DoD's $20M Remedial Action Contract for Hunters Point Naval Shipyard Soil Cover and Biomonitoring

Contract Overview

Contract Amount: $19,987,019 ($20.0M)

Contractor: Leisnoi-Kemron 8A JV, LLC

Awarding Agency: Department of Defense

Start Date: 2019-09-20

End Date: 2025-07-31

Contract Duration: 2,141 days

Daily Burn Rate: $9.3K/day

Competition Type: NOT AVAILABLE FOR COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: REMEDIAL ACTION PARCEL E-2 SITE MAINTENANCE, SOIL COVER, AND BIOMONITORING (PHASE III), AT HUNTERS POINT NAVAL SHIPYARD, SAN FRANCISCO, CA

Place of Performance

Location: SAN FRANCISCO, SAN FRANCISCO County, CALIFORNIA, 94124

State: California Government Spending

Plain-Language Summary

Department of Defense obligated $20.0 million to LEISNOI-KEMRON 8A JV, LLC for work described as: REMEDIAL ACTION PARCEL E-2 SITE MAINTENANCE, SOIL COVER, AND BIOMONITORING (PHASE III), AT HUNTERS POINT NAVAL SHIPYARD, SAN FRANCISCO, CA Key points: 1. Contract awarded to a joint venture, potentially indicating specialized capabilities for complex environmental remediation. 2. The fixed-price contract structure aims to control costs for a multi-year environmental cleanup project. 3. The duration of nearly six years suggests a significant scope of work and potential for long-term environmental impact. 4. Performance is located in California, a state with stringent environmental regulations, implying a high standard of compliance. 5. The contract's focus on soil cover and biomonitoring addresses critical aspects of hazardous site remediation.

Value Assessment

Rating: fair

The contract value of approximately $20 million over nearly six years for environmental remediation services appears reasonable given the scope. However, without specific benchmarks for soil cover and biomonitoring at a Superfund-like site, a precise value-for-money assessment is challenging. The firm-fixed-price structure provides cost certainty for the government, but the contractor bears the risk of cost overruns. Further analysis would require comparing this contract to similar remediation projects at other naval facilities or complex industrial sites.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was not competed, identified as 'NOT AVAILABLE FOR COMPETITION'. This suggests that either a specific justification for sole-sourcing was made, or the contract was awarded under a specific program or existing relationship where full and open competition was not pursued. The lack of competition limits the government's ability to solicit multiple bids and potentially achieve lower pricing through a competitive bidding process.

Taxpayer Impact: The absence of competition means taxpayers may not have benefited from the potential cost savings that could arise from a bidding war among qualified contractors.

Public Impact

The primary beneficiaries are the Department of the Navy and the surrounding community, through the remediation of a potentially hazardous environmental site. Services delivered include soil cover installation and ongoing biomonitoring to ensure containment and assess environmental recovery. The geographic impact is localized to the Hunters Point Naval Shipyard in San Francisco, California. Workforce implications include employment opportunities for environmental scientists, engineers, technicians, and construction labor.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition raises concerns about whether the government secured the best possible price and value.
The long duration of the contract could present risks related to contractor performance over an extended period.
Environmental remediation projects are inherently complex and carry risks of unforeseen site conditions impacting cost and schedule.

Positive Signals

The firm-fixed-price contract type shifts cost overrun risk to the contractor, providing budget predictability.
The contract addresses critical environmental cleanup needs at a former naval facility, contributing to public health and safety.
The award to a joint venture (LEISNOI-KEMRON 8A JV, LLC) may indicate a strategic approach to leveraging specialized expertise for this complex task.

Sector Analysis

This contract falls within the Environmental Remediation Services sector, a critical component of the broader industrial and defense support services market. The market for environmental remediation is driven by regulatory compliance, legacy site cleanup (particularly former industrial and military sites), and ongoing environmental management. Spending in this sector can be substantial, especially for large-scale projects like those at former naval shipyards, which often involve complex contaminants and extensive cleanup requirements. Benchmarks for such specialized services are typically project-specific due to unique site conditions and regulatory frameworks.

Small Business Impact

The contract was awarded to LEISNOI-KEMRON 8A JV, LLC. Information regarding small business set-asides or subcontracting plans is not explicitly provided in the data. If this joint venture includes small business participation, it could contribute to small business contracting goals. However, without further details on the JV's structure or subcontracting requirements, the direct impact on the broader small business ecosystem remains unclear.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of the Navy's contracting and program management offices. Accountability measures are embedded in the contract terms, including performance requirements and payment schedules tied to deliverables. Transparency may be limited due to the sole-source nature of the award. Inspector General jurisdiction would apply to investigations of fraud, waste, or abuse related to the contract.

Related Government Programs

Environmental Remediation Services
Naval Facilities Engineering Command Contracts
Superfund Site Management
Department of Defense Environmental Programs
Hazardous Waste Management

Risk Flags

Sole-source award limits transparency and potential cost savings.
Long contract duration increases performance monitoring complexity.
Environmental remediation projects carry inherent risks of unforeseen conditions.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $20.0 million to LEISNOI-KEMRON 8A JV, LLC. REMEDIAL ACTION PARCEL E-2 SITE MAINTENANCE, SOIL COVER, AND BIOMONITORING (PHASE III), AT HUNTERS POINT NAVAL SHIPYARD, SAN FRANCISCO, CA

Who is the contractor on this award?

The obligated recipient is LEISNOI-KEMRON 8A JV, LLC.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $20.0 million.

What is the period of performance?

Start: 2019-09-20. End: 2025-07-31.

What is the specific nature of the environmental hazards at the Hunters Point Naval Shipyard that necessitate this remedial action?

The Hunters Point Naval Shipyard has a history of industrial activities, including ship repair and manufacturing, which have led to contamination of soil and groundwater with various hazardous substances. These include heavy metals (such as lead and chromium), petroleum hydrocarbons, volatile organic compounds (VOCs), and polychlorinated biphenyls (PCBs). The specific remedial action parcel E-2 site maintenance, soil cover, and biomonitoring (Phase III) likely addresses contamination identified in previous investigations and cleanup phases, focusing on containing existing contamination through engineered solutions like soil capping and monitoring its long-term stability and potential migration.

How does the firm-fixed-price contract structure mitigate risks for the Department of the Navy in this long-term remediation project?

A firm-fixed-price (FFP) contract structure is advantageous for the Department of the Navy (DoD) in long-term remediation projects like this because it establishes a ceiling price for the work. The contractor, LEISNOI-KEMRON 8A JV, LLC, assumes the primary risk of cost overruns. If the project encounters unforeseen challenges or costs escalate beyond initial estimates, the contractor is obligated to absorb those additional expenses, provided they are not due to scope changes initiated by the government. This predictability in budgeting allows the DoD to manage its financial obligations more effectively over the contract's duration, although it may mean the initial price is set higher to account for the contractor's risk premium.

What are the potential implications of awarding this contract on a sole-source basis for cost efficiency and contractor performance?

Awarding this contract on a sole-source basis, meaning it was not competed, has several implications. Primarily, it removes the downward price pressure that typically results from multiple bidders competing for a contract. This could mean that the government did not achieve the lowest possible price for the services. Furthermore, without the vetting process of a competitive bid, it's harder to definitively assess if the selected contractor, LEISNOI-KEMRON 8A JV, LLC, is the most capable or cost-effective option available in the market. While the government likely had a justification for sole-sourcing, it bypasses the standard mechanism for ensuring optimal value and potentially limits opportunities for innovative approaches that might have emerged from a competitive environment.

What is the typical duration and cost range for similar environmental remediation contracts involving soil capping and biomonitoring at large industrial sites?

Environmental remediation contracts involving soil capping and biomonitoring at large industrial or former military sites can vary significantly in duration and cost due to site-specific complexities, contaminant types, regulatory requirements, and the extent of the affected area. Durations often range from 1 to 10 years or more, depending on the phase of remediation and ongoing monitoring needs. Costs can range from hundreds of thousands to tens or even hundreds of millions of dollars. For a project spanning nearly six years with a value of approximately $20 million, this contract appears to be within a moderate range for a significant phase of remediation at a large site like Hunters Point Naval Shipyard, assuming the scope is well-defined.

What are the key performance indicators (KPIs) likely used to evaluate the success of this remedial action contract?

Key performance indicators (KPIs) for this contract would likely focus on the effectiveness of the soil cover in preventing contaminant migration, the accuracy and reliability of biomonitoring data, adherence to the project schedule, and compliance with all environmental regulations and permit conditions. Specific KPIs might include the rate of contaminant leaching (or lack thereof) from the capped area, the health and diversity of monitored biological indicators, the successful installation of the soil cover according to engineering specifications, and the timely submission of all required reports and data to regulatory agencies and the DoD. Cost control within the FFP framework would also be a KPI, though primarily managed by the contractor's risk.

Industry Classification

NAICS: Administrative and Support and Waste Management and Remediation Services › Remediation and Other Waste Management Services › Remediation Services

Product/Service Code: NATURAL RESOURCES MANAGEMENT › ENVIRONMENTAL SYSTEMS PROTECTION

Competition & Pricing

Extent Competed: NOT AVAILABLE FOR COMPETITION

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: N6247319R0008

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 561 E 36TH AVE STE 120, ANCHORAGE, AK, 99503

Business Categories: Alaskan Native Corporation Owned Firm, Asian Pacific American Owned Business, Category Business, Corporate Entity Not Tax Exempt, DoT Certified Disadvantaged Business Enterprise, Minority Owned Business, SBA Certified 8 a Joint Venture, Self-Certified Small Disadvantaged Business, Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $19,987,019

Exercised Options: $19,987,019

Current Obligation: $19,987,019

Actual Outlays: $6,300,847

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Timeline