Army awards $37.3M for Philadelphia port dredging, with 3 bidders vying for the work

Contract Overview

Contract Amount: $37,322,681 ($37.3M)

Contractor: Norfolk Dredging Company

Awarding Agency: Department of Defense

Start Date: 2009-10-09

End Date: 2011-01-31

Contract Duration: 479 days

Daily Burn Rate: $77.9K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 3

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: MAINT DREDGING PHILLY TO THE SEA

Place of Performance

Location: CHESAPEAKE, CHESAPEAKE CITY County, VIRGINIA, 23320

State: Virginia Government Spending

Plain-Language Summary

Department of Defense obligated $37.3 million to NORFOLK DREDGING COMPANY for work described as: MAINT DREDGING PHILLY TO THE SEA Key points: 1. Contract value appears reasonable given the scope of major civil engineering projects. 2. Full and open competition suggests a healthy market for dredging services. 3. Definitive contract type may indicate a need for flexibility in project execution. 4. Fixed-price structure shifts performance risk to the contractor. 5. Project duration of nearly two years points to a significant undertaking. 6. The award was made to Norfolk Dredging Company, a known entity in the sector.

Value Assessment

Rating: good

The contract value of $37.3 million for maintenance dredging of the Philadelphia port is within a reasonable range for such large-scale civil engineering projects. Benchmarking against similar Army Corps of Engineers dredging contracts reveals that costs can vary significantly based on volume, depth, and location. However, the number of bidders (3) suggests a competitive environment that likely contributed to a fair price. The firm-fixed-price nature of the contract also provides cost certainty for the government.

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 three bidders suggests a competitive market for these specialized dredging services. A higher number of bidders generally leads to more robust price discovery and potentially lower costs for the government. The fact that three companies submitted offers implies that the market is sufficiently robust to support competition for this type of work.

Taxpayer Impact: The full and open competition process ensures that taxpayer dollars are used efficiently by fostering a competitive environment that drives down prices. This approach maximizes the opportunity for the government to secure the best value for its investment in critical infrastructure maintenance.

Public Impact

The primary beneficiaries are the maritime industry and businesses relying on the Port of Philadelphia, ensuring continued access for commercial vessels. The services delivered include essential maintenance dredging to maintain navigable depths in shipping channels. The geographic impact is focused on the Delaware River and the Port of Philadelphia, a key economic hub. This project supports jobs in the maritime and construction sectors, particularly for the awarded contractor and its supply chain.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for scope creep in definitive contracts if not managed tightly.
Reliance on a single contractor for a critical infrastructure maintenance task.
Environmental impact of dredging activities requires careful monitoring.

Positive Signals

Firm-fixed-price contract provides cost certainty.
Full and open competition suggests market health and potential for good value.
Award to an experienced dredging company with a track record.

Sector Analysis

This contract falls within the heavy and civil engineering construction sector, specifically focusing on maritime infrastructure maintenance. The market for dredging services is specialized, involving significant capital investment in equipment and expertise. Comparable spending benchmarks for major port maintenance projects can vary widely, but this award of $37.3 million is substantial, reflecting the scale of the Port of Philadelphia's needs. The Army Corps of Engineers is a major procurer in this space, regularly awarding contracts for channel maintenance and improvement.

Small Business Impact

The data indicates this contract was not set aside for small businesses, nor does it appear to have specific subcontracting requirements for small businesses mentioned. Given the specialized nature and scale of major dredging projects, they often favor larger, established firms with the necessary equipment and financial capacity. This could limit direct opportunities for small businesses unless they are part of a larger prime contractor's team or can compete for smaller, ancillary services.

Oversight & Accountability

The Army Corps of Engineers typically has robust oversight mechanisms for its construction and dredging contracts, including resident engineers and quality assurance personnel on-site. The definitive contract type may necessitate close monitoring to manage any potential changes or scope adjustments. Inspector General jurisdiction would apply to ensure the integrity of the procurement and contract performance processes.

Related Government Programs

Army Corps of Engineers Civil Works Programs
Port Infrastructure Development Projects
Inland Waterways Navigation
Coastal and Harbor Maintenance

Risk Flags

Potential for scope creep with definitive contract type.
Environmental impact monitoring required.
Reliance on fixed-price structure for potentially variable conditions.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $37.3 million to NORFOLK DREDGING COMPANY. MAINT DREDGING PHILLY TO THE SEA

Who is the contractor on this award?

The obligated recipient is NORFOLK DREDGING 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 $37.3 million.

What is the period of performance?

Start: 2009-10-09. End: 2011-01-31.

What is Norfolk Dredging Company's track record with the Army Corps of Engineers for similar dredging projects?

Norfolk Dredging Company has a significant history of working with the Army Corps of Engineers on various dredging and marine construction projects. Reviewing past contract awards and performance evaluations would provide insight into their reliability, quality of work, and adherence to schedules and budgets. Their established presence suggests they are a capable contractor for large-scale federal projects. Specific details on past performance metrics, such as timeliness and cost overruns on previous similar contracts, would offer a more granular understanding of their capabilities and potential risks associated with this award.

How does the awarded price compare to the estimated cost or independent government cost estimate for this dredging project?

Without access to the government's independent cost estimate or the specific details of the bids received beyond the number of bidders, a direct price comparison is challenging. However, the fact that the contract was awarded under full and open competition with three bidders suggests that the awarded price of $37.3 million was deemed competitive and represented good value. If the awarded price was significantly below the government estimate, it could indicate aggressive bidding or potential underestimation of scope. Conversely, if it was close to or exceeded the estimate, it might warrant further scrutiny of the estimate's accuracy or the contractor's pricing strategy.

What are the primary risks associated with a definitive contract for maintenance dredging?

Definitive contracts, while offering flexibility, carry inherent risks, especially for large projects like maintenance dredging. A key risk is scope creep, where the project's requirements may expand beyond the initial agreement, potentially leading to cost overruns if not managed meticulously. There's also a risk of contractor performance issues, such as delays or quality deficiencies, which could impact navigation schedules and require corrective actions. Furthermore, unforeseen subsurface conditions (e.g., harder materials, debris) can increase costs and extend timelines. Effective government oversight, clear communication, and robust change management processes are crucial to mitigate these risks.

What is the historical spending trend for maintenance dredging in the Philadelphia port region by the Army Corps of Engineers?

Analyzing historical spending for maintenance dredging in the Philadelphia port region by the Army Corps of Engineers would reveal patterns in contract values, frequency, and awarded contractors. This data can help establish a baseline for 'normal' spending and identify any significant deviations in the current award. Understanding past spending helps in assessing whether the current $37.3 million contract is an outlier, a continuation of a trend, or a response to specific needs like increased sedimentation or infrastructure upgrades. It also informs future budget planning and risk assessment for similar projects.

What are the potential environmental impacts and mitigation strategies for this dredging project?

Maintenance dredging projects, while essential for navigation, can have environmental impacts such as turbidity (clouding of water), disruption of benthic habitats, and potential resuspension of contaminated sediments. The Army Corps of Engineers typically requires detailed environmental impact assessments and mitigation plans as part of the contract. These plans often include specific dredging windows to protect sensitive species, methods for sediment containment and disposal, and monitoring protocols to assess water quality and habitat recovery. The effectiveness of these mitigation strategies is crucial for minimizing the project's ecological footprint.

Industry Classification

NAICS: Construction › Other Heavy and Civil Engineering Construction › Other Heavy and Civil Engineering Construction

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

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SEALED BID

Solicitation ID: W912BU09B0005

Offers Received: 3

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 110 CENTERVILLE TPKE N, CHESAPEAKE, VA, 23320

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

Financial Breakdown

Contract Ceiling: $37,322,681

Exercised Options: $37,322,681

Current Obligation: $37,322,681

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline