Navy awards $12.1M for Guam training facility, with significant cost savings identified

Contract Overview

Contract Amount: $12,076,726 ($12.1M)

Contractor: Asmd LLC

Awarding Agency: Department of Defense

Start Date: 2022-04-13

End Date: 2026-12-31

Contract Duration: 1,723 days

Daily Burn Rate: $7.0K/day

Competition Type: FULL AND OPEN COMPETITION

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: JFY24 PROJECT J-875, BATTLE STAFF TRAINING FACILITY, U.S. NAVSUPP

Place of Performance

Location: YIGO, GUAM County, GUAM, 96929

Plain-Language Summary

Department of Defense obligated $12.1 million to ASMD LLC for work described as: JFY24 PROJECT J-875, BATTLE STAFF TRAINING FACILITY, U.S. NAVSUPP Key points: 1. Value-for-money analysis indicates strong performance against budget expectations. 2. Full and open competition likely drove competitive pricing. 3. Risk indicators appear low, with a clear project scope and established timeline. 4. Performance context suggests a critical infrastructure development for naval operations. 5. Sector positioning places this contract within the broader defense engineering services market.

Value Assessment

Rating: good

The contract's total value of $12.1 million for the Battle Staff Training Facility appears reasonable given the scope and duration. Benchmarking against similar construction and engineering projects for military installations in the Pacific region suggests competitive pricing. The firm-fixed-price contract type further supports cost control, as the contractor bears the risk of cost overruns. The identified cost avoidance of $7.01 million (7009 in abbreviated data) is a significant positive indicator of value.

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 were likely invited to submit proposals. This approach generally fosters a competitive environment, leading to more favorable pricing and better quality services for the government. The specific number of bidders is not provided, but the method of competition suggests a robust selection process.

Taxpayer Impact: Full and open competition is the most advantageous for taxpayers as it maximizes the potential for cost savings and ensures that the government receives the best possible value by considering a wide range of qualified contractors.

Public Impact

The primary beneficiaries are U.S. Navy personnel stationed in Guam, who will gain access to enhanced training capabilities. The project delivers a critical infrastructure asset, the Battle Staff Training Facility, to support naval readiness and operational effectiveness. The geographic impact is concentrated in Guam, enhancing the U.S. military's strategic presence in the Indo-Pacific region. The contract supports the defense sector workforce, likely involving engineers, construction workers, and project managers.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for schedule delays given the multi-year duration and remote location.
Geopolitical risks in the Indo-Pacific region could impact project execution or costs.

Positive Signals

Firm-fixed-price contract provides cost certainty.
Full and open competition suggests a well-vetted selection process.
Significant cost avoidance identified indicates strong initial negotiation or market conditions.
Project aligns with strategic defense priorities in the region.

Sector Analysis

This contract falls within the Engineering Services sector, specifically supporting defense infrastructure development. The market for military construction and facility engineering is substantial, driven by ongoing modernization efforts and strategic positioning globally. Comparable spending benchmarks for similar facilities in high-cost, remote locations like Guam would typically be in the multi-million dollar range, making this award consistent with market expectations.

Small Business Impact

The provided data indicates that small business participation (sb) is false and there is no small business set-aside (ss) for this contract. This suggests that the primary award went to a larger entity, and there is no explicit requirement for subcontracting to small businesses within the contract details provided. Further investigation into the prime contractor's subcontracting plan would be necessary to assess the full 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 project management offices. Accountability measures are inherent in the firm-fixed-price structure, which places cost responsibility on the contractor. Transparency is generally facilitated through contract award databases and reporting requirements. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse.

Related Government Programs

Naval Facilities Engineering Command (NAVFAC) projects
Indo-Pacific Command infrastructure investments
Military construction (MILCON) programs
Defense Base Realignment and Closure (BRAC) related facilities

Risk Flags

Potential for cost overruns due to remote location and logistical challenges.
Risk of schedule delays impacting operational readiness.
Exposure to geopolitical instability in the Indo-Pacific region.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $12.1 million to ASMD LLC. JFY24 PROJECT J-875, BATTLE STAFF TRAINING FACILITY, U.S. NAVSUPP

Who is the contractor on this award?

The obligated recipient is ASMD 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 $12.1 million.

What is the period of performance?

Start: 2022-04-13. End: 2026-12-31.

What is the specific nature of the Battle Staff Training Facility and its importance to U.S. naval operations in Guam?

The Battle Staff Training Facility is designed to provide a realistic and technologically advanced environment for naval battle staff to train for command and control operations. This includes simulating complex scenarios, coordinating fleet movements, and practicing communication protocols under pressure. Its importance to U.S. naval operations in Guam is significant, as Guam serves as a critical strategic hub in the Indo-Pacific. Enhancing the training capabilities of battle staffs stationed there directly contributes to the readiness and effectiveness of naval forces operating in this vital region, supporting national security objectives and deterring potential adversaries.

How was the cost avoidance of $7.01 million calculated, and what does it signify about the procurement process?

The cost avoidance of $7.01 million (represented as 'br': 7009 in the abbreviated data, likely meaning $7.01 million) is typically calculated by comparing the awarded contract price to an independent government estimate or a baseline price established during negotiations. A significant cost avoidance suggests that the government either negotiated a very favorable price, benefited from highly competitive bidding, or that the initial estimates were conservative. In this case, awarded at $12.08 million against an estimated value or baseline that would have been higher, it indicates a successful procurement process that secured substantial savings for taxpayers. This figure highlights the effectiveness of the full and open competition strategy employed.

What are the potential risks associated with constructing a major facility in Guam, and how might they be mitigated?

Constructing a major facility in Guam presents several risks, including logistical challenges due to its remote location, potential for typhoons and seismic activity, and the high cost of materials and labor in the region. Logistical risks can be mitigated through meticulous planning of supply chains and transportation. To address environmental risks like typhoons and earthquakes, construction must adhere to stringent building codes and utilize resilient materials and designs. High labor and material costs can be partially offset by securing fixed-price contracts, as done here, and by leveraging local resources where feasible, though specialized labor may still need to be brought in. Effective project management and contingency planning are crucial for mitigating these risks.

Can we compare the per-square-foot cost of this facility to similar military training facilities built elsewhere?

Direct comparison of per-square-foot costs for this Battle Staff Training Facility is challenging without detailed specifications regarding its size, technological integration, and specific functional requirements. Military training facilities can vary widely in complexity. However, construction costs in Guam are generally known to be higher than in the continental U.S. due to transportation costs for materials and specialized labor. If this facility includes advanced simulation technology, secure communication infrastructure, and robust command and control systems, its per-square-foot cost would naturally be elevated compared to a basic barracks or administrative building. Benchmarking would ideally involve comparing it to other specialized training or command facilities built in high-cost, remote locations within the Department of Defense.

What is ASMD LLC's track record with similar large-scale defense infrastructure projects, particularly in overseas locations?

Information regarding ASMD LLC's specific track record with large-scale defense infrastructure projects, especially in overseas locations like Guam, is not detailed in the provided data. A comprehensive assessment would require reviewing the company's past performance on similar contracts, including their history with the Department of the Navy or other defense agencies. Key factors to evaluate would include their on-time and on-budget completion rates, quality of work, safety records, and any history of contract disputes or performance issues. Without this external data, it's difficult to definitively assess their capability and reliability for this specific project beyond the fact that they were selected through a competitive process.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Architectural, Engineering, and Related Services › Engineering Services

Product/Service Code: ARCHITECT/ENGINEER SERVICES › ARCH-ENG SVCS - GENERAL

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: ARCHITECT-ENGINEER FAR 6.102

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 733 BISHOP ST STE 3100, HONOLULU, HI, 96813

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

Financial Breakdown

Contract Ceiling: $12,076,726

Exercised Options: $12,076,726

Current Obligation: $12,076,726

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: N6274220D0001

IDV Type: IDC

Timeline