Army awards $26.4M for embankment repairs at Texas lakes, with 8 bids received

Contract Overview

Contract Amount: $26,432,080 ($26.4M)

Contractor: Environmental Chemical Corporation

Awarding Agency: Department of Defense

Start Date: 2009-09-30

End Date: 2011-05-27

Contract Duration: 604 days

Daily Burn Rate: $43.8K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 8

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: TAS::96 3135::TAS CONSTRUCT EMBANKMENT REPAIRS, GRANGER, BELTON, AND NAVARRO MILLS LAKES, TEXAS

Place of Performance

Location: BELTON, BELL County, TEXAS, 76513

State: Texas Government Spending

Plain-Language Summary

Department of Defense obligated $26.4 million to ENVIRONMENTAL CHEMICAL CORPORATION for work described as: TAS::96 3135::TAS CONSTRUCT EMBANKMENT REPAIRS, GRANGER, BELTON, AND NAVARRO MILLS LAKES, TEXAS Key points: 1. Contract value appears reasonable given the scope of major civil works. 2. Full and open competition suggests a healthy market for these services. 3. Contract duration of 604 days indicates a significant project timeline. 4. Fixed-price contract type shifts risk to the contractor. 5. Project is located in Texas, impacting regional infrastructure. 6. Contractor has a history of performing similar federal work.

Value Assessment

Rating: good

The contract value of $26.4 million for embankment repairs at multiple Texas lakes aligns with typical costs for large-scale civil engineering projects. Benchmarking against similar Army Corps of Engineers projects for dam and levee maintenance suggests this award is within a reasonable range. The firm fixed-price structure indicates that the contractor assumed the risk for cost overruns, which is generally favorable for the government when the scope is well-defined.

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 solicitation received 8 bids, suggesting a competitive environment for this type of civil construction work. A higher number of bids generally leads to better price discovery and potentially lower costs for the government.

Taxpayer Impact: The robust competition for this contract likely resulted in a more favorable price for taxpayers, as multiple firms vied to secure the work.

Public Impact

Benefits the U.S. Army Corps of Engineers by ensuring the structural integrity of critical water management infrastructure. Services delivered include embankment repairs, crucial for flood control and water conservation. Geographic impact is concentrated in Granger, Belton, and Navarro Mills Lakes, Texas. Workforce implications include employment for construction labor and engineering professionals in the region.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for schedule delays given the project's 604-day duration and complexity of civil works.
Ensuring quality of repairs to meet long-term structural integrity standards.
Managing environmental compliance during construction activities.

Positive Signals

Firm fixed-price contract limits cost escalation risk for the government.
Full and open competition suggests a competitive pricing environment.
Contractor has experience in similar federal construction projects.

Sector Analysis

This contract falls within the heavy and civil engineering construction sector, specifically focusing on water infrastructure maintenance. The market for such services is characterized by specialized firms capable of undertaking large-scale projects requiring significant engineering expertise and equipment. Comparable spending benchmarks for dam and levee repair projects can vary widely based on location, scope, and specific repair needs, but this award appears consistent with projects of similar magnitude.

Small Business Impact

The contract was awarded under full and open competition and does not indicate any specific small business set-aside provisions. While the prime contractor, Environmental Chemical Corporation, is not explicitly identified as a small business, the contract does not preclude subcontracting opportunities. The impact on the small business ecosystem would depend on whether the prime contractor utilizes small businesses for specialized services or materials.

Oversight & Accountability

Oversight for this contract would primarily reside with the U.S. Army Corps of Engineers, the contracting agency. Accountability measures are embedded in the firm fixed-price contract terms, requiring the contractor to complete the work to specified standards within the agreed-upon price. Transparency is generally maintained through contract award databases, though specific project progress reports may not be publicly available. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Army Corps of Engineers Civil Works Programs
Lake and Dam Maintenance Contracts
Flood Control Infrastructure Projects
Embankment and Levee Repair Contracts

Risk Flags

Potential for cost overruns if unforeseen site conditions arise.
Risk of schedule delays due to weather or complex construction phases.
Ensuring long-term durability and effectiveness of repair work.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $26.4 million to ENVIRONMENTAL CHEMICAL CORPORATION. TAS::96 3135::TAS CONSTRUCT EMBANKMENT REPAIRS, GRANGER, BELTON, AND NAVARRO MILLS LAKES, TEXAS

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 $26.4 million.

What is the period of performance?

Start: 2009-09-30. End: 2011-05-27.

What is the track record of Environmental Chemical Corporation in performing similar federal construction contracts?

Environmental Chemical Corporation has a history of performing federal construction contracts, particularly with agencies like the Army Corps of Engineers. While specific details on past performance for embankment repairs would require a deeper dive into contract databases, their involvement in this $26.4 million award suggests they possess the necessary qualifications and experience. Reviewing past contract performance metrics, such as on-time delivery, quality of work, and adherence to budget (where applicable), would provide a more comprehensive understanding of their capabilities. Federal procurement systems often track contractor performance, which contracting officers consider during source selection.

How does the $26.4 million award compare to other federal contracts for embankment repairs?

The $26.4 million award for embankment repairs at Granger, Belton, and Navarro Mills Lakes is a substantial sum, indicative of a large-scale civil engineering project. Comparing this to other federal contracts requires analyzing projects with similar scopes (e.g., dam stabilization, levee reinforcement, erosion control) and geographic contexts. Smaller projects might range from a few hundred thousand to a few million dollars, while major rehabilitation efforts on large dams or extensive levee systems could easily exceed tens of millions. The number of bids received (8) suggests that the market had sufficient capacity and interest at this price point, implying it's a competitive and potentially fair market value for the services rendered.

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

The primary risk associated with a firm fixed-price (FFP) contract for a project of this magnitude lies with the contractor. If the contractor underestimates costs, encounters unforeseen site conditions (e.g., unexpected soil issues, subsurface obstructions), or experiences significant labor or material price increases, they bear the financial burden of these overruns. For the government, the main risk is that the contractor might cut corners on quality or scope to protect their profit margin if they encounter difficulties. However, FFP contracts are generally preferred by the government for well-defined scopes as they provide cost certainty. Robust government oversight and clear contract specifications are crucial to mitigate quality risks.

How effective are full and open competitions in ensuring value for taxpayer money in large construction projects?

Full and open competition is widely considered the most effective method for ensuring value for taxpayer money in large construction projects. By allowing all responsible sources to compete, it fosters a competitive environment that drives down prices and encourages innovation. The requirement for multiple bids, as seen in this case with 8 bidders, increases the likelihood that the government will receive proposals reflecting fair market value. It also provides a broader pool of qualified contractors, potentially leading to better technical solutions and higher quality outcomes. Agencies are mandated to use full and open competition unless specific exceptions apply, underscoring its importance in government procurement.

What is the historical spending pattern for embankment repair and related civil works by the Department of the Army?

The Department of the Army, primarily through the U.S. Army Corps of Engineers (USACE), has a consistent and significant historical spending pattern on civil works, including embankment repairs, dam maintenance, and flood control infrastructure. Annual spending on these types of projects often runs into the billions of dollars, reflecting the vast network of waterways, dams, levees, and coastal defenses managed by the agency. This spending is driven by the need for ongoing maintenance, upgrades, and repairs to ensure the safety and functionality of these critical assets. Funding levels can fluctuate based on appropriations, infrastructure needs assessments, and national priorities, but civil works remain a core mission area.

What are the potential implications of the 604-day contract duration on project costs and oversight?

A contract duration of 604 days (approximately 20 months) for embankment repairs indicates a project of considerable scale and complexity. Longer durations can increase indirect costs for both the contractor (e.g., project management, equipment mobilization/demobilization over time) and the government (e.g., sustained oversight, contract administration). However, for major civil works, such a timeline might be necessary to accommodate weather delays, phased construction, or complex environmental mitigation efforts. Effective oversight is critical throughout this extended period to monitor progress, ensure compliance with specifications, manage any change orders, and verify that the project remains on track to deliver the intended outcomes within the agreed-upon budget.

Industry Classification

NAICS: Construction › Highway, Street, and Bridge Construction › Highway, Street, and Bridge Construction

Product/Service Code: CONSTRUCT OF STRUCTURES/FACILITIES › CONSTRUCT NONBUILDING FACILITIES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 8

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 1240 BAYSHORE HGHWY, BURLINGAME, CA, 94010

Business Categories: Category Business, Minority Owned Business, Not Designated a Small Business, Indian (Subcontinent) American Owned Business

Financial Breakdown

Contract Ceiling: $26,432,080

Exercised Options: $26,432,080

Current Obligation: $26,432,080

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: W912BV08D2020

IDV Type: IDC

Timeline