DoD's $133M construction contract for environmental remediation awarded to Environmental Chemical Corporation

Contract Overview

Contract Amount: $133,468,639 ($133.5M)

Contractor: Environmental Chemical Corporation

Awarding Agency: Department of Defense

Start Date: 2008-09-24

End Date: 2010-11-30

Contract Duration: 797 days

Daily Burn Rate: $167.5K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 20

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: MIGRATED DATA VALUE UNKNOWN

Place of Performance

Location: SAN ANTONIO, BEXAR County, TEXAS, 78234, UNITED STATES OF AMERICA

State: Texas Government Spending

Plain-Language Summary

Department of Defense obligated $133.5 million to ENVIRONMENTAL CHEMICAL CORPORATION for work described as: MIGRATED DATA VALUE UNKNOWN Key points: 1. Contract value significantly exceeds typical remediation projects, raising questions about cost-effectiveness. 2. Sole bidder suggests potential lack of market interest or pre-qualification issues. 3. Long performance period may indicate complex scope or potential for cost overruns. 4. Fixed-price contract shifts risk to the contractor, but scope creep could still impact final cost. 5. Geographic concentration in Texas limits broader applicability of findings. 6. Contractor's past performance and specific expertise in this niche are critical for success.

Value Assessment

Rating: fair

The contract's total value of $133.4 million is substantial for a single environmental remediation project. Benchmarking against similar large-scale remediation efforts is difficult without more specific project details. However, the absence of multiple bids suggests that either the market for such specialized services is limited, or the contract's terms may not have been attractive enough to elicit broad competition. The fixed-price nature provides cost certainty, but the sheer scale of the award warrants scrutiny regarding the unit costs and overall value delivered.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

The contract was awarded under 'FULL AND OPEN COMPETITION', but the data indicates only one bid was received. This suggests that while the opportunity was advertised broadly, only one entity, Environmental Chemical Corporation, submitted a proposal. This could be due to the highly specialized nature of the work, stringent pre-qualification requirements, or a lack of interest from other potential bidders. The limited competition raises concerns about whether the government received the best possible pricing and terms.

Taxpayer Impact: A single bid limits the government's ability to negotiate favorable terms and potentially leads to higher costs for taxpayers compared to a scenario with robust competition.

Public Impact

The primary beneficiary is the Department of Defense, which will see environmental remediation at a specific site. The services delivered involve commercial and institutional building construction, likely related to site cleanup or restoration. The geographic impact is concentrated in Texas, where the project is located. Workforce implications include employment opportunities for construction and environmental specialists in the project's vicinity.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Limited competition may have resulted in a higher price than if multiple bids were received.
The long duration of the contract increases the risk of unforeseen issues impacting cost and schedule.
Lack of detailed scope in the provided data makes it difficult to assess the true value for money.
The specific environmental hazards being addressed are not detailed, making risk assessment challenging.

Positive Signals

The contract is firm-fixed-price, which transfers significant cost risk to the contractor.
Awarding to a single bidder implies they met all technical and qualification requirements.
The contract is for a specific, defined need within the Department of Defense's infrastructure management.

Sector Analysis

The contract falls within the Commercial and Institutional Building Construction sector, specifically focusing on environmental remediation. This is a specialized niche within the broader construction industry, often requiring specific certifications and expertise. The market size for such large-scale environmental remediation projects can vary significantly depending on regulatory requirements and the extent of contamination. Comparable spending benchmarks are difficult to establish without knowing the exact nature and scale of the environmental issues being addressed.

Small Business Impact

The provided data indicates that small business participation (ss) and set-asides (sb) were not applicable to this contract. This suggests that the contract was not specifically targeted towards small businesses, and there is no explicit information on subcontracting opportunities for small businesses. Consequently, the direct impact on the small business ecosystem from this particular award is likely minimal, unless the prime contractor voluntarily engages small businesses for specialized services.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and relevant program managers within the Department of the Army. Accountability measures are embedded in the firm-fixed-price structure, requiring the contractor to complete the work within the agreed-upon cost. Transparency is generally facilitated through contract award databases, though detailed project-specific oversight reports may not always be publicly available. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

Environmental Remediation Services
Department of Defense Construction Contracts
Large-Scale Infrastructure Projects
Federal Environmental Compliance

Risk Flags

Limited Competition
Potential for Cost Overruns
Lack of Detailed Scope Information
Contractor Performance Risk

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $133.5 million to ENVIRONMENTAL CHEMICAL CORPORATION. MIGRATED DATA VALUE UNKNOWN

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 $133.5 million.

What is the period of performance?

Start: 2008-09-24. End: 2010-11-30.

What specific environmental hazards or contamination issues does this contract address?

The provided data does not specify the exact environmental hazards or contamination issues being addressed by this contract. It broadly falls under 'Commercial and Institutional Building Construction' with a focus on environmental remediation. To understand the full scope and risk, further details on the nature of the contamination (e.g., hazardous waste, soil contamination, groundwater pollution, asbestos abatement) and the specific remediation technologies required would be necessary. This information is crucial for assessing the complexity of the work, the potential risks involved, and the appropriateness of the contract's value.

How does the $133.4 million contract value compare to similar environmental remediation projects awarded by the DoD or other federal agencies?

Benchmarking the $133.4 million contract value against similar environmental remediation projects requires access to a broader dataset of comparable contracts. Without specific details on the scope, duration, and type of remediation, a direct comparison is challenging. However, as a single award of this magnitude, it suggests a large-scale, complex undertaking. Typically, environmental remediation contracts can range from a few million to hundreds of millions of dollars, depending on factors like the size of the affected area, the type of contaminants, and the required cleanup standards. The limited competition (one bid) for this contract may indicate that the price achieved might be higher than if more bidders had participated, making direct comparison to competitively bid projects difficult.

What is the track record of Environmental Chemical Corporation in performing large-scale federal environmental remediation contracts?

Assessing the track record of Environmental Chemical Corporation requires a review of their past performance on federal contracts, particularly those involving environmental remediation and construction of similar scale and complexity. Information on their past performance ratings, any contract disputes, or successful project completions would be vital. While the award of this $133.4 million contract suggests they met the qualification criteria, a deeper dive into their history with agencies like the DoD, EPA, or Army Corps of Engineers would provide a clearer picture of their capabilities, reliability, and ability to manage such significant projects effectively and within budget.

Given the firm-fixed-price structure, what are the potential risks if unforeseen environmental conditions are discovered during the contract period?

Under a firm-fixed-price (FFP) contract, the contractor, Environmental Chemical Corporation, bears the primary risk for cost overruns. However, if unforeseen environmental conditions are discovered that significantly alter the scope of work, the contract may be subject to modification. This could involve change orders to address the new conditions, potentially increasing the contract price and extending the performance period. While the FFP structure aims to cap costs, significant 'unknown unknowns' in environmental projects can lead to complex negotiations and potential disputes over whether the new conditions constitute a change in scope or were implicitly part of the original risk. The government's oversight and contract administration are critical in managing such situations.

What oversight mechanisms are in place to ensure the successful completion and environmental compliance of this project?

Oversight for this Department of Defense contract is typically managed through the contracting officer's representative (COR) and potentially other technical monitors assigned by the Department of the Army. These individuals are responsible for monitoring the contractor's progress, ensuring adherence to the contract specifications, verifying quality control, and confirming compliance with all relevant environmental regulations. Regular site inspections, progress reports from the contractor, and milestone reviews are standard oversight tools. Given the nature of environmental remediation, specific environmental compliance monitoring and reporting protocols would also be integral to the oversight process.

How does the limited competition (one bid) impact the government's ability to ensure value for money on this $133.4 million contract?

Limited competition, particularly when only one bid is received under a 'full and open' solicitation, significantly hampers the government's ability to ensure optimal value for money. With only one offer, there is no direct price comparison to benchmark against. The government must rely heavily on pre-negotiated rates, historical data, or independent cost estimates to determine if the offered price is fair and reasonable. This lack of competitive pressure can lead to higher prices than might be achieved in a multi-bidder scenario. It also reduces the incentive for the contractor to offer the most competitive terms, as they face no immediate threat from rivals for this specific award.

Industry Classification

NAICS: Construction › Nonresidential Building Construction › Commercial and Institutional Building Construction

Product/Service Code: MAINT, REPAIR, ALTER REAL PROPERTY › MAINT, ALTER, REPAIR BUILDINGS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 20

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 1240 BAYSHORE HGHWY, BURLINGAME, CA, 94010

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $133,468,639

Exercised Options: $133,468,639

Current Obligation: $133,468,639

Contract Characteristics

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: FA890306D8511

IDV Type: IDC

Timeline