Demolition and cleanup contract awarded to Environmental Chemical Corporation for $24.1M in Louisiana

Contract Overview

Contract Amount: $24,111,885 ($24.1M)

Contractor: Environmental Chemical Corporation

Awarding Agency: Department of Defense

Start Date: 2006-05-24

End Date: 2006-09-30

Contract Duration: 129 days

Daily Burn Rate: $186.9K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: STRUCTURAL DEMOLITION, DEBRIS REMOVAL AND SITE CLEANUP WORK IN SECTOR 2A, ORLEANS PARISH (SOUTH OF I-10) IN THE STATE OF LOUISIANA

Place of Performance

Location: NEW ORLEANS, ORLEANS County, LOUISIANA, 70130

State: Louisiana Government Spending

Plain-Language Summary

Department of Defense obligated $24.1 million to ENVIRONMENTAL CHEMICAL CORPORATION for work described as: STRUCTURAL DEMOLITION, DEBRIS REMOVAL AND SITE CLEANUP WORK IN SECTOR 2A, ORLEANS PARISH (SOUTH OF I-10) IN THE STATE OF LOUISIANA Key points: 1. Contract focused on structural demolition, debris removal, and site cleanup in Orleans Parish. 2. Awarded under full and open competition after exclusion of sources, indicating a specific justification for limited competition. 3. The contract duration was 129 days, suggesting a focused and time-sensitive scope of work. 4. The firm-fixed-price contract type aims to control costs for the government. 5. The contract was awarded to a single vendor, Environmental Chemical Corporation. 6. The work was performed in Louisiana, a region impacted by significant environmental and infrastructure challenges.

Value Assessment

Rating: fair

The contract value of $24.1 million for demolition and cleanup services over approximately four months appears substantial. Without specific benchmarks for the scale and complexity of the demolition and cleanup in Sector 2A, Orleans Parish, it's difficult to definitively assess value for money. However, the firm-fixed-price structure suggests an attempt to cap costs. Further analysis would require comparing this to similar large-scale disaster recovery or demolition projects in terms of cost per square foot or per unit of debris removed.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

The contract was awarded under 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES.' This specific procurement method suggests that while the intent was competition, certain sources were excluded, potentially due to specialized capabilities, prior performance, or specific project requirements. The fact that only one award was made indicates that Environmental Chemical Corporation was the sole responsive and responsible bidder under the specified conditions. This limited competition may have implications for price negotiation.

Taxpayer Impact: While competition was intended, the exclusion of sources and single award suggest that taxpayers may not have benefited from the full range of potential pricing efficiencies that a broader, unrestricted competition could have offered.

Public Impact

The primary beneficiaries are the residents and businesses of Orleans Parish (South of I-10) who would see improved environmental conditions and land availability. The services delivered include structural demolition, debris removal, and site cleanup, crucial for post-disaster recovery and urban renewal. The geographic impact is localized to Sector 2A in Orleans Parish, Louisiana. The contract likely involved a significant workforce for demolition, debris handling, and site remediation, contributing to local employment opportunities.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Limited competition raises concerns about potential overpayment and lack of cost-saving innovation.
The exclusion of sources requires scrutiny to ensure it was justified and not restrictive.
The firm-fixed-price contract, while good for cost control, could incentivize cutting corners if not adequately overseen.

Positive Signals

The firm-fixed-price contract provides cost certainty for the government.
The contract was awarded under a competitive process, even if limited, suggesting some level of market vetting.
The focus on demolition and cleanup addresses critical post-event needs, contributing to public safety and environmental health.

Sector Analysis

This contract falls within the environmental services and construction sector, specifically focusing on demolition and debris removal. The market for such services can be highly specialized, particularly in disaster recovery scenarios. The size of the contract, over $24 million, indicates a significant project. Comparable spending benchmarks would typically involve analyzing the cost per unit of demolition (e.g., per square foot of structure) or per ton of debris removed for similar projects, especially those undertaken in response to natural disasters.

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 arising from a set-aside provision. The prime contractor, Environmental Chemical Corporation, would determine any subcontracting opportunities. Without further information on the prime contractor's subcontracting plan, the direct impact on the small business ecosystem is unclear, though large prime contracts can sometimes lead to opportunities for specialized small business subcontractors.

Oversight & Accountability

Oversight for this contract would typically fall under the purview of the awarding agency, the Department of the Army. Mechanisms would include contract administration, performance monitoring, and potentially site inspections to ensure work is completed according to specifications and safety standards. Transparency is generally facilitated through contract databases like FPDS. Accountability would be enforced through contractual remedies if performance issues arise. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

FEMA Disaster Recovery Programs
EPA Superfund Site Cleanups
Army Corps of Engineers Construction Contracts
State Environmental Remediation Funds

Risk Flags

Limited competition requires careful justification and oversight.
Potential for cost overruns if unforeseen site conditions arise.
Need for stringent quality control to ensure thorough cleanup and environmental compliance.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $24.1 million to ENVIRONMENTAL CHEMICAL CORPORATION. STRUCTURAL DEMOLITION, DEBRIS REMOVAL AND SITE CLEANUP WORK IN SECTOR 2A, ORLEANS PARISH (SOUTH OF I-10) IN THE STATE OF LOUISIANA

Who is the contractor on this award?

The obligated recipient is ENVIRONMENTAL CHEMICAL CORPORATION.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $24.1 million.

What is the period of performance?

Start: 2006-05-24. End: 2006-09-30.

What was the specific justification for excluding certain sources in this 'full and open competition after exclusion of sources' procurement?

The justification for excluding certain sources under this procurement method typically stems from requirements for highly specialized equipment, unique technical expertise, or specific security clearances that only a limited number of contractors possess. In the context of demolition and debris removal, especially after a significant event, factors like rapid mobilization capabilities, experience with particular types of hazardous materials, or established relationships with local regulatory bodies might necessitate excluding some potential bidders. The contracting officer would have documented this justification in the procurement file. Without access to that specific documentation, the precise reasons remain speculative, but they are intended to ensure the most qualified contractor is selected for a critical task, even if it narrows the competitive pool.

How does the $24.1 million contract value compare to similar demolition and debris removal contracts awarded by the Department of Defense or other agencies for disaster recovery?

Comparing the $24.1 million contract value requires context regarding the scope and scale of the work. For instance, if this contract covered the demolition of hundreds of heavily damaged structures and the removal of vast quantities of debris across a large area in Orleans Parish, the value might be reasonable. However, if the scope was more limited, it could be considered high. Benchmarking against similar contracts would involve looking at the cost per structure demolished, cost per ton of debris removed, or cost per acre of site cleaned. Contracts for large-scale disaster recovery, like Hurricane Katrina response efforts in the Gulf Coast, often ran into hundreds of millions or even billions of dollars, making this $24.1 million contract a component of a larger recovery effort. Without detailed scope metrics, a direct comparison is challenging, but the value suggests a significant, albeit not massive, undertaking.

What performance risks were associated with Environmental Chemical Corporation for this contract, given it was the sole awardee?

As the sole awardee under a limited competition, the primary performance risk is the potential lack of robust market pressure to ensure optimal performance and efficiency. While the firm-fixed-price contract provides cost certainty, it doesn't inherently guarantee quality or timeliness if the contractor faces unforeseen challenges or lacks sufficient resources. Risks could include delays due to logistical issues, unexpected site conditions (e.g., hazardous materials not initially identified), or workforce shortages. The government's oversight and quality assurance processes become critical in mitigating these risks. The contracting officer would have assessed Environmental Chemical Corporation's capability and past performance prior to award, but ongoing monitoring is essential to ensure the contractor meets all contractual obligations, including safety, environmental compliance, and completion deadlines.

What was the historical spending pattern for structural demolition and debris removal in Louisiana by the Department of Defense prior to and following this contract?

Analyzing historical spending patterns for structural demolition and debris removal in Louisiana by the Department of Defense requires access to historical contract data. Prior to this 2006 contract, spending would likely have been project-specific and potentially lower unless major federal disaster declarations occurred. Following this contract, especially in the aftermath of major events like Hurricane Katrina (which occurred shortly before this contract's award date), spending in this category would have surged dramatically across multiple agencies, including the Army Corps of Engineers and FEMA. This specific contract appears to be an early component of the response to significant regional needs. A broader analysis would reveal cyclical spending tied to natural disasters and the government's increasing focus on infrastructure resilience and disaster preparedness.

What are the potential long-term environmental implications of the site cleanup performed under this contract?

The long-term environmental implications depend heavily on the nature of the debris and the thoroughness of the cleanup. If the demolition involved structures contaminated with hazardous materials (e.g., asbestos, lead paint, chemical storage), the effectiveness of the removal and disposal processes is critical. Proper site remediation ensures that residual contaminants do not leach into soil or groundwater, posing risks to public health and ecosystems. The contract specifies 'site cleanup,' which implies more than just debris removal, potentially including soil testing and remediation. Assuming Environmental Chemical Corporation adhered to all environmental regulations and disposal protocols, the long-term impact should be positive, restoring the land for future use. However, inadequate cleanup could lead to persistent environmental issues requiring further, more costly remediation efforts later.

Industry Classification

NAICS: Administrative and Support and Waste Management and Remediation Services › Waste Collection › Other Waste Collection

Product/Service Code: UTILITIES AND HOUSEKEEPING › HOUSEKEEPING SERVICES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: ONLY ONE SOURCE

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 1240 BAYSHORE HWY, BURLINGAME, CA, 90

Business Categories: Category Business, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $24,111,885

Exercised Options: $24,111,885

Current Obligation: $24,111,885

Contract Characteristics

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: W912P805D0023

IDV Type: IDC

Timeline