State Department awarded $29.3M for overseas construction, with limited transparency on foreign awardees

Contract Overview

Contract Amount: $29,353,298 ($29.4M)

Contractor: Foreign Awardees (undisclosed)

Awarding Agency: Department of State

Start Date: 2011-05-03

End Date: 2015-03-12

Contract Duration: 1,409 days

Daily Burn Rate: $20.8K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 8

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: OVERSEAS CONTRACT

Plain-Language Summary

Department of State obligated $29.4 million to FOREIGN AWARDEES (UNDISCLOSED) for work described as: OVERSEAS CONTRACT Key points: 1. Contract awarded to foreign entities with undisclosed specifics, raising transparency concerns. 2. The firm-fixed-price structure aims to control costs, but the lack of detailed awardee information limits value assessment. 3. Competition was full and open, suggesting a potentially competitive bidding process. 4. The contract duration of 1409 days indicates a significant, long-term construction project. 5. Construction services for commercial and institutional buildings are broad, requiring careful oversight. 6. The absence of small business set-asides means limited direct benefit to U.S. small businesses.

Value Assessment

Rating: questionable

Benchmarking the value of this contract is challenging due to the undisclosed nature of the foreign awardees and the lack of specific project details. While the total award amount of $29.3 million is substantial, without knowing the scope of work and the specific entities performing the construction, it's difficult to assess if it represents good value for money. The firm-fixed-price contract type suggests cost certainty, but the lack of transparency on the recipients of these funds prevents a thorough comparison to similar overseas construction projects or market rates.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that a wide range of potential bidders were allowed to submit proposals. However, the provided data does not specify the number of bids received or the identities of the competing firms, other than the ultimate awardee being foreign. This level of competition is generally positive for price discovery, but the lack of detail on the awardees themselves limits the ability to fully assess the competitive landscape and its impact on the final price.

Taxpayer Impact: Full and open competition is generally beneficial for taxpayers as it encourages multiple companies to bid, potentially driving down prices. However, the lack of transparency regarding the specific foreign awardees makes it difficult to confirm if the most cost-effective solution was secured for taxpayer funds.

Public Impact

The primary beneficiaries are likely the foreign construction firms that received the contract award. The services delivered involve the construction of commercial and institutional buildings in overseas locations. The geographic impact is specific to the locations where these overseas buildings are constructed. Workforce implications would primarily involve the employment of labor by the foreign awardees for the construction activities.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of transparency regarding the specific foreign awardees and their qualifications.
Difficulty in verifying the value for money due to undisclosed project specifics and awardee details.
Potential risks associated with managing construction projects executed by foreign entities without clear oversight.
Limited visibility into the subcontracting practices of the foreign awardees.

Positive Signals

The contract was awarded through full and open competition, suggesting a broad search for qualified bidders.
The firm-fixed-price contract type provides cost certainty for the government.
The contract duration indicates a significant commitment to infrastructure development.

Sector Analysis

This contract falls within the Commercial and Institutional Building Construction sector, a broad category encompassing the building of non-residential structures like offices, schools, hospitals, and retail spaces. The global construction market is vast, with significant government spending allocated to infrastructure and facilities abroad. This specific award represents a portion of the Department of State's efforts to maintain and develop its overseas presence, fitting within the broader context of diplomatic and operational support infrastructure.

Small Business Impact

The data indicates that this contract did not include any small business set-asides (sb: false). This means that opportunities for U.S. small businesses to directly participate in this specific construction project were not prioritized through a set-aside mechanism. Consequently, there are no direct subcontracting implications for small businesses mandated by this contract's structure, limiting their potential involvement in this particular award.

Oversight & Accountability

Oversight mechanisms for this contract would primarily be managed by the Department of State's contracting officers and program managers. Accountability measures would be tied to the contract's performance clauses and delivery schedules. Transparency is limited by the lack of disclosed information about the foreign awardees and the specific project details. Inspector General jurisdiction would apply to investigations of fraud, waste, or abuse related to the contract.

Related Government Programs

Department of State Overseas Buildings Operations
Foreign Military Construction
Government Construction Contracts
International Infrastructure Projects

Risk Flags

Lack of transparency regarding awardee identity
Limited detail on project scope
Potential challenges in oversight of foreign contractors

Frequently Asked Questions

What is this federal contract paying for?

Department of State awarded $29.4 million to FOREIGN AWARDEES (UNDISCLOSED). OVERSEAS CONTRACT

Who is the contractor on this award?

The obligated recipient is FOREIGN AWARDEES (UNDISCLOSED).

Which agency awarded this contract?

Awarding agency: Department of State (Department of State).

What is the total obligated amount?

The obligated amount is $29.4 million.

What is the period of performance?

Start: 2011-05-03. End: 2015-03-12.

What specific types of commercial and institutional buildings were constructed under this contract?

The provided data categorizes the contract under 'Commercial and Institutional Building Construction' (nd: 236220), which is a broad classification. This typically includes structures such as office buildings, administrative facilities, community centers, educational institutions, or healthcare facilities. However, without more specific project documentation or descriptions linked to this particular award, the exact nature and purpose of the buildings constructed remain undisclosed. The Department of State often requires a variety of facilities to support its diplomatic missions and personnel abroad, ranging from secure office spaces to housing and recreational facilities.

Can the value of this contract be benchmarked against similar overseas construction projects?

Benchmarking the value of this $29.3 million contract is difficult due to several factors. Firstly, the awardees are foreign and undisclosed, making it hard to compare their pricing structures or overhead costs to known U.S. or international contractors. Secondly, the specific location and scope of work for the 'Commercial and Institutional Building Construction' are not detailed. Overseas construction projects can vary significantly in cost due to logistical challenges, security requirements, local labor costs, material availability, and regulatory environments. Without these specifics, a direct comparison to similar projects is speculative and lacks a solid data foundation.

What are the potential risks associated with awarding construction contracts to undisclosed foreign entities?

Awarding contracts to undisclosed foreign entities presents several potential risks. These can include challenges in ensuring compliance with U.S. labor and safety standards, difficulties in verifying the financial stability and past performance of the contractors, and potential issues with intellectual property protection or quality control. Furthermore, the lack of transparency can obscure potential conflicts of interest or undue influence. Managing communication and dispute resolution can also be more complex across different legal and cultural frameworks. Ensuring accountability and recourse in case of contract breaches or substandard work requires robust oversight mechanisms.

How does the firm-fixed-price contract type impact cost control and risk for this overseas construction project?

A firm-fixed-price (FFP) contract type is designed to provide cost certainty for the government. Under an FFP agreement, the contractor agrees to a total price for a well-defined scope of work, and is responsible for controlling costs to achieve profitability. This shifts the risk of cost overruns from the government to the contractor. For this overseas construction project, the FFP structure means the Department of State has a clear understanding of the maximum expenditure. However, the effectiveness of cost control relies heavily on the contractor's efficiency and the accuracy of the initial cost estimates. If the scope of work was not perfectly defined, or if unforeseen conditions arise, the contractor still bears the risk, which could potentially lead to disputes or pressure to cut corners if not managed carefully.

What is the historical spending pattern for overseas construction by the Department of State?

Historical spending data for overseas construction by the Department of State, particularly through its Overseas Buildings Operations (OBO), reveals a consistent and significant investment in maintaining and expanding its global facilities. OBO manages a large portfolio of projects, including new embassy compounds, consulates, and associated infrastructure. Annual spending can fluctuate based on the number and scale of active projects, but it typically runs into hundreds of millions or even billions of dollars over multi-year periods. This $29.3 million award represents one component within that larger, ongoing commitment to providing secure and functional diplomatic facilities worldwide.

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: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 8

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 1800 F ST NW, WASHINGTON, DC, 20405

Business Categories: Category Business, Foreign Owned, Not Designated a Small Business, Special Designations

Financial Breakdown

Contract Ceiling: $29,353,298

Exercised Options: $29,353,298

Current Obligation: $29,353,298

Contract Characteristics

Commercial Item: SUPPLIES OR SERVICES PURSUANT TO FAR 12.102(F)

Cost or Pricing Data: NO

Timeline