DoD's $16.6M rotary wing apron construction contract awarded to undisclosed foreign entities raises transparency concerns

Contract Overview

Contract Amount: $16,591,801 ($16.6M)

Contractor: Foreign Awardees (undisclosed)

Awarding Agency: Department of Defense

Start Date: 2010-02-01

End Date: 2011-06-30

Contract Duration: 514 days

Daily Burn Rate: $32.3K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 14

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: CONSTRUCT ROTARY WING PARKING APRON

Plain-Language Summary

Department of Defense obligated $16.6 million to FOREIGN AWARDEES (UNDISCLOSED) for work described as: CONSTRUCT ROTARY WING PARKING APRON Key points: 1. The contract's value of $16.6 million for apron construction appears substantial, warranting scrutiny of cost-effectiveness. 2. Awarding to undisclosed foreign entities limits visibility into contractor qualifications and potential risks. 3. The use of a definitive contract type suggests a clear scope, but the lack of specific performance metrics is a risk indicator. 4. This contract falls under highway, street, and bridge construction, a sector with established pricing benchmarks. 5. The firm fixed-price structure aims to control costs, but the foreign awardee complicates value assessment.

Value Assessment

Rating: questionable

The $16.6 million price tag for constructing a rotary wing parking apron is significant. Without detailed breakdowns or comparable domestic project costs, it's difficult to definitively benchmark value. The award to undisclosed foreign entities further complicates a thorough value-for-money assessment, as their overhead, labor, and material costs may differ significantly from domestic contractors. The firm fixed-price nature provides some cost certainty, but the lack of transparency around the awardee prevents a robust comparison to market rates or similar government contracts.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that multiple bidders were theoretically allowed to participate. However, the fact that the award went to 'FOREIGN AWARDEES (UNDISCLOSED)' raises questions about the effectiveness of this competition in securing the best value or the most transparent outcome. The number of bidders (14) suggests a degree of interest, but the ultimate selection of an undisclosed foreign entity warrants further investigation into the evaluation process and the specific criteria that led to this award.

Taxpayer Impact: While full and open competition is generally beneficial for taxpayers by fostering price discovery, the award to undisclosed foreign entities obscures the true cost drivers and potentially limits the ability to verify competitive pricing. This lack of transparency could mean taxpayers are not receiving the most cost-effective solution.

Public Impact

The primary beneficiaries are likely military aviation units requiring improved parking and operational facilities for rotary wing aircraft. The contract delivers essential infrastructure improvements for defense operations. The geographic impact is localized to the specific military installation where the apron is constructed. Workforce implications would include construction labor, project management, and potentially specialized aviation support personnel.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of transparency regarding the identity and qualifications of the foreign awardee.
Potential for increased logistical or communication challenges with an undisclosed foreign contractor.
Difficulty in assessing the true cost-effectiveness and value for money due to opaque foreign pricing structures.
Uncertainty about adherence to U.S. labor and safety standards if not explicitly mandated and verified.

Positive Signals

The contract was awarded under full and open competition, suggesting a broad outreach for potential bidders.
The firm fixed-price contract type provides cost certainty for the government.
The project addresses a clear operational need for improved aviation infrastructure.

Sector Analysis

This contract falls within the construction sector, specifically related to civil engineering and infrastructure development for transportation facilities. The North American Industry Classification System (NAICS) code 237310, Highway, Street, and Bridge Construction, is relevant here. The market for military construction projects is often competitive, but awards to foreign entities, especially undisclosed ones, are less common and can indicate specific strategic sourcing or unique capabilities required. Benchmarking would typically involve comparing costs to similar apron construction projects at other military bases or large civilian airports.

Small Business Impact

The data indicates that small business participation (sb: false) was not a primary consideration for this contract, and there is no mention of small business set-asides. This suggests the contract was likely awarded based on factors other than small business utilization. There is no information provided on subcontracting plans, so the impact on the small business ecosystem is likely minimal unless specific requirements were embedded within the larger contract that are not detailed here.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of the Army's contracting and project management offices. Given the award to foreign entities, enhanced oversight may be necessary to ensure compliance with contract terms, quality standards, and security protocols. Transparency is limited by the undisclosed nature of the awardee, making public oversight more challenging. Inspector General jurisdiction would apply if any fraud, waste, or abuse is suspected.

Related Government Programs

Military Airfield Pavement Construction
Rotary Wing Aircraft Support Infrastructure
Department of Defense Construction Contracts
Foreign Military Sales Infrastructure Support

Risk Flags

Lack of Transparency in Awardee Identity
Potential National Security Risks
Difficulty in Verifying Cost-Effectiveness
Challenges in Contract Enforcement

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $16.6 million to FOREIGN AWARDEES (UNDISCLOSED). CONSTRUCT ROTARY WING PARKING APRON

Who is the contractor on this award?

The obligated recipient is FOREIGN AWARDEES (UNDISCLOSED).

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $16.6 million.

What is the period of performance?

Start: 2010-02-01. End: 2011-06-30.

What specific criteria led to the selection of undisclosed foreign awardees over domestic contractors for this construction project?

The provided data does not specify the exact criteria that led to the selection of undisclosed foreign awardees. However, in government contracting, such decisions can stem from various factors including specialized expertise not readily available domestically, unique technological capabilities, cost advantages perceived by the procuring agency, or geopolitical considerations. The fact that it was awarded under 'FULL AND OPEN COMPETITION' suggests that domestic bidders were considered, but the foreign entity's proposal was deemed superior based on the evaluation factors outlined in the solicitation. Without access to the source selection decision document, the precise rationale remains speculative. It is possible that the foreign awardee offered a significantly lower price, a faster completion timeline, or possessed specific certifications or experience crucial for this particular project that domestic firms could not match.

How does the $16.6 million cost compare to similar rotary wing parking apron construction projects, both domestically and internationally?

Benchmarking the $16.6 million cost requires detailed project specifications (size, materials, soil conditions, lighting, drainage, etc.) and the specific location's cost of living and labor. However, as a general reference, large-scale apron construction projects can range from tens to hundreds of millions of dollars. For a rotary wing apron, which may require specific load-bearing capacities and safety features, $16.6 million could be within a reasonable range for a significant project, but it could also be high if the scope is modest. The primary challenge in comparison here is the 'FOREIGN AWARDEES (UNDISCLOSED)' aspect. Their cost structures (labor, materials, overhead, profit margins) may differ substantially from U.S. contractors. Without knowing the size and complexity of this specific apron, and without comparable data from undisclosed foreign contractors, a precise value-for-money assessment is difficult. If this were a domestic contract, one would look for data from other DoD bases or FAA-funded airport projects.

What are the potential risks associated with awarding a significant construction contract to undisclosed foreign entities?

Awarding a significant construction contract to undisclosed foreign entities introduces several potential risks. Firstly, transparency is significantly reduced, making it harder to vet the contractor's financial stability, past performance, and adherence to ethical standards. Secondly, there could be logistical challenges related to communication, cultural differences, and ensuring compliance with U.S. labor laws, safety regulations, and quality control standards. Thirdly, national security concerns might arise if the foreign entity has ties to adversarial nations or if sensitive site information is compromised. Finally, the lack of clear accountability and recourse in case of disputes or contract failures can be more complex with international parties. The 'undisclosed' nature exacerbates these risks by preventing even basic due diligence.

What is the typical duration and cost per year for a contract of this nature and value?

This contract had a duration of 514 days (approximately 17 months) and a total value of $16,591,800.76. This equates to an average annual cost of roughly $9.76 million per year ($16.6M / (514/365)). The cost per day was approximately $32,280. For a construction project of this magnitude, a duration of over a year is common, allowing for planning, mobilization, execution, and demobilization, potentially including weather delays or phased construction. The cost per year seems substantial, but it's directly tied to the total project value and duration. Without knowing the specific scope of work, it's difficult to definitively say if this annual burn rate is typical, but it reflects a significant investment in infrastructure.

How does the use of a 'DEFINITIVE CONTRACT' impact oversight and accountability compared to other contract types?

A 'Definitive Contract' is a broad term often referring to a contract that clearly defines the terms and conditions, including scope, price, and delivery schedule, before performance begins. In the context of construction, this typically means a fixed-price contract like the 'FIRM FIXED PRICE' noted here. This contract type generally enhances oversight and accountability by establishing clear expectations upfront. The government knows the total price, and the contractor is obligated to complete the work for that price. This reduces the risk of cost overruns for the government, making financial oversight more straightforward. Accountability is high because deviations from the agreed-upon scope or quality can lead to contractor liability. However, the effectiveness of oversight still depends on robust inspection, quality assurance processes, and the government's ability to enforce the contract terms, especially when dealing with an undisclosed foreign entity.

Industry Classification

NAICS: Construction › Highway, Street, and Bridge Construction › Highway, Street, and Bridge Construction

Product/Service Code: CONSTRUCT OF STRUCTURES/FACILITIES › CONSTRUCT NONBUILDING FACILITIES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: W912ER10R0016

Offers Received: 14

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 1800 F ST NW, WASHINGTON, DC, 20405

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

Financial Breakdown

Contract Ceiling: $16,693,584

Exercised Options: $16,693,584

Current Obligation: $16,591,801

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline