DoD's $26.1M construction contract for JBER headquarters building awarded to KICC-ALCAN GENERAL JV

Contract Overview

Contract Amount: $26,132,715 ($26.1M)

Contractor: Kicc-Alcan General JV

Awarding Agency: Department of Defense

Start Date: 2012-05-03

End Date: 2014-05-29

Contract Duration: 756 days

Daily Burn Rate: $34.6K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 5

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: CONSTRUCT BRIGADE AND BATTALION HEADQUARTERS BUILDING WITH CLASSROOMS ON JOINT BASE ELMENDORF-RICHARDSON, ALASKA

Place of Performance

Location: FORT RICHARDSON, ANCHORAGE County, ALASKA, 99505

State: Alaska Government Spending

Plain-Language Summary

Department of Defense obligated $26.1 million to KICC-ALCAN GENERAL JV for work described as: CONSTRUCT BRIGADE AND BATTALION HEADQUARTERS BUILDING WITH CLASSROOMS ON JOINT BASE ELMENDORF-RICHARDSON, ALASKA Key points: 1. The contract aimed to construct a headquarters building with classrooms, indicating a need for enhanced operational and training facilities. 2. Awarded under full and open competition after exclusion of sources, suggesting a deliberate but potentially limited bidding process. 3. The firm-fixed-price contract type shifts cost risk to the contractor, potentially leading to higher initial bids but predictable final costs. 4. The project duration of 756 days points to a significant construction undertaking requiring substantial planning and execution. 5. The contract's value of approximately $26.1 million positions it as a mid-sized infrastructure project within the Department of Defense. 6. The geographic location in Alaska presents unique logistical and environmental challenges that likely influenced project costs and timelines.

Value Assessment

Rating: fair

Benchmarking the value of this specific construction contract is challenging without detailed cost breakdowns and comparable project data. However, the total award of $26.1 million for a headquarters building with classrooms on a military installation appears within a reasonable range for large-scale construction projects. The firm-fixed-price nature of the contract suggests the government sought cost certainty, which can sometimes lead to higher upfront pricing compared to cost-plus contracts, but it mitigates the risk of cost overruns for the government.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

The contract was awarded under 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES.' This indicates that while the competition was intended to be open, certain sources were excluded prior to the solicitation. The specific reasons for exclusion are not detailed, but this approach can sometimes limit the pool of potential bidders. The number of bidders is not explicitly stated, but the 'exclusion of sources' suggests it may not have been as broad as a truly unrestricted full and open competition.

Taxpayer Impact: While the competition was not fully unrestricted, the 'after exclusion of sources' clause implies an effort to ensure some level of competition. Taxpayers benefit from competitive bidding processes, as they generally drive down prices. However, the exclusion of specific sources could potentially lead to less aggressive pricing than if all qualified contractors were allowed to bid.

Public Impact

Military personnel stationed at Joint Base Elmendorf-Richardson (JBER) in Alaska will benefit from improved facilities. The construction of a new headquarters building and classrooms will enhance operational efficiency and training capabilities for the Army. The project's geographic impact is localized to JBER, Alaska, contributing to the local economy through construction jobs and material sourcing. The construction phase will likely create temporary employment opportunities for skilled trades and laborers in the Alaska region.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if unforeseen site conditions or logistical challenges arise in Alaska, despite the fixed-price nature.
The 'exclusion of sources' in the competition process raises questions about whether the most competitive pricing was achieved.
Limited transparency on the specific criteria used for excluding sources could obscure potential biases or inefficiencies in the procurement.
The long duration of the contract (756 days) increases the risk of material price fluctuations or labor availability issues.

Positive Signals

The firm-fixed-price contract structure provides cost certainty for the government, minimizing the risk of budget overruns.
Awarding the contract to a joint venture (KICC-ALCAN GENERAL JV) may indicate a strategic approach to leveraging specialized expertise for complex projects.
The project addresses a clear need for improved infrastructure at a key military installation, supporting operational readiness.
The construction will provide modern facilities, potentially improving the quality of life and work environment for service members.

Sector Analysis

This contract falls within the Commercial and Institutional Building Construction sector, specifically for government and defense facilities. The market for large-scale military construction is often characterized by specialized contractors capable of meeting stringent security, environmental, and logistical requirements. Spending in this sector is driven by military readiness needs, infrastructure upgrades, and geopolitical factors. Comparable benchmarks would include other large military construction projects, particularly those in challenging geographic locations like Alaska.

Small Business Impact

The data indicates that this contract was not set aside for small businesses (ss: false, sb: false). Therefore, there are no direct subcontracting implications or specific impacts on the small business ecosystem stemming from a set-aside requirement. The prime contractor, KICC-ALCAN GENERAL JV, is likely a larger entity or a joint venture of larger entities, and their subcontracting practices would determine any indirect impact on small businesses.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and the relevant program executive office within the Department of the Army. Accountability measures are embedded in the firm-fixed-price contract terms, requiring the contractor to deliver the specified building within the agreed-upon price and timeframe. Transparency is generally maintained through contract award databases and reporting requirements, though specific oversight details and Inspector General involvement would depend on the project's lifecycle and any reported issues.

Related Government Programs

Military Construction, Army
Base Realignment and Closure (BRAC) Projects
Department of Defense Facilities Modernization
Joint Base Elmendorf-Richardson Infrastructure Projects

Risk Flags

Limited Competition Concerns
Potential for Higher Costs due to Geographic Location
Unclear Rationale for Source Exclusion

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $26.1 million to KICC-ALCAN GENERAL JV. CONSTRUCT BRIGADE AND BATTALION HEADQUARTERS BUILDING WITH CLASSROOMS ON JOINT BASE ELMENDORF-RICHARDSON, ALASKA

Who is the contractor on this award?

The obligated recipient is KICC-ALCAN GENERAL JV.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $26.1 million.

What is the period of performance?

Start: 2012-05-03. End: 2014-05-29.

What specific factors led to the exclusion of certain sources in this 'full and open competition after exclusion of sources' award?

The specific reasons for excluding certain sources are not detailed in the provided data. Typically, exclusion might occur due to past performance issues, inability to meet specific technical requirements, security concerns, or if the contract was structured with unique pre-qualification criteria. Without further documentation, it's difficult to ascertain the exact rationale. However, this procurement method suggests the agency had specific needs or identified potential issues with certain contractors, leading them to narrow the field before the main competition phase. This approach can sometimes be used to ensure that only highly qualified or specialized contractors participate, but it also risks limiting overall competition and potentially increasing costs if the excluded sources could have offered better value.

How does the firm-fixed-price (FFP) contract type compare to other contract types in terms of risk and potential cost for similar construction projects?

The Firm-Fixed-Price (FFP) contract type is generally favored by the government for construction projects when the scope of work is well-defined and risks are understood. Under an FFP contract, the contractor agrees to a set price for the completed work, regardless of their actual costs. This places the primary cost risk on the contractor. If costs exceed the agreed price, the contractor absorbs the loss; if costs are lower, they retain the profit. Compared to cost-plus contracts, FFP offers greater cost certainty for the government, reducing the risk of budget overruns. However, contractors often build in a contingency premium into their FFP bids to account for potential risks, which can sometimes make the initial price higher than a comparable cost-plus contract where the government bears more of the cost risk. For a project like constructing a headquarters building, where the design is likely finalized, FFP is a suitable choice for managing budget predictability.

What are the potential implications of constructing a major facility in Alaska on project timelines and costs?

Constructing a major facility in Alaska presents unique challenges that significantly impact project timelines and costs. The remote location often leads to higher transportation costs for materials, equipment, and personnel. Extreme weather conditions, including prolonged periods of cold, snow, and limited daylight, can severely restrict construction activities, leading to extended project durations and potential delays. The permafrost environment in many parts of Alaska requires specialized foundation engineering and construction techniques to prevent structural instability, adding complexity and cost. Furthermore, the limited local workforce and the need to potentially bring in skilled labor from outside the state can increase labor costs and logistical burdens. These factors collectively contribute to higher overall project costs and longer timelines compared to similar construction projects in more temperate and accessible regions.

What is the typical track record or specialization of a joint venture like KICC-ALCAN GENERAL JV for large-scale construction projects?

Joint ventures like KICC-ALCAN GENERAL JV are typically formed to combine the resources, expertise, and bonding capacity of multiple companies to undertake large, complex projects that might be beyond the scope or capability of a single firm. KICC likely refers to a Korean company (e.g., Korea Infrastructure & Construction Co.), and Alcan suggests a connection to Alaska or North America. Such joint ventures often specialize in large-scale civil engineering, infrastructure, and construction projects, particularly those in challenging environments or requiring specific technical capabilities. Their track record would involve successful completion of similar projects, adherence to safety and quality standards, and financial stability. For military construction, they would need experience navigating government contracting regulations, security protocols, and specific military design standards. The formation of a JV for this project indicates a strategic decision to pool capabilities for a significant undertaking.

How does the $26.1 million contract value compare to other Department of the Army construction projects of similar scope?

The $26.1 million contract value for the construction of a brigade and battalion headquarters building with classrooms at Joint Base Elmendorf-Richardson falls into the mid-to-large range for military construction projects. Without specific details on the building's square footage, complexity, and specific features, direct comparison is difficult. However, major military construction projects, especially those involving new building construction on established bases, can range from tens of millions to hundreds of millions of dollars. Projects involving specialized facilities, extensive site work, or challenging environmental conditions (like Alaska) tend to be at the higher end. This $26.1 million figure suggests a substantial facility, likely encompassing significant office space, training areas, and support infrastructure, consistent with the needs of brigade and battalion command elements.

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 AFTER EXCLUSION OF SOURCES

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: W911KB11R0022

Offers Received: 5

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 1500 W 33RD AVE STE 105, ANCHORAGE, AK, 99503

Business Categories: Alaskan Native Corporation Owned Firm, Category Business, Emerging Small Business, Minority Owned Business, Native American Owned Business, Partnership or Limited Liability Partnership, Self-Certified Small Disadvantaged Business, Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $26,132,715

Exercised Options: $26,132,715

Current Obligation: $26,132,715

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline