Universal Construction Company Inc. awarded $82M for industrial building construction by the Department of the Army
Contract Overview
Contract Amount: $82,065,076 ($82.1M)
Contractor: Universal Construction Company Inc.
Awarding Agency: Department of Defense
Start Date: 2005-09-19
End Date: 2012-12-21
Contract Duration: 2,650 days
Daily Burn Rate: $31.0K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 3
Pricing Type: FIRM FIXED PRICE
Sector: Construction
Place of Performance
Location: ANNISTON, CALHOUN County, ALABAMA, 36201
State: Alabama Government Spending
Plain-Language Summary
Department of Defense obligated $82.1 million to UNIVERSAL CONSTRUCTION COMPANY INC. for work described as: Key points: 1. Contract value of $82 million indicates a significant investment in infrastructure. 2. The firm fixed-price contract type suggests a defined scope and budget, potentially limiting cost overruns. 3. A duration of 2650 days (approximately 7.2 years) points to a long-term project with sustained contractor involvement. 4. The contract was awarded under full and open competition, implying a broad market search. 5. The North American Industry Classification System (NAICS) code 236210 signifies specialized industrial building construction services. 6. The contract was awarded by the Department of the Army, a major federal agency with substantial construction needs.
Value Assessment
Rating: good
The contract value of $82 million for industrial building construction appears substantial, aligning with large-scale infrastructure projects. Benchmarking against similar large-scale industrial construction contracts awarded by the Department of Defense would provide a clearer picture of value for money. The firm fixed-price nature of the award suggests that the contractor assumed the primary risk for cost overruns, which is generally favorable for the government when the scope is well-defined. Without specific details on the scope of work and market rates for comparable construction projects in Alabama, a precise value-for-money assessment is challenging, but the competitive award process is a positive indicator.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
This contract was awarded through full and open competition, indicating that the Department of the Army sought bids from all responsible prospective contractors. The presence of 3 bidders suggests a moderate level of competition for this specific industrial building construction project. While more bidders would typically lead to more robust price discovery, full and open competition is the most advantageous method for ensuring a wide range of offers and potentially the best value.
Taxpayer Impact: Full and open competition generally benefits taxpayers by fostering a competitive environment that can drive down prices and encourage innovation. The fact that multiple companies bid on this project suggests that the government received a range of pricing and technical proposals, increasing the likelihood of a cost-effective outcome.
Public Impact
The primary beneficiaries are likely military personnel and operations requiring enhanced industrial facilities. The services delivered include the construction of industrial buildings, which are critical for logistics, maintenance, and manufacturing support. The geographic impact is focused on Alabama (AL), where the construction will take place. The contract implies a need for a skilled construction workforce in Alabama, potentially creating jobs in the region.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Long contract duration (over 7 years) could lead to scope creep or unforeseen cost increases if not managed meticulously.
- Firm fixed-price contracts can sometimes incentivize contractors to cut corners on quality if not adequately overseen.
- Dependence on a single contractor for an extended period might limit flexibility in adapting to changing operational needs.
Positive Signals
- Full and open competition suggests a thorough vetting process and potential for competitive pricing.
- The firm fixed-price contract structure shifts cost-overrun risk to the contractor.
- The contract is awarded to a company with a specific NAICS code for industrial building construction, indicating specialized expertise.
Sector Analysis
The industrial building construction sector is a vital component of the broader construction industry, focusing on facilities for manufacturing, processing, storage, and distribution. This contract falls within the general construction services category, specifically for industrial purposes. The Department of Defense is a significant client for construction services, often requiring specialized facilities for defense-related operations. Benchmarking this $82 million contract would involve comparing it to other large-scale industrial or military construction projects, considering factors like project complexity, location, and prevailing market conditions.
Small Business Impact
The data indicates that this contract was not set aside for small businesses (sb: false) and there is no information provided regarding small business subcontracting plans (ss: false). This suggests that the primary award went to a large business, and there may be limited direct opportunities for small businesses through this specific prime contract. However, the prime contractor, Universal Construction Company Inc., may engage small businesses as subcontractors, depending on their own subcontracting strategies and the nature of the work required.
Oversight & Accountability
Oversight for this contract would primarily fall under the Department of the Army's contracting and project management offices. Given the long duration, regular performance reviews, site inspections, and financial audits would be expected. Transparency is typically maintained through contract award databases and reporting requirements. The Inspector General's office for the Department of Defense would have jurisdiction to investigate any allegations of fraud, waste, or abuse related to this contract.
Related Government Programs
- Military Base Construction
- Department of Defense Infrastructure Projects
- Industrial Facility Development
- Federal Building and Renovation Contracts
Risk Flags
- Long-term contract duration may increase risk of cost escalation or scope creep.
- Firm Fixed Price contract requires careful monitoring to ensure quality is maintained over the project life.
- Limited number of bidders (3) may indicate potential for increased price negotiation leverage.
Tags
construction, industrial-building, department-of-the-army, firm-fixed-price, full-and-open-competition, alabama, large-contract, long-duration, defense
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $82.1 million to UNIVERSAL CONSTRUCTION COMPANY INC.. See the official description on USAspending.
Who is the contractor on this award?
The obligated recipient is UNIVERSAL CONSTRUCTION COMPANY 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 $82.1 million.
What is the period of performance?
Start: 2005-09-19. End: 2012-12-21.
What is the specific scope of work for this industrial building construction contract?
The provided data indicates the contract is for 'Industrial Building Construction' under NAICS code 236210. However, the specific scope of work is not detailed. This typically encompasses the planning, design (if applicable), and physical construction of facilities intended for industrial purposes such as manufacturing, processing, warehousing, or research and development. For the Department of the Army, this could range from constructing new hangars, maintenance depots, or specialized production facilities. A detailed scope would outline the building's size, materials, specific functionalities, site preparation requirements, and any integrated systems (e.g., HVAC, electrical, plumbing, specialized industrial equipment).
How does the $82 million contract value compare to similar industrial building construction projects by the Department of Defense?
An $82 million contract for industrial building construction is a significant investment, indicative of a large-scale project. To benchmark this value, one would typically compare it against other major construction contracts awarded by the Department of Defense or other federal agencies for similar types of industrial facilities. Factors such as the square footage of the building, complexity of the construction (e.g., specialized environmental controls, heavy machinery integration), location, and the prevailing construction market conditions in the region (Alabama, in this case) are crucial for a meaningful comparison. Without access to a database of comparable projects with detailed specifications, it's difficult to definitively state if $82 million represents excellent, fair, or questionable value. However, the full and open competition suggests an effort to achieve competitive pricing.
What are the potential risks associated with a firm fixed-price contract lasting over 7 years?
A firm fixed-price (FFP) contract, while beneficial for budget certainty, carries specific risks when extended over a long period like 2650 days (over 7 years). The primary risk is that the fixed price may not adequately account for unforeseen changes in material costs, labor rates, or regulatory requirements that emerge over such an extended timeframe. If the contractor underestimated these factors, they could face significant financial losses, potentially leading to project delays, disputes, or even contractor default. Conversely, if the initial estimate was overly conservative, the government might end up overpaying. Effective risk mitigation requires robust contract administration, including mechanisms for addressing equitable adjustments for significant, unforeseen changes, and diligent oversight to ensure the contractor maintains quality and performance throughout the project lifecycle.
What does the number of bidders (3) suggest about the competition for this contract?
Having 3 bidders for a large industrial construction contract awarded under full and open competition suggests a moderate level of market interest and capability. While more bidders generally lead to more intense price competition, 3 bidders indicate that the opportunity was known and attractive enough to elicit responses from multiple qualified firms. This number suggests that the market is not overly concentrated, nor is it so specialized that only one or two firms could realistically bid. The quality of the proposals received from these 3 bidders, alongside their pricing, would be the ultimate determinant of whether the competition yielded the best possible value for the government.
What is the historical spending pattern for industrial building construction by the Department of the Army in Alabama?
The provided data only pertains to this single contract awarded in 2005. To understand historical spending patterns for industrial building construction by the Department of the Army in Alabama, one would need to analyze contract awards over several fiscal years. This would involve querying federal procurement databases (like FPDS or SAM.gov) for contracts with similar NAICS codes (e.g., 236210, 236220) awarded by the Army within Alabama. Analyzing the volume, value, and types of industrial construction projects awarded over time would reveal trends, identify periods of high or low investment, and potentially highlight specific bases or facilities that have undergone significant development.
Industry Classification
NAICS: Construction › Nonresidential Building Construction › Industrial 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: 3
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: Vinci (UEI: 462009101)
Address: 336 JAMES RECORD ROAD, HUNTSVILLE, AL, 05
Business Categories: Category Business, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Contract Characteristics
Cost or Pricing Data: NO
Timeline
Start Date: 2005-09-19
Current End Date: 2012-12-21
Potential End Date: 2012-12-21 00:00:00
Last Modified: 2012-09-25
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- 200508!501892!2100!w91278!usa Engineer Dist Mobile !W9127805C0024 !A!N! !N! ! !20050503!20070503!058635699!128604506!315922807!n!universal Construction CO INC!336 James Record Road !huntsville !al!35824!63912!089!01!redstone Arsenal !madison !alabama !+000038408375!n!n!000000000000!y119!other Administrative & Service Buildings !C2 !construction !000 !* !236220!E! !3! ! ! ! ! !20200930!B! ! !A! !a!n!j!2!003!b! !D!N!Z! ! !N!C!N! ! ! !c!c!a!a!000!a!b!y! !N! ! ! ! !0001! ! — $42.8M (Department of Defense)
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