Over $1.4 billion awarded for NGA construction phase services, with a joint venture as the primary contractor

Contract Overview

Contract Amount: $1,433,788,456 ($1.4B)

Contractor: Clark/Balfour Beatty - NCE, a Joint Venture

Awarding Agency: Department of Defense

Start Date: 2007-08-10

End Date: 2014-10-21

Contract Duration: 2,629 days

Daily Burn Rate: $545.4K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: FIXED PRICE INCENTIVE

Sector: Construction

Official Description: PHASE SERVICES FOR NGA

Place of Performance

Location: FORT BELVOIR, FAIRFAX County, VIRGINIA, 22060

State: Virginia Government Spending

Plain-Language Summary

Department of Defense obligated $1.43 billion to CLARK/BALFOUR BEATTY - NCE, A JOINT VENTURE for work described as: PHASE SERVICES FOR NGA Key points: 1. The contract value suggests a significant investment in infrastructure development for the National Geospatial-Intelligence Agency. 2. Awarded under full and open competition, indicating a broad market solicitation. 3. The definitive contract type with fixed-price incentive elements suggests a focus on performance and cost control. 4. The duration of the contract (over 7 years) points to a long-term project with substantial execution requirements. 5. The contractor, a joint venture, implies a pooling of resources and expertise for a large-scale undertaking. 6. The construction and facilities maintenance sector is critical for supporting agency operations and national security.

Value Assessment

Rating: fair

Benchmarking the value of this contract is challenging without specific service breakdowns and comparable project data. However, the substantial award amount for a multi-year construction project for a major intelligence agency suggests a significant investment. The fixed-price incentive structure aims to balance cost and performance, but the final value could fluctuate based on incentive achievement. Further analysis would require detailed cost breakdowns and comparisons to similar large-scale government 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 offers. This approach typically fosters a competitive environment, potentially leading to better pricing and innovative solutions. The specific number of bidders is not provided, but the 'full and open' designation suggests a robust competition was intended.

Taxpayer Impact: Full and open competition generally benefits taxpayers by encouraging a wider range of offers, which can drive down costs and improve the quality of services received.

Public Impact

The National Geospatial-Intelligence Agency (NGA) is the primary beneficiary, receiving essential construction services to support its mission. The services delivered likely include the construction or renovation of facilities critical for intelligence gathering, analysis, and dissemination. The geographic impact is concentrated in Virginia, where the NGA has significant operations. The contract supports a workforce involved in construction, engineering, project management, and related trades.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Long contract duration could lead to scope creep or cost overruns if not managed effectively.
Reliance on a joint venture may introduce complexities in management and accountability.
The fixed-price incentive structure requires careful monitoring to ensure cost efficiencies are realized.

Positive Signals

Awarded under full and open competition, suggesting a competitive process that could yield value.
The joint venture structure may bring specialized expertise to a complex construction project.
The substantial award indicates a significant commitment to critical national security infrastructure.

Sector Analysis

This contract falls within the Commercial and Institutional Building Construction sector, a vital part of the broader construction industry. This sector encompasses the building of non-residential structures such as government facilities, offices, and specialized operational sites. The market size for federal construction is substantial, driven by the need to maintain, modernize, and expand government infrastructure. This specific award represents a significant investment in a specialized facility for a key intelligence agency, fitting within the broader trend of government investment in secure and advanced operational capabilities.

Small Business Impact

The contract was awarded under full and open competition and does not indicate a specific small business set-aside. While the prime contractor is a joint venture, it is not explicitly stated if small businesses are involved in subcontracting opportunities. Further investigation into subcontracting plans would be necessary to assess the impact on the small business ecosystem.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of the Army and the National Geospatial-Intelligence Agency's internal contracting and program management offices. The contract type (Fixed Price Incentive) implies performance metrics that would be monitored. Transparency would be facilitated through contract award databases and potentially agency reports, though specific project details might be classified. Inspector General jurisdiction would apply to any allegations of fraud, waste, or abuse.

Related Government Programs

National Geospatial-Intelligence Agency (NGA) Facilities
Department of Defense Construction Contracts
Intelligence Community Infrastructure Projects
Federal Building and Renovation Programs

Risk Flags

Potential for cost overruns due to contract type and project scale.
Schedule adherence risks for long-duration projects.
Security vulnerabilities during construction phase.
Complexity in managing a joint venture contractor.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $1.43 billion to CLARK/BALFOUR BEATTY - NCE, A JOINT VENTURE. PHASE SERVICES FOR NGA

Who is the contractor on this award?

The obligated recipient is CLARK/BALFOUR BEATTY - NCE, A JOINT VENTURE.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $1.43 billion.

What is the period of performance?

Start: 2007-08-10. End: 2014-10-21.

What specific construction services were included under this contract?

While the contract is broadly categorized under 'PHASE SERVICES FOR NGA' and 'Commercial and Institutional Building Construction,' the specific services are not detailed in the provided data. Typically, such contracts for major intelligence agencies could encompass new construction, major renovations, facility upgrades, site development, and potentially specialized security infrastructure. The 'phase services' designation suggests it might be part of a larger, multi-phase project. Without access to the contract's statement of work, a precise breakdown of services like architectural design, engineering, site preparation, building erection, interior finishing, and systems installation remains unspecified.

How does the $1.43 billion award compare to similar NGA construction projects?

Comparing this $1.43 billion award requires access to historical data on other NGA construction projects, which is not readily available in the public domain, especially for sensitive intelligence facilities. However, the magnitude of the award suggests a large-scale undertaking, potentially a new major facility or a significant expansion/modernization of an existing one. Large federal construction projects, particularly for high-security government entities, often run into hundreds of millions or even billions of dollars due to complex requirements, advanced technology integration, and stringent security protocols. This award appears consistent with the scale of investment expected for critical national infrastructure supporting intelligence operations.

What are the key risks associated with a multi-year, multi-billion dollar construction contract for an intelligence agency?

Key risks include significant cost overruns due to unforeseen site conditions, material price fluctuations, or scope creep. Schedule delays are also a major concern, potentially impacting the agency's operational readiness. Security risks are paramount, involving the protection of sensitive information during construction and ensuring the final facility meets stringent security standards. Contractor performance and management of the joint venture can also pose risks, as can potential changes in agency requirements or funding priorities over the long contract duration. Cybersecurity risks related to integrated building systems are also a growing concern.

What does the 'Fixed Price Incentive' (FPI) contract type imply for cost control and contractor performance?

A Fixed Price Incentive (FPI) contract aims to provide a middle ground between fixed-price and cost-reimbursement contracts. It establishes a target cost, a target profit, and a price ceiling. The final price is determined by the contractor's performance against the target cost. If the contractor finishes under the target cost, both the government and contractor share in the savings (within limits). If costs exceed the target, the contractor assumes a larger share of the overrun up to the price ceiling. This structure incentivizes the contractor to control costs and perform efficiently while allowing for some flexibility to accommodate potential cost variations inherent in complex projects, thereby balancing risk and reward.

What is the significance of the contractor being a joint venture (CLARK/BALFOUR BEATTY - NCE)?

The contractor being a joint venture, CLARK/BALFOUR BEATTY - NCE, signifies a strategic alliance formed by two or more companies to undertake this specific large-scale project. Joint ventures are often created to pool complementary expertise, share financial risks, and enhance bidding capacity for complex or high-value contracts that might be too large or specialized for a single entity. Clark and Balfour Beatty are established construction firms, and their joint venture likely leverages their combined experience in large-scale construction, project management, and potentially specialized government contracting to meet the demanding requirements of the NGA project.

How has federal spending on construction for intelligence agencies evolved over time?

Federal spending on construction for intelligence agencies has generally trended upwards, reflecting increased national security needs, technological advancements requiring specialized facilities, and the modernization of aging infrastructure. Post-9/11, there was a significant surge in investment across the intelligence community to enhance capabilities and consolidate operations. While specific figures for intelligence agency construction are often classified or aggregated within broader defense budgets, the consistent need for secure, technologically advanced facilities suggests sustained, and often increasing, capital investment. Factors like evolving threats, the need for data centers, and collaborative workspaces drive ongoing construction and renovation efforts.

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

Solicitation ID: W912DR07R0006

Offers Received: 1

Pricing Type: FIXED PRICE INCENTIVE (L)

Evaluated Preference: NONE

Contractor Details

Parent Company: Clark Enterprises, Inc. (UEI: 064862345)

Address: 7500 OLD GEORGETOWN ROAD, BETHESDA, MD, 20814

Business Categories: Category Business, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $1,538,589,181

Exercised Options: $1,515,589,181

Current Obligation: $1,433,788,456

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline