Construction Law

Corps of Engineers Announces Recovery Act Projects

By Michael Payne

The U.S. Army Corps of Engineers has posted the Civil Works projects that it intends to fund from the appropriations Congress provided in the American Recovery and Reinvestment Act of 2009 (Pub. L. 111-5) on its website. In order to spend its $5 billion slice of the $787 billion stimulus pie, the Corps selected approximately 178 Construction projects and 892 Operation and Maintenance projects, nine Formerly Utilized Sites Remedial Action Program (FUSRAP) projects. These projects or useful increments of these projects will be completed with stimulus funding.
 
The only state that is not slated to receive any stimulus projects is Wyoming, because no eligible work on any ongoing Civil Works activity was presently available. The Corps applied the selection criteria which largely revolved around contracts that could be awarded and completed quickly. The wide geographic distribution of selected projects spreads the employment and other economic benefits across the United States and across Civil Works programs to provide the nation with project benefits related to inland and coastal navigation, the environment, flood and storm damage reduction, hydropower, and recreation.
 
The Corps has indicated that the majority of the contracts will be competitively bid. Some contracts will be awarded by issuing task orders on existing contracts generally referred to as Indefinite Delivery Indefinite Quantity (IDIQ) contracts or Multiple Award Task Order Contracts (MATOC). At this time the Corps is unable to specify what projects will be procured in what fashion. The Corps has indicated that it intends to make maximum use of small businesses, either as prime contractors or subcontractors, in its stimulus program.
 
In a recent article in Engineering News Record, Bruce Buckley reported that 'Driven by a need to speed projects to market, federal agencies are drawing heavily on accelerated delivery methods to move stimulus-funded work into the express lane. More than ever, traditional stand-alone procurement will take a back seat on federal jobs, as many new opportunities end up with firms holding existing 'task order' contracts.' The risk that overuse of task order contracts will be anti-competitive was stressed in the article. Mr. Buckley noted that 'Agencies are already leaning heavily on IDIQ contracts. Data from the Federal Procurement Data System show that orders through contracts grew from 14% of total dollars in fiscal 1990 to about 52% in fiscal 2005, says OMB.' In a May 2007 memo to federal acquisition officers, then-OMB Administrator Paul Denett warned of 'a lack of meaningful competition for orders' in light of the increased use of IDIQ vehicles.
 
Mr. Buckley quoted Michael Payne, chairman of the federal construction practice group in Cohen Seglias Pallas Greenhall & Furman: 'As more tasks go to IDIQ holders, some small to medium-size firms who don't have IDIQ contracts are locked out . . . With IDIQ contract limits now reaching into the hundreds of millions of dollars and the scope sometimes spanning multiple states, many firms can't get adequate bonding to compete.' Mr. Payne also stressed that the method could hurt many of those the stimulus is designed to help, 'The purpose is to lead to job creation. What better way than to go with open competition and make it available to the maximum number of companies?'

Full post as published by Federal Construction Contracting Blog on July 24, 2009 (boomark / email).