Department of the Army awards $42.1M construction contract for FY14 building project under full and open competition

Contract Overview

Contract Amount: $42,145,926 ($42.1M)

Contractor: PER Aarsleff A/S

Awarding Agency: Department of Defense

Start Date: 2014-07-21

End Date: 2017-09-01

Contract Duration: 1,138 days

Daily Burn Rate: $37.0K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 4

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: BASE BID ITEMS CONSTRUCTION OF FY 14. LINE ITEM 0001, 0002 AND 0003 ARE AWARDED.

Plain-Language Summary

Department of Defense obligated $42.1 million to PER AARSLEFF A/S for work described as: BASE BID ITEMS CONSTRUCTION OF FY 14. LINE ITEM 0001, 0002 AND 0003 ARE AWARDED. Key points: 1. Contract awarded to Aarsleff A/S for construction services. 2. Project scope includes multiple line items for building construction. 3. The contract was awarded via full and open competition, suggesting broad market participation. 4. A firm-fixed-price contract type indicates defined costs for the government. 5. The contract duration spans over three years, from July 2014 to September 2017. 6. No small business set-aside was utilized for this procurement. 7. The contract is for commercial and institutional building construction.

Value Assessment

Rating: fair

Benchmarking the value of this specific construction contract is challenging without detailed project specifications and comparable market data for the period. The base bid amount of $42.1 million for a multi-year construction project suggests a significant investment. However, without knowing the exact scope of work for line items 0001, 0002, and 0003, it's difficult to assess if the pricing is competitive or represents good value for money. Further analysis would require comparing the cost per square foot or per unit of construction against similar projects awarded by the Department of the Army or other federal agencies during the same timeframe.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that the solicitation was made available to all responsible prospective contractors. The presence of 4 bidders suggests a reasonable level of interest in the project. This competitive environment is generally expected to drive more favorable pricing and better terms for the government, as contractors vie for the award. The specific number of bidders (4) provides some insight into the market's responsiveness to this particular opportunity.

Taxpayer Impact: Full and open competition typically benefits taxpayers by fostering a competitive bidding process that can lead to lower prices and higher quality services. It ensures that the government is not limited to a select few providers, maximizing the potential for cost savings and innovation.

Public Impact

The primary beneficiaries are the Department of the Army and its personnel who will utilize the constructed facilities. The contract delivers essential building construction services, contributing to the military's infrastructure. The geographic impact is localized to the site where the construction took place, likely a military installation. The project likely supported jobs in the construction sector, including skilled trades and project management roles.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if unforeseen construction challenges arise, although the firm-fixed-price contract aims to mitigate this.
Schedule delays are a common risk in large construction projects, potentially impacting operational readiness.
Quality control during construction is crucial to ensure the final product meets specifications and durability standards.

Positive Signals

Firm-fixed-price contract provides cost certainty for the government.
Awarded under full and open competition, suggesting a robust selection process.
Contract duration of over three years allows for phased construction and potential learning curve efficiencies.

Sector Analysis

This contract falls within the Commercial and Institutional Building Construction sector, a significant segment of the broader construction industry. Federal spending in construction is substantial, supporting military bases, government facilities, and infrastructure projects. The market for large-scale construction is often characterized by a mix of large prime contractors and specialized subcontractors. This contract represents a typical procurement for facility upgrades or new builds within a federal agency's operational footprint.

Small Business Impact

This contract was not awarded as a small business set-aside, nor does it appear to have specific subcontracting goals mentioned in the provided data. The prime contractor, Aarsleff A/S, is likely a larger entity. The absence of set-aside provisions means that opportunities for small businesses would primarily come through subcontracting opportunities offered by the prime contractor, the extent of which is not detailed here. This could limit direct contracting opportunities for small businesses on this specific project.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and the contracting officer's representative (COR) within the Department of the Army. Accountability measures are inherent in the firm-fixed-price contract type, which obligates the contractor to deliver specified work for an agreed-upon price. Transparency is generally facilitated through contract award databases like FPDS. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

Military Construction Projects
Department of Defense Facilities
General Building Construction
Federal Infrastructure Projects

Risk Flags

Potential for schedule delays
Risk of cost overruns if modifications are extensive
Quality control challenges in large construction projects

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $42.1 million to PER AARSLEFF A/S. BASE BID ITEMS CONSTRUCTION OF FY 14. LINE ITEM 0001, 0002 AND 0003 ARE AWARDED.

Who is the contractor on this award?

The obligated recipient is PER AARSLEFF A/S.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $42.1 million.

What is the period of performance?

Start: 2014-07-21. End: 2017-09-01.

What was the specific scope of work for line items 0001, 0002, and 0003?

The provided data indicates that line items 0001, 0002, and 0003 were awarded as part of the base bid for the construction of FY14 facilities. However, the specific details of what each line item entails (e.g., specific buildings, phases, or components of the construction project) are not included in this summary. To understand the full scope, one would need to consult the original contract solicitation documents or detailed award information. This level of detail is crucial for a comprehensive value assessment and risk analysis, as different construction elements carry varying costs and complexities.

How did the final award price compare to the initial estimated cost or the bids received?

The data states the base bid amount awarded was $42,145,926.10. It also indicates that 4 bids were received. However, the data does not provide the government's estimate for the project, nor does it detail the amounts of the other three bids received. Therefore, a direct comparison of the winning bid against estimates or other bids to assess pricing competitiveness or potential negotiation outcomes is not possible with the information provided. Further analysis would require access to the full bid tabulation and the government's independent cost estimate.

What is the track record of Aarsleff A/S with the Department of the Army or similar federal construction projects?

The provided data identifies Aarsleff A/S as the contractor but does not offer details on their past performance, track record, or experience with the Department of the Army or other federal agencies. A comprehensive assessment of contractor performance would typically involve reviewing past contract awards, performance evaluations (e.g., Contractor Performance Assessment Reporting System - CPARS), and any history of disputes or claims. Without this information, it's difficult to gauge their reliability and expertise for this specific construction project.

Were there any significant modifications or change orders issued against this contract during its performance period?

The provided data pertains to the initial award of the contract and does not include information on any subsequent modifications, change orders, or amendments that may have occurred during the contract's performance period (July 21, 2014, to September 1, 2017). Large construction projects often undergo modifications due to unforeseen site conditions, design adjustments, or scope changes. Analyzing these modifications is essential for understanding the final cost, duration, and any deviations from the original plan, which impacts the overall value assessment.

What were the key performance indicators (KPIs) for this construction contract, and how was performance measured?

The provided data does not specify the key performance indicators (KPIs) or the methods used to measure the performance of Aarsleff A/S for this construction contract. Typically, construction contracts include performance standards related to quality of work, adherence to schedule, safety compliance, and responsiveness to directives. Performance is often formally assessed through systems like CPARS. Without explicit KPIs and performance data, it is challenging to evaluate the contractor's success in meeting the government's requirements beyond the basic completion of the awarded scope.

How does the contract duration of 1138 days compare to typical construction project timelines for similar federal facilities?

The contract duration of 1138 days (approximately 3.1 years) is a significant period, which is not uncommon for large-scale federal construction projects. The complexity, size, and specific requirements of the facility being built heavily influence project timelines. Without knowing the exact nature of the buildings constructed under line items 0001, 0002, and 0003, a precise comparison is difficult. However, federal construction projects often face extended timelines due to regulatory compliance, environmental reviews, security requirements, and the sheer scale of the undertakings.

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: SEALED BID

Solicitation ID: W912DS14B0007

Offers Received: 4

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: LOKESVEJ 15, ABYHOJ

Business Categories: Category Business, Foreign Owned, International Organization, Not Designated a Small Business, Special Designations

Financial Breakdown

Contract Ceiling: $42,145,926

Exercised Options: $42,145,926

Current Obligation: $42,145,926

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline