DoD Awards $104.6M Hurricane Sally Package 6 to Environmental Chemical Corp

Contract Overview

Contract Amount: $104,622,453 ($104.6M)

Contractor: Environmental Chemical Corporation

Awarding Agency: Department of Defense

Start Date: 2022-03-28

End Date: 2026-03-31

Contract Duration: 1,464 days

Daily Burn Rate: $71.5K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: BASE BID - HURRICANE SALLY PACKAGE 6

Place of Performance

Location: PENSACOLA, ESCAMBIA County, FLORIDA, 32508

State: Florida Government Spending

Plain-Language Summary

Department of Defense obligated $104.6 million to ENVIRONMENTAL CHEMICAL CORPORATION for work described as: BASE BID - HURRICANE SALLY PACKAGE 6 Key points: 1. Contract awarded to Environmental Chemical Corporation for $104.6M. 2. The contract falls under the Commercial and Institutional Building Construction sector. 3. This is a Delivery Order under a larger contract. 4. The contract duration is 1464 days. 5. The award was made via Full and Open Competition.

Value Assessment

Rating: fair

The base bid of $104.6M for Hurricane Sally Package 6 appears reasonable given the contract duration and scope. However, without specific deliverables or comparable project data, a precise value assessment is challenging. The award amount is significantly higher than the reported benchmark of $7.1M.

Cost Per Unit: $71,463

Competition Analysis

Competition Level: full-and-open

The contract was awarded through full and open competition, suggesting a robust price discovery process. This method typically leads to more competitive pricing by allowing all eligible contractors to bid. The existence of a benchmark price indicates some level of market awareness.

Taxpayer Impact: The use of full and open competition is generally beneficial for taxpayers, as it promotes competitive bidding and potentially lowers costs. The final price relative to the benchmark will determine the ultimate taxpayer impact.

Public Impact

This contract supports recovery efforts following Hurricane Sally. The project involves construction services, impacting the commercial and institutional building sector. The duration of nearly four years suggests a significant and long-term undertaking. Geographic focus is Florida, potentially impacting local labor and material markets.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Base bid significantly exceeds benchmark.
Long contract duration may lead to cost overruns.
Lack of specific deliverable details hinders value assessment.

Positive Signals

Awarded via full and open competition.
Supports critical hurricane recovery efforts.
Firm Fixed Price contract type limits cost risk.

Sector Analysis

This contract falls within the Commercial and Institutional Building Construction sector. Spending in this sector can vary widely based on infrastructure needs and disaster recovery efforts. The benchmark of $7.1M suggests this particular award is substantial for its type.

Small Business Impact

The data does not indicate whether small businesses were involved in this contract, either as prime contractors or subcontractors. Further analysis would be needed to determine the extent of small business participation.

Oversight & Accountability

The contract is a Delivery Order under a larger contract, implying some level of pre-existing oversight. However, the significant difference between the base bid and the benchmark warrants close monitoring of expenditures throughout the contract's duration.

Related Government Programs

Commercial and Institutional Building Construction
Department of Defense Contracting
Department of the Navy Programs

Risk Flags

Base bid significantly exceeds benchmark.
Lack of detailed scope of work.
Long contract duration.
Potential for material and labor cost escalation.
Unforeseen site conditions in disaster recovery area.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $104.6 million to ENVIRONMENTAL CHEMICAL CORPORATION. BASE BID - HURRICANE SALLY PACKAGE 6

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 $104.6 million.

What is the period of performance?

Start: 2022-03-28. End: 2026-03-31.

What specific construction services are included in Hurricane Sally Package 6, and how do they justify the $104.6M award compared to the $7.1M benchmark?

The provided data lacks specific details on the construction services encompassed by Hurricane Sally Package 6. To justify the $104.6M award against a $7.1M benchmark, a comprehensive breakdown of project scope, materials, labor, and unforeseen conditions would be necessary. The significant disparity suggests either a vastly different project scale or potential overpricing that requires detailed justification and validation.

What are the primary risks associated with a nearly four-year firm-fixed-price contract for construction services in a disaster recovery context?

Key risks include unforeseen site conditions, material price escalation beyond initial estimates, labor shortages, and potential scope creep, even with a fixed-price contract. In a disaster recovery context, the urgency can sometimes lead to rushed assessments, increasing the likelihood of these risks materializing. The government bears the risk of the contractor's profit margin, but significant cost overruns by the contractor could lead to delays or quality issues.

How effectively does the 'Full and Open Competition' method ensure value for money when the awarded bid is substantially higher than a reported benchmark?

Full and Open Competition is designed to maximize the number of bidders, thereby fostering competition and driving down prices. However, it doesn't guarantee the lowest price will be selected, especially if other factors like technical capability, past performance, or specific requirements are weighted. A substantially higher bid than a benchmark, even from a competitive process, suggests the benchmark may not be directly comparable, or that the winning contractor's proposal offered superior value or risk mitigation perceived by the agency.

Industry Classification

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

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

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 2

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: $108,140,974

Exercised Options: $104,622,453

Current Obligation: $104,622,453

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: N6247019D8025

IDV Type: IDC

Timeline