Department of the Army awards $16.4M contract for commercial power installation in South Korea

Contract Overview

Contract Amount: $16,427,605 ($16.4M)

Contractor: Sunglim Engineering & Construction CO., Ltd

Awarding Agency: Department of Defense

Start Date: 2021-10-28

End Date: 2026-10-02

Contract Duration: 1,800 days

Daily Burn Rate: $9.1K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 11

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: FY21 ROKFC CASH, INSTALL COMMERCIAL POWER, CARROLL*, KOREA

Plain-Language Summary

Department of Defense obligated $16.4 million to SUNGLIM ENGINEERING & CONSTRUCTION CO., LTD for work described as: FY21 ROKFC CASH, INSTALL COMMERCIAL POWER, CARROLL*, KOREA Key points: 1. Contract awarded to SUNGLIM ENGINEERING & CONSTRUCTION CO., LTD for power infrastructure. 2. Definitive contract type suggests a long-term relationship for ongoing services. 3. Firm Fixed Price contract type provides cost certainty for the government. 4. Competition was full and open, indicating a broad market search. 5. The contract duration is 1800 days, spanning approximately 5 years. 6. North American Industry Classification System (NAICS) code 237310 points to highway, street, and bridge construction, which may be a broad categorization for infrastructure projects.

Value Assessment

Rating: fair

The contract value of $16.4 million for commercial power installation over five years appears reasonable given the scope of infrastructure work in a foreign military installation. Benchmarking against similar projects is challenging without more specific details on the scope of work, such as the capacity of the power system or the extent of the installation. However, the firm fixed-price nature of the contract suggests that the contractor bears the risk of cost overruns, which can be a positive indicator for value if the price was competitive.

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 offers. With 11 bids received, the competition level appears healthy, suggesting that the Department of the Army was able to solicit a range of potential contractors. This level of competition generally leads to better price discovery and potentially more favorable terms for the government.

Taxpayer Impact: A competitive bidding process for this contract helps ensure that taxpayer dollars are used efficiently by driving down costs through market forces.

Public Impact

This contract directly benefits the Department of Defense by ensuring reliable commercial power at a facility in South Korea. The services delivered include the installation of commercial power infrastructure. The geographic impact is localized to the specific military installation in Carroll, Korea. The contract supports the operational readiness and infrastructure maintenance of U.S. forces stationed abroad.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

The NAICS code 237310 (Highway, Street, and Bridge Construction) seems broad for a power installation project, raising questions about the precise nature of the work and potential misclassification.
Lack of detailed performance metrics or specific deliverables in the provided data makes it difficult to assess the contractor's track record or the project's success criteria.
The long contract duration (1800 days) could present risks if technology or requirements change significantly over the period.

Positive Signals

Awarded under full and open competition with 11 bidders indicates a robust market engagement.
The firm fixed-price contract type shifts cost overrun risk to the contractor, which is favorable for budget predictability.
The contract is for essential infrastructure, supporting military operations and readiness.

Sector Analysis

The construction sector, particularly infrastructure development for government and defense, is a significant market. This contract falls within the broader construction services category, specifically related to utility infrastructure. The Department of Defense is a major client for construction services globally, often awarding large, long-term contracts for base development, maintenance, and upgrades. Benchmarking this specific contract's value is difficult without more granular data on the scope of power installation, but it represents a typical investment in maintaining and improving overseas facilities.

Small Business Impact

The data indicates that this contract was not set aside for small businesses (ss: false, sb: false). Given the nature and potential scale of power infrastructure projects, it is common for prime contracts to be awarded to larger, specialized firms. However, the prime contractor, SUNGLIM ENGINEERING & CONSTRUCTION CO., LTD, may engage small businesses for subcontracting opportunities, depending on the specific requirements and availability of specialized services within the local market or from U.S. small businesses.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and the relevant contracting command within the Department of the Army. Performance monitoring would likely involve site inspections, progress reports, and adherence to the firm fixed-price terms. Transparency is generally maintained through contract award databases like FPDS. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse.

Related Government Programs

Military Construction
Base Operations Support
Utility Infrastructure Modernization
Foreign Military Sales Support

Risk Flags

NAICS Code Mismatch
Lack of Specific Performance Metrics
Potential for Scope Creep in Long-Term Contracts

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $16.4 million to SUNGLIM ENGINEERING & CONSTRUCTION CO., LTD. FY21 ROKFC CASH, INSTALL COMMERCIAL POWER, CARROLL*, KOREA

Who is the contractor on this award?

The obligated recipient is SUNGLIM ENGINEERING & CONSTRUCTION CO., LTD.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $16.4 million.

What is the period of performance?

Start: 2021-10-28. End: 2026-10-02.

What is the specific scope of 'commercial power installation' covered by this contract, and how does it align with the NAICS code 237310?

The provided data lists the NAICS code as 237310, which pertains to 'Highway, Street, and Bridge Construction.' However, the contract description specifies 'INSTALL COMMERCIAL POWER.' This discrepancy suggests that the NAICS code might be a broad categorization for infrastructure projects at the installation, or it could indicate that the project involves significant civil works alongside power installation, such as trenching, conduit laying, or site preparation that falls under heavy civil construction. A more precise NAICS code for power infrastructure might be in the 221100 series (Electric Power Generation, Transmission and Distribution) or 238210 (Electrical Contractors and Other Wiring Installation Contractors). Clarification on the specific deliverables and the rationale for the chosen NAICS code would be beneficial for accurate sector classification and benchmarking.

How does the $16.4 million contract value compare to similar power installation projects for overseas military bases?

Benchmarking the $16.4 million contract value for power installation against similar projects is challenging without more detailed information on the project's scope, scale, and specific location. Overseas military base infrastructure projects can vary significantly in cost due to factors like the size of the base, the required power capacity, the complexity of the installation (e.g., underground vs. overhead, integration with existing systems), and local labor and material costs. However, for a multi-year project involving significant infrastructure, $16.4 million is within a plausible range for substantial power system upgrades or installations. A more precise comparison would require access to data on comparable projects, including their technical specifications and contract values.

What are the key performance indicators (KPIs) or deliverables expected under this contract, and how will they be measured?

The provided data does not specify the key performance indicators (KPIs) or detailed deliverables for this contract. Typically, for a firm fixed-price contract of this nature, deliverables would include project milestones, completion of specific installation phases, successful testing and commissioning of the power system, and final handover. Performance would likely be measured against adherence to project schedules, quality standards, safety regulations, and the successful integration and operation of the installed power infrastructure. The contracting officer's representative (COR) would usually be responsible for monitoring progress and ensuring that the contractor meets all contractual obligations. Without access to the contract's statement of work (SOW), a precise assessment of KPIs and measurement methods is not possible.

What is SUNGLIM ENGINEERING & CONSTRUCTION CO., LTD's track record with the Department of Defense, particularly on similar infrastructure projects?

Information regarding SUNGLIM ENGINEERING & CONSTRUCTION CO., LTD's specific track record with the Department of Defense on similar infrastructure projects is not detailed in the provided data. As a contractor awarded a definitive contract with a significant value, it is likely that they have prior experience and have met the necessary qualifications. To assess their track record thoroughly, one would need to consult federal procurement databases (like FPDS or SAM.gov) for past performance reviews, other awarded contracts, and any reported issues or commendations. Their history on projects of comparable size, scope, and complexity, especially in overseas environments, would be crucial for evaluating their reliability and capability for this specific power installation contract.

What is the historical spending pattern for commercial power installation and related infrastructure at this specific military installation in Korea?

The provided data does not include historical spending patterns for commercial power installation or related infrastructure at the specific military installation in Carroll, Korea. To analyze historical spending, one would need to query federal procurement databases for contracts awarded to this installation or within the relevant geographic area over previous fiscal years. This analysis would involve identifying contracts related to utility infrastructure, construction, and maintenance, and aggregating their values. Understanding past spending trends can help contextualize the current $16.4 million award, identify potential increases or decreases in investment, and assess the overall infrastructure development strategy for the base.

Industry Classification

NAICS: Construction › Highway, Street, and Bridge Construction › Highway, Street, and Bridge Construction

Product/Service Code: CONSTRUCT OF STRUCTURES/FACILITIES › CONSTRUCTION OF BUILDINGS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SEALED BID

Solicitation ID: W912UM21B0005

Offers Received: 11

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 84-17 GUSEO-DONG, GEUMJEONG-GU, PUSAN

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Foreign Owned, Not Designated a Small Business, Special Designations

Financial Breakdown

Contract Ceiling: $16,427,605

Exercised Options: $16,427,605

Current Obligation: $16,427,605

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline