details of the bidding process and evaluation criteria would provide a clearer picture of the competition's intensity.

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

Public Impact

The primary beneficiaries are the U.S. Navy and its operational readiness, ensuring the Puget Sound Naval Shipyard can continue its critical maintenance and repair functions. The project will deliver modernized electrical infrastructure, enhancing the reliability and capacity of the shipyard's power systems. The geographic impact is concentrated in Bremerton, Washington, supporting a vital military installation on the West Coast. The project will likely create or sustain jobs in the construction sector, particularly for electricians, project managers, and support staff in the Bremerton area.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for schedule delays in large-scale construction projects of this complexity.
Ensuring the new electrical backbone integrates seamlessly with existing and future shipyard systems.
Managing the impact of construction activities on ongoing shipyard operations.

Positive Signals

Firm-fixed-price contract provides cost certainty and reduces financial risk for the government.
Awarded to a single contractor, potentially streamlining project management and execution.
Project duration allows for phased implementation and minimizes disruption.

Sector Analysis

This contract falls within the Commercial and Institutional Building Construction sector, specifically focusing on large-scale infrastructure upgrades for a government facility. The market for such specialized construction services is significant, driven by both public and private sector needs for modernization and expansion. Comparable spending benchmarks would include other major federal construction projects, particularly those involving critical infrastructure at military installations or large industrial complexes.

Small Business Impact

The data indicates this contract was not set aside for small businesses (ss: false, sb: false). Therefore, the primary contractor, ABSHER CONSTRUCTION CO, is likely a large business. There is no explicit information on subcontracting plans for small businesses within this award. Future analysis could investigate subcontracting goals and performance to assess the impact on the small business ecosystem.

Oversight & Accountability

Oversight for this contract will likely be managed by the Department of the Navy's contracting and engineering divisions, with potential involvement from the Naval Facilities Engineering Command. Accountability measures are inherent in the firm-fixed-price contract type, requiring the contractor to deliver the specified work within the agreed-upon price. Transparency may be enhanced through contract award databases and public reporting, though specific project oversight details are not provided.

Related Government Programs

Naval Shipyard Modernization Programs
Department of Defense Infrastructure Projects
Federal Construction Contracts
Electrical Infrastructure Upgrades

Risk Flags

Potential for cost overruns if initial estimates are inaccurate despite FFP.
Risk of schedule delays due to complexity and site-specific challenges.
Ensuring seamless integration with existing and future naval systems.
Impact of construction on ongoing shipyard operations.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $145.2 million to ABSHER CONSTRUCTION CO. P891 SIOP SHIPYARD ELECTRICAL BACKBONE, PUGET SOUND NAVAL SHIPYARD (PSNS), BREMERTON, WA.

Who is the contractor on this award?

The obligated recipient is ABSHER CONSTRUCTION CO.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $145.2 million.

What is the period of performance?

Start: 2024-09-16. End: 2029-04-13.

What is the track record of ABSHER CONSTRUCTION CO on similar federal contracts, particularly those involving large-scale electrical infrastructure or shipyard construction?

A review of ABSHER CONSTRUCTION CO's contract history reveals a portfolio of projects primarily in the commercial and institutional building construction sector. While specific details on past electrical backbone projects or shipyard work are not immediately available from this summary, their experience in large-scale construction is evident. Further investigation into their past performance ratings, any past performance issues, and the scale of their previous electrical system installations would be necessary to fully assess their suitability and track record for this specific naval shipyard project. Examining their history with the Department of Defense or other federal agencies would provide more targeted insights into their capabilities and reliability in executing complex, high-value government contracts.

How does the awarded price of $145.2 million compare to the estimated cost or benchmark for similar naval shipyard electrical backbone projects?

Benchmarking the $145.2 million award requires detailed project specifications and cost breakdowns, which are not provided. However, large-scale infrastructure projects at naval shipyards are inherently complex and costly due to specialized requirements, security protocols, and the need for minimal disruption to ongoing operations. Factors such as the scope of work (e.g., capacity upgrades, redundancy, integration with new technologies), the age and condition of existing infrastructure, and the specific geographic location (influencing labor and material costs) significantly impact overall project cost. Without access to detailed cost estimates or data on comparable projects (e.g., similar upgrades at other naval facilities), a precise value-for-money assessment is challenging. The firm-fixed-price nature suggests the government has negotiated a ceiling, but the reasonableness of that ceiling depends on market conditions and the contractor's cost structure.

What are the primary risks associated with this contract, and what mitigation strategies are in place?

Key risks for this contract include potential construction delays due to unforeseen site conditions, integration challenges with existing shipyard systems, and fluctuations in material costs (though mitigated by the firm-fixed-price structure). The long duration (approx. 5.5 years) also presents risks related to technological obsolescence and the need for adaptive management. Mitigation strategies likely include robust project management by the Navy, detailed site surveys prior to and during construction, phased implementation plans to minimize operational disruption, and clear contractual clauses addressing change orders and performance standards. The firm-fixed-price contract itself is a primary risk mitigation tool for the government, shifting cost overrun risk to the contractor. However, ensuring the contractor has adequate bonding and financial stability is crucial.

How effective is the firm-fixed-price contract type in ensuring value for money for this specific project, considering its long duration?

The firm-fixed-price (FFP) contract type is generally effective in providing cost certainty and encouraging contractor efficiency, as the contractor bears the risk of cost overruns. For a project of this scale and duration, an FFP contract incentivizes ABSHER CONSTRUCTION CO to manage costs tightly and complete the work within the agreed budget. However, the long duration introduces a risk that the initial price may not fully account for potential market shifts in labor or materials over several years, potentially leading to less favorable outcomes if the contractor underestimated future costs. Conversely, it protects the government from unexpected price increases. The effectiveness hinges on the thoroughness of the initial negotiation and the contractor's ability to accurately forecast costs over the project's lifecycle.

What is the historical spending pattern for electrical infrastructure upgrades at Puget Sound Naval Shipyard or similar naval facilities?

Historical spending data for electrical infrastructure upgrades at Puget Sound Naval Shipyard or comparable naval facilities would provide valuable context for this $145.2 million award. Analyzing past investments in similar projects can reveal trends in project scope, cost escalation, and the frequency of such upgrades. Without specific historical data, it's difficult to determine if this award represents a significant increase or decrease in spending for this category of work. Understanding the historical investment cycle for critical infrastructure at naval facilities is essential for long-term capital planning and assessing the adequacy of current funding levels to maintain operational readiness and modernize aging systems.

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: N4425521R4000

Offers Received: 2

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 1001 SHAW RD, PUYALLUP, WA, 98372

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

Financial Breakdown

Contract Ceiling: $145,224,204

Exercised Options: $145,224,204

Current Obligation: $145,224,204

Subaward Activity

Number of Subawards: 8

Total Subaward Amount: $88,101,602

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: N4425523D1700

IDV Type: IDC

Timeline