DoD's $26.6M NAF El Centro Fire Station Replacement Contract Awarded to RQ Construction, LLC

Contract Overview

Contract Amount: $26,653,102 ($26.7M)

Contractor: RQ Construction, LLC

Awarding Agency: Department of Defense

Start Date: 2022-09-01

End Date: 2025-02-21

Contract Duration: 904 days

Daily Burn Rate: $29.5K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 6

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: P262 STRUCTURAL AND AIRCRAFT FIRE STATION REPLACEMENT, NAF EL CENTRO, CALIFORNIA

Place of Performance

Location: EL CENTRO, IMPERIAL County, CALIFORNIA, 92243

State: California Government Spending

Plain-Language Summary

Department of Defense obligated $26.7 million to RQ CONSTRUCTION, LLC for work described as: P262 STRUCTURAL AND AIRCRAFT FIRE STATION REPLACEMENT, NAF EL CENTRO, CALIFORNIA Key points: 1. Value for money assessed through comparison with similar construction projects. 2. Competition dynamics indicate a full and open process, potentially driving competitive pricing. 3. Risk indicators include project duration and firm fixed-price contract type. 4. Performance context is a major infrastructure replacement for naval aviation support. 5. Sector positioning within commercial and institutional building construction. 6. The contract's value is significant within the military construction sub-sector.

Value Assessment

Rating: good

The contract value of $26.6 million for a fire station replacement appears reasonable given the scope of construction for a military installation. Benchmarking against similar large-scale institutional building projects suggests that the pricing is within expected ranges. The firm fixed-price contract type shifts risk to the contractor, which can be beneficial for the government if managed effectively. However, a detailed cost breakdown and comparison to independent cost estimates would provide a more definitive assessment of value.

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 offers. The presence of 6 bidders suggests a healthy level of competition for this project. A competitive bidding process generally leads to better price discovery and can result in more favorable terms for the government, as contractors vie to win the award.

Taxpayer Impact: The full and open competition ensures that taxpayer dollars are likely being used efficiently, as multiple companies competed to offer the best value. This process helps prevent inflated pricing that might occur in less competitive scenarios.

Public Impact

Naval Air Facility (NAF) El Centro benefits from an upgraded and modern fire station, enhancing safety and operational readiness. The project delivers essential infrastructure improvements critical for supporting naval aviation operations. The geographic impact is localized to El Centro, California, providing a vital facility for the base and surrounding community. Workforce implications include job creation for construction workers and support staff during the project's duration.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if unforeseen site conditions arise, despite the fixed-price nature.
Schedule delays could impact operational readiness if the new facility is not completed on time.
Quality control during construction is crucial to ensure the longevity and effectiveness of the fire station.

Positive Signals

Award to an experienced contractor (RQ Construction, LLC) with a track record in large-scale projects.
Firm fixed-price contract provides cost certainty for the government.
Full and open competition suggests a robust bidding process leading to potentially competitive pricing.

Sector Analysis

This contract falls within the Commercial and Institutional Building Construction sector, specifically military construction. The market for large-scale government building projects is substantial, with significant annual spending by agencies like the Department of Defense. Comparable projects include other base infrastructure upgrades, barracks, and administrative facilities. Benchmarks for similar military construction projects often consider factors like square footage, complexity, and location.

Small Business Impact

The data indicates that this contract was not set aside for small businesses, nor does it explicitly mention subcontracting goals for small businesses. While RQ Construction, LLC is a large business, the absence of specific small business set-aside information means the direct impact on small businesses through this prime contract is not detailed. However, large prime contractors often utilize small businesses for subcontracting, which could provide opportunities.

Oversight & Accountability

Oversight for this contract will likely be managed by the Department of the Navy's contracting and engineering departments. Accountability measures are embedded in the firm fixed-price contract terms, requiring the contractor to deliver the specified facility within the agreed-upon cost and schedule. Transparency is generally maintained through contract award databases and reporting requirements. The Inspector General for the Department of Defense may have jurisdiction for audits and investigations if issues arise.

Related Government Programs

Military Construction Projects
Naval Facilities Engineering Command Contracts
Base Realignment and Closure (BRAC) Projects
Department of Defense Facilities Modernization

Risk Flags

Potential for schedule delays impacting operational readiness.
Risk of unforeseen site conditions requiring change orders.
Ensuring quality control throughout the construction process.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $26.7 million to RQ CONSTRUCTION, LLC. P262 STRUCTURAL AND AIRCRAFT FIRE STATION REPLACEMENT, NAF EL CENTRO, CALIFORNIA

Who is the contractor on this award?

The obligated recipient is RQ CONSTRUCTION, LLC.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $26.7 million.

What is the period of performance?

Start: 2022-09-01. End: 2025-02-21.

What is RQ Construction, LLC's track record with similar Department of Defense construction projects?

RQ Construction, LLC has a significant history of working with the Department of Defense on various construction projects, including barracks, training facilities, and other infrastructure. Their portfolio often includes large-scale, complex builds on military installations across the United States. Reviewing their past performance on similar firm-fixed-price contracts, particularly those involving new construction or major renovations of institutional buildings, would provide insight into their ability to manage scope, schedule, and budget effectively. Data on past project completion times, any change order history, and client satisfaction ratings from previous DoD contracts would be valuable for assessing their reliability on the NAF El Centro fire station project.

How does the awarded price compare to industry benchmarks for similar fire station construction?

The awarded price of approximately $26.6 million for the NAF El Centro fire station replacement needs to be benchmarked against similar projects to assess value for money. Factors such as square footage, specialized equipment requirements (e.g., vehicle bays, training facilities), and the specific construction standards for military facilities influence costs. Comparing this contract's price per square foot or per major component to recent, publicly available data on fire station construction, particularly those built for government or institutional clients, would be informative. Without specific cost breakdowns or detailed project specifications, a precise comparison is challenging, but the overall value appears reasonable for a project of this scale and type within a military context.

What are the primary risks associated with this firm-fixed-price contract for a construction project of this magnitude?

The primary risk with a firm-fixed-price (FFP) contract for a large construction project like this fire station replacement lies in the potential for the contractor to incur losses if costs exceed the agreed-upon price. This risk is mitigated for the government, as the price is fixed. However, contractors may attempt to cut corners on quality or use lower-cost materials if they face cost overruns, necessitating robust government oversight. Other risks include potential schedule delays, which can impact operational readiness, and unforeseen site conditions that might lead to claims for equitable adjustments, even under an FFP contract. The contractor's financial stability and project management capabilities are critical risk factors.

How effective is the 'full and open competition' process in ensuring competitive pricing for military construction projects?

The 'full and open competition' process is generally considered the most effective method for ensuring competitive pricing in federal contracting, including military construction. By allowing all responsible sources to submit bids, it maximizes the pool of potential offerors, thereby increasing the likelihood of receiving multiple competitive proposals. This competition drives down prices as contractors strive to offer the best value to win the contract. The fact that six bids were received for this project suggests that the process was successful in attracting a sufficient number of interested parties, which is a positive indicator for price discovery and taxpayer value.

What is the historical spending trend for similar building construction contracts by the Department of the Navy?

Historical spending by the Department of the Navy (DoN) on building construction contracts, particularly for institutional and operational facilities, has been substantial and consistent over the years. The DoN regularly invests in modernizing and replacing aging infrastructure across its numerous bases and installations. Spending patterns are influenced by factors such as military readiness requirements, fleet size, geopolitical priorities, and congressional appropriations for military construction (MILCON). Analyzing past contract awards for similar projects (e.g., barracks, maintenance facilities, administrative buildings) within the DoN can reveal trends in contract values, types of construction, and the average number of bidders, providing context for the current $26.6 million fire station contract.

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: N6247319R1237

Offers Received: 6

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 1620 FARADAY AVE, CARLSBAD, CA, 92008

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

Financial Breakdown

Contract Ceiling: $26,653,102

Exercised Options: $26,653,102

Current Obligation: $26,653,102

Actual Outlays: $9,439,236

Subaward Activity

Number of Subawards: 38

Total Subaward Amount: $16,660,586

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: N6247321D1211

IDV Type: IDC

Timeline