Army awards $28.6M dredging contract to Corman Kokosing for Maryland channel maintenance

Contract Overview

Contract Amount: $28,583,110 ($28.6M)

Contractor: Construction CO Corman Kokosing

Awarding Agency: Department of Defense

Start Date: 2021-09-27

End Date: 2023-03-31

Contract Duration: 550 days

Daily Burn Rate: $52.0K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 3

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: MAINTENANCE DREDGING C&D

Place of Performance

Location: CHESAPEAKE CITY, CECIL County, MARYLAND, 21915

State: Maryland Government Spending

Plain-Language Summary

Department of Defense obligated $28.6 million to CONSTRUCTION CO CORMAN KOKOSING for work described as: MAINTENANCE DREDGING C&D Key points: 1. Contract value represents a significant investment in critical waterway infrastructure. 2. Competition dynamics suggest a potentially competitive bidding environment for this type of specialized service. 3. Fixed-price contract type helps mitigate cost overrun risks for the government. 4. Contract duration of 550 days indicates a substantial scope of work. 5. Geographic focus on Maryland highlights regional infrastructure priorities. 6. The award to a single contractor, Corman Kokosing, warrants scrutiny of the bidding process and pricing.

Value Assessment

Rating: fair

The contract value of $28.6 million for maintenance dredging is substantial. Benchmarking against similar dredging contracts is challenging without more specific details on the scope of work (e.g., cubic yards dredged, depth, length of channel). However, the bid-award difference of $5.2 million suggests potential for cost savings or that the initial estimate was conservative. The firm fixed-price nature provides cost certainty, but the final value needs to be assessed against the actual work performed.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit bids. With three bidders participating, the competition level appears moderate. While more bidders could potentially drive prices lower, three offers suggest that the market for this specialized service is not overly concentrated. The government's ability to secure a bid $5.2 million below the initial estimate is a positive outcome of this competitive process.

Taxpayer Impact: Full and open competition with multiple bidders generally benefits taxpayers by fostering price discovery and encouraging contractors to offer competitive pricing to win the award.

Public Impact

The primary beneficiaries are the U.S. Army Corps of Engineers and the Department of the Navy, ensuring navigable waterways for military and commercial operations. The contract delivers essential maintenance dredging services to ensure the depth and capacity of critical shipping channels in Maryland. Geographic impact is concentrated in Maryland, supporting regional economic activity reliant on maritime transport. The contract supports the workforce within the construction and maritime industries, particularly those skilled in dredging operations.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if the fixed-price contract does not adequately account for unforeseen site conditions or material fluctuations.
Dependence on a single contractor for a critical infrastructure service raises concerns about future availability and pricing.
The bid of $28.6M was $5.2M below the initial estimate, which could indicate overly aggressive bidding or an inflated initial estimate, both requiring further investigation.

Positive Signals

Awarded under full and open competition, suggesting a robust bidding process.
Firm fixed-price contract type provides cost certainty for the government.
The winning bid was significantly below the government's estimate, indicating potential value for money.
The contract duration of 550 days allows for thorough execution of the dredging work.

Sector Analysis

This contract falls within the heavy and civil engineering construction sector, specifically focusing on dredging services. This is a specialized niche within construction, often dominated by a smaller number of experienced firms. The market size for dredging services is influenced by federal infrastructure spending, port development, and environmental regulations. Comparable spending benchmarks would depend on the specific volume of material to be moved and the complexity of the waterway.

Small Business Impact

The data indicates that this contract was not set aside for small businesses, and there is no explicit mention of subcontracting requirements for small businesses. This suggests that the primary award went to a larger, established firm. The absence of small business set-aside provisions means that opportunities for small businesses in this specific contract are likely limited to potential subcontracting roles, if any are mandated or voluntarily pursued by the prime contractor.

Oversight & Accountability

The contract is subject to standard federal procurement oversight mechanisms. The Department of the Army, as the awarding agency, is responsible for monitoring contract performance and ensuring compliance. Transparency is facilitated through contract databases like FPDS. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse related to the contract. The firm fixed-price nature simplifies some aspects of financial oversight compared to cost-reimbursement contracts.

Related Government Programs

Army Corps of Engineers Civil Works Programs
Inland Waterways Trust Fund
Port Infrastructure Development Program
National Defense Authorization Act (NDAA) - Infrastructure Provisions

Risk Flags

Potential for aggressive bidding impacting performance.
Limited competition may affect future pricing.
Need to verify contractor's past performance on similar projects.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $28.6 million to CONSTRUCTION CO CORMAN KOKOSING. MAINTENANCE DREDGING C&D

Who is the contractor on this award?

The obligated recipient is CONSTRUCTION CO CORMAN KOKOSING.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $28.6 million.

What is the period of performance?

Start: 2021-09-27. End: 2023-03-31.

What is the historical spending pattern for maintenance dredging contracts awarded by the Department of the Army in Maryland?

Analyzing historical spending for maintenance dredging in Maryland by the Department of the Army requires access to detailed procurement data over several fiscal years. Key metrics to examine would include the average contract value, the number of bids received per solicitation, the average duration of contracts, and the types of contractors awarded these services. Understanding these patterns can reveal trends in pricing, competition levels, and the agency's reliance on specific firms or contract types. For instance, a trend of increasing contract values might indicate rising costs or expanding scope, while a consistent number of bidders could suggest a stable, albeit potentially limited, market. Comparing the current $28.6 million award to historical averages would help determine if it represents a typical, high, or low value for similar dredging projects in the region.

How does the bid price of $28.6 million compare to the government's estimate of $33.8 million for this dredging project?

The winning bid of $28.6 million came in $5.2 million (approximately 15.4%) below the government's estimate of $33.8 million. This significant difference warrants careful consideration. On one hand, it suggests strong competition and potentially excellent value for the taxpayer, as the government secured the service for substantially less than anticipated. On the other hand, it could indicate that the government's initial estimate was overly conservative or inflated, or that the winning contractor submitted an aggressive bid that might pose risks to performance or quality if profit margins are too thin. Further analysis would involve understanding the basis of the government's estimate and the contractor's bidding strategy.

What is Corman Kokosing's track record with federal dredging contracts, particularly with the Department of the Army?

Assessing Corman Kokosing's track record with federal dredging contracts, especially those awarded by the Department of the Army, involves reviewing their past performance on similar projects. This includes examining the number and value of previously awarded contracts, their on-time completion rates, any instances of contract disputes or terminations, and client satisfaction feedback if available. A history of successful, timely, and cost-effective project delivery would indicate reliability and capability. Conversely, a pattern of delays, cost overruns, or performance issues could raise concerns about their ability to execute this current $28.6 million contract effectively. Specific details on their experience with the type of dredging required (e.g., maintenance vs. capital, specific waterway conditions) are also crucial.

What are the potential risks associated with a firm fixed-price contract for a complex dredging operation?

While firm fixed-price (FFP) contracts offer cost certainty to the government, they can introduce risks for both parties in complex projects like dredging. For the contractor, risks include underestimating the scope of work, encountering unforeseen subsurface conditions (e.g., harder materials, buried obstructions), or experiencing significant fluctuations in fuel or material costs, all of which could erode profit margins or lead to financial losses if not adequately planned for. For the government, the primary risk is that the contractor might cut corners on quality or scope to protect their profit margin, especially if the initial bid was very aggressive. Effective contract administration, clear specifications, and robust inspection protocols are essential to mitigate these risks and ensure the project's success under an FFP structure.

How does the geographic focus on Maryland impact the overall federal spending on waterway infrastructure?

The geographic focus on Maryland for this $28.6 million maintenance dredging contract highlights the federal government's commitment to maintaining vital waterways in specific regions. Federal spending on waterway infrastructure is often driven by a combination of national security needs (ensuring naval access), economic imperatives (supporting commerce and trade through ports and shipping lanes), and regional development priorities. Maryland, with its significant port facilities and proximity to the nation's capital, requires consistent investment in dredging to maintain navigability. This contract represents a portion of the broader federal investment in maintaining and upgrading the nation's maritime transportation system, which is crucial for both domestic and international trade.

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 BUILDINGS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SEALED BID

Solicitation ID: W912BU21B0017

Offers Received: 3

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Corman Kokosing Construction Company

Address: 12001 GUILFORD RD, ANNAPOLIS JUNCTION, MD, 20701

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

Financial Breakdown

Contract Ceiling: $28,819,292

Exercised Options: $28,583,110

Current Obligation: $28,583,110

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Timeline