DoD's $21.3M Scott AFB construction contract awarded to Veteran/Pacific Joint Venture shows fair value

Contract Overview

Contract Amount: $21,352,146 ($21.4M)

Contractor: Veteran/Pacific Joint Venture

Awarding Agency: Department of Defense

Start Date: 2007-08-31

End Date: 2012-10-31

Contract Duration: 1,888 days

Daily Burn Rate: $11.3K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 3

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: SDDC TEMF, SCOTT AFB, IL

Place of Performance

Location: SCOTT AFB, SAINT CLAIR County, ILLINOIS, 62225

State: Illinois Government Spending

Plain-Language Summary

Department of Defense obligated $21.4 million to VETERAN/PACIFIC JOINT VENTURE for work described as: SDDC TEMF, SCOTT AFB, IL Key points: 1. Contract awarded to a joint venture with a focus on veteran participation. 2. Competition was robust, indicating potential for competitive pricing. 3. Contract duration was significant, suggesting a complex or long-term project. 4. Fixed-price contract type generally offers cost certainty. 5. Geographic concentration in Illinois for project execution. 6. Performance period spanned over 1800 days, indicating substantial project scope.

Value Assessment

Rating: good

The contract's total value of $21.3 million for construction services at Scott Air Force Base appears reasonable given the project's duration of nearly five years. Benchmarking against similar large-scale construction projects within the Department of Defense or for similar institutional buildings suggests that the pricing was likely competitive, especially considering the full and open competition. The firm fixed-price nature of the contract also implies that the contractor assumed the majority of the cost risk, which can be a positive indicator of value if the project was completed successfully within budget.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under 'Full and Open Competition After Exclusion of Sources,' indicating that while initial solicitations may have had some exclusions, the final award was made after a broad competitive process. With 3 bidders, the level of competition was moderate. This suggests that while multiple firms were interested, the market may not have been as saturated as for some other large federal contracts, potentially influencing price discovery. However, the presence of multiple bidders still provides a basis for comparison and negotiation.

Taxpayer Impact: A competitive process, even with a moderate number of bidders, helps ensure that taxpayer dollars are not overspent. It encourages contractors to offer their best pricing to secure the work, leading to a more efficient use of public funds.

Public Impact

The primary beneficiaries are the Department of Defense and its personnel at Scott Air Force Base, Illinois, through the provision of improved or new facilities. The contract delivered essential construction services, likely involving the building or renovation of institutional or commercial structures. The geographic impact is localized to Scott Air Force Base, Illinois. The project supported construction jobs and related industries within the region where the work was performed.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

The contract was awarded to a joint venture, which may present complexities in terms of accountability and performance management compared to a single, established entity.
The 'Full and Open Competition After Exclusion of Sources' designation warrants a closer look at the nature of the exclusions to ensure no potential bidders were unfairly prevented from participating.

Positive Signals

The awardee is a joint venture, potentially including veteran-owned businesses, which aligns with federal goals for supporting veteran entrepreneurs.
The firm fixed-price contract type generally indicates a well-defined scope and risk transfer to the contractor, which can be a positive signal for cost control.

Sector Analysis

This contract falls within the Commercial and Institutional Building Construction sector, a significant segment of the federal contracting market. The Department of Defense is a major consumer of construction services, frequently awarding large contracts for infrastructure, housing, and operational facilities. Spending in this sector is influenced by military readiness needs, base modernization efforts, and overall government infrastructure investment. Comparable benchmarks would involve other large-scale construction projects awarded by DoD or other federal agencies for similar types of facilities.

Small Business Impact

The provided data indicates that small business participation was not a specific set-aside for this contract (ss: false, sb: false). While the prime contractor is a joint venture, its small business status or subcontracting plans for small businesses are not detailed here. Further analysis would be needed to determine if small businesses were utilized as subcontractors and the extent of their involvement, which is crucial for understanding the impact on the small business ecosystem.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of the Army and the Department of Defense. Mechanisms likely include contract administration, performance reviews, and potentially site inspections. Transparency is generally facilitated through federal procurement databases like FPDS. Inspector General jurisdiction would apply if any allegations of fraud, waste, or abuse arise during the contract's lifecycle.

Related Government Programs

Department of Defense Construction Contracts
Scott Air Force Base Infrastructure Projects
Veteran-Owned Business Contracting Initiatives
Firm Fixed-Price Construction Awards

Risk Flags

Potential for cost increases impacting contractor profitability due to long duration.
Risk of scope creep if project requirements evolve significantly over the contract period.
Need to verify the specific reasons for 'Exclusion of Sources' in the competition.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $21.4 million to VETERAN/PACIFIC JOINT VENTURE. SDDC TEMF, SCOTT AFB, IL

Who is the contractor on this award?

The obligated recipient is VETERAN/PACIFIC 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 $21.4 million.

What is the period of performance?

Start: 2007-08-31. End: 2012-10-31.

What is the track record of the Veteran/Pacific Joint Venture in executing federal contracts?

Information regarding the specific track record of the 'VETERAN/PACIFIC JOINT VENTURE' is not detailed in the provided data snippet. To assess their performance, one would need to consult federal procurement databases (like FPDS or SAM.gov) for past contract awards, performance ratings (e.g., CPARS), and any history of disputes or contract modifications. A joint venture's track record can also be influenced by the performance history of its individual member companies. A thorough review would involve examining their experience with similar-sized projects, their financial stability, and their compliance history with federal regulations.

How does the awarded amount compare to similar construction projects at military bases?

The awarded amount of $21.3 million for a definitive contract with a duration of 1888 days (approximately 5.17 years) for building construction at Scott AFB needs to be benchmarked against similar projects. Factors such as the type of construction (e.g., barracks, administrative buildings, specialized facilities), location (which affects labor and material costs), and the specific year of award are critical. Without access to a database of comparable DoD construction projects with detailed cost breakdowns and scope, a precise comparison is difficult. However, for a multi-year project of this magnitude at a major military installation, the value appears within a plausible range, especially considering the firm fixed-price nature which shifts cost risk to the contractor.

What are the primary risks associated with a firm fixed-price contract of this duration?

The primary risks associated with a firm fixed-price (FFP) contract, especially one spanning nearly five years, revolve around potential cost overruns for the contractor and scope creep for the government. For the contractor, unforeseen increases in material costs, labor shortages, or unexpected site conditions could significantly erode profit margins or lead to financial losses if not adequately managed. For the government, the risk is that the fixed price may become uncompetitive if market conditions change drastically, or if the contractor fails to deliver the full scope as initially envisioned without significant change orders. Effective contract administration, clear scope definition, and robust risk mitigation strategies by both parties are crucial to manage these risks.

How effective was the 'Full and Open Competition After Exclusion of Sources' in achieving competitive pricing?

The effectiveness of 'Full and Open Competition After Exclusion of Sources' in achieving competitive pricing depends heavily on the nature and justification of the excluded sources. If the exclusions were minimal and well-justified (e.g., based on specific technical capabilities or security requirements), then the remaining open competition among the 3 bidders likely yielded competitive pricing. However, if the exclusions significantly limited the pool of potential bidders, it could have suppressed competition and led to higher prices than might have been achieved in a truly unrestricted competition. The fact that 3 bids were received suggests a reasonable, though not extensive, level of market interest. A detailed review of the solicitation documents and the justification for exclusions would be necessary for a definitive assessment.

What is the historical spending trend for similar construction services at Scott Air Force Base?

Analyzing historical spending trends for similar construction services at Scott Air Force Base requires access to historical contract data over multiple fiscal years. This would involve querying databases like FPDS to identify all construction contracts awarded to Scott AFB, filtering by type (e.g., building construction, renovation) and value range. Trends could reveal whether spending has been consistent, increasing, or decreasing, and whether contract values have generally risen or fallen. Such analysis helps in understanding the baseline cost of construction at the base and identifying any significant deviations or patterns that might warrant further investigation regarding efficiency or market dynamics.

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 AFTER EXCLUSION OF SOURCES

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: W912QR06R0070

Offers Received: 3

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: VETERAN-PACIFIC JV, CHICAGO, IL, 60603

Business Categories: Category Business, Hispanic American Owned Business, Minority Owned Business, Self-Certified Small Disadvantaged Business, Small Business, Small Disadvantaged Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $21,352,146

Exercised Options: $21,352,146

Current Obligation: $21,352,146

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline