DoD's $36.6M environmental remediation contract awarded to Laguna Construction Company, Inc. for 1208 days
Contract Overview
Contract Amount: $36,615,207 ($36.6M)
Contractor: Laguna Construction Company, Inc
Awarding Agency: Department of Defense
Start Date: 2005-06-10
End Date: 2008-09-30
Contract Duration: 1,208 days
Daily Burn Rate: $30.3K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 30
Pricing Type: COST PLUS FIXED FEE
Sector: Other
Plain-Language Summary
Department of Defense obligated $36.6 million to LAGUNA CONSTRUCTION COMPANY, INC for work described as: Key points: 1. The contract's duration of over three years suggests a significant scope of work. 2. Awarded under full and open competition, indicating a broad market search. 3. The cost-plus-fixed-fee pricing structure may incentivize cost control by the contractor. 4. The absence of small business set-aside flags potential for larger prime contractors. 5. Performance period spans from 2005 to 2008, providing historical context for remediation services. 6. The North American Industry Classification System (NAICS) code 562910 points to environmental remediation services.
Value Assessment
Rating: fair
Benchmarking the value of this $36.6 million contract is challenging without specific deliverables or performance metrics. The cost-plus-fixed-fee (CPFF) structure, while common for complex projects, can sometimes lead to higher costs if not managed tightly. Comparing it to similar environmental remediation contracts of comparable scope and complexity would be necessary for a more precise value assessment. The fixed fee component provides some cost certainty for the government, but the overall cost is variable.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under full and open competition, suggesting that the Department of the Air Force sought bids from all responsible sources. This approach typically fosters a competitive environment, potentially leading to better pricing and service offerings. The number of bids received (30) is a strong indicator of robust competition, which is generally favorable for the government.
Taxpayer Impact: A high level of competition, as indicated by 30 bids, suggests that taxpayer dollars were likely used efficiently, as contractors vied to offer the most competitive terms.
Public Impact
The primary beneficiaries are likely the Department of Defense and the specific Air Force installation requiring environmental remediation. Services delivered include remediation of contaminated sites, contributing to environmental protection and compliance. The geographic impact is localized to the site(s) where the remediation activities took place. Workforce implications include employment opportunities for environmental scientists, engineers, technicians, and construction labor.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Cost-plus-fixed-fee contracts can sometimes lead to cost overruns if not rigorously monitored.
- The long duration of the contract (1208 days) requires sustained oversight to ensure performance and prevent scope creep.
- Environmental remediation projects can face unforeseen challenges, potentially impacting timelines and costs.
Positive Signals
- Awarded under full and open competition with 30 bids suggests a competitive pricing environment.
- The fixed fee component provides a degree of cost predictability for the government.
- The contract addresses critical environmental compliance and protection needs for the Department of Defense.
Sector Analysis
Environmental remediation services fall under the broader professional, scientific, and technical services sector. This sector is characterized by specialized expertise and often involves complex regulatory compliance. The market size for environmental remediation is substantial, driven by industrial activity, government mandates, and legacy contamination. This contract represents a specific instance of federal spending within this sector, addressing the unique needs of military installations.
Small Business Impact
The data indicates that this contract was not set aside for small businesses, nor does it explicitly mention subcontracting goals for small businesses. This suggests that the prime contract was likely awarded to a larger entity capable of handling the scope and complexity of the environmental remediation. The absence of small business participation could mean fewer opportunities for smaller firms to engage in this specific federal project.
Oversight & Accountability
Oversight for this contract would typically be managed by the contracting officer and the contract administration office within the Department of the Air Force. Performance monitoring, financial reviews, and compliance checks are standard oversight mechanisms. Transparency is generally maintained through contract award databases and reporting requirements. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.
Related Government Programs
- Environmental Services
- Base Realignment and Closure (BRAC) environmental cleanup
- Defense Environmental Restoration Program (DERP)
- Hazardous Waste Management
- Site Remediation
Risk Flags
- Potential for cost overruns inherent in CPFF contracts.
- Complexity of environmental remediation can lead to unforeseen challenges.
- Need for sustained oversight due to long contract duration.
Tags
defense, department-of-defense, air-force, environmental-remediation, remediation-services, cost-plus-fixed-fee, full-and-open-competition, large-contract, professional-scientific-and-technical-services, us
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $36.6 million to LAGUNA CONSTRUCTION COMPANY, INC. See the official description on USAspending.
Who is the contractor on this award?
The obligated recipient is LAGUNA CONSTRUCTION COMPANY, INC.
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Air Force).
What is the total obligated amount?
The obligated amount is $36.6 million.
What is the period of performance?
Start: 2005-06-10. End: 2008-09-30.
What was the specific nature of the environmental remediation required under this contract?
The provided data indicates the NAICS code 562910, which corresponds to 'Remediation Services'. This broadly covers the cleanup or removal of contaminated soil, water, or buildings. Without more specific contract details, it's difficult to ascertain the exact contaminants or the type of remediation (e.g., soil excavation, groundwater treatment, asbestos abatement). However, given it's a Department of the Air Force contract, potential issues could include historical fuel spills, chemical contamination from operations, or ordnance-related cleanup. The duration and value suggest a significant, multi-faceted remediation effort at a specific installation.
How does the $36.6 million cost compare to similar environmental remediation contracts awarded by the DoD?
Comparing this $36.6 million contract requires context on the scope, duration, and complexity of the remediation. Environmental cleanup projects can vary dramatically in cost. A 1208-day (approx. 3.3 year) contract of this value suggests a substantial project. For instance, large-scale Superfund site cleanups or extensive hazardous material removal at major military bases can run into tens or hundreds of millions of dollars. Conversely, smaller, more localized cleanups might cost significantly less. To provide a precise comparison, one would need to analyze contracts with similar NAICS codes, contract types (CPFF), and project scales within the DoD or other federal agencies over a comparable timeframe.
What are the potential risks associated with a Cost Plus Fixed Fee (CPFF) contract for environmental remediation?
The primary risk with a CPFF contract is that the contractor may have less incentive to control costs compared to a fixed-price contract, as the government agrees to cover all allowable costs plus a predetermined fixed fee. For environmental remediation, unforeseen site conditions (e.g., discovering more contamination than initially assessed, encountering difficult geological formations) can significantly increase costs. The government bears the risk of these cost increases, while the contractor's fee remains fixed. Effective oversight, detailed cost tracking, and robust change order management are crucial to mitigate these risks and ensure value for taxpayer money.
What does the high number of bids (30) suggest about the market for environmental remediation services?
The fact that 30 bids were received for this contract strongly indicates a healthy and competitive market for environmental remediation services, at least within the geographic or capability scope relevant to this solicitation. A large number of bidders suggests that multiple companies possess the necessary qualifications, capacity, and interest to undertake such projects for the Department of Defense. This level of competition generally benefits the government by driving down prices, encouraging innovation, and increasing the pool of potential contractors for future needs. It also implies that the barriers to entry for qualified firms are not prohibitively high.
What is the historical spending trend for environmental remediation services within the Department of Defense?
Historical spending on environmental remediation by the Department of Defense (DoD) has been substantial and ongoing for decades, largely driven by the Defense Environmental Restoration Program (DERP). DERP addresses the cleanup of hazardous substances, pollutants, and contaminants resulting from past military activities. Spending fluctuates based on the number and scale of cleanup sites, regulatory requirements, and budget allocations. While specific annual figures vary, the DoD consistently allocates significant funds towards environmental compliance and cleanup, reflecting its commitment to addressing legacy environmental issues and ensuring operational sustainability. This $36.6M contract fits within that broader historical context of significant federal investment in environmental management.
Industry Classification
NAICS: Administrative and Support and Waste Management and Remediation Services › Remediation and Other Waste Management Services › Remediation Services
Product/Service Code: CONSTRUCT OF STRUCTURES/FACILITIES › CONSTRUCTION OF BUILDINGS
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY
Offers Received: 30
Pricing Type: COST PLUS FIXED FEE (U)
Evaluated Preference: NONE
Contractor Details
Address: I-40 WEST EXIT 114, LAGUNA, NM, 02
Business Categories: Category Business, Not Designated a Small Business
Financial Breakdown
Contract Ceiling: $36,615,203
Exercised Options: $36,615,203
Current Obligation: $36,615,207
Contract Characteristics
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: FA890304D8690
IDV Type: IDC
Timeline
Start Date: 2005-06-10
Current End Date: 2008-09-30
Potential End Date: 2008-09-30 00:00:00
Last Modified: 2011-08-26
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