DoD's $17.8M barracks construction contract awarded to Eastern Construction & Electric Inc. shows fair competition

Contract Overview

Contract Amount: $17,875,972 ($17.9M)

Contractor: Eastern Construction & Electric Inc

Awarding Agency: Department of Defense

Start Date: 2021-09-27

End Date: 2025-01-01

Contract Duration: 1,192 days

Daily Burn Rate: $15.0K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 8

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: BUILDING 5503, BARRACKS D/B FFR AT JOINT BASE MCGUIRE-DIX-LAKEHURST, NEW JERSEY

Place of Performance

Location: TRENTON, BURLINGTON County, NEW JERSEY, 08641

State: New Jersey Government Spending

Plain-Language Summary

Department of Defense obligated $17.9 million to EASTERN CONSTRUCTION & ELECTRIC INC for work described as: BUILDING 5503, BARRACKS D/B FFR AT JOINT BASE MCGUIRE-DIX-LAKEHURST, NEW JERSEY Key points: 1. The contract value of $17.8 million for barracks construction appears reasonable given the scope and duration. 2. Full and open competition after exclusion of sources suggests a deliberate procurement strategy to ensure best value. 3. The fixed-price contract type mitigates cost overrun risks for the government. 4. Performance is expected over a 1192-day period, indicating a significant construction project. 5. The project is situated at Joint Base McGuire-Dix-Lakehurst, a key military installation. 6. The North American Industry Classification System (NAICS) code 236220 points to commercial and institutional building construction.

Value Assessment

Rating: good

The $17.8 million contract for building barracks at Joint Base McGuire-Dix-Lakehurst represents a substantial investment in military infrastructure. While direct comparisons are difficult without specific project details, the firm-fixed-price structure suggests a commitment to cost control. Benchmarking against similar military construction projects of this scale would be necessary for a more precise value assessment, but the price appears within a plausible range for a project of this magnitude and complexity.

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 the initial pool of potential bidders might have been narrowed, the final award was made through a competitive process. The presence of 8 bidders suggests a healthy level of interest and competition for this type of government contract. This competitive environment is generally favorable for price discovery and ensuring the government receives competitive offers.

Taxpayer Impact: The competitive bidding process for this contract is beneficial for taxpayers as it likely drove down costs and encouraged multiple firms to offer their best pricing and capabilities, leading to a more efficient use of public funds.

Public Impact

Service members stationed at Joint Base McGuire-Dix-Lakehurst will benefit from improved living quarters. The construction project will deliver new barracks facilities, enhancing the quality of life for military personnel. The geographic impact is localized to New Jersey, specifically the Joint Base McGuire-Dix-Lakehurst. The project will likely create temporary employment opportunities for construction workers in the region.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for delays in construction timelines impacting service member readiness.
Risk of unforeseen site conditions requiring change orders, potentially increasing costs.
Ensuring quality of construction meets long-term durability and safety standards.

Positive Signals

Firm-fixed-price contract type limits the government's exposure to cost overruns.
Award to a single contractor streamlines project management and accountability.
Competition among 8 bidders suggests a robust market response and potential for value.

Sector Analysis

This contract falls within the broader construction sector, specifically commercial and institutional building construction (NAICS 236220). The Department of Defense is a significant client for construction services, frequently awarding contracts for infrastructure development, maintenance, and upgrades at military installations worldwide. The market for large-scale government construction projects is competitive, with many firms specializing in public sector work. This contract represents a typical investment in maintaining and improving military housing.

Small Business Impact

The data indicates that this contract was not set aside for small businesses (ss: false, sb: false). Eastern Construction & Electric Inc. is likely a large business. There is no explicit information on subcontracting plans for small businesses within this award. Without specific subcontracting goals, the direct impact on the small business ecosystem for this particular contract is limited, though the prime contractor may engage small businesses as subcontractors.

Oversight & Accountability

Oversight for this contract will likely be managed by the Department of the Army contracting and project management offices. The firm-fixed-price nature of the contract provides a degree of accountability by fixing the total cost. Transparency is generally maintained through federal contract databases. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Military Housing Construction
Base Infrastructure Development
Department of Defense Facilities Management
Barracks Renovation and Construction

Risk Flags

Potential for construction delays
Risk of unforeseen site conditions
Quality control during construction
Contractor's past performance verification needed

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $17.9 million to EASTERN CONSTRUCTION & ELECTRIC INC. BUILDING 5503, BARRACKS D/B FFR AT JOINT BASE MCGUIRE-DIX-LAKEHURST, NEW JERSEY

Who is the contractor on this award?

The obligated recipient is EASTERN CONSTRUCTION & ELECTRIC 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: 2021-09-27. End: 2025-01-01.

What is the track record of Eastern Construction & Electric Inc. with federal contracts, particularly with the Department of Defense?

Eastern Construction & Electric Inc. has a history of federal contracting, as evidenced by this award. To fully assess their track record, a deeper dive into their contract history with the Department of Defense and other federal agencies would be necessary. This would involve examining past performance reviews, any documented disputes or terminations, and the types and values of previous contracts awarded. A review of their performance on similar construction projects, especially those involving military barracks or institutional buildings, would provide crucial context for evaluating their capability and reliability in executing the current contract effectively and on time.

How does the awarded price of $17.8 million compare to similar barracks construction projects at other military bases?

Benchmarking the $17.8 million contract against similar barracks construction projects requires access to detailed cost data for comparable projects, which is often not publicly available in granular form. Factors such as location, size (square footage, number of occupants), specific amenities, prevailing labor costs in the region, and the complexity of site conditions significantly influence project costs. However, for a large-scale barracks project at a major military installation, $17.8 million is a substantial but not necessarily outlier figure. A comprehensive comparison would involve analyzing the cost per square foot or cost per bed for this project against a portfolio of recently awarded military barracks contracts of similar scope and complexity.

What are the primary risk indicators associated with this firm-fixed-price construction contract?

The primary risk indicator for a firm-fixed-price (FFP) contract, while generally favorable to the government by capping costs, is the potential for the contractor to cut corners on quality or materials to maintain profitability if unforeseen issues arise or if their initial cost estimates were too low. For this barracks construction project, risks could include encountering unexpected subsurface conditions (e.g., soil issues, utilities), labor shortages driving up costs beyond estimates, or material price volatility. The long duration (1192 days) also increases the exposure to these risks over time. Effective risk mitigation would involve robust government oversight, clear contract specifications, and proactive management of potential issues.

How effective is the 'Full and Open Competition After Exclusion of Sources' method in ensuring value for taxpayer money in this case?

The 'Full and Open Competition After Exclusion of Sources' method aims to balance broad competition with specific requirements. By excluding certain sources, the agency might be targeting specific capabilities or past performance. However, the subsequent 'Full and Open Competition' among the remaining eligible sources is intended to drive value. With 8 bidders participating, the competition appears robust, suggesting that the exclusion criteria did not unduly limit the pool of qualified contractors. This level of competition generally leads to better price discovery and encourages contractors to offer competitive terms, thereby serving taxpayer interests. The key to ensuring value lies in the agency's ability to properly define requirements and evaluate proposals effectively.

What is the historical spending trend for barracks construction by the Department of the Army at bases like McGuire-Dix-Lakehurst?

Historical spending on barracks construction by the Department of the Army is substantial, reflecting the continuous need to maintain and upgrade military housing across numerous installations. Specific spending trends for bases like Joint Base McGuire-Dix-Lakehurst would vary based on modernization cycles, infrastructure needs, and available funding. Generally, the Army invests billions annually in facilities sustainment, restoration, and modernization (SRM), which includes barracks. Analyzing past budgets and contract awards for similar projects at comparable bases would reveal patterns in investment, project types, and average contract values over time. This particular $17.8 million contract fits within the broader pattern of significant capital investments required for military housing.

What are the potential long-term implications for service member quality of life and base readiness resulting from this new barracks construction?

The construction of new barracks directly enhances the quality of life for service members by providing modern, safe, and comfortable living environments. This can lead to improved morale, retention rates, and overall well-being. Modern facilities often incorporate better amenities, energy efficiency, and space utilization compared to older structures. From a readiness perspective, adequate and well-maintained housing is crucial for supporting military operations. By replacing or upgrading aging facilities, this project ensures that the base can effectively house its personnel, contributing to the overall operational readiness and mission capability of Joint Base McGuire-Dix-Lakehurst.

Industry Classification

NAICS: Construction › Nonresidential Building Construction › Commercial and Institutional Building Construction

Product/Service Code: MAINT, REPAIR, ALTER REAL PROPERTY › MAINT, ALTER, REPAIR NONBUILDINGS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: TWO STEP

Solicitation ID: W912QR21R0054

Offers Received: 8

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 18 GEORGETOWN RD, WRIGHTSTOWN, NJ, 08562

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Hispanic American Owned Business, Minority Owned Business, Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $18,180,972

Exercised Options: $17,875,972

Current Obligation: $17,875,972

Subaward Activity

Number of Subawards: 16

Total Subaward Amount: $3,792,075

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline