TIP TOP CONSTRUCTION CORP awarded $18.6M contract for heavy civil engineering construction

Contract Overview

Contract Amount: $18,657,013 ($18.7M)

Contractor: TIP TOP Construction Corp

Awarding Agency: Department of Defense

Start Date: 2010-04-29

End Date: 2013-01-20

Contract Duration: 997 days

Daily Burn Rate: $18.7K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 7

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: BASE BID RTI PHASE I

Place of Performance

Location: CHRISTIANSTED, SAINT CROIX County, VIRGIN ISLANDS OF THE U.S., 00820

Plain-Language Summary

Department of Defense obligated $18.7 million to TIP TOP CONSTRUCTION CORP for work described as: BASE BID RTI PHASE I Key points: 1. Contract awarded at a slight premium to the base bid, suggesting potential for cost overruns or scope changes. 2. Full and open competition after exclusion of sources indicates a deliberate decision to limit the bidding pool. 3. The definitive contract type suggests a need for flexibility in scope or delivery, potentially increasing risk. 4. A duration of 997 days points to a long-term project with sustained resource commitment. 5. The contract falls under 'Other Heavy and Civil Engineering Construction,' a broad category with varying market dynamics. 6. Awarded to a single contractor, TIP TOP CONSTRUCTION CORP, highlighting the importance of their specific capabilities.

Value Assessment

Rating: fair

The contract value of $18.6 million for heavy civil engineering construction appears within a reasonable range for a project of this duration and scope. However, the award amount ($18.71M) slightly exceeding the base bid ($18.66M) warrants attention. Without specific benchmarks for similar Army Corps of Engineers projects in the Virgin Islands, a precise value-for-money assessment is challenging. Further analysis of the contract's performance and any modifications would be necessary to fully evaluate its cost-effectiveness.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

The contract was awarded under 'Full and Open Competition After Exclusion of Sources.' This procurement method suggests that while the government intended to compete the contract, specific criteria or circumstances led to the exclusion of certain potential bidders. The number of bidders is not explicitly stated, but the exclusion implies a potentially smaller pool than a truly open competition. This could impact price discovery and potentially lead to higher prices than if a wider range of contractors had been considered.

Taxpayer Impact: The exclusion of sources may limit competitive pressure, potentially resulting in a higher cost to taxpayers compared to a fully open solicitation. It is crucial to understand the justification for excluding sources to ensure fair competition and optimal use of public funds.

Public Impact

The primary beneficiaries are likely the Department of the Army, receiving critical infrastructure or construction services. The services delivered fall under 'Other Heavy and Civil Engineering Construction,' which could include a wide range of projects such as roads, bridges, or other civil works. The geographic impact is specified as the Virgin Islands of the U.S., indicating a focus on regional development or military infrastructure in that area. Workforce implications could include job creation for construction workers, engineers, and project managers in the Virgin Islands and potentially beyond.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

The 'after exclusion of sources' clause in the competition type raises concerns about the breadth of competition and potential for inflated pricing.
The award amount exceeding the base bid suggests potential for cost growth or unforeseen issues during contract performance.
The definitive contract type, while offering flexibility, can introduce risks related to scope creep and cost control if not managed diligently.

Positive Signals

The contract was awarded by the Department of the Army, a major federal agency with established procurement processes.
The project is located in the Virgin Islands of the U.S., potentially contributing to local economic development and infrastructure.
The use of a Firm Fixed Price contract type, where applicable, can provide cost certainty for the government.

Sector Analysis

The 'Other Heavy and Civil Engineering Construction' sector is a significant part of the construction industry, encompassing a wide array of infrastructure projects. This contract, awarded by the Department of the Army, likely pertains to military base infrastructure or support facilities. Comparable spending benchmarks would depend heavily on the specific type of civil engineering work. The market for such services can be influenced by factors like geographic location, available resources, and the specific needs of the contracting agency.

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 for small businesses arising from a set-aside. However, the prime contractor, TIP TOP CONSTRUCTION CORP, may engage small businesses as subcontractors, depending on the project's needs and their own subcontracting plans. The overall impact on the small business ecosystem would depend on the extent of such subcontracting.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of the Army's contracting and program management offices. Accountability measures would be embedded in the contract terms, including performance standards, delivery schedules, and payment milestones. Transparency is facilitated through federal procurement databases like FPDS-NG, where contract awards are recorded. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse.

Related Government Programs

Army Corps of Engineers Construction Contracts
Department of Defense Infrastructure Projects
Heavy and Civil Engineering Construction Services
Federal Public Works Projects

Risk Flags

Potential for reduced competition due to source exclusion.
Award amount exceeding base bid warrants monitoring.
Long contract duration increases risk of scope creep and performance issues.
Logistical challenges and potential cost increases due to island location.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $18.7 million to TIP TOP CONSTRUCTION CORP. BASE BID RTI PHASE I

Who is the contractor on this award?

The obligated recipient is TIP TOP CONSTRUCTION CORP.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $18.7 million.

What is the period of performance?

Start: 2010-04-29. End: 2013-01-20.

What is the specific nature of the 'Other Heavy and Civil Engineering Construction' project awarded to TIP TOP CONSTRUCTION CORP?

The provided data classifies the contract under NAICS code 237990, which covers 'Other Heavy and Civil Engineering Construction.' This broad category can include a variety of projects such as dredging, marine construction, pipeline construction, and other specialized heavy civil works not elsewhere classified. Without further details on the specific task orders or project descriptions within this definitive contract, the exact nature of the services remains general. However, given the awarding agency is the Department of the Army, it is plausible the project relates to military infrastructure, port facilities, or other defense-related civil engineering needs within the Virgin Islands of the U.S.

How does the award amount of $18.71M compare to the base bid of $18.66M, and what does this difference signify?

The award amount of $18,710,000 is approximately $50,000 higher than the base bid of $18,657,013. This represents a marginal increase of about 0.27%. Such differences can arise for various reasons, including minor adjustments to scope, inclusion of specific contract line item numbers (CLINs) that were bid slightly higher, or the incorporation of initial contractor-proposed changes that were deemed acceptable. While a small difference, it warrants attention to ensure it doesn't indicate a trend of cost escalation or a lack of precise initial bidding. Further investigation into the contract modifications and performance history would be needed to determine the precise cause and its implications for value for money.

What are the potential risks associated with a 'Full and Open Competition After Exclusion of Sources' procurement method?

This procurement method, while still competitive, introduces potential risks by intentionally limiting the pool of eligible bidders. The exclusion of certain sources, if not rigorously justified and documented, could lead to reduced competition, potentially resulting in higher prices for the government. It may also limit the government's access to innovative solutions or specialized capabilities that excluded firms might offer. The risk lies in ensuring that the exclusion criteria are objective, necessary, and do not unduly restrict competition. Transparency in the justification for exclusion is crucial for mitigating these risks and assuring taxpayers that the best value was sought.

What is the significance of the contract being a 'Definitive Contract' with a duration of 997 days?

A definitive contract is a contract that has been awarded and is binding on both parties. In this context, it signifies that the terms and conditions have been finalized. The long duration of 997 days (approximately 2.7 years) indicates a substantial, long-term project. This extended timeline can introduce risks related to economic price adjustments, changes in requirements, contractor performance over time, and the potential for scope creep. However, it also allows for sustained effort and potentially greater efficiency for complex construction projects. Effective contract management and oversight are critical to mitigate risks associated with such long-duration contracts.

How does the contract's geographic location in the Virgin Islands of the U.S. influence its context and potential impact?

The location in the Virgin Islands of the U.S. is significant for several reasons. Firstly, it suggests the project is likely related to critical infrastructure, military installations, or federal facilities within this U.S. territory. Secondly, construction projects in remote or island locations can often incur higher costs due to logistical challenges, transportation of materials and personnel, and potentially limited local labor pools or specialized equipment. This could impact the overall cost-effectiveness and timeline. Thirdly, such projects can have a substantial positive impact on the local economy through job creation, utilization of local resources, and development of essential infrastructure.

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 AFTER EXCLUSION OF SOURCES

Solicitation Procedures: SEALED BID

Offers Received: 7

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 5064 MOUNT WELCOME, CHRISTIANSTED, VI, 00820

Business Categories: Black American Owned Business, Category Business, DoT Certified Disadvantaged Business Enterprise, Emerging Small Business, HUBZone Firm, Minority Owned Business, Self-Certified Small Disadvantaged Business, Small Business, Special Designations, Subchapter S Corporation, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $18,657,013

Exercised Options: $18,657,013

Current Obligation: $18,657,013

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline