Army awards $17.9M for Johnstown, PA runway upgrade to Hi-Way Paving, Inc

Contract Overview

Contract Amount: $17,910,850 ($17.9M)

Contractor: Hi-Way Paving, Inc.

Awarding Agency: Department of Defense

Start Date: 2007-02-21

End Date: 2010-10-01

Contract Duration: 1,318 days

Daily Burn Rate: $13.6K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 5

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: CONSTRUCTION OF AIRFIELD RUNWAY UPGRADE, JOHNSTOWN, PA

Place of Performance

Location: JOHNSTOWN, CAMBRIA County, PENNSYLVANIA, 15904

State: Pennsylvania Government Spending

Plain-Language Summary

Department of Defense obligated $17.9 million to HI-WAY PAVING, INC. for work described as: CONSTRUCTION OF AIRFIELD RUNWAY UPGRADE, JOHNSTOWN, PA Key points: 1. Contract awarded via full and open competition, suggesting a competitive bidding process. 2. The contract type is a definitive contract with a firm fixed price, indicating price certainty. 3. The duration of 1318 days suggests a significant, long-term construction project. 4. The North American Industry Classification System (NAICS) code 237990 points to heavy and civil engineering construction. 5. The award was made by the Department of the Army, part of the Department of Defense. 6. The project is located in Johnstown, Pennsylvania.

Value Assessment

Rating: fair

Benchmarking the value of this specific contract is challenging without comparable airfield runway upgrade projects in the same region and timeframe. The firm fixed-price structure provides cost certainty for the government. However, the total award amount of $17.9 million for a runway upgrade over approximately 3.6 years warrants scrutiny to ensure it aligns with industry standards for similar infrastructure projects.

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 a bid. With 5 bidders participating, the competition level appears adequate, which typically aids in price discovery and can lead to more competitive pricing for the government. The presence of multiple bidders suggests that the market for this type of construction service is accessible.

Taxpayer Impact: The full and open competition with multiple bidders is beneficial for taxpayers as it increases the likelihood of receiving a fair market price and encourages contractors to offer their best value proposals.

Public Impact

The primary beneficiaries are the U.S. Army and potentially other military branches utilizing the airfield. The project delivers critical infrastructure improvements to an existing airfield runway. The geographic impact is localized to Johnstown, Pennsylvania. The project will likely involve a significant construction workforce, including skilled laborers, engineers, and project managers.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if unforeseen site conditions arise during the extended construction period.
Risk of schedule delays due to weather, material availability, or labor issues common in large construction projects.
Ensuring the quality of the runway upgrade meets stringent military specifications.

Positive Signals

Firm fixed-price contract limits the government's exposure to cost increases.
Full and open competition with multiple bidders suggests a competitive pricing environment.
The definitive contract structure provides a clear framework for the project's execution.

Sector Analysis

This contract falls within the heavy and civil engineering construction sector, specifically related to airfield infrastructure. The market for such specialized construction services is often characterized by a limited number of highly qualified firms capable of undertaking large-scale, complex projects. Comparable spending benchmarks would typically be found in other military or major civilian airport runway renovation projects, which can vary significantly based on location, scope, and specific requirements.

Small Business Impact

This contract does not appear to have a small business set-aside component, as indicated by 'sb: false'. There is no explicit information regarding subcontracting plans for small businesses. The absence of set-asides means that large businesses were the primary focus for bidding, and the impact on the small business ecosystem would depend on whether the prime contractor voluntarily engages small businesses for subcontracting opportunities.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and the relevant project management office within the Department of the Army. Accountability measures are embedded in the firm fixed-price contract terms, requiring the contractor to deliver the specified work within the agreed-upon price. Transparency is generally maintained through contract award databases and reporting requirements, though specific project-level oversight details are not provided.

Related Government Programs

Military Airfield Construction
Civil Engineering Projects
Department of Defense Infrastructure Modernization
Heavy Construction Contracts

Risk Flags

Potential for schedule delays
Risk of unforeseen site conditions
Quality control for aviation infrastructure

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $17.9 million to HI-WAY PAVING, INC.. CONSTRUCTION OF AIRFIELD RUNWAY UPGRADE, JOHNSTOWN, PA

Who is the contractor on this award?

The obligated recipient is HI-WAY PAVING, 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 $17.9 million.

What is the period of performance?

Start: 2007-02-21. End: 2010-10-01.

What is the track record of Hi-Way Paving, Inc. with similar federal construction contracts, particularly airfield projects?

Analyzing the track record of Hi-Way Paving, Inc. requires access to a comprehensive federal contract database. Without specific data on their past performance, it's difficult to definitively assess their experience with similar airfield projects. However, the fact that they were awarded a contract of this magnitude by the Department of the Army suggests they possess the necessary qualifications and experience. Further investigation into their past federal contract awards, performance reviews (if publicly available), and any history of contract disputes or successes would provide a clearer picture of their reliability and expertise in executing large-scale construction projects like runway upgrades.

How does the awarded amount of $17.9 million compare to the average cost of similar airfield runway upgrade projects?

Determining the average cost of similar airfield runway upgrade projects is complex due to variations in project scope, location, materials, and specific requirements (e.g., length, width, load-bearing capacity, lighting systems). A $17.9 million award for a runway upgrade over approximately 3.6 years suggests a substantial project. To benchmark this value effectively, one would need to compare it against recent, publicly available data for military or civilian airport runway rehabilitation or construction projects of comparable size and complexity. Factors such as the specific pavement type, drainage improvements, and any associated taxiway or apron work would significantly influence the cost. Without such comparative data, it's challenging to definitively state whether this award represents excellent, fair, or concerning value for money.

What are the primary risks associated with a construction project of this duration and scale?

Construction projects of this duration (1318 days, approx. 3.6 years) and scale carry inherent risks. Key risks include potential cost escalation due to unforeseen site conditions (e.g., soil instability, underground utilities), material price fluctuations over the project's life, and labor availability issues. Schedule delays are also a significant concern, often caused by adverse weather, permitting issues, or contractor performance. For an airfield runway, specific risks involve ensuring minimal disruption to ongoing operations (if applicable), meeting stringent safety and quality standards for aviation infrastructure, and managing the complexity of coordinating various construction phases. The firm fixed-price nature of the contract mitigates some financial risk for the government but places it on the contractor, potentially leading to pressure on quality or schedule if not managed effectively.

What is the historical spending pattern for airfield construction or upgrades by the Department of the Army?

Historical spending patterns for airfield construction and upgrades by the Department of the Army are substantial, reflecting the military's extensive global infrastructure needs. The Army operates and maintains numerous airfields for various operational purposes. Annual spending can fluctuate significantly based on modernization initiatives, readiness requirements, and budget allocations. Major upgrades, like runway replacements or significant rehabilitations, are typically multi-year projects funded through specific military construction (MILCON) appropriations or operations and maintenance budgets. Analyzing historical data would reveal trends in contract types, competition levels, and average project costs, providing context for individual awards like the Johnstown runway project. This specific award represents a portion of the broader Army investment in maintaining and improving its aviation facilities.

How does the 'definitive contract' type impact project management and flexibility?

A definitive contract, in contrast to an 'undefinitized' or letter contract, is a fixed-price contract that has been fully negotiated and finalized. For this airfield runway upgrade, it means that the terms, conditions, price, and scope of work were clearly established and agreed upon by both the Department of the Army and Hi-Way Paving, Inc. before work commenced. This structure provides significant clarity and predictability for both parties. It generally offers less flexibility for scope changes compared to cost-reimbursement contracts, meaning any modifications would likely require formal change orders, potentially impacting cost and schedule. For the government, it offers strong price control, while for the contractor, it defines their maximum revenue and profit potential, assuming they manage costs effectively.

Industry Classification

NAICS: Construction › Other Heavy and Civil Engineering Construction › Other Heavy and Civil Engineering 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: W912QR07R0005

Offers Received: 5

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 4343 WEAVER COURT N, HILLIARD, OH, 43026

Business Categories: Category Business, Small Business

Financial Breakdown

Contract Ceiling: $17,910,850

Exercised Options: $17,910,850

Current Obligation: $17,910,850

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline