DHS Coast Guard Awards $2.95M for Vessel Destruction Services to Power Engineering Construction Company

Contract Overview

Contract Amount: $2,949,957 ($2.9M)

Contractor: Power Engineering Construction Company

Awarding Agency: Department of Homeland Security

Start Date: 2025-05-19

End Date: 2025-08-31

Contract Duration: 104 days

Daily Burn Rate: $28.4K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 5

Pricing Type: TIME AND MATERIALS

Sector: Other

Official Description: UCGPA24012 DESTRUCTION OF M/V CHALEUR

Place of Performance

Location: STOCKTON, SAN JOAQUIN County, CALIFORNIA, 95201

State: California Government Spending

Plain-Language Summary

Department of Homeland Security obligated $2.9 million to POWER ENGINEERING CONSTRUCTION COMPANY for work described as: UCGPA24012 DESTRUCTION OF M/V CHALEUR Key points: 1. Contract awarded for vessel destruction services. 2. Power Engineering Construction Company is the sole awardee. 3. The contract is for Time and Materials pricing. 4. The award is a Delivery Order under a larger contract. 5. The contract duration is 104 days.

Value Assessment

Rating: fair

The Time and Materials pricing structure can lead to cost overruns if not closely monitored. Benchmarking against similar vessel destruction contracts is difficult without more detailed scope information.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, suggesting a competitive bidding process. However, the specific pricing mechanism (Time and Materials) may limit price certainty for the government.

Taxpayer Impact: Taxpayer funds are being used for the disposal of a vessel, a necessary but potentially costly environmental service.

Public Impact

Environmental cleanup and disposal of maritime assets. Potential impact on marine ecosystems if not handled properly. Supports Coast Guard operational readiness by removing obsolete vessels.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Time and Materials pricing risk
Potential for scope creep
Limited competition visibility on specific task orders

Positive Signals

Awarded under full and open competition
Addresses environmental remediation needs

Sector Analysis

This contract falls under remediation services, a niche sector often involving specialized environmental and engineering expertise. Spending benchmarks for vessel destruction can vary significantly based on vessel size, material, and location.

Small Business Impact

The data indicates the awardee is not a small business. There is no information provided on subcontracting opportunities for small businesses within this contract.

Oversight & Accountability

Oversight will be critical to manage the Time and Materials aspect of this contract, ensuring costs remain within reasonable limits and the scope of work is adhered to.

Related Government Programs

Remediation Services
Department of Homeland Security Contracting
U.S. Coast Guard Programs

Risk Flags

Time and Materials pricing
Potential for cost overruns
Environmental risks associated with vessel destruction
Lack of small business participation noted

Frequently Asked Questions

What is this federal contract paying for?

Department of Homeland Security awarded $2.9 million to POWER ENGINEERING CONSTRUCTION COMPANY. UCGPA24012 DESTRUCTION OF M/V CHALEUR

Who is the contractor on this award?

The obligated recipient is POWER ENGINEERING CONSTRUCTION COMPANY.

Which agency awarded this contract?

Awarding agency: Department of Homeland Security (U.S. Coast Guard).

What is the total obligated amount?

The obligated amount is $2.9 million.

What is the period of performance?

Start: 2025-05-19. End: 2025-08-31.

What is the estimated total cost if this contract were fixed-price, and how does it compare to the current Time and Materials estimate?

Without a detailed breakdown of labor hours, material costs, and overhead rates, it's impossible to provide a precise fixed-price estimate. However, Time and Materials contracts inherently carry a higher risk of cost escalation compared to fixed-price contracts, potentially leading to a higher final cost if not managed diligently. The government's ability to control costs depends heavily on effective oversight and negotiation of rates.

What specific environmental risks are associated with the destruction of M/V CHALEUR, and what mitigation strategies are in place?

The specific environmental risks depend on the vessel's construction materials (e.g., presence of hazardous substances like asbestos, PCBs, lead paint) and its current condition. Mitigation strategies typically involve containment of hazardous materials, proper disposal protocols, and monitoring of surrounding water and soil. The contract should detail these procedures, and the Coast Guard's oversight should ensure compliance.

How effectively will the U.S. Coast Guard ensure that the 'Remediation Services' provided under this contract meet all regulatory and environmental standards?

The Coast Guard will likely ensure effectiveness through rigorous contract oversight, including regular progress reviews, site inspections, and verification of compliance with all applicable federal, state, and local environmental regulations. The contract's performance work statement should clearly define deliverables and standards, and the contracting officer's representative will be responsible for monitoring adherence to these requirements.

Industry Classification

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

Product/Service Code: NATURAL RESOURCES MANAGEMENT › ENVIRONMENTAL SYSTEMS PROTECTION

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 5

Pricing Type: TIME AND MATERIALS (Y)

Evaluated Preference: NONE

Contractor Details

Address: 1501 VIKING ST STE 200, ALAMEDA, CA, 94501

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, Subchapter S Corporation, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $2,949,957

Exercised Options: $2,949,957

Current Obligation: $2,949,957

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Parent Contract

Parent Award PIID: 70Z08425GALAM0001

IDV Type: BOA

Timeline