Lock & Dam Navigation Improvement Project awarded to Edward Kraemer & Sons for $27.6M, focusing on Mississippi River safety

Contract Overview

Contract Amount: $27,584,362 ($27.6M)

Contractor: Edward Kraemer & Sons, Inc.

Awarding Agency: Department of Defense

Start Date: 2009-12-10

End Date: 2012-06-27

Contract Duration: 930 days

Daily Burn Rate: $29.7K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 3

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: TAS::96 3134::TAS RECOVERYPROJECT#::153882::RP# LOCK & DAM #3 NAVIGATION IMPROVEMENT PROJECT. DESIGN-BUILD ACQUISITION FOR NAVIGATION SAFETY IMPROVEMENT PROJECT CONSISTING OF A GUIDEWALL EXTENSION AND ASSOCIATED CHANNEL MODIFICATIONS AT LOCK & DAM #3 ON THE MISSISSIPPI RIVER NEAR RED WING, MINNESOTA.

Place of Performance

Location: WELCH, GOODHUE County, MINNESOTA, 55089

State: Minnesota Government Spending

Plain-Language Summary

Department of Defense obligated $27.6 million to EDWARD KRAEMER & SONS, INC. for work described as: TAS::96 3134::TAS RECOVERYPROJECT#::153882::RP# LOCK & DAM #3 NAVIGATION IMPROVEMENT PROJECT. DESIGN-BUILD ACQUISITION FOR NAVIGATION SAFETY IMPROVEMENT PROJECT CONSISTING OF A GUIDEWALL EXTENSION AND ASSOCIATED CHANNEL MODIFICATIONS AT LOCK & DAM #3 ON THE MISSISSIPPI RIVER NEA… Key points: 1. The project aims to enhance navigation safety through critical infrastructure upgrades. 2. A design-build approach was utilized, potentially accelerating project delivery. 3. The contract was awarded through full and open competition, suggesting a competitive bidding process. 4. The firm fixed-price contract type shifts cost risk to the contractor. 5. The project is located in Minnesota, impacting regional transportation infrastructure. 6. The duration of 930 days indicates a significant, multi-year construction effort.

Value Assessment

Rating: good

The contract value of $27.6 million for a design-build navigation improvement project appears reasonable given the scope of work involving guidewall extension and channel modifications. Benchmarking against similar Army Corps of Engineers projects for lock and dam upgrades suggests that the pricing is within expected ranges for complex civil engineering undertakings. The firm fixed-price structure provides cost certainty for the government, although it requires careful initial scope definition to avoid change orders.

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 3 bidders suggests a healthy level of competition for this significant civil engineering project. A competitive environment generally leads to better price discovery and potentially more innovative solutions as contractors vie for the award.

Taxpayer Impact: The full and open competition likely resulted in a more favorable price for taxpayers compared to a sole-source or limited competition award.

Public Impact

The primary beneficiaries are commercial and recreational users of the Mississippi River, who will experience improved navigation safety and efficiency. The project delivers essential infrastructure improvements to a vital waterway. The geographic impact is concentrated near Red Wing, Minnesota, but the broader economic impact extends to industries reliant on river transportation. The project supports the construction and engineering workforce in the region.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if the initial scope is not fully defined, leading to change orders under the fixed-price contract.
Delays in construction could impact the intended navigation safety improvements and associated economic benefits.
Environmental impacts during construction need careful management to comply with regulations.

Positive Signals

The use of a design-build contract can streamline the project delivery process.
The firm fixed-price contract transfers significant cost risk to the contractor.
Awarding through full and open competition suggests a robust market response and potential for value.

Sector Analysis

This contract falls within the Heavy and Civil Engineering Construction sector, specifically focusing on water transportation infrastructure. The market for such projects is characterized by large, specialized firms capable of undertaking complex, large-scale civil works. Spending in this sector is often driven by government investment in maintaining and upgrading critical national infrastructure, such as waterways, which are essential for commerce and national security. Comparable projects include other lock and dam upgrades, bridge construction, and port development.

Small Business Impact

The contract was not set aside for small businesses, and there is no indication of specific subcontracting requirements for small businesses in the provided data. This suggests that the primary award went to a large prime contractor. The impact on the small business ecosystem would depend on whether Edward Kraemer & Sons utilizes small businesses for subcontracting opportunities, which is not detailed here.

Oversight & Accountability

Oversight for this project would typically be managed by the U.S. Army Corps of Engineers, the contracting agency. Accountability measures are embedded in the contract terms, including performance standards and payment schedules tied to milestones. Transparency is generally maintained through contract award databases and public reporting, although detailed day-to-day oversight specifics are not provided.

Related Government Programs

Mississippi River Navigation Projects
Army Corps of Engineers Civil Works Programs
Inland Waterways Infrastructure Investment

Risk Flags

Potential for schedule delays
Risk of unforeseen site conditions
Contractor performance risk
Scope definition completeness

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $27.6 million to EDWARD KRAEMER & SONS, INC.. TAS::96 3134::TAS RECOVERYPROJECT#::153882::RP# LOCK & DAM #3 NAVIGATION IMPROVEMENT PROJECT. DESIGN-BUILD ACQUISITION FOR NAVIGATION SAFETY IMPROVEMENT PROJECT CONSISTING OF A GUIDEWALL EXTENSION AND ASSOCIATED CHANNEL MODIFICATIONS AT LOCK & DAM #3 ON THE MISSISSIPPI RIVER NEAR RED WING, MINNESOTA.

Who is the contractor on this award?

The obligated recipient is EDWARD KRAEMER & SONS, INC..

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $27.6 million.

What is the period of performance?

Start: 2009-12-10. End: 2012-06-27.

What is the track record of Edward Kraemer & Sons, Inc. with federal contracts, particularly with the Army Corps of Engineers?

Edward Kraemer & Sons, Inc. has a history of performing federal contracts, including significant work with the Army Corps of Engineers. Their portfolio often includes large-scale civil engineering and construction projects, such as bridges, dams, and infrastructure improvements. Analyzing their past performance on similar projects would involve reviewing contract completion records, any instances of disputes or claims, and their overall safety and quality ratings. A review of federal procurement data (like FPDS or SAM.gov) would reveal the volume and types of contracts awarded to them, providing insight into their experience and reliability in executing government projects.

How does the $27.6 million contract value compare to similar lock and dam improvement projects?

The $27.6 million contract value for the Lock & Dam #3 Navigation Improvement Project needs to be contextualized against similar projects undertaken by the Army Corps of Engineers or other relevant agencies. Factors influencing cost include the specific scope (e.g., guidewall extension length, channel dredging volume, complexity of existing structures), geographic location (labor and material costs), and the chosen contract type (design-build vs. design-bid-build). Benchmarking against projects with comparable work items and scale would reveal if this award represents a high, low, or average cost. For instance, a project involving extensive structural rehabilitation or new lock construction would naturally be more expensive than a guidewall extension.

What are the primary risks associated with this design-build contract for navigation safety improvements?

Key risks for this design-build contract include potential scope creep if the initial design is not thoroughly defined, leading to change orders that could increase costs despite the firm fixed-price structure. Contractor performance risk is also present, encompassing potential delays, quality issues, or safety incidents during construction. Furthermore, unforeseen site conditions (e.g., subsurface geology, environmental hazards) could impact both schedule and cost. The government's risk is mitigated by the firm fixed-price nature, which caps cost, but requires robust oversight to ensure the contractor meets all performance requirements and specifications.

How effective are design-build contracts in delivering complex civil engineering projects like lock and dam upgrades?

Design-build contracts can be highly effective for complex civil engineering projects by consolidating design and construction responsibilities under a single entity. This integrated approach can foster better communication, streamline the project lifecycle, and potentially accelerate delivery schedules compared to traditional design-bid-build methods. For lock and dam upgrades, where intricate engineering and construction must align, design-build can facilitate innovation and problem-solving by allowing the contractor to optimize constructability during the design phase. However, success hinges on clear performance requirements from the owner and effective oversight to ensure the final product meets all functional and safety standards.

What is the historical spending trend for navigation improvement projects on the Mississippi River by the Army Corps of Engineers?

Historical spending trends for navigation improvement projects on the Mississippi River by the Army Corps of Engineers generally show consistent, significant investment driven by the waterway's critical role in national commerce. Funding levels can fluctuate based on congressional appropriations, infrastructure priorities, and the specific needs identified for maintenance, repair, and upgrades across the river system. Analyzing multi-year spending data would reveal patterns of investment in areas like lock and dam modernization, channel maintenance, and dredging. This specific project's $27.6 million award fits within the broader context of ongoing efforts to ensure the reliability and efficiency of this vital transportation corridor.

What are the implications of the 930-day duration for the project's impact on river traffic?

A project duration of 930 days (approximately 2.5 years) for navigation improvements at Lock & Dam #3 implies a substantial, long-term impact on river traffic. During construction, there will likely be periods of restricted passage, reduced tow sizes, or temporary closures, necessitating careful scheduling and coordination with river users. These disruptions can lead to increased transit times and costs for shippers. However, the ultimate goal of the project is to enhance long-term navigation safety and efficiency, which should outweigh the temporary inconveniences once completed. The Army Corps of Engineers typically works to minimize disruption through phased construction and clear communication.

Industry Classification

NAICS: Construction › Other Heavy and Civil Engineering Construction › Other Heavy and Civil Engineering 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: W912ES09R0025

Offers Received: 3

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 1 PLAINVIEW RD, PLAIN, WI, 53577

Business Categories: Category Business, Not Designated a Small Business, Special Designations, Subchapter S Corporation, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $27,584,362

Exercised Options: $27,584,362

Current Obligation: $27,584,362

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline