DoD's $157M construction contract awarded to BEAR BROTHERS INC for building in Alabama

Contract Overview

Contract Amount: $15,713,327 ($15.7M)

Contractor: Bear Brothers Inc

Awarding Agency: Department of Defense

Start Date: 2006-03-03

End Date: 2008-06-16

Contract Duration: 836 days

Daily Burn Rate: $18.8K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Place of Performance

Location: MONTGOMERY, MONTGOMERY County, ALABAMA, 36112

State: Alabama Government Spending

Plain-Language Summary

Department of Defense obligated $15.7 million to BEAR BROTHERS INC for work described as: Key points: 1. Contract value of $157 million represents a significant investment in infrastructure. 2. Awarded under full and open competition, suggesting a robust bidding process. 3. Fixed-price contract type aims to control costs and manage financial risk. 4. Duration of 836 days indicates a substantial construction project timeline. 5. Geographic focus on Alabama highlights regional development impact. 6. Contractor BEAR BROTHERS INC has secured a large-scale federal project.

Value Assessment

Rating: fair

Benchmarking the value of this $157 million construction contract is challenging without specific project details or comparable project costs. However, the firm fixed-price nature suggests an attempt to lock in costs, which can be beneficial if the contractor's estimate is accurate. The number of bids received (2) is on the lower side for a contract of this magnitude, potentially indicating less competitive pricing than might be expected in a more crowded field. Further analysis would require comparing the final cost against initial estimates and industry benchmarks for similar construction projects.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, meaning all responsible sources were permitted to submit a bid. Despite this broad solicitation, only two bids were received. This limited number of bidders for a contract of this size could suggest potential barriers to entry for other firms, or perhaps a specialized nature of the construction required. The limited competition may have impacted price discovery, potentially leading to a higher price than if more firms had competed.

Taxpayer Impact: While full and open competition is generally favorable for taxpayers, the low number of bidders in this instance raises questions about whether the most competitive pricing was achieved. Taxpayers may have paid more than necessary if a wider range of contractors had participated.

Public Impact

The primary beneficiaries are the Department of Defense and potentially military personnel stationed at the facility. The contract delivers essential commercial and institutional building construction services. The geographic impact is concentrated in Alabama, supporting local economic activity. The project likely created numerous jobs in the construction sector within Alabama. The completed facility will serve long-term operational needs for the Army.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Limited number of bidders (2) for a large contract may indicate insufficient market outreach or high barriers to entry.
Firm fixed-price contracts can expose the government to higher costs if the initial bid is inflated due to limited competition.
The contract duration of 836 days requires careful monitoring to ensure timely completion and avoid cost overruns.

Positive Signals

Awarded under full and open competition, adhering to principles of fair opportunity.
Firm fixed-price contract provides cost certainty for the government.
Project located in Alabama may stimulate regional economic development and job creation.

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 area often supports military bases, government facilities, and public infrastructure. The market size for federal construction is substantial, with numerous large firms and specialized subcontractors participating. This contract represents a significant award within this sector, likely for a critical facility supporting defense operations.

Small Business Impact

The data indicates that this contract was not specifically set aside for small businesses (ss: false, sb: false). Therefore, the primary contractor, BEAR BROTHERS INC, is likely a large business. There is no explicit information on subcontracting plans, but large federal construction contracts often include provisions for small business participation. The absence of a set-aside suggests that the competition was geared towards larger firms capable of handling the scale of this project, potentially limiting direct opportunities for small businesses as prime contractors.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and the relevant Department of the Army contracting office. The firm fixed-price nature provides some cost control, but performance monitoring is crucial. Transparency is generally maintained through contract award databases like FPDS. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected during the contract's lifecycle. Accountability rests with BEAR BROTHERS INC for performance and the agency for proper contract administration.

Related Government Programs

Military Construction
Base Realignment and Closure (BRAC) Projects
Department of Defense Facilities Management
Federal Building Construction Contracts

Risk Flags

Limited competition may lead to higher costs.
Potential for cost overruns in fixed-price contracts if not managed carefully.
Contractor performance risk.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $15.7 million to BEAR BROTHERS INC. See the official description on USAspending.

Who is the contractor on this award?

The obligated recipient is BEAR BROTHERS 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 $15.7 million.

What is the period of performance?

Start: 2006-03-03. End: 2008-06-16.

What is the track record of BEAR BROTHERS INC with federal contracts, particularly in construction?

Detailed information on BEAR BROTHERS INC's specific track record with federal contracts, including past performance, past disputes, and overall satisfaction ratings, would typically be available through government performance assessment systems (e.g., Contractor Performance Assessment Reporting System - CPARS). Without direct access to these proprietary systems, a comprehensive analysis is limited. However, the award of a $157 million contract by the Department of the Army suggests that the agency found BEAR BROTHERS INC to be a responsible contractor with the capability to perform the required work. Further investigation would involve reviewing their contract history for similar projects, any documented performance issues, and their financial stability.

How does the $157 million contract value compare to similar Department of Defense construction projects?

Comparing the $157 million value requires context on the type and scope of construction. For instance, constructing a barracks might cost significantly less than building a specialized research facility or a large hangar. The Department of Defense undertakes a wide range of construction projects, from minor renovations to major base expansions. A $157 million contract is substantial and likely represents a significant infrastructure development, such as a new major building complex, a large training facility, or critical upgrades to existing infrastructure. Benchmarking would involve looking at the cost per square foot or cost per function for comparable DoD construction projects awarded within the last few years, adjusted for inflation and regional cost differences.

What are the primary risks associated with a firm fixed-price construction contract of this magnitude?

The primary risks with a firm fixed-price (FFP) contract of this magnitude ($157 million) revolve around cost overruns if the initial bid does not accurately reflect the total cost of performance. While FFP shifts most cost risk to the contractor, unforeseen site conditions, material price escalations beyond what was anticipated, or design changes initiated by the government can lead to claims or disputes. For the government, the risk is paying a premium if the contractor's bid included significant contingency due to perceived risks or limited competition. For the contractor, the risk is absorbing unexpected costs that erode profit margins or lead to financial distress. Effective oversight and clear contract terms are crucial to mitigate these risks.

What does the limited competition (2 bidders) imply for the effectiveness of the procurement process?

The limited competition, with only two bidders for a $157 million contract awarded under full and open solicitation, raises questions about the effectiveness of the procurement process in maximizing competition. This could stem from several factors: the specialized nature of the construction requiring unique expertise, high pre-qualification requirements that screened out many potential bidders, insufficient market research to identify all capable firms, or perhaps unfavorable contract terms that deterred broader participation. While two bidders still represent some level of competition, it is significantly less than ideal for a contract of this size. This could potentially lead to higher prices than if more firms had vied for the contract, and it may indicate missed opportunities to engage a wider range of contractors, including potentially innovative or more cost-effective ones.

How has federal spending on commercial and institutional building construction trended in recent years?

Federal spending on commercial and institutional building construction has generally remained robust, particularly driven by defense infrastructure needs, upgrades to federal facilities, and investments in areas like veterans' affairs hospitals and national parks. While specific year-over-year trends can fluctuate based on budget appropriations, economic conditions, and national priorities, the overall demand for construction services by federal agencies is a consistent component of government spending. Factors such as aging infrastructure requiring modernization, new security requirements, and the need for energy-efficient buildings influence spending patterns. The Department of Defense, being the largest federal agency, is a significant contributor to this spending category, often undertaking large-scale projects similar to the one awarded to BEAR BROTHERS INC.

What are the potential workforce implications of a $157 million construction project in Alabama?

A $157 million construction project in Alabama would likely have significant positive workforce implications for the region. It would create numerous direct jobs for skilled tradespeople, including carpenters, electricians, plumbers, heavy equipment operators, and general laborers. Indirect job creation would also occur in supporting industries such as material suppliers, equipment rental companies, transportation services, and local hospitality businesses. The project could also lead to increased demand for training programs to supply the necessary skilled labor. The duration of 836 days suggests sustained employment opportunities over an extended period, contributing to local economic stability and potentially attracting workers from surrounding areas.

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: 2

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Bear Lumber Company, Inc. (UEI: 001947449)

Address: 39 E JEFFERSON ST, MONTGOMERY, AL, 02

Business Categories: Category Business, Small Business

Contract Characteristics

Cost or Pricing Data: NO

Timeline