Construction Contracting
“Construction” means construction, alteration, or repair (including dredging, excavating, and painting) of buildings, structures, or other real property. For purposes of this definition, the terms “buildings, structures, or other real property” include, but are not limited to, improvements of all types, such as bridges, dams, plants, highways, parkways, streets, subways, tunnels, sewers, mains, power lines, cemeteries, pumping stations, railways, airport facilities, terminals, docks, piers, wharves, ways, lighthouses, buoys, jetties, breakwaters, levees, canals, and channels.
Construction does not include the manufacture, production, furnishing, construction, alteration, repair, processing, or assembling of vessels, aircraft, or other kinds of personal property (except that for use in subpart 22.5, see definition at 22.502).”
Many in the federal government believe that construction can be classified as a commercial category. However this is not true, as the Federal Acquisition Regulations require construction to be accomplished in accordance with Part 36 and further define the term “commercial” differently than we might do so in our private lives.
“Commercial item” means (1) Any item, other than real property, that is of a type customarily used by the general public or by non-governmental entities for purposes other than governmental purposes, …” The term “real property” is further defined within the FAR definition of construction with the stipulation that it “includes but is not limited to” a wholesale list of anything that looks like a facility. Clearly the regulation anticipates that there are unique aspects of federal facilities and specifically sets them aside from commercial procedures.
The regulations also call out the term Building or work to further discriminate between construction and manufacturing. “Building or work” means construction activity as distinguished from manufacturing, furnishing of materials, or servicing and maintenance work. The terms include, without limitation, buildings, structures, and improvements of all types, such as bridges, dams, plants, highways, parkways, streets, subways, tunnels, sewers, mains, power lines, pumping stations, heavy generators, railways, airports, terminals, docks, piers, wharves, ways, lighthouses, buoys, jetties, breakwaters, levees, canals, dredging, shoring, rehabilitation and reactivation of plants, scaffolding, drilling, blasting, excavating, clearing, and landscaping.
The manufacture or furnishing of materials, articles, supplies, or equipment (whether or not a Federal or State agency acquires title to such materials, articles, supplies, or equipment during the course of the manufacture or furnishing, or owns the materials from which they are manufactured or furnished) is not “building” or “work” within the meaning of this definition unless conducted in connection with and at the site of such building or work as is described in the foregoing sentence, or under the United States Housing Act of 1937 and the Housing Act of 1949 in the construction or development of the project.”
Discussion: What is a Facility?
Each base and the facilities on it represent a platform from which the operations or functions will be run. But the distinction incorporates more than efficient and functional buildings. The ramifications of the facility design and construction extend far beyond the perimeter of the base itself and include traffic patterns, municipal economies, and public safety as well as air, water, and energy.
The Department of Defense Base Structure Report listed 555,074 buildings, structures, and linear structures worldwide with a stated Plant Replacement Value (PRV) at more than $847 billion. These facilities range from small communications stations to the renovated $1 billion Bethesda Hospital. Each of these facilities are expected to remain in service and functioning at state of the art levels for their entire design life – which is often as much as 100 years. Facilities themselves are further classified as expeditionary, temporary, semi-permanent or permanent a ranking which implies a life expectancy, level of service and to a certain extent the type of funding that can be anticipated.
In addition to buildings and structures DoD also manages over 28.5 million acres of land worldwide in the form of bases, installations and training ranges each of which requires an extensive array of utilities and transportation systems. As with the buildings themselves, there are a host of concerns that extend from protection of endangered species to protection of clean air and water, force protection issues and include safety of the public.
Real estate actions themselves – the buying, selling or leasing of public land - are regulated under Title 10 U.S.C. and are not included in the Federal Acquisition Regulations. Once in the public domain however, each of these parcels of land is operated by the military services in much the same manner as municipal public works. Building code enforcement, public safety and protection of the environment are paramount concerns. Similar to our municipal counterparts requiring citizens to obtain building permits and construction inspection before allowing a certificate of occupancy, federal regulations require base engineering personnel to maintain current licenses in their field as engineers, architects and public surveyors, current certifications as electricians, plumbers as well requiring host and tenant commands to process facility requirements through a design review and approval process.
DoD facilities often take on a life of their own due to the extended time required to complete environmental studies, real estate actions, design, construction, and commissioning services. Many in the acquisition workforce are not familiar with these requirements and legal ramifications which lead to conflicts as weapons systems are fielded. It is critical that new systems and revisions of existing systems be coordinated with the facility engineer.
Funding:
The FAR clearly calls out construction as “construction…” i.e. new, “... alteration and repair…” of existing facilities. This deliberate distinction requires the identification of the proper funding source and it also differentiates “construction” from both manufacturing and/or maintenance functions. New construction and many alteration/repair projects are done using MILCON funding. However these projects may also be tied to Environmental restoration, family housing, RDT&E, or BRAC.
10 U.S.C. 2805 permits using appropriations available for operation and maintenance amounts to carry out minor military construction projects costing not more than $1,000,000.
Labor Laws:
The Construction Wage Rate Requirements statute (formerly known as the Davis-Bacon Act) requires that contracts over $2,000 for construction, alteration, or repair (including painting and decorating) of public buildings or public works within the United States contain the clause at FAR 52.222-6 so that no laborer or mechanic employed directly upon the site of the work shall receive less than the prevailing wage rates as determined by the Secretary of Labor.