Department of Defense contract for waste treatment awarded to KURASHIKI KANKYO CO., LTD. for over $19 million

Contract Overview

Contract Amount: $19,032,867 ($19.0M)

Contractor: Kurashiki Kankyo CO., Ltd.

Awarding Agency: Department of Defense

Start Date: 2006-10-01

End Date: 2011-09-30

Contract Duration: 1,825 days

Daily Burn Rate: $10.4K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: FB00

Plain-Language Summary

Department of Defense obligated $19.0 million to KURASHIKI KANKYO CO., LTD. for work described as: FB00 Key points: 1. Contract value of $19 million over five years suggests a significant investment in waste management services. 2. The contract was awarded under full and open competition, indicating a potentially competitive bidding process. 3. The duration of the contract (1825 days) points to a long-term need for these services. 4. The North American Industry Classification System (NAICS) code 562219 indicates a focus on nonhazardous waste treatment and disposal. 5. The contract type is Firm Fixed Price, which shifts cost risk to the contractor. 6. The absence of small business set-aside flags suggests this was not specifically targeted towards small businesses.

Value Assessment

Rating: fair

Benchmarking the value of this contract is challenging without specific details on the scope of services and location. However, a $19 million award over five years for waste treatment services represents a substantial commitment. The firm fixed-price structure implies that the contractor bears the risk of cost overruns, which can be a positive indicator for value if the contractor is efficient. Further analysis would require comparing the per-unit costs of services rendered against similar contracts in the same geographic region and for comparable waste volumes.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under 'FULL AND OPEN COMPETITION,' suggesting that all responsible sources were permitted to submit bids. The presence of two bids (no: 2) indicates some level of competition, but the low number of bidders could suggest limited market interest or specialized requirements. A higher number of bidders typically leads to more competitive pricing and better value for the government.

Taxpayer Impact: A competitive bidding process, even with a limited number of bidders, generally benefits taxpayers by encouraging lower prices and better service offerings compared to sole-source or limited competition scenarios.

Public Impact

The primary beneficiaries are the Department of Defense and its associated facilities, which receive essential waste treatment and disposal services. The services delivered ensure compliance with environmental regulations and maintain operational readiness by managing waste effectively. The geographic impact is likely concentrated around the military installations served by KURASHIKI KANKYO CO., LTD., though specific locations are not detailed. Workforce implications include employment opportunities for personnel involved in waste management operations, logistics, and administration.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Limited competition with only two bidders could indicate potential for higher prices than a more robustly competed contract.
Lack of specific performance metrics or quality assurance details in the provided data makes it difficult to assess service quality.
The firm fixed-price contract, while shifting risk, could lead to contractor corner-cutting if not adequately monitored.
The long contract duration might reduce flexibility for the agency to adapt to changing waste management technologies or needs.

Positive Signals

Awarded under full and open competition, which is generally a positive sign for market fairness.
Firm Fixed Price contract structure places cost control responsibility on the contractor.
The contract addresses a critical operational need for the Department of Defense, ensuring essential services are met.
The contractor, KURASHIKI KANKYO CO., LTD., has secured a significant, long-term contract, suggesting a level of established capability.

Sector Analysis

The waste management services sector is a critical component of industrial operations, encompassing collection, treatment, and disposal of various waste streams. This contract falls under the broader environmental services industry, which is characterized by stringent regulatory compliance and specialized operational requirements. The market size for federal waste management contracts is substantial, driven by the extensive footprint of government agencies. This specific contract for nonhazardous waste treatment and disposal is a niche within this larger sector, requiring expertise in handling and processing specific types of waste generated by military operations.

Small Business Impact

The data indicates that this contract was not awarded as a small business set-aside (ss: false) and there is no indication of specific subcontracting requirements for small businesses (sb: false, st: ''). This suggests that the primary focus was on securing the necessary services through the most competitive means available, rather than specifically promoting small business participation. Consequently, the direct impact on the small business ecosystem for this particular award is likely minimal, although the prime contractor may engage small businesses for support services not detailed here.

Oversight & Accountability

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

Related Government Programs

Department of Defense Waste Management Contracts
Environmental Services Contracts
Nonhazardous Waste Treatment Services
Federal Government Waste Disposal

Risk Flags

Limited Competition
Potential for Quality Compromise in FFP Contracts
Lack of Specific Performance Metrics

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $19.0 million to KURASHIKI KANKYO CO., LTD.. FB00

Who is the contractor on this award?

The obligated recipient is KURASHIKI KANKYO CO., LTD..

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $19.0 million.

What is the period of performance?

Start: 2006-10-01. End: 2011-09-30.

What is the historical spending pattern for KURASHIKI KANKYO CO., LTD. with the Department of Defense?

Analyzing the historical spending patterns of KURASHIKI KANKYO CO., LTD. with the Department of Defense requires access to comprehensive contract databases beyond the provided data. This specific award of $19,032,867.35 from October 1, 2006, to September 30, 2011, represents a significant portion of their federal engagement during that period. To understand their broader track record, one would need to query databases for all contracts awarded to this entity by the DoD, noting the total value, duration, and types of services rendered across different fiscal years. This would reveal if they are a frequent contractor, specialize in specific service areas, or if this was a unique large-scale engagement. Without this broader context, it's difficult to assess their consistent performance or reliability with the agency.

How does the per-unit cost of this waste treatment contract compare to similar federal contracts?

Determining the per-unit cost comparison for this waste treatment contract is not feasible with the provided data. The contract value of $19,032,867.35 is a total award amount over five years for services categorized under NAICS code 562219 (Other Nonhazardous Waste Treatment and Disposal). To perform a per-unit cost analysis, specific metrics such as cost per ton of waste treated, cost per gallon of liquid waste processed, or cost per cubic yard of solid waste managed would be necessary. These granular data points are typically found in detailed contract line item structures or performance reports. Benchmarking would then involve comparing these per-unit costs against similar contracts awarded by the Department of Defense or other federal agencies for comparable waste streams and geographic locations. The current data only provides the aggregate contract value, making direct per-unit cost comparisons impossible.

What are the key performance indicators (KPIs) used to evaluate the contractor's performance on this contract?

The provided data does not specify the Key Performance Indicators (KPIs) used to evaluate KURASHIKI KANKYO CO., LTD.'s performance on this waste treatment contract. Federal contracts, especially those for essential services like waste management, typically include performance standards related to timeliness of service, quality of treatment, compliance with environmental regulations, and safety protocols. For a waste treatment contract, KPIs might include metrics such as the percentage of waste treated within specified parameters, adherence to disposal schedules, incident rates (e.g., spills, accidents), and customer satisfaction feedback from the serviced facilities. Effective oversight would involve regular performance reviews against these KPIs, with potential for incentives or penalties tied to performance outcomes. Without explicit mention of these KPIs, assessing the contractor's actual performance quality is speculative.

What is the risk profile associated with a firm fixed-price contract for waste management services?

A Firm Fixed Price (FFP) contract for waste management services, like the one awarded to KURASHIKI KANKYO CO., LTD., shifts the primary cost risk to the contractor. This means the contractor is obligated to perform the work for the agreed-upon price, regardless of their actual costs. For the government, this offers budget certainty and protection against cost overruns. However, the risk for the contractor can be substantial if unforeseen operational challenges, material price increases, or regulatory changes impact their costs. A potential risk for the government under an FFP contract is that the contractor might compromise on quality or service levels to maintain profitability if their costs exceed the fixed price, necessitating robust performance monitoring and quality assurance measures to mitigate this.

How does the limited number of bidders (2) impact the overall value and taxpayer cost for this contract?

The fact that this contract received only two bids under a full and open competition scenario raises questions about the level of competition achieved and its potential impact on taxpayer cost. While 'full and open' implies an attempt at broad solicitation, a low number of bidders can suggest several possibilities: the market for these specialized services is small, the contract requirements were highly specific and restrictive, or the bidding process itself may have deterred potential competitors. When competition is limited, the remaining bidders may face less pressure to offer the lowest possible price, potentially leading to higher costs for the government and, consequently, taxpayers. Ideally, a more competitive environment with numerous bidders would drive prices down through market forces. Therefore, the limited competition here suggests a potential risk of suboptimal value for taxpayer dollars.

Industry Classification

NAICS: Administrative and Support and Waste Management and Remediation Services › Waste Treatment and Disposal › Other Nonhazardous Waste Treatment and Disposal

Product/Service Code: UTILITIES AND HOUSEKEEPING › HOUSEKEEPING SERVICES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 2

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 3190 AZA IKEHARA, OKINAWA

Business Categories: Category Business, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $24,019,965

Exercised Options: $20,088,462

Current Obligation: $19,032,867

Contract Characteristics

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: N4008406D2007

IDV Type: IDC

Timeline