D/B/B Construction Contract Awarded to L.R. Costanzo for Wilkes-Barre Area Maintenance Support

Contract Overview

Contract Amount: $14,781,147 ($14.8M)

Contractor: L.R. Costanzo Company, Incorporated

Awarding Agency: Department of Defense

Start Date: 2025-06-13

End Date: 2027-09-05

Contract Duration: 814 days

Daily Burn Rate: $18.2K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: D/B/B CONSTRUCTION CONTRACT FOR THE AREA MAINTENANCE SUPPORT ACTIVITY IN WILKES BARRE, PA

Place of Performance

Location: WILKES BARRE, LUZERNE County, PENNSYLVANIA, 18702

State: Pennsylvania Government Spending

Plain-Language Summary

Department of Defense obligated $14.8 million to L.R. COSTANZO COMPANY, INCORPORATED for work described as: D/B/B CONSTRUCTION CONTRACT FOR THE AREA MAINTENANCE SUPPORT ACTIVITY IN WILKES BARRE, PA Key points: 1. Contract awarded through full and open competition, suggesting a competitive bidding process. 2. The contract is a definitive contract with a firm fixed price, providing cost certainty. 3. The duration of the contract is 814 days, indicating a medium-term project. 4. The award amount of $14.78 million falls within a typical range for construction projects of this nature. 5. The project is located in Pennsylvania, potentially impacting the local construction workforce and economy. 6. The contract is managed by the Department of the Army, a significant federal agency with substantial construction needs.

Value Assessment

Rating: good

The contract value of $14.78 million for a definitive contract with a firm fixed price appears reasonable for a commercial and institutional building construction project of this scope and duration. Benchmarking against similar Department of Defense construction contracts would provide a more precise assessment, but the fixed-price nature suggests a degree of cost control. The award amount is below the reported bid amount of $18.16 million, indicating successful negotiation.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, meaning all responsible sources were permitted to submit a bid. The presence of two bidders (no) suggests a moderate level of competition for this specific contract. While more bidders could potentially drive prices lower, full and open competition generally promotes a fair marketplace and encourages competitive pricing.

Taxpayer Impact: Taxpayers benefit from the assurance that the contract was awarded through a process designed to solicit the best possible price and value from a wide range of qualified contractors.

Public Impact

The primary beneficiaries are the Department of the Army, which will receive enhanced area maintenance support services. The project will involve the construction or renovation of commercial and institutional buildings. The geographic impact is localized to Wilkes-Barre, Pennsylvania, and its surrounding areas. The contract is expected to create or sustain jobs within the construction sector in Pennsylvania.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if unforeseen site conditions arise, despite the firm fixed price.
Dependence on the contractor's ability to meet the project timeline and quality standards.
Risk of supply chain disruptions affecting material availability and project completion.

Positive Signals

Firm fixed price contract provides cost certainty for the government.
Awarded through full and open competition, promoting a competitive bidding environment.
Contractor has a track record, though specific performance details require further investigation.
Project duration is clearly defined, allowing for planning and resource allocation.

Sector Analysis

This contract falls within the Commercial and Institutional Building Construction sector, a significant segment of the broader construction industry. Federal spending in this area is often driven by the need to maintain and upgrade facilities essential for government operations. Comparable spending benchmarks would involve analyzing other Department of Defense construction contracts for similar facility types and geographic regions to assess value for money.

Small Business Impact

The data indicates that this contract was not set aside for small businesses (ss: false, sb: false). Therefore, there are no direct subcontracting implications for small businesses mandated by a set-aside. However, the prime contractor, L.R. Costanzo Company, Inc., may choose to subcontract portions of the work to small businesses as part of their overall business strategy, which could indirectly benefit the small business ecosystem.

Oversight & Accountability

Oversight for this contract will likely be managed by the Department of the Army's contracting and project management offices. Accountability measures are embedded within the firm fixed-price contract terms, requiring the contractor to deliver specified services within the agreed-upon price and timeframe. Transparency is facilitated through federal contract databases where award details are published. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse.

Related Government Programs

Department of Defense Facilities Construction
Army Corps of Engineers Construction Projects
General Services Administration (GSA) Public Buildings Service
Commercial Building Construction Contracts

Risk Flags

Potential for cost escalation due to long contract duration.
Reliance on contractor's performance for project success.
Need for detailed review of contractor's past performance.
Geographic concentration of federal spending.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $14.8 million to L.R. COSTANZO COMPANY, INCORPORATED. D/B/B CONSTRUCTION CONTRACT FOR THE AREA MAINTENANCE SUPPORT ACTIVITY IN WILKES BARRE, PA

Who is the contractor on this award?

The obligated recipient is L.R. COSTANZO COMPANY, INCORPORATED.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $14.8 million.

What is the period of performance?

Start: 2025-06-13. End: 2027-09-05.

What is the track record of L.R. Costanzo Company, Inc. with federal contracts, particularly with the Department of Defense?

A thorough review of L.R. Costanzo Company, Inc.'s federal contract history would be necessary to assess their track record. This would involve examining past performance evaluations, any history of contract disputes or terminations, and their experience with similar types of construction projects for the Department of Defense or other federal agencies. Analyzing their performance on previous firm fixed-price contracts would be particularly relevant to gauge their reliability in delivering projects on time and within budget. Without specific data on past performance, it is difficult to definitively assess their reliability for this current contract.

How does the awarded amount of $14.78 million compare to the bid amount of $18.16 million and similar construction projects?

The awarded amount of $14.78 million is approximately 18.6% lower than the bid amount of $18.16 million, indicating successful negotiation or a competitive advantage for the winning bidder. To benchmark this value effectively, it would be crucial to compare it against similar Department of the Army or Department of Defense construction contracts for area maintenance support or similar institutional building projects in the Northeast region. Factors such as project scope, square footage, complexity, and prevailing construction costs in Pennsylvania should be considered. A lower award price relative to bids generally suggests good value, but a comprehensive comparison with market rates and historical data for comparable projects is needed for a definitive assessment.

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

The primary risks associated with this firm fixed-price construction contract include potential cost overruns if unforeseen site conditions are encountered, which could lead to change orders that increase the total cost. There is also a risk related to the contractor's ability to adhere to the project schedule and maintain the required quality standards throughout the 814-day duration. Furthermore, supply chain disruptions for materials or labor shortages could impact project completion. While the firm fixed price offers cost certainty, the government bears the risk of scope creep or contractor non-performance, which could necessitate additional oversight and potentially legal action.

How effective is full and open competition in ensuring value for money for construction contracts of this size?

Full and open competition is generally considered the most effective method for ensuring value for money in federal contracting, including for construction projects of this size. By allowing all responsible sources to compete, it fosters a competitive environment that incentivizes contractors to offer their best prices and innovative solutions. The presence of multiple bidders, even if only two in this case, increases the likelihood that the government will receive a fair market price. However, the effectiveness also depends on the clarity of the solicitation requirements and the government's ability to evaluate bids accurately. For this contract, the significant difference between the bid and award price suggests competition played a role in achieving a favorable outcome.

What is the historical spending pattern for area maintenance support contracts by the Department of the Army?

Analyzing historical spending patterns for area maintenance support contracts by the Department of the Army would provide valuable context for this award. This would involve examining the frequency, value, and duration of similar contracts awarded over the past several fiscal years. Understanding the typical number of bidders, the average award values relative to initial estimates, and the prevalence of different contract types (e.g., firm fixed price vs. cost-plus) would help determine if this $14.78 million contract is an outlier or consistent with historical trends. It would also reveal if there are specific geographic concentrations or recurring needs for such services.

What are the implications of the 814-day contract duration on project management and potential cost fluctuations?

A contract duration of 814 days (approximately 2.2 years) for a construction project of this nature necessitates robust project management to ensure timely completion and control costs. Longer durations increase the exposure to market fluctuations in material prices and labor costs, even under a firm fixed-price agreement. While the fixed price aims to cap the government's liability, significant unforeseen economic shifts could strain the contractor's ability to perform without requesting modifications or potentially facing default. Effective oversight during this extended period is crucial to monitor progress, manage risks, and ensure adherence to the contract terms, preventing potential delays and cost escalations.

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

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: W912QR24R0031

Offers Received: 2

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 123 N MAIN AVE, SCRANTON, PA, 18504

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

Financial Breakdown

Contract Ceiling: $15,114,474

Exercised Options: $14,781,147

Current Obligation: $14,781,147

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline