Demilitarization of ammo items contract awarded to Day & Zimmermann Hawthorne Corp. for over $19.6M
Contract Overview
Contract Amount: $19,667,896 ($19.7M)
Contractor: DAY & Zimmermann Hawthorne Corporation
Awarding Agency: Department of Defense
Start Date: 2006-11-21
End Date: 2014-04-30
Contract Duration: 2,717 days
Daily Burn Rate: $7.2K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 3
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: DEMILITARIZATION OF AMMO ITEMS
Place of Performance
Location: HAWTHORNE, MINERAL County, NEVADA, 89415
State: Nevada Government Spending
Plain-Language Summary
Department of Defense obligated $19.7 million to DAY & ZIMMERMANN HAWTHORNE CORPORATION for work described as: DEMILITARIZATION OF AMMO ITEMS Key points: 1. Contract value appears reasonable for specialized hazardous material handling and disposal services. 2. Full and open competition suggests a competitive bidding process, potentially leading to better pricing. 3. Contract duration of over 7 years indicates a significant, long-term requirement for these services. 4. Fixed-price contract type shifts risk to the contractor, encouraging cost control. 5. The contractor, Day & Zimmermann, has a history in defense contracting, suggesting relevant experience. 6. Services provided are critical for safe and compliant disposal of military ordnance.
Value Assessment
Rating: good
The contract value of approximately $19.6 million over its duration is difficult to benchmark precisely without more granular data on the volume and type of ammunition demilitarized. However, given the specialized nature of hazardous material handling, disposal, and compliance requirements associated with ordnance, this figure appears within a reasonable range for a large-scale, multi-year federal contract. The firm fixed-price structure incentivizes the contractor to manage costs effectively.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit bids. The presence of 3 bidders suggests a moderate level of competition for this specialized service. While not an exceptionally high number of bidders, it demonstrates that the market was accessible and that multiple companies were interested and capable of performing the work.
Taxpayer Impact: Full and open competition generally benefits taxpayers by fostering a competitive environment that can drive down prices and encourage innovation. The fact that multiple firms bid suggests that the government received a range of offers, increasing the likelihood of securing a fair market price.
Public Impact
The Department of the Army benefits from the safe and compliant demilitarization of its ammunition inventory. This service ensures the removal of hazardous materials from military stockpiles, reducing environmental and safety risks. The contract supports the safe disposal of potentially dangerous ordnance, contributing to overall military readiness and safety. The workforce implications include employment opportunities for skilled labor in hazardous material handling and disposal at the contractor's facility.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Potential for cost overruns if unforeseen hazardous materials or disposal challenges arise, despite fixed-price structure.
- Ensuring consistent adherence to stringent environmental and safety regulations throughout the contract lifecycle.
- Managing the logistical complexities of transporting and processing large quantities of ordnance.
Positive Signals
- Contractor's established presence and experience in defense sector likely translates to efficient execution.
- Firm fixed-price contract aligns contractor incentives with cost-effective service delivery.
- Full and open competition suggests a robust vetting process for qualified bidders.
Sector Analysis
The demilitarization of ammunition falls within the broader defense logistics and hazardous waste management sectors. This contract represents a specific, high-stakes application of these services, requiring specialized expertise in handling explosive materials and adhering to strict regulatory frameworks. The market for such services is relatively niche, dominated by contractors with proven capabilities in defense support and environmental compliance. Comparable spending benchmarks would likely be found in other large-scale hazardous material disposal contracts or specialized military support services.
Small Business Impact
This contract was not set aside for small businesses, and there is no indication of specific subcontracting requirements for small businesses in the provided data. The nature of ammunition demilitarization often requires specialized facilities and certifications that may limit the pool of eligible small business subcontractors. Further investigation into subcontracting plans would be needed to assess the impact on the small business ecosystem.
Oversight & Accountability
Oversight for this contract would primarily fall under the Department of the Army's contracting and program management offices. The firm fixed-price nature of the contract provides a degree of accountability by placing cost control responsibility on the contractor. Transparency would be facilitated through standard federal procurement reporting mechanisms. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse.
Related Government Programs
- Ordnance Disposal Services
- Hazardous Material Management
- Defense Logistics Support
- Military Munitions Management
- Environmental Remediation Services
Risk Flags
- Potential environmental hazards
- Safety risks associated with ordnance
- Contractor performance risk
- Regulatory compliance complexity
Tags
defense, department-of-defense, department-of-the-army, facilities-support-services, full-and-open-competition, firm-fixed-price, hazardous-materials, ordnance-disposal, nevada, large-contract, demilitarization
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $19.7 million to DAY & ZIMMERMANN HAWTHORNE CORPORATION. DEMILITARIZATION OF AMMO ITEMS
Who is the contractor on this award?
The obligated recipient is DAY & ZIMMERMANN HAWTHORNE 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 $19.7 million.
What is the period of performance?
Start: 2006-11-21. End: 2014-04-30.
What is the specific type and quantity of ammunition demilitarized under this contract?
The provided data does not specify the exact types or quantities of ammunition demilitarized. The contract covers 'DEMILITARIZATION OF AMMO ITEMS' valued at over $19.6 million. Demilitarization typically involves rendering ordnance safe and non-explosive, often through dismantling, destruction, or chemical treatment. The specific processes and materials handled would depend on the nature of the ammunition, ranging from small arms rounds to larger munitions. Detailed specifications would be found in the contract's statement of work.
How does the per-unit cost of demilitarization compare to industry benchmarks?
A precise per-unit cost benchmark is not calculable with the given data, as the quantity and type of ammunition are unspecified. Per-unit costs for demilitarization can vary significantly based on the explosive material, casing type, size, and required disposal methods. Factors such as the need for specialized containment, environmental controls, and labor intensity all influence pricing. Without a defined unit (e.g., per pound, per round, per ton) and the corresponding quantity, a direct comparison to industry benchmarks is not feasible.
What is Day & Zimmermann Hawthorne Corporation's track record with similar defense contracts?
Day & Zimmermann has a significant history as a defense contractor, providing a wide range of services including munitions manufacturing, logistics, and base operations support. Their experience likely includes handling hazardous materials and managing complex government contracts. While specific details on their demilitarization performance for the Army under this particular contract are not detailed here, their broader portfolio suggests a capacity and familiarity with the defense industrial base and its requirements. Performance reviews and past performance questionnaires from the government would offer more granular insights.
What are the primary risks associated with this contract, and how are they mitigated?
Key risks include the inherent dangers of handling explosive materials, potential environmental contamination, and contractor non-performance. Mitigation strategies involve stringent safety protocols mandated by the contract, adherence to environmental regulations, and the firm fixed-price structure which incentivizes contractor diligence. The government's oversight, contractor's experience, and the competitive bidding process also serve as risk mitigation factors. Potential unforeseen challenges in the demilitarization process could still pose risks.
How has federal spending on ammunition demilitarization evolved over time?
Historical spending data on ammunition demilitarization specifically is not provided. However, overall defense spending fluctuates based on geopolitical factors, military readiness requirements, and budget allocations. As the military modernizes its arsenal and retires older munitions, the need for demilitarization services generally remains consistent, though the volume and types of materials may change. Trends in environmental regulations and disposal technologies also influence spending patterns in this sector.
What is the geographic impact of this contract, considering the contractor's location?
The contract was awarded to Day & Zimmermann Hawthorne Corporation, located in Hawthorne, Nevada. Therefore, the primary geographic impact is concentrated in that region, where the demilitarization activities would take place. This includes potential job creation and economic activity in the local area surrounding the contractor's facility. The contract itself is a federal service requirement, but its physical execution is localized.
Industry Classification
NAICS: Administrative and Support and Waste Management and Remediation Services › Facilities Support Services › Facilities Support Services
Product/Service Code: UTILITIES AND HOUSEKEEPING › HOUSEKEEPING SERVICES
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Offers Received: 3
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: DAY & Zimmermann Group Inc., the (UEI: 007913486)
Address: 2 S MAIN ST, BLDG # 2, HAWTHORNE, NV, 04
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business
Financial Breakdown
Contract Ceiling: $19,667,896
Exercised Options: $19,667,896
Current Obligation: $19,667,896
Contract Characteristics
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: DAAA0999D0022
IDV Type: IDC
Timeline
Start Date: 2006-11-21
Current End Date: 2014-04-30
Potential End Date: 2014-04-30 00:00:00
Last Modified: 2014-06-27
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