DoD's $17.5M water services contract with Veolia Water North America awarded in 2002, spanning over a decade

Contract Overview

Contract Amount: $17,479,546 ($17.5M)

Contractor: Veolia Water North America Operating Services, LLC

Awarding Agency: Department of Defense

Start Date: 2002-06-19

End Date: 2012-12-25

Contract Duration: 3,842 days

Daily Burn Rate: $4.5K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 4

Pricing Type: FIRM FIXED PRICE

Sector: Other

Place of Performance

Location: PICATINNY ARSENAL, MORRIS County, NEW JERSEY, 07806

State: New Jersey Government Spending

Plain-Language Summary

Department of Defense obligated $17.5 million to VEOLIA WATER NORTH AMERICA OPERATING SERVICES, LLC for work described as: Key points: 1. Contract awarded under full and open competition, suggesting a potentially competitive pricing environment. 2. The contract's duration of over 10 years may present risks related to evolving needs and technological obsolescence. 3. Fixed-price contract type generally shifts performance risk to the contractor, but scope creep could still impact costs. 4. The absence of small business set-aside indicates a focus on large prime contractors for this service. 5. The contract's value, while significant, needs to be benchmarked against similar water utility services for a comprehensive value assessment. 6. The specific performance metrics and quality assurance measures are crucial for evaluating the contractor's effectiveness over the long term.

Value Assessment

Rating: fair

The contract value of approximately $17.5 million over more than 10 years averages around $1.75 million annually. Benchmarking this against similar large-scale water utility contracts for federal installations is necessary to determine if the pricing is competitive. Without specific details on the scope of services (e.g., water treatment, distribution, maintenance) and the size/complexity of the facilities served, a definitive value-for-money assessment is challenging. However, the long duration could imply either a stable, well-understood requirement or a potential for overpricing if needs have changed significantly since award.

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 offers. This suggests that the Department of Defense actively sought the best value through a broad solicitation process. The number of bidders (4) provides a moderate level of competition, which typically aids in price discovery and can lead to more favorable terms for the government compared to sole-source or limited competition scenarios.

Taxpayer Impact: A competitive award process generally benefits taxpayers by driving down prices and encouraging innovation from multiple vendors, leading to a more efficient use of public funds.

Public Impact

Military personnel and their families stationed at the New Jersey facility benefit from reliable access to potable water and wastewater management. The contract ensures the continuous operation and maintenance of critical water supply and irrigation systems essential for base functionality. The geographic impact is localized to the specific Department of the Army installation in New Jersey where the services are provided. The contract supports jobs within the water utility sector, potentially including engineers, technicians, and operational staff employed by the prime contractor and any subcontractors.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Long contract duration (over 10 years) increases the risk of cost escalation due to unforeseen market changes or technological advancements.
Fixed-price contracts can lead to contractor underperformance if not rigorously monitored for quality and service delivery.
Lack of specific performance metrics in the provided data makes it difficult to assess the contractor's adherence to service level agreements.
The absence of small business participation may limit opportunities for smaller, specialized firms in the water utility sector.

Positive Signals

Awarded through full and open competition, suggesting a robust vetting process and potential for competitive pricing.
The firm fixed-price contract type provides cost certainty for the government, assuming the scope is well-defined and managed.
The contractor, Veolia Water North America, is a recognized entity in the water utility sector, implying experience and established operational capabilities.
The contract's long-term nature, if managed effectively, can lead to operational efficiencies and stable service delivery for the installation.

Sector Analysis

The water supply and irrigation systems sector for federal agencies involves the provision of essential utilities, including potable water treatment, distribution, and wastewater management. This contract falls within the broader utilities and infrastructure maintenance market. Comparable spending benchmarks would typically involve analyzing the cost per gallon treated or distributed, or the cost per facility served, across different government installations or municipal contracts. The market is often characterized by a mix of large, established utility providers and specialized engineering firms.

Small Business Impact

This contract does not appear to have included a small business set-aside, as indicated by 'sb: false'. This suggests that the primary focus was on securing services from larger, potentially more experienced prime contractors capable of managing extensive water utility operations. There is no information provided regarding subcontracting plans or actual performance with small businesses. The lack of a set-aside means that opportunities for small businesses in this specific contract were likely limited to potential subcontracting roles, if any were pursued by the prime contractor.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and the contract administration office within the Department of Defense. Performance monitoring, quality assurance checks, and invoice verification are standard oversight mechanisms. Transparency is generally facilitated through contract databases like FPDS, which provide basic award details. Inspector General jurisdiction would apply if any allegations of fraud, waste, or abuse arise during the contract's performance or closeout.

Related Government Programs

Department of Defense Facilities Management Contracts
Federal Utility Services Contracts
Army Base Operations Support
Water Infrastructure Maintenance
Government Water Treatment Services

Risk Flags

Long contract duration may increase risk of cost escalation and technological obsolescence.
Fixed-price contract requires careful scope management to prevent cost overruns due to changes.
Lack of detailed performance data hinders comprehensive value assessment.
Absence of small business participation noted.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $17.5 million to VEOLIA WATER NORTH AMERICA OPERATING SERVICES, LLC. See the official description on USAspending.

Who is the contractor on this award?

The obligated recipient is VEOLIA WATER NORTH AMERICA OPERATING SERVICES, LLC.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $17.5 million.

What is the period of performance?

Start: 2002-06-19. End: 2012-12-25.

What specific water and wastewater services were included under this contract, and what were the key performance indicators (KPIs)?

The provided data indicates the contract covered 'Water Supply and Irrigation Systems' (NAICS 221310). However, the specific services are not detailed. Typically, such contracts encompass the operation and maintenance of water treatment plants, distribution networks, wastewater collection and treatment facilities, and potentially irrigation systems for grounds maintenance. Key performance indicators (KPIs) would likely include water quality compliance (e.g., meeting EPA standards), system uptime and reliability, response times for service calls, and efficient resource management (e.g., water conservation). Without the full contract statement of work, these specifics remain inferred.

How does the average annual cost of $1.75 million compare to similar water utility contracts for federal installations of comparable size and complexity?

To assess the value, this $1.75 million average annual cost needs comparison against benchmarks. Factors influencing cost include the volume of water treated/distributed, the complexity of the treatment processes (e.g., desalination, advanced purification), the scope of wastewater services, the number of personnel required, and the geographic location's labor costs. For instance, a contract serving a large military base with extensive housing and training facilities would naturally incur higher costs than one for a smaller administrative site. Without data on comparable contracts (e.g., other DoD water contracts in similar regions or with similar service scopes), it's difficult to definitively state if this represents excellent, fair, or questionable value. However, the duration suggests a potentially stable, long-term operational cost structure.

What is Veolia Water North America's track record with federal contracts, particularly in water management services?

Veolia Water North America (and its parent company Veolia Environnement) has a significant history of managing water and wastewater services for municipal and industrial clients globally, including numerous contracts with government entities. Their track record with federal contracts would involve reviewing past performance evaluations, any contract disputes or terminations, and the scale and complexity of previous federal projects. A review of publicly available contract data (like FPDS) would show the number and value of contracts awarded to Veolia by various federal agencies. Generally, large, established utility providers like Veolia are considered experienced, but performance can vary significantly by contract and location. Specific details on their performance for this particular DoD contract would require access to past performance reviews.

Given the contract's award date in 2002, what are the potential risks associated with technological obsolescence or outdated infrastructure?

A contract awarded in 2002 and ending in 2012 (or potentially extended) carries inherent risks related to technological obsolescence. Water treatment and management technologies evolve; systems operational in 2002 might be less efficient or capable of meeting current environmental standards compared to newer technologies. Infrastructure maintained under such a long contract could also face degradation. The fixed-price nature might disincentivize the contractor from proactively recommending or implementing upgrades unless explicitly required by the scope or change orders, potentially leaving the government with aging systems. Conversely, a well-defined contract could ensure consistent maintenance of existing systems, but the risk of falling behind best practices remains.

What oversight mechanisms were in place to ensure the quality and reliability of water supply and irrigation services over the contract's duration?

Oversight for federal contracts typically involves a multi-layered approach. For this contract, the Department of the Army would have designated a Contracting Officer's Representative (COR) responsible for day-to-day monitoring of performance and ensuring compliance with the contract's technical requirements. The COR would likely conduct regular site visits, review operational reports, and verify that water quality met all regulatory and contractual standards. Additionally, the Contracting Officer (CO) holds ultimate responsibility for the contract's administration, including managing modifications, payments, and resolving disputes. Quality assurance surveillance plans (QASPs) are often employed to systematically evaluate contractor performance against defined metrics, ensuring the reliability of critical services like water supply.

Industry Classification

NAICS: Utilities › Water, Sewage and Other Systems › Water Supply and Irrigation Systems

Product/Service Code: UTILITIES AND HOUSEKEEPING › UTILITIES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Offers Received: 4

Pricing Type: FIRM FIXED PRICE (J)

Contractor Details

Parent Company: Wasco LLC (UEI: 034126353)

Address: 101 W WASHINGTON ST STE 1400 E, INDIANAPOLIS, IN, 07

Business Categories: Category Business, Limited Liability Corporation, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Contract Characteristics

Cost or Pricing Data: NO

Timeline