DoD awards $112M for Fort Greely infrastructure, including utilidors, with a firm fixed price contract

Contract Overview

Contract Amount: $112,193,845 ($112.2M)

Contractor: Neeser Construction, Inc

Awarding Agency: Department of Defense

Start Date: 2018-12-20

End Date: 2025-08-01

Contract Duration: 2,416 days

Daily Burn Rate: $46.4K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: CONSTRUCT MF4 INFRASTRUCTURE WITH UTILIDORS AND OTHER CLINS IAW FULLY DESIGNED SPECIFICATIONS AND DRAWINGS, FORT GREELY, ALASKA (FTG218D)

Place of Performance

Location: FORT GREELY, SOUTHEAST FAIRBANKS County, ALASKA, 99731

State: Alaska Government Spending

Plain-Language Summary

Department of Defense obligated $112.2 million to NEESER CONSTRUCTION, INC for work described as: CONSTRUCT MF4 INFRASTRUCTURE WITH UTILIDORS AND OTHER CLINS IAW FULLY DESIGNED SPECIFICATIONS AND DRAWINGS, FORT GREELY, ALASKA (FTG218D) Key points: 1. Contract awarded to Neeser Construction, Inc. for infrastructure development at Fort Greely, Alaska. 2. The contract utilizes a firm fixed price structure, indicating a defined cost for the project. 3. Full and open competition was employed, suggesting a broad range of potential bidders. 4. The project scope includes construction of utilidors and other elements based on detailed specifications. 5. The contract duration is approximately 2416 days, spanning from late 2018 to mid-2025. 6. This award represents a significant investment in military infrastructure in Alaska.

Value Assessment

Rating: good

The contract value of $112.2 million for infrastructure development at Fort Greely appears reasonable given the scope and duration. The firm fixed price nature of the contract helps manage cost certainty for the government. Benchmarking against similar large-scale military construction projects would provide further insight into value for money, but the comprehensive nature of the work, including specialized utilidors and adherence to fully designed specifications, suggests a substantial undertaking.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit bids. This approach typically fosters a competitive environment, potentially leading to better pricing and terms for the government. The presence of two bids suggests a moderate level of competition for this significant infrastructure project.

Taxpayer Impact: Full and open competition generally benefits taxpayers by encouraging multiple companies to bid, which can drive down costs and improve the quality of services or goods received.

Public Impact

The primary beneficiaries are the U.S. Army and personnel stationed at Fort Greely, Alaska, who will receive improved and modernized infrastructure. The contract delivers essential construction services, including the development of utilidors, which are crucial for utility distribution in harsh environments. The geographic impact is localized to Fort Greely, Alaska, supporting the operational readiness and living conditions at this remote military installation. The project will likely create or sustain jobs in the construction sector within Alaska, contributing to the local economy.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if unforeseen site conditions arise, despite the fixed-price nature.
Delays in construction could impact the operational readiness of Fort Greely.
Reliance on a single contractor for a long-duration project may limit flexibility.

Positive Signals

Firm fixed price contract provides cost certainty.
Full and open competition suggests a robust bidding process.
Detailed specifications and drawings aim to minimize ambiguity.
Project addresses critical infrastructure needs at a key military installation.

Sector Analysis

This contract falls within the heavy and civil engineering construction sector, specifically focusing on infrastructure development for military installations. The market for large-scale military construction is often characterized by specialized requirements, stringent security protocols, and significant government investment. Comparable spending benchmarks would involve other major construction projects at military bases, particularly those in remote or challenging environments like Alaska, where specialized infrastructure like utilidors is essential for operational functionality.

Small Business Impact

The contract data indicates that small business participation was not a specific set-aside (ss: false, sb: false). While this contract was awarded under full and open competition, there may be opportunities for small businesses to participate as subcontractors to Neeser Construction, Inc. The impact on the small business ecosystem will depend on the subcontracting plan developed by the prime contractor.

Oversight & Accountability

Oversight for this contract will likely be managed by the Department of the Army, potentially through contracting officers and project managers at Fort Greely. Accountability measures are inherent in the firm fixed price contract, which penalizes the contractor for cost overruns. Transparency is facilitated by the contract's award under full and open competition, with data publicly available through federal procurement databases. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Military Construction, Army
Infrastructure Modernization Programs
Arctic Infrastructure Development
Defense Base Realignment and Closure (BRAC) related construction

Risk Flags

Long contract duration increases risk of unforeseen issues.
Remote location may pose logistical challenges.
Potential for permafrost or environmental site condition issues.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $112.2 million to NEESER CONSTRUCTION, INC. CONSTRUCT MF4 INFRASTRUCTURE WITH UTILIDORS AND OTHER CLINS IAW FULLY DESIGNED SPECIFICATIONS AND DRAWINGS, FORT GREELY, ALASKA (FTG218D)

Who is the contractor on this award?

The obligated recipient is NEESER CONSTRUCTION, INC.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $112.2 million.

What is the period of performance?

Start: 2018-12-20. End: 2025-08-01.

What is the track record of Neeser Construction, Inc. with similar large-scale military infrastructure projects?

Neeser Construction, Inc. has a history of performing construction services for the government. To assess their track record for this specific type of project, a review of their past performance on similar firm fixed-price contracts for military infrastructure, particularly those involving complex utility systems or remote locations, would be necessary. Examining past performance evaluations, any contract disputes, or awards for similar work would provide context on their capability to deliver on the Fort Greely project. Data on their financial stability and bonding capacity would also be relevant for a project of this magnitude and duration.

How does the awarded price compare to similar infrastructure projects in Alaska or other remote military installations?

Benchmarking the $112.2 million award against similar projects requires detailed comparison of scope, complexity, and location. Projects involving utilidors and extensive civil engineering in remote, cold-weather environments like Alaska typically command higher costs due to logistical challenges, specialized materials, and extended construction seasons. A direct comparison would ideally involve projects of similar scale (e.g., over $100 million) and type (e.g., utility infrastructure, base construction) awarded within the last 1-3 years. Without specific comparable project data, it's difficult to definitively state if this price is high or low, but the firm fixed price suggests the government has negotiated a defined cost for the specified work.

What are the primary risks associated with this firm fixed-price contract for infrastructure development?

The primary risks for the government in a firm fixed-price contract, even with detailed specifications, often revolve around potential scope creep if changes are not managed rigorously, or if unforeseen site conditions (e.g., permafrost issues, unexpected subsurface obstructions) significantly impact the cost of performance. For the contractor, the risk lies in underestimating the costs or encountering difficulties that erode their profit margin. Given the long duration (over 6 years) and the remote Alaskan location, logistical challenges, material cost fluctuations, and labor availability are significant risk factors that Neeser Construction, Inc. must manage effectively to avoid project delays or financial distress.

How effective are the specified utilidors likely to be in supporting Fort Greely's infrastructure needs?

Utilidors are designed to protect and insulate utility lines (water, sewer, power, communications) from extreme weather conditions, preventing freezing and reducing heat loss, which is critical in a location like Fort Greely, Alaska. Their effectiveness hinges on proper design, material selection, installation quality, and ongoing maintenance. The contract specifies that these are to be built 'IAW FULLY DESIGNED SPECIFICATIONS AND DRAWINGS,' suggesting a thorough design process. Assuming the design adequately addresses the specific environmental challenges of Fort Greely and the construction adheres strictly to these specifications, the utilidors should significantly enhance the reliability and efficiency of utility distribution, reducing vulnerability to weather-related disruptions.

What is the historical spending trend for infrastructure projects at Fort Greely or similar Army installations in Alaska?

Historical spending on infrastructure at Fort Greely and other Army installations in Alaska generally reflects the challenges and costs associated with operating in the Arctic. Investments are often focused on maintaining and upgrading facilities to withstand extreme cold, permafrost, and logistical complexities. Spending trends typically show consistent allocation for sustainment, repair, and modernization, with periodic large-scale projects like this one for significant upgrades or new construction. Analyzing past Army Corps of Engineers or Installation Management Command budgets for Alaska-based facilities would reveal patterns of investment in utilities, barracks, training areas, and support infrastructure, highlighting the ongoing need for substantial capital outlays in such environments.

What are the implications of the contract's duration (2416 days) on project management and oversight?

A contract duration of 2416 days (approximately 6.7 years) presents significant project management and oversight challenges. For the government, it requires sustained attention from contracting officers, project managers, and quality assurance personnel over an extended period. Maintaining consistent oversight requires robust documentation, regular progress reviews, and effective communication channels to ensure the project stays on schedule and within scope. For the contractor, managing resources, workforce, and potential changes over such a long timeframe demands strong organizational capacity and strategic planning. The extended duration also increases the risk of material price escalation or changes in regulatory requirements that may need to be addressed.

Industry Classification

NAICS: Construction › Other Heavy and Civil Engineering Construction › Other Heavy and Civil Engineering Construction

Product/Service Code: CONSTRUCT OF STRUCTURES/FACILITIES › CONSTRUCTION OF BUILDINGS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: W911KB18R0010

Offers Received: 2

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 2501 BLUEBERRY RD, ANCHORAGE, AK, 99503

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

Financial Breakdown

Contract Ceiling: $112,193,845

Exercised Options: $112,193,845

Current Obligation: $112,193,845

Actual Outlays: $1,342,474

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline