Department of the Army awards $30.6M contract for Schofield Barracks building repair, highlighting construction sector activity

Contract Overview

Contract Amount: $30,587,076 ($30.6M)

Contractor: NAN Inc

Awarding Agency: Department of Defense

Start Date: 2023-11-15

End Date: 2026-06-14

Contract Duration: 942 days

Daily Burn Rate: $32.5K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: REPAIR BUILDING 1670 FOR COF, SSA, AND TEMF, SCHOFIELD BARRACKS, OAHU, HAWAII

Place of Performance

Location: SCHOFIELD BARRACKS, HONOLULU County, HAWAII, 96857

State: Hawaii Government Spending

Plain-Language Summary

Department of Defense obligated $30.6 million to NAN INC for work described as: REPAIR BUILDING 1670 FOR COF, SSA, AND TEMF, SCHOFIELD BARRACKS, OAHU, HAWAII Key points: 1. Contract value of $30.6 million indicates significant investment in facility maintenance. 2. Full and open competition suggests a robust bidding environment for this project. 3. The firm-fixed-price contract type aims to control costs and manage financial risk. 4. Project duration of 942 days points to a substantial scope of work. 5. The contract falls within the Commercial and Institutional Building Construction sector. 6. Location in Hawaii may influence labor costs and material availability.

Value Assessment

Rating: good

The contract value of $30.6 million for repairing Building 1670 at Schofield Barracks appears reasonable for a project of this scale and duration. Benchmarking against similar large-scale construction and repair projects within military installations, this figure aligns with typical investment levels for comprehensive facility upgrades. The firm-fixed-price structure provides cost certainty, which is a positive indicator for value. Without specific details on the scope of repairs, a precise per-unit cost comparison is difficult, but the overall award suggests a commitment to maintaining critical infrastructure.

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 two bidders suggests a moderate level of competition for this specific project. While more than two bidders would typically indicate stronger price discovery, the full and open nature ensures a fair process. The competition level is sufficient to provide a reasonable baseline for pricing, though further analysis of bid proposals could reveal more about price competitiveness.

Taxpayer Impact: The full and open competition process, even with two bidders, is beneficial for taxpayers as it encourages multiple firms to offer their best pricing and technical solutions, potentially leading to a more cost-effective outcome compared to limited or sole-source procurements.

Public Impact

The primary beneficiaries are the U.S. Army personnel and operations at Schofield Barracks, Oahu, Hawaii, who will utilize the repaired facility. The contract delivers essential repair and maintenance services for a significant building, ensuring its continued functionality and safety. The geographic impact is localized to Schofield Barracks, Oahu, Hawaii, supporting the local military infrastructure. Workforce implications include employment opportunities for construction workers, engineers, and project managers in the Hawaii region.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if unforeseen structural issues arise beyond the initial scope.
Dependence on specialized construction labor in Hawaii, which could lead to scheduling delays.
Risk of material cost fluctuations impacting the fixed-price contract if not adequately hedged.

Positive Signals

Firm-fixed-price contract provides cost certainty and limits the government's exposure to cost increases.
Full and open competition generally leads to better pricing and selection of qualified contractors.
The contractor, NAN INC, has a track record that can be reviewed for performance history.
The project duration is clearly defined, allowing for structured project management and oversight.

Sector Analysis

The Commercial and Institutional Building Construction sector is a vital part of the economy, encompassing the erection, alteration, and repair of non-residential buildings. Federal spending in this sector, particularly for military installations, is substantial, driven by the need to maintain aging infrastructure and construct new facilities. This contract represents a typical investment within this sector, reflecting the ongoing demand for construction services to support government operations. Comparable spending benchmarks for similar military facility repair projects can vary widely based on location, scope, and complexity.

Small Business Impact

This contract was not set aside for small businesses, and the data indicates no explicit subcontracting requirements for small businesses were mandated. The award to NAN INC, without specific small business participation noted, suggests that the primary focus was on securing the best overall offer through full and open competition. This approach may limit direct opportunities for small businesses on this specific contract, though they may participate as subcontractors if NAN INC chooses to engage them.

Oversight & Accountability

Oversight for this contract will likely be managed by the Department of the Army contracting and project management offices responsible for Schofield Barracks. Accountability measures are embedded in the firm-fixed-price contract terms, requiring the contractor to deliver the specified repairs within the agreed-upon budget and timeline. Transparency is facilitated through the Federal Procurement Data System (FPDS), which records contract awards. Inspector General jurisdiction may apply if allegations of fraud, waste, or abuse arise.

Related Government Programs

Military Construction
Facility Maintenance and Repair
Department of Defense Construction Contracts
Schofield Barracks Operations

Risk Flags

Potential for schedule delays due to the extended duration.
Risk of cost escalation if unforeseen conditions are encountered.
Dependence on contractor's ability to manage complex repairs over a long period.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $30.6 million to NAN INC. REPAIR BUILDING 1670 FOR COF, SSA, AND TEMF, SCHOFIELD BARRACKS, OAHU, HAWAII

Who is the contractor on this award?

The obligated recipient is NAN 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 $30.6 million.

What is the period of performance?

Start: 2023-11-15. End: 2026-06-14.

What is the track record of NAN INC in performing similar large-scale construction and repair contracts for the Department of Defense?

Assessing the track record of NAN INC is crucial for understanding their capability to successfully execute this $30.6 million contract. A review of their past performance, particularly on projects of similar size, scope, and complexity for the Department of Defense or other federal agencies, would provide insight into their reliability, quality of work, and adherence to schedule and budget. Data from sources like the Contractor Performance Assessment Reporting System (CPARS) would be invaluable here. If NAN INC has a history of successful project completion, it increases confidence in their ability to deliver on this contract. Conversely, a history of delays, cost overruns, or quality issues would raise significant concerns and warrant closer scrutiny of their project management plan and resources allocated to this specific award.

How does the awarded amount of $30.6 million compare to the estimated cost or independent government cost estimate for repairing Building 1670?

Comparing the awarded amount of $30.6 million to the government's independent cost estimate (ICE) or the initial estimate for repairing Building 1670 is essential for evaluating value for money. If the awarded price is significantly lower than the ICE, it could indicate aggressive bidding by the contractor or potential underestimation by the government, possibly leading to future change orders. Conversely, if the award is close to or exceeds the ICE, it suggests the government's estimate was accurate or perhaps conservative. The number of bidders (two in this case) also plays a role; a lower number might result in less competitive pricing compared to a scenario with multiple bids closer to the ICE. Understanding this relationship helps determine if the government secured a favorable price.

What are the specific risks associated with the firm-fixed-price contract type for this building repair project?

While a firm-fixed-price (FFP) contract is generally preferred for cost control, it carries specific risks for a building repair project like this one. The primary risk is that the contractor, NAN INC, may encounter unforeseen conditions (e.g., hidden structural damage, hazardous materials) that significantly increase their costs beyond what was anticipated during the bidding phase. If these unforeseen issues are substantial and not covered by specific contract clauses for equitable adjustments, the contractor might face financial losses, potentially impacting their motivation or ability to complete the work satisfactorily. Conversely, the government bears the risk if the contractor's bid was unrealistically low, potentially leading to quality compromises or contractor default. Effective risk mitigation involves thorough pre-bid site assessments and clearly defined contract terms regarding unforeseen conditions.

What is the expected impact of this repair project on the operational readiness and functionality of Schofield Barracks?

The repair of Building 1670 is expected to have a direct positive impact on the operational readiness and functionality of Schofield Barracks. By addressing necessary repairs, the project ensures that the facility remains safe, compliant with building codes, and suitable for its intended purpose, whether it be administrative, housing, or operational support. A well-maintained building reduces the likelihood of disruptions caused by system failures or structural issues, thereby supporting the continuous operations of the units or personnel assigned to it. This investment in infrastructure maintenance is critical for sustaining the long-term effectiveness and habitability of the military installation.

How does the $30.6 million spending on this single repair contract compare to the Army's overall annual spending on facility maintenance and repair in Hawaii?

Placing the $30.6 million award for Building 1670 within the context of the Army's broader spending patterns is important. To assess this, one would need data on the total annual budget allocated by the Army for facility maintenance and repair specifically within Hawaii, or perhaps across all its Pacific installations. If this single contract represents a significant portion of the annual budget for a specific type of repair or for that particular installation, it highlights its importance. Conversely, if it's a routine expenditure within a much larger overall maintenance budget, it suggests a more normalized level of investment. Understanding this relative scale helps gauge the priority and impact of this specific project within the Army's infrastructure management strategy in the region.

What are the potential implications of the 942-day duration on the surrounding activities at Schofield Barracks?

A project duration of 942 days (approximately 2.6 years) for repairing Building 1670 at Schofield Barracks implies a significant, long-term construction effort. This extended timeline will likely necessitate careful planning to minimize disruption to ongoing military operations, personnel movement, and potentially noise or traffic impacts on the base. Temporary relocation of personnel or functions from Building 1670 may be required, impacting space utilization and workflow. Furthermore, the extended duration increases the exposure to potential risks such as weather delays, material availability issues, and labor fluctuations. Effective project phasing and communication with base command will be critical to manage these implications.

Industry Classification

NAICS: Construction › Nonresidential Building Construction › Commercial and Institutional Building Construction

Product/Service Code: MAINT, REPAIR, ALTER REAL PROPERTY › MAINT, ALTER, REPAIR NONBUILDINGS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: W9128A23R0021

Offers Received: 2

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 636 LAUMAKA ST, HONOLULU, HI, 96819

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

Financial Breakdown

Contract Ceiling: $30,587,076

Exercised Options: $30,587,076

Current Obligation: $30,587,076

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline