Environmental Chemical Corp. awarded $96.3M for Hurricane Florence recovery efforts in North Carolina

Contract Overview

Contract Amount: $96,288,536 ($96.3M)

Contractor: Environmental Chemical Corporation

Awarding Agency: Department of Defense

Start Date: 2019-01-03

End Date: 2021-12-13

Contract Duration: 1,075 days

Daily Burn Rate: $89.6K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 3

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: IGF::OT::IGF X015 HURRICANE FLORENCE RECOVERY EFFORTS FOR MCAS CH

Place of Performance

Location: CHERRY POINT, CRAVEN County, NORTH CAROLINA, 28533

State: North Carolina Government Spending

Plain-Language Summary

Department of Defense obligated $96.3 million to ENVIRONMENTAL CHEMICAL CORPORATION for work described as: IGF::OT::IGF X015 HURRICANE FLORENCE RECOVERY EFFORTS FOR MCAS CH Key points: 1. Contract value appears reasonable given the scope of disaster recovery. 2. Full and open competition suggests a competitive bidding process. 3. Fixed-price contract type mitigates cost overrun risks for the government. 4. Contract duration aligns with the complexities of large-scale recovery operations. 5. Focus on environmental cleanup indicates a critical post-disaster need. 6. Geographic focus on North Carolina targets specific recovery needs.

Value Assessment

Rating: good

The contract value of $96.3 million for Hurricane Florence recovery efforts is substantial, reflecting the significant damage caused by the storm. Benchmarking against similar large-scale disaster recovery contracts is challenging due to unique event-specific factors. However, the firm fixed-price structure suggests that the initial pricing was determined to be fair and reasonable for the anticipated scope of work. The contract's duration of 1075 days also indicates a comprehensive approach to the recovery process.

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 presence of 3 bids suggests a moderate level of competition for this significant recovery effort. While more bidders could potentially drive prices lower, a competitive process was still employed, allowing for price discovery and selection of a qualified contractor.

Taxpayer Impact: The use of full and open competition is generally favorable for taxpayers as it aims to secure the best value through a structured bidding process, encouraging multiple firms to offer competitive pricing.

Public Impact

Residents and businesses in North Carolina impacted by Hurricane Florence benefit from the environmental cleanup and recovery services. Services delivered include environmental remediation and restoration of affected areas. Geographic impact is concentrated in regions of North Carolina devastated by the hurricane. Workforce implications include potential job creation in the construction and environmental services sectors within North Carolina.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for scope creep in disaster recovery projects if not managed tightly.
Ensuring timely completion of environmental remediation is crucial for public health and safety.

Positive Signals

Firm fixed-price contract helps control costs.
Full and open competition promotes a fair bidding process.
Contract duration appears adequate for the recovery scope.

Sector Analysis

This contract falls within the Commercial and Institutional Building Construction sector, specifically addressing post-disaster environmental recovery. The market for disaster recovery services is highly specialized and often involves rapid mobilization. While specific benchmarks for hurricane recovery contracts are difficult to isolate, the scale of this award is consistent with the significant infrastructure and environmental damage typically associated with major hurricanes impacting coastal regions.

Small Business Impact

Information regarding small business set-asides or subcontracting plans was not explicitly provided in the data. However, for large-scale disaster recovery contracts, prime contractors are often large firms with the capacity to manage complex operations. It is possible that subcontracting opportunities may exist for specialized environmental services, but the extent to which small businesses would participate is unclear without further details.

Oversight & Accountability

Oversight for this contract would likely be managed by the Department of the Navy, with potential involvement from relevant Inspector General offices to ensure proper execution and financial accountability. The firm fixed-price nature of the contract provides a degree of financial oversight by establishing a set cost. Transparency would be enhanced through regular reporting requirements and performance reviews.

Related Government Programs

Hurricane Recovery Efforts
Environmental Remediation Services
Disaster Response Contracts
Department of Defense Construction Contracts

Risk Flags

Potential for cost overruns if scope is not well-defined.
Risk of delays due to logistical challenges in disaster zones.
Ensuring contractor compliance with environmental regulations.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $96.3 million to ENVIRONMENTAL CHEMICAL CORPORATION. IGF::OT::IGF X015 HURRICANE FLORENCE RECOVERY EFFORTS FOR MCAS CH

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 Navy).

What is the total obligated amount?

The obligated amount is $96.3 million.

What is the period of performance?

Start: 2019-01-03. End: 2021-12-13.

What is the track record of Environmental Chemical Corporation in handling large-scale disaster recovery projects?

Information regarding the specific track record of Environmental Chemical Corporation in handling large-scale disaster recovery projects is not detailed in the provided data. However, their selection under full and open competition suggests they met the qualifications and requirements set forth by the Department of the Navy for this critical Hurricane Florence recovery effort. Further investigation into the company's past performance, client references, and project completion history would be necessary for a comprehensive assessment of their capabilities in disaster response.

How does the $96.3 million contract value compare to other Hurricane Florence recovery efforts?

Direct comparison of the $96.3 million contract value to other Hurricane Florence recovery efforts is difficult without a comprehensive database of all awarded contracts for this specific event. However, the value is substantial and likely reflects the significant environmental damage and the scope of remediation required. Major disaster recovery operations often involve multi-million dollar contracts, and this award appears to be in line with the scale of a Category 4 hurricane's impact. The specific services rendered by Environmental Chemical Corporation (environmental cleanup) also dictate its value relative to other recovery activities like debris removal or infrastructure repair.

What are the primary risks associated with this contract, and how are they mitigated?

The primary risks associated with this contract include potential scope creep, unforeseen environmental hazards, and logistical challenges inherent in disaster recovery. Scope creep could increase costs and extend timelines if not managed effectively. Unforeseen hazards might require additional resources or specialized expertise. Logistical challenges in accessing affected areas and coordinating work crews are also significant. Mitigation strategies likely include the firm fixed-price contract structure, which caps the government's financial exposure, and detailed performance work statements. Robust project management, regular site assessments, and clear communication channels between the contractor and the Department of the Navy are crucial for managing these risks.

How effective is the firm fixed-price contract type in ensuring value for money in disaster recovery?

The firm fixed-price (FFP) contract type is generally effective in ensuring value for money by establishing a ceiling on costs, incentivizing the contractor to control expenses and work efficiently to maximize profit. For disaster recovery, an FFP contract provides budget certainty for the government, as the price is set upfront. This reduces the risk of cost overruns due to contractor inefficiencies or unexpected price increases. However, it also places the burden of estimating all costs accurately on the contractor. If the scope is not well-defined or unforeseen issues arise, the contractor may face financial losses, or the initial price might be inflated to account for potential risks, potentially leading to a higher initial cost than a cost-reimbursable contract.

What is the historical spending pattern for environmental cleanup contracts in North Carolina by the Department of Defense?

Historical spending patterns for environmental cleanup contracts in North Carolina by the Department of Defense are not detailed in the provided data. However, the Department of Defense has a long-standing commitment to environmental stewardship and remediation, particularly at military installations. Spending in this area can fluctuate based on specific environmental challenges, regulatory requirements, and the occurrence of natural disasters. The significant award to Environmental Chemical Corporation for Hurricane Florence recovery suggests a substantial, event-driven expenditure rather than a consistent, ongoing baseline for routine environmental cleanup in the region.

What are the implications of awarding a large contract like this to a single prime contractor for the broader recovery ecosystem?

Awarding a large contract like this to a single prime contractor, Environmental Chemical Corporation, can have several implications for the broader recovery ecosystem. On one hand, it consolidates responsibility and streamlines management for a complex task, potentially leading to more efficient execution. The prime contractor is then responsible for coordinating subcontractors, which can include small businesses, thereby distributing some of the work. On the other hand, it concentrates significant financial resources and project control within one entity. The effectiveness of this approach depends heavily on the prime contractor's ability to manage subcontractors fairly and efficiently, ensuring that the benefits of the contract are distributed appropriately within the local and specialized service provider community.

Industry Classification

NAICS: Construction › Nonresidential Building Construction › Commercial and Institutional Building Construction

Product/Service Code: MAINT, REPAIR, ALTER REAL PROPERTY › MAINT, ALTER, REPAIR BUILDINGS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: N6247012R5010

Offers Received: 3

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 1240 BAYSHORE HGHWY, BURLINGAME, CA, 94010

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

Financial Breakdown

Contract Ceiling: $96,288,536

Exercised Options: $96,288,536

Current Obligation: $96,288,536

Actual Outlays: $39,403,332

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: N6247013D6020

IDV Type: IDC

Timeline