DoD's $66.8M Hangar Construction Contract Awarded to Harper Construction for Arizona Facility

Contract Overview

Contract Amount: $66,871,580 ($66.9M)

Contractor: Harper Construction Company, Inc.

Awarding Agency: Department of Defense

Start Date: 2019-06-13

End Date: 2024-08-01

Contract Duration: 1,876 days

Daily Burn Rate: $35.6K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 5

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: BASE ITEM 3_VMX1 MAINT. HANGER

Place of Performance

Location: YUMA, YUMA County, ARIZONA, 85365

State: Arizona Government Spending

Plain-Language Summary

Department of Defense obligated $66.9 million to HARPER CONSTRUCTION COMPANY, INC. for work described as: BASE ITEM 3_VMX1 MAINT. HANGER Key points: 1. The contract's value of $66.8 million represents a significant investment in military infrastructure. 2. Awarded under full and open competition, suggesting a robust bidding process. 3. The fixed-price contract type aims to control costs and provide predictability. 4. The duration of 1876 days indicates a long-term, complex construction project. 5. The contract is for hangar maintenance and construction, a critical defense need. 6. The geographic location in Arizona may have implications for local labor and material sourcing.

Value Assessment

Rating: good

The contract value of $66.8 million for a hangar project appears within a reasonable range for large-scale defense construction. Benchmarking against similar large hangar construction projects for the Department of Defense would provide a more precise value-for-money assessment. The firm fixed-price structure suggests an effort to manage costs effectively, but the final cost will depend on the execution and any potential change orders over the nearly five-year period.

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. With 5 bids received, the competition level suggests a healthy market interest for this type of defense construction. This level of competition is generally favorable for price discovery and can lead to more competitive pricing for the government.

Taxpayer Impact: The full and open competition ensures that taxpayer dollars are likely being used efficiently by fostering a competitive environment that drives down costs.

Public Impact

The primary beneficiaries are the Department of Defense, specifically the Department of the Navy, which will receive a critical infrastructure asset. The contract will deliver a maintained and potentially expanded hangar facility, essential for aircraft operations and maintenance. The project's geographic impact is concentrated in Arizona, potentially creating jobs and economic activity in the local construction sector. The workforce implications include employment opportunities for construction workers, engineers, project managers, and related trades in Arizona.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns on a long-duration fixed-price contract if not managed diligently.
Dependence on a single contractor for a critical infrastructure project over an extended period.
Risk of supply chain disruptions or material cost increases impacting project timelines and budget.
Ensuring compliance with all environmental and safety regulations during construction.

Positive Signals

Awarded through full and open competition, indicating a competitive bidding process.
Firm fixed-price contract type helps to control costs and provides budget certainty.
The contractor, Harper Construction Company, Inc., has experience in large-scale construction projects.
The project addresses a critical infrastructure need for the Department of Defense.
The contract duration is clearly defined, allowing for structured project planning and execution.

Sector Analysis

The construction sector, particularly for large-scale commercial and institutional buildings, is a significant part of federal spending. This contract falls within the broader category of defense infrastructure development, which often involves substantial investments in facilities like hangars, barracks, and training grounds. Comparable spending benchmarks for similar military construction projects can vary widely based on size, complexity, and location, but projects in the tens of millions are common for major facilities.

Small Business Impact

This contract was not set aside for small businesses, and there is no indication of specific subcontracting requirements for small businesses in the provided data. The award to a large construction firm suggests that the primary contract is likely beyond the scope of many small businesses. Further analysis would be needed to determine if significant subcontracting opportunities exist for small businesses within the execution of this large project.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and the relevant project management office within the Department of the Navy. Accountability measures are embedded in the firm fixed-price contract terms, with penalties or incentives potentially tied to performance milestones. Transparency is generally maintained through contract award databases, though detailed project execution reports may not be publicly available. Inspector General jurisdiction would apply if any fraud, waste, or abuse is suspected.

Related Government Programs

Department of Defense Military Construction
Naval Facilities Engineering Command Contracts
Aircraft Hangar Construction
Large Commercial Building Construction

Risk Flags

Long-duration contract increases risk of cost escalation or contractor performance issues.
Potential for unforeseen site conditions in construction projects.
Market volatility in construction materials and labor costs.
Dependence on specific geographic location for labor and materials.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $66.9 million to HARPER CONSTRUCTION COMPANY, INC.. BASE ITEM 3_VMX1 MAINT. HANGER

Who is the contractor on this award?

The obligated recipient is HARPER CONSTRUCTION COMPANY, INC..

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $66.9 million.

What is the period of performance?

Start: 2019-06-13. End: 2024-08-01.

What is Harper Construction Company, Inc.'s track record with large federal construction contracts, particularly for the Department of Defense?

Harper Construction Company, Inc. has a history of securing and executing large-scale construction contracts, including significant work for the Department of Defense and other federal agencies. Their portfolio often includes projects similar in scope and complexity to hangar construction, such as barracks, training facilities, and other specialized military infrastructure. Reviewing their past performance on similar projects, including any reported issues, delays, or cost overruns, would provide valuable insight into their capabilities and reliability for this specific hangar contract. Federal procurement databases and contract award histories can offer details on their previous awards, contract values, and performance ratings, if available.

How does the $66.8 million contract value compare to similar hangar construction projects awarded by the Department of the Navy or other military branches?

The $66.8 million contract value for this hangar project needs to be benchmarked against similar Department of Defense (DoD) construction contracts to assess its value for money. Factors such as the size of the hangar (square footage), specific functionalities required (e.g., specialized equipment, climate control), geographic location (influencing labor and material costs), and the complexity of the construction will heavily influence cost. Comparing this award to other recent hangar projects of comparable scale and purpose within the Navy or across other branches can reveal whether this price is competitive or potentially high. Data from federal contract databases can help identify such comparable projects and their awarded values.

What are the primary risk indicators associated with a firm fixed-price contract for a nearly five-year construction project?

The primary risk indicator for a firm fixed-price (FFP) contract over a long duration like this 1876-day project is the potential for unforeseen cost increases that are not adequately accounted for in the initial bid. While FFP aims to cap the government's cost, contractors may face risks from fluctuating material prices, labor shortages, unexpected site conditions, or design changes. If the contractor's initial cost estimates were too low or if significant market shifts occur, they might seek change orders, potentially increasing the overall cost to the government, or face financial strain if they cannot absorb these increases. Diligent project management and contingency planning by both the government and the contractor are crucial to mitigate these risks.

What is the expected effectiveness and impact of this new or maintained hangar facility on naval aviation operations in Arizona?

The effectiveness and impact of this hangar facility will be directly tied to its intended purpose, whether it's for new construction or maintenance of an existing structure. A functional and well-maintained hangar is critical for protecting aircraft from environmental damage, facilitating efficient maintenance and repair operations, and ensuring the readiness of naval aviation assets. Its impact on operations in Arizona would depend on the specific base it serves and the types of aircraft it supports. Improved facilities can lead to reduced downtime for aircraft, enhanced safety for maintenance crews, and overall increased operational tempo for the units stationed there.

How has federal spending on military construction, specifically hangars, trended over the past 5-10 years, and does this award align with those trends?

Federal spending on military construction, including hangars, has generally remained a significant component of the Department of Defense budget, driven by the need to modernize aging infrastructure and adapt to evolving military requirements. Trends can be influenced by geopolitical factors, strategic shifts, and budget allocations. Awards like this $66.8 million contract for a hangar in Arizona align with the ongoing investment in maintaining and upgrading critical defense facilities. Analyzing historical spending data for similar projects would reveal if the scale and frequency of such awards are consistent with broader trends in military infrastructure development.

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: N6247315R2434

Offers Received: 5

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 2241 KETTNER BLVD STE 300, SAN DIEGO, CA, 92101

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

Financial Breakdown

Contract Ceiling: $66,871,580

Exercised Options: $66,871,580

Current Obligation: $66,871,580

Actual Outlays: $30,544,836

Subaward Activity

Number of Subawards: 2124

Total Subaward Amount: $2,332,128,449

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: N6247316D1881

IDV Type: IDC

Timeline