DoD's $21M Water/Wastewater Privatization Contract for Parris Island and MCAS Beaufort Awarded to Beaufort-Jasper Water & Sewer Authority

Contract Overview

Contract Amount: $20,987,603 ($21.0M)

Contractor: Beaufort-Jasper Water & Sewer Authority

Awarding Agency: Department of Defense

Start Date: 2008-02-28

End Date: 2058-02-27

Contract Duration: 18,262 days

Daily Burn Rate: $1.1K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 5

Pricing Type: FIXED PRICE REDETERMINATION

Sector: Other

Official Description: MCRD PARRIS ISLAND, MCAS BEAUFORT, NAVAL HOSPITAL AND LAUREL BAY HOUSING WATER AND WASTEWATER SYSTEM PRIVATIZATION CONTRACT

Place of Performance

Location: BEAUFORT, BEAUFORT County, SOUTH CAROLINA, 29904

State: South Carolina Government Spending

Plain-Language Summary

Department of Defense obligated $21.0 million to BEAUFORT-JASPER WATER & SEWER AUTHORITY for work described as: MCRD PARRIS ISLAND, MCAS BEAUFORT, NAVAL HOSPITAL AND LAUREL BAY HOUSING WATER AND WASTEWATER SYSTEM PRIVATIZATION CONTRACT Key points: 1. The contract aims to privatize water and wastewater systems for key military installations in South Carolina. 2. Awarded via full and open competition, suggesting a competitive bidding process. 3. The fixed-price redetermination contract type introduces potential cost fluctuations over its long duration. 4. This long-term infrastructure project highlights the government's strategy for managing essential utility services at military bases.

Value Assessment

Rating: fair

The contract value of $20.9M over 50 years averages to approximately $419,752 annually. Benchmarking is difficult without specific service level agreements and comparable privatization projects.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating multiple bidders likely participated. This method is generally expected to yield competitive pricing, though the long-term nature and specific requirements of utility privatization can influence final price discovery.

Taxpayer Impact: Long-term privatization of essential services can potentially offer cost savings to taxpayers compared to direct government operation, but requires careful oversight to ensure value.

Public Impact

Ensures reliable water and wastewater services for critical military operations and personnel housing. Potential for modernization and improved efficiency of aging infrastructure through private sector expertise. Long-term commitment may provide cost stability for the government and residents over decades. Requires ongoing monitoring to ensure service quality and environmental compliance.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Long contract duration (50 years) increases risk of unforeseen cost escalations or performance issues.
Fixed-price redetermination contract type can lead to price adjustments, potentially increasing costs.
Lack of explicit small business participation noted.

Positive Signals

Full and open competition suggests a robust bidding process.
Privatization can leverage private sector efficiencies for infrastructure management.
Long-term contract provides service continuity for military installations.

Sector Analysis

This contract falls within the utilities and infrastructure management sector, specifically focusing on water and wastewater systems. Government privatization of such essential services is a common strategy to leverage private sector expertise and potentially reduce long-term operational costs.

Small Business Impact

The provided data does not indicate any specific set-aside for small businesses. The contract was awarded under full and open competition, suggesting that large entities or established utility providers were likely the primary bidders.

Oversight & Accountability

The long duration of this contract necessitates robust oversight mechanisms to ensure the contractor meets performance standards, maintains infrastructure, and complies with environmental regulations. Regular performance reviews and audits will be crucial for accountability.

Related Government Programs

Water Supply and Irrigation Systems
Department of Defense Contracting
Department of the Navy Programs

Risk Flags

Long-term contract duration (50 years).
Fixed Price Redetermination contract type.
Potential for cost overruns due to inflation or unforeseen issues.
Lack of explicit small business participation.
Requires significant ongoing oversight.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $21.0 million to BEAUFORT-JASPER WATER & SEWER AUTHORITY. MCRD PARRIS ISLAND, MCAS BEAUFORT, NAVAL HOSPITAL AND LAUREL BAY HOUSING WATER AND WASTEWATER SYSTEM PRIVATIZATION CONTRACT

Who is the contractor on this award?

The obligated recipient is BEAUFORT-JASPER WATER & SEWER AUTHORITY.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $21.0 million.

What is the period of performance?

Start: 2008-02-28. End: 2058-02-27.

What are the specific performance metrics and service level agreements included in the contract to ensure adequate water and wastewater services?

The provided data does not detail the specific performance metrics or service level agreements. These are critical components of any utility privatization contract and would typically be outlined in the contract's statement of work. They would define standards for water quality, pressure, wastewater treatment, response times for issues, and infrastructure maintenance, ensuring the government receives the agreed-upon level of service.

How will the 'redetermination' aspect of the fixed-price contract be managed to control costs and protect taxpayer interests over 50 years?

The 'redetermination' clause allows for price adjustments based on specific criteria, likely related to operating costs or economic factors. Effective management requires clear, pre-defined triggers for redetermination, transparent data sharing from the contractor, and rigorous government review of cost justifications to prevent unwarranted price increases and ensure fairness to taxpayers.

What is the projected long-term cost savings or efficiency gain compared to the government operating these systems directly?

The data does not provide projections for cost savings or efficiency gains. Privatization contracts often aim for these benefits through private sector innovation and economies of scale. A thorough analysis would require comparing the total lifecycle costs of private operation (including contract payments and oversight) against the estimated costs of continued government management, considering factors like capital investment and operational expertise.

Industry Classification

NAICS: Utilities › Water, Sewage and Other Systems › Water Supply and Irrigation Systems

Product/Service Code: UTILITIES AND HOUSEKEEPING › UTILITIES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: N6945008R0070

Offers Received: 5

Pricing Type: FIXED PRICE REDETERMINATION (A)

Evaluated Preference: NONE

Contractor Details

Address: 6 SNAKE RD, OKATIE, SC, 29909

Business Categories: Category Business, Government, U.S. Local Government, U.S. National Government, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $254,977,741

Exercised Options: $254,977,741

Current Obligation: $20,987,603

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: YES

Timeline