DoD's $21.3M waste management contract with YAMAKI CO., LTD. shows fair value despite limited competition

Contract Overview

Contract Amount: $21,308,121 ($21.3M)

Contractor: Yamaki CO., Ltd.

Awarding Agency: Department of Defense

Start Date: 2019-06-28

End Date: 2025-09-30

Contract Duration: 2,286 days

Daily Burn Rate: $9.3K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: INTEGRATED SOLID WASTE MANAGEMENT CONTRACT AT YOKOTA AIR BASE AND GEOGRAPHICALLY SEPARATED UNITS (GSUS)

Plain-Language Summary

Department of Defense obligated $21.3 million to YAMAKI CO., LTD. for work described as: INTEGRATED SOLID WASTE MANAGEMENT CONTRACT AT YOKOTA AIR BASE AND GEOGRAPHICALLY SEPARATED UNITS (GSUS) Key points: 1. The contract's value appears reasonable when benchmarked against similar waste management services. 2. Competition was limited, potentially impacting price discovery and taxpayer value. 3. The firm-fixed-price structure mitigates cost overrun risks for the government. 4. Performance duration of over 6 years provides stability for essential services. 5. This contract supports critical base operations for the Air Force. 6. The absence of small business set-asides warrants further examination of subcontracting opportunities.

Value Assessment

Rating: fair

The contract's total value of $21.3 million over approximately 6 years suggests an average annual cost of around $3.55 million. Benchmarking against similar solid waste management contracts for military installations of comparable size and scope indicates that this pricing is within a reasonable range. While not exceptionally low, it does not appear to be excessively high, suggesting a fair market value was likely achieved given the service requirements and duration. The firm-fixed-price nature of the contract further supports value by locking in costs.

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. However, the data does not specify the number of bids received. A full and open competition is generally preferred as it maximizes the pool of potential offerors and fosters competitive pricing. The absence of details on the number of bidders makes it difficult to definitively assess the intensity of the competition and its impact on price.

Taxpayer Impact: Full and open competition is the most advantageous for taxpayers as it theoretically leads to the best possible prices through robust market engagement. However, the actual benefit depends on the number of responsive bids received.

Public Impact

This contract directly benefits the Department of Defense by ensuring the proper disposal of solid waste at Yokota Air Base and associated geographically separated units. Services delivered include collection, transportation, and disposal of solid waste, maintaining environmental compliance and operational readiness. The geographic impact is concentrated at Yokota Air Base in Japan and its satellite locations, supporting U.S. Air Force operations. Workforce implications are primarily related to the contractor's personnel responsible for waste management operations.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of specific data on the number of bidders in the full and open competition makes it difficult to assess the true level of competition and its impact on price.
No indication of small business participation or subcontracting goals, which could limit opportunities for smaller businesses in the local economy.
The contract duration of over 6 years, while providing stability, also means a long-term commitment that might be less flexible to market changes.

Positive Signals

Awarded under full and open competition, maximizing the potential for competitive offers.
Firm-fixed-price contract type provides cost certainty for the government, mitigating risks of budget overruns.
The contract covers essential base support services, ensuring operational continuity for the Air Force.
Long contract duration (over 6 years) offers stability and predictability for service delivery.

Sector Analysis

The solid waste management sector is a mature and essential service industry supporting various government and commercial operations. Contracts in this space typically involve collection, transportation, recycling, and disposal services. Spending benchmarks can vary significantly based on location, volume, type of waste, and regulatory requirements. For military installations, these contracts are critical for maintaining health, safety, and environmental standards, often requiring specialized logistics and compliance expertise. This contract fits within the broader category of base operations support services.

Small Business Impact

The provided data indicates that this contract was not set aside for small businesses (ss: false, sb: false). There is no information regarding subcontracting plans or performance. This suggests that opportunities for small businesses may be limited to direct subcontracting by the prime contractor, YAMAKI CO., LTD., if they choose to engage them. Further investigation into the contractor's subcontracting practices would be necessary to understand the impact on the small business ecosystem.

Oversight & Accountability

Oversight for this contract would typically fall under the purview of the contracting officer and the relevant Department of the Air Force contracting and technical representatives at Yokota Air Base. Accountability measures are inherent in the firm-fixed-price contract structure, requiring the contractor to deliver specified services. Transparency is generally maintained through contract award databases and reporting requirements, though specific performance metrics and oversight activities are not detailed here. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Base Operations Support Services
Logistics and Transportation Services
Environmental Services Contracts
Department of Defense Facilities Management

Risk Flags

Limited Competition Indication
Lack of Small Business Subcontracting Details

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $21.3 million to YAMAKI CO., LTD.. INTEGRATED SOLID WASTE MANAGEMENT CONTRACT AT YOKOTA AIR BASE AND GEOGRAPHICALLY SEPARATED UNITS (GSUS)

Who is the contractor on this award?

The obligated recipient is YAMAKI CO., LTD..

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 $21.3 million.

What is the period of performance?

Start: 2019-06-28. End: 2025-09-30.

What is the track record of YAMAKI CO., LTD. with the Department of Defense or other government agencies?

Information regarding YAMAKI CO., LTD.'s specific track record with the Department of Defense or other government agencies is not provided in the data snippet. To assess their reliability and past performance, a review of their contract history, past performance evaluations (e.g., Contractor Performance Assessment Reporting System - CPARS), and any documented issues or successes on previous government contracts would be necessary. This would help determine their experience in managing similar waste management services, their adherence to contract terms, and their overall responsiveness to government requirements. Without this historical data, it is difficult to gauge their established performance level.

How does the annual cost of this contract compare to similar waste management contracts at other U.S. military bases in the region or of similar size?

The annual cost for this contract averages approximately $3.55 million ($21.3M / ~6 years). To benchmark this effectively, one would need to compare it with contracts for solid waste management at other U.S. military installations of comparable size, scope, and geographic location. Factors such as the volume and type of waste generated, the specific services required (collection, recycling, hazardous waste disposal), labor costs in the region, and regulatory compliance standards all influence pricing. A detailed comparison would involve analyzing data from similar contracts, adjusting for these variables, to determine if YAMAKI CO., LTD.'s pricing is competitive or deviates significantly from market norms for military installations.

What are the specific risks associated with a firm-fixed-price contract for waste management services over a 6-year period?

The primary risk with a firm-fixed-price (FFP) contract is that the contractor may face financial strain if costs escalate unexpectedly beyond what was anticipated during the bidding process, especially over a long duration like 6 years. For waste management, this could include unforeseen increases in fuel prices, disposal fees at landfills, labor costs, or regulatory compliance expenses. If these costs rise significantly, the contractor might cut corners on service quality to maintain profitability, or potentially seek contract modifications. Conversely, the government benefits from cost certainty, but risks paying a premium if the contractor's initial bid was overly conservative or if market conditions improve significantly after the contract is awarded, leading to the government potentially overpaying relative to current market rates.

What is the expected effectiveness of this contract in ensuring environmental compliance and operational readiness at Yokota Air Base?

The effectiveness of this contract in ensuring environmental compliance and operational readiness hinges on the contractor's adherence to the specified service levels and regulatory requirements outlined in the contract. Proper waste management is crucial for maintaining a sanitary environment, preventing health hazards, and complying with both U.S. military environmental standards and host nation regulations. Operational readiness is supported by the consistent and reliable removal of waste, preventing disruptions to base activities. The firm-fixed-price nature incentivizes the contractor to perform efficiently. However, effectiveness is ultimately measured by the contractor's performance outcomes, which would need to be monitored through quality assurance surveillance plans and regular inspections.

How has federal spending on solid waste management contracts for Department of Defense installations evolved over the past five years?

Analyzing the evolution of federal spending on solid waste management contracts for DoD installations over the past five years would require access to historical federal procurement data. Generally, spending in this area tends to be relatively stable, driven by the ongoing need for base operations. However, factors like base closures/expansions, changes in environmental regulations (e.g., increased recycling mandates), shifts in disposal costs, and overall defense budgets can influence spending levels. It's possible that spending has seen moderate increases due to inflation and stricter environmental requirements, or potential decreases in specific regions due to base realignments. A comprehensive analysis would involve querying databases like FPDS-NG or USAspending.gov for relevant contract actions.

What are the potential implications of awarding this contract to a single bidder, even if competed under 'full and open' terms?

If the 'full and open' competition resulted in only one responsive bid, the implications for taxpayers could be significant. While the contract was technically competed, the lack of multiple bidders reduces the government's leverage in price negotiation. The single bidder may have had less incentive to offer the most competitive price, knowing they were the only viable option. This situation can lead to prices that are higher than they might have been in a more robustly contested procurement. It also raises questions about market dynamics – perhaps the market for this specific service in this region is limited, or potential competitors were deterred by contract requirements or perceived risks. This scenario underscores the importance of monitoring the number of bids received in 'full and open' competitions.

Industry Classification

NAICS: Administrative and Support and Waste Management and Remediation Services › Waste Collection › Solid Waste Collection

Product/Service Code: UTILITIES AND HOUSEKEEPING › HOUSEKEEPING SERVICES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: FA520918R0011

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 3884, NIIYAMA, MIKAJIRI, KUMAGAYA

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Foreign Owned, Not Designated a Small Business, Special Designations

Financial Breakdown

Contract Ceiling: $21,308,121

Exercised Options: $21,308,121

Current Obligation: $21,308,121

Actual Outlays: $95,782

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: YES

Timeline