Army awards $67.9M contract for dormitory construction in Alaska, emphasizing firm fixed-price terms

Contract Overview

Contract Amount: $67,871,673 ($67.9M)

Contractor: Unit Company

Awarding Agency: Department of Defense

Start Date: 2023-05-19

End Date: 2025-12-15

Contract Duration: 941 days

Daily Burn Rate: $72.1K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 3

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: CONSTRUCT 84 PN DORMITORY, CLEAR SFS, ALASKA (CLR049)

Place of Performance

Location: CLEAR, DENALI County, ALASKA, 99704

State: Alaska Government Spending

Plain-Language Summary

Department of Defense obligated $67.9 million to UNIT COMPANY for work described as: CONSTRUCT 84 PN DORMITORY, CLEAR SFS, ALASKA (CLR049) Key points: 1. Contract value of $67.9M for dormitory construction in Alaska. 2. Awarded under full and open competition, suggesting a competitive bidding process. 3. Firm fixed-price contract type aims to control costs and manage risk. 4. Project duration of 941 days indicates a significant construction timeline. 5. The contract is for commercial and institutional building construction. 6. Geographic focus on Alaska may present unique logistical and environmental challenges.

Value Assessment

Rating: good

The contract value of $67.9M for dormitory construction appears reasonable given the scope and duration. Benchmarking against similar large-scale construction projects in remote or challenging environments like Alaska is crucial for a definitive value assessment. The firm fixed-price structure suggests an effort to lock in costs, which can be beneficial for the government if the contractor accurately estimates expenses. However, without specific cost breakdowns or comparisons to similar projects, a precise value-for-money judgment is difficult.

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 bids. The presence of 3 bidders suggests a moderate level of competition for this project. A higher number of bidders typically leads to more competitive pricing and better value for the government. The fact that it was competed openly is a positive sign for price discovery.

Taxpayer Impact: Full and open competition generally benefits taxpayers by driving down prices through a wider pool of potential bidders, leading to more cost-effective use of public funds.

Public Impact

Service members stationed in Alaska will benefit from improved dormitory facilities. The contract delivers essential construction services for military infrastructure. The geographic impact is concentrated in Clear, Alaska. The project will likely create temporary construction jobs in the region.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if unforeseen construction challenges arise in Alaska's climate.
Risk of schedule delays due to logistical complexities in a remote location.
Ensuring quality of construction meets long-term durability standards in harsh weather.

Positive Signals

Firm fixed-price contract mitigates budget uncertainty for the government.
Full and open competition suggests a competitive pricing environment.
Clear contract scope for dormitory construction provides defined deliverables.

Sector Analysis

This contract falls within the Commercial and Institutional Building Construction sector, a significant segment of the broader construction industry. Federal spending in this sector often supports infrastructure development, military facilities, and public buildings. The market size for such specialized construction, particularly in remote or challenging locations like Alaska, can be substantial, with a limited number of contractors possessing the necessary expertise and capacity. This project represents a specific investment in military housing infrastructure.

Small Business Impact

The data indicates that small business participation was not a specific set-aside for this contract (ss: false, sb: false). While the primary award went to 'UNIT COMPANY', there is no explicit information on subcontracting plans for small businesses. The absence of a small business set-aside means that larger firms were likely the primary focus, and the impact on the small business ecosystem will depend on whether the prime contractor engages them for subcontracting opportunities.

Oversight & Accountability

Oversight for this contract will likely be managed by the Department of the Army, with specific contracting officers and project managers responsible for monitoring progress, quality, and adherence to terms. Transparency is facilitated by the public nature of contract awards. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse. Accountability measures are embedded in the firm fixed-price contract, which places the onus on the contractor to deliver within the agreed budget.

Related Government Programs

Military Construction Projects
Defense Infrastructure
Government Dormitory Construction
Alaska Federal Contracts

Risk Flags

Potential for cost escalation due to remote location logistics.
Risk of schedule delays from Alaskan environmental conditions.
Ensuring long-term durability of construction in extreme climate.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $67.9 million to UNIT COMPANY. CONSTRUCT 84 PN DORMITORY, CLEAR SFS, ALASKA (CLR049)

Who is the contractor on this award?

The obligated recipient is UNIT COMPANY.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $67.9 million.

What is the period of performance?

Start: 2023-05-19. End: 2025-12-15.

What is the track record of 'UNIT COMPANY' in executing similar large-scale construction projects for the Department of Defense?

A review of 'UNIT COMPANY's' contract history would be necessary to assess their track record. Specifically, examining past performance on firm fixed-price contracts of similar magnitude and complexity, especially in challenging environments like Alaska, would provide insight into their reliability and execution capabilities. Data on past project completion times, budget adherence, and quality of work would be key indicators. Without this specific data, it's difficult to definitively assess their suitability beyond the fact that they were selected through a competitive process.

How does the awarded amount of $67.9 million compare to the estimated cost or bids from other competitors?

The provided data indicates that 'UNIT COMPANY' was awarded the contract for $67.9 million, and there were 3 bidders in total. To assess value, a comparison of this award amount against the bids submitted by the other two competitors is essential. If the award was significantly lower than other bids, it suggests strong price competition. Conversely, if it was close to the highest bid, it might indicate less aggressive pricing. Furthermore, comparing this figure to independent cost estimates or benchmarks for similar dormitory construction projects in Alaska would provide a more robust assessment of whether the government secured a competitive price.

What are the primary risks associated with constructing a dormitory in Clear, Alaska, and how are they mitigated by the contract terms?

Constructing in Clear, Alaska, presents several inherent risks, including extreme weather conditions, permafrost, logistical challenges for material delivery, and a limited local labor pool. These factors can lead to cost overruns and schedule delays. The contract's firm fixed-price (FFP) nature aims to mitigate financial risk for the government by capping the total cost. However, the contractor assumes more risk under an FFP contract. Mitigation strategies for schedule and performance risks would likely involve detailed project planning, robust quality assurance protocols, and potentially incentives or penalties tied to timely completion and adherence to specifications. The 941-day duration suggests an acknowledgment of these potential challenges.

What is the expected impact of this dormitory construction on the local workforce and economy in Alaska?

This dormitory construction project is expected to have a positive, albeit likely temporary, impact on the local workforce and economy in Alaska. The construction phase will require a significant number of skilled and unskilled laborers, potentially creating numerous jobs. This could lead to increased demand for local services and supplies. However, the extent of the benefit depends on the extent to which local labor and businesses are utilized by the prime contractor and any subcontractors. If 'UNIT COMPANY' sources labor and materials locally, the economic multiplier effect will be greater. Post-construction, the facility will support military personnel, indirectly contributing to the long-term economic stability of the base.

How does the $67.9 million contract value compare to historical federal spending on similar dormitory construction projects in Alaska or other remote military installations?

To assess historical spending patterns, one would need to analyze federal contract databases for similar dormitory construction projects in Alaska or other remote military installations over the past several years. Key comparison points would include project size (square footage, number of occupants), complexity, duration, and the specific location's logistical challenges. The $67.9 million figure should be adjusted for inflation if comparing to older contracts. Without access to such a comparative database, it's challenging to determine if this contract represents an outlier, a standard cost, or a particularly good/bad deal relative to historical spending. Factors like the specific requirements for the Clear, Alaska site (e.g., seismic resilience, extreme cold weather design) will influence cost.

What are the specific performance standards and quality control measures required under this firm fixed-price contract?

Under a firm fixed-price contract, the performance standards and quality control measures are typically detailed in the contract's Statement of Work (SOW) and associated specifications. These would outline the required materials, construction methods, architectural designs, and functional requirements for the dormitory. Quality control would involve the contractor implementing its own internal quality assurance program, subject to government inspection and acceptance testing at various project milestones. The government's Quality Assurance Representative (QAR) would monitor compliance. Failure to meet these standards could result in contractually defined remedies, such as rejection of work, withholding of payments, or liquidated damages, depending on the contract's specific clauses.

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

Solicitation ID: W911KB22R0016

Offers Received: 3

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 620 E WHITNEY RD, ANCHORAGE, AK, 99501

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

Financial Breakdown

Contract Ceiling: $67,871,673

Exercised Options: $67,871,673

Current Obligation: $67,871,673

Subaward Activity

Number of Subawards: 49

Total Subaward Amount: $54,584,805

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline