DoD's $75.4M construction contract for environmental remediation awarded to ENVIRONMENTAL CHEMICAL CORPORATION

Contract Overview

Contract Amount: $75,391,919 ($75.4M)

Contractor: Environmental Chemical Corporation

Awarding Agency: Department of Defense

Start Date: 2010-09-29

End Date: 2013-06-15

Contract Duration: 990 days

Daily Burn Rate: $76.2K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 20

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: KMTC

Plain-Language Summary

Department of Defense obligated $75.4 million to ENVIRONMENTAL CHEMICAL CORPORATION for work described as: KMTC Key points: 1. The contract value of $75.4 million represents a significant investment in environmental services. 2. Awarded under full and open competition, suggesting a potentially competitive bidding process. 3. The firm-fixed-price contract type shifts performance risk to the contractor. 4. The duration of 990 days indicates a substantial, long-term project. 5. The North American Industry Classification System (NAICS) code 236220 points to commercial and institutional building construction. 6. The contract was awarded by the Department of the Air Force, a major component of the DoD. 7. The absence of small business set-aside flags indicates it was not specifically targeted for small businesses.

Value Assessment

Rating: fair

Benchmarking the value of this $75.4 million contract is challenging without specific details on the scope of environmental remediation. However, for large-scale construction and environmental services, this amount falls within a typical range for significant federal projects. The firm-fixed-price structure suggests that the contractor is expected to manage costs effectively to maintain profitability. Further analysis would require comparing the specific services rendered against industry standards and similar government contracts to ascertain if the price reflects true value for money.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under 'full and open competition,' indicating that all responsible sources were permitted to submit bids. The presence of 20 bids suggests a healthy level of interest and competition for this project. A higher number of bidders generally leads to more competitive pricing and a greater likelihood of selecting the best value proposal for the government. The specific details of the bidding process, such as the evaluation criteria and the number of proposals deemed technically acceptable, would provide further insight into the effectiveness of the competition.

Taxpayer Impact: The robust competition for this contract is beneficial for taxpayers, as it likely drove down the final price and ensured the government received competitive offers. This process helps prevent overspending and encourages contractors to offer their best terms.

Public Impact

The primary beneficiaries are likely military installations requiring environmental remediation services, ensuring compliance with environmental regulations. The services delivered involve construction and potentially hazardous material handling related to environmental cleanup. The geographic impact is specific to the location of the Air Force facilities where the remediation is conducted. Workforce implications include employment opportunities for construction workers, environmental specialists, and project managers.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if unforeseen environmental conditions arise, despite the firm-fixed-price structure.
Ensuring contractor compliance with stringent environmental regulations and safety protocols.
The long duration of the contract could lead to potential scope creep or changes if not managed tightly.

Positive Signals

Firm-fixed-price contract shifts cost risk to the contractor.
Awarded under full and open competition, indicating a competitive bidding process.
The contractor, ENVIRONMENTAL CHEMICAL CORPORATION, has experience in this sector.

Sector Analysis

The construction industry, particularly the segment focused on environmental remediation, is a critical sector for government operations. Federal spending in this area is driven by regulatory compliance, infrastructure maintenance, and the need to address legacy environmental issues at military bases and other federal sites. This contract fits within the broader category of federal construction and environmental services, which can involve significant investments due to the specialized nature of the work and the stringent regulatory environment. Comparable spending benchmarks would depend on the specific type and scale of environmental remediation required.

Small Business Impact

The contract was not awarded as a small business set-aside, and there is no indication of specific subcontracting goals for small businesses in the provided data. This suggests that the primary award went to a large business. While not a direct set-aside, the prime contractor may still engage small businesses for subcontracting opportunities, depending on the project's needs and their own procurement policies. The impact on the small business ecosystem would depend on whether they are included in the supply chain for this contract.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and the relevant program office within the Department of the Air Force. Performance monitoring, compliance checks, and payment approvals are standard oversight mechanisms. Transparency is generally maintained through contract award databases and public reporting. Inspector General jurisdiction would apply if any allegations of fraud, waste, or abuse arise during the contract's performance.

Related Government Programs

Environmental Remediation Services
Military Construction
Department of Defense Contracts
Air Force Procurement
Federal Construction Projects

Risk Flags

Potential for unforeseen environmental conditions impacting cost and schedule.
Ensuring contractor compliance with stringent environmental regulations.
Contract duration may lead to scope management challenges.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $75.4 million to ENVIRONMENTAL CHEMICAL CORPORATION. KMTC

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 Air Force).

What is the total obligated amount?

The obligated amount is $75.4 million.

What is the period of performance?

Start: 2010-09-29. End: 2013-06-15.

What is the track record of ENVIRONMENTAL CHEMICAL CORPORATION with federal contracts, particularly with the Department of Defense?

ENVIRONMENTAL CHEMICAL CORPORATION has a history of receiving federal contracts, primarily with the Department of Defense. Analyzing their past performance, including contract values, types of services rendered, and any past performance issues or awards, is crucial. For instance, understanding their success rate on similar environmental remediation or construction projects can provide insight into their capability to execute this current $75.4 million contract effectively. A review of their contract history might reveal a pattern of successful project completion or highlight areas where they have faced challenges, which could inform risk assessment for this ongoing award.

How does the $75.4 million contract value compare to similar environmental remediation contracts awarded by the Department of the Air Force or DoD?

The $75.4 million contract value for environmental remediation is substantial and falls within the upper range for significant federal projects of this nature. To benchmark its value, one would compare it against other contracts for similar services (e.g., hazardous waste cleanup, site restoration, soil and groundwater remediation) awarded by the Air Force or other DoD branches over the past several years. Factors such as the specific scope of work, geographic location, duration, and complexity of the environmental challenges would need to be considered for a precise comparison. If similar projects have been awarded for considerably less, or if this contract's scope is unusually broad, it might indicate a potential overvaluation or a highly competitive bid.

What are the primary risks associated with a firm-fixed-price contract for environmental remediation of this magnitude?

The primary risk with a firm-fixed-price (FFP) contract of this magnitude ($75.4 million) for environmental remediation lies in unforeseen site conditions. While FFP shifts cost overrun risk to the contractor, significant discoveries of highly hazardous materials, unexpected geological challenges, or changes in regulatory requirements could lead to contractor claims for equitable adjustments or, in extreme cases, contract termination if the contractor cannot absorb the unexpected costs. Another risk is the contractor's capacity to manage such a large and potentially complex project over its duration, ensuring quality control and adherence to strict environmental and safety standards. The government's risk is ensuring the contractor has the technical expertise and financial stability to complete the work as specified.

How effective are the oversight mechanisms for ensuring successful completion and compliance with environmental standards?

The effectiveness of oversight for this $75.4 million contract hinges on the diligence of the Department of the Air Force's contracting officer representatives (CORs) and quality assurance personnel. Robust oversight involves regular site inspections, monitoring of progress against the schedule, verification of compliance with environmental regulations and safety protocols, and thorough review of all deliverables and invoices. The firm-fixed-price nature requires careful monitoring to ensure the contractor is meeting all performance requirements without cutting corners. The presence of a strong quality assurance surveillance plan (QASP) and clear communication channels between the government and the contractor are critical for mitigating risks and ensuring the project's success and environmental integrity.

What is the historical spending trend for environmental remediation contracts within the Department of the Air Force?

Historical spending on environmental remediation contracts within the Department of the Air Force (and the DoD broadly) has been substantial and consistent, driven by the need to manage environmental liabilities at active and former military installations. Spending fluctuates based on specific cleanup initiatives, base realignment and closure actions, and evolving environmental regulations. Analyzing past spending patterns can reveal which types of remediation services are most frequently contracted, the average contract values, and the primary contracting vehicles used. This context helps in evaluating whether the $75.4 million awarded to ENVIRONMENTAL CHEMICAL CORPORATION aligns with historical investment levels for similar projects or represents a significant deviation.

What are the potential implications of the 20 bids received on the final price and quality of services?

Receiving 20 bids for this $75.4 million environmental remediation contract suggests a highly competitive marketplace for these services. A large number of bidders generally exerts downward pressure on pricing, increasing the likelihood that the government secured a competitive price. Furthermore, it expands the pool of potential contractors, enhancing the probability of selecting a firm with superior technical capabilities and relevant experience. The government's evaluation process would then focus on identifying the best value among these competitive offers, balancing price against technical merit and past performance to ensure both cost-effectiveness and high-quality service delivery.

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, 90

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

Financial Breakdown

Contract Ceiling: $75,391,919

Exercised Options: $75,391,919

Current Obligation: $75,391,919

Contract Characteristics

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: FA890306D8511

IDV Type: IDC

Timeline