DOD awards $32.4M for Shoalwater Dune Barrier Reconstruction, raising value-for-money questions

Contract Overview

Contract Amount: $32,412,020 ($32.4M)

Contractor: ECC Environmental LLC

Awarding Agency: Department of Defense

Start Date: 2022-05-17

End Date: 2023-08-31

Contract Duration: 471 days

Daily Burn Rate: $68.8K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 3

Pricing Type: COST PLUS FIXED FEE

Sector: Construction

Official Description: SHOALWATER DUNE BARRIER RECONSTRUCTION, TOKELAND WASHINGTON TASK ORDER

Place of Performance

Location: TOKELAND, PACIFIC County, WASHINGTON, 98590

State: Washington Government Spending

Plain-Language Summary

Department of Defense obligated $32.4 million to ECC ENVIRONMENTAL LLC for work described as: SHOALWATER DUNE BARRIER RECONSTRUCTION, TOKELAND WASHINGTON TASK ORDER Key points: 1. The contract's cost-plus-fixed-fee structure may incentivize higher spending. 2. Limited public data makes it difficult to assess true value for money. 3. The relatively short duration for a reconstruction project warrants scrutiny. 4. The project's success hinges on effective environmental mitigation and long-term resilience. 5. Geographic concentration in Washington State limits broader applicability. 6. The contractor's performance history on similar projects is a key risk indicator.

Value Assessment

Rating: questionable

The awarded amount of $32.4 million for the Shoalwater Dune Barrier Reconstruction is substantial. Without detailed cost breakdowns or comparisons to similar coastal resilience projects, it is difficult to definitively benchmark the value for money. The cost-plus-fixed-fee (CPFF) contract type, while offering flexibility, can sometimes lead to higher overall costs compared to fixed-price contracts if not managed tightly. Further analysis of the fixed fee and the contractor's cost management practices is needed to assess if this represents a fair price for the services rendered.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that multiple bidders were likely considered. However, the number of bids received (3) is on the lower side for a project of this magnitude, which could suggest potential limitations in the market or the attractiveness of the contract terms. While competition is present, the limited number of bidders may have impacted price discovery and potentially led to a higher-than-optimal award price.

Taxpayer Impact: Taxpayers benefit from competition, which theoretically drives down costs. However, with only three bidders, the full cost-saving potential of a more robust competition may not have been realized.

Public Impact

The project directly benefits the Shoalwater Bay Indian Tribe by enhancing coastal protection for their lands and infrastructure. It aims to deliver critical environmental services by reconstructing a vital dune barrier, crucial for ecosystem health and storm surge mitigation. The geographic impact is localized to Tokeland, Washington, addressing specific regional vulnerabilities. Workforce implications include potential job creation for construction and environmental specialists in the region.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost-plus-fixed-fee contract type can lead to cost overruns if not closely monitored.
Limited number of bidders (3) may indicate insufficient market competition, potentially inflating prices.
The effectiveness of the reconstruction in providing long-term resilience against coastal erosion and storm surges needs to be monitored.
Environmental impacts during construction must be carefully managed to avoid further ecological damage.

Positive Signals

Awarded under full and open competition, suggesting a broad search for qualified contractors.
The project addresses a critical environmental need for coastal protection in a vulnerable area.
The Department of Defense's involvement may indicate a commitment to thorough oversight and execution.

Sector Analysis

This contract falls within the Commercial and Institutional Building Construction sector, specifically addressing environmental and infrastructure resilience. The market for coastal defense and environmental restoration projects is growing due to climate change impacts. Comparable spending benchmarks are difficult to establish without more specific project details, but large-scale reconstruction efforts often involve multi-million dollar investments. This project represents a significant investment in a niche but critical area of construction.

Small Business Impact

The contract was not set aside for small businesses, and there is no indication of specific subcontracting goals for small businesses. This suggests that the primary award went to a larger entity, and the direct impact on the small business ecosystem may be limited unless the prime contractor actively engages small businesses for subcontracting opportunities. Further investigation into subcontracting plans would be necessary to assess the full impact.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of the Army's contracting and project management divisions. The CPFF structure necessitates robust financial oversight to ensure costs are reasonable and allocable. Transparency is moderate, with contract award data available, but detailed performance metrics and cost justifications are often not publicly disclosed. Inspector General jurisdiction would apply if any fraud, waste, or abuse is suspected.

Related Government Programs

Coastal Resilience Projects
Environmental Remediation Services
Department of Defense Construction Contracts
Army Corps of Engineers Projects

Risk Flags

Cost-plus-fixed-fee contract type may lead to higher costs.
Limited number of bidders (3) could indicate reduced competition and potentially higher pricing.
Lack of detailed public performance metrics makes value assessment difficult.
Long-term effectiveness of the reconstructed barrier against environmental factors requires monitoring.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $32.4 million to ECC ENVIRONMENTAL LLC. SHOALWATER DUNE BARRIER RECONSTRUCTION, TOKELAND WASHINGTON TASK ORDER

Who is the contractor on this award?

The obligated recipient is ECC ENVIRONMENTAL LLC.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $32.4 million.

What is the period of performance?

Start: 2022-05-17. End: 2023-08-31.

What is the track record of ECC Environmental LLC on similar federal contracts, particularly those involving coastal reconstruction or environmental restoration?

A review of federal contract databases indicates that ECC Environmental LLC has a history of performing work for various government agencies, including the Department of Defense. Their portfolio includes projects related to environmental remediation, construction, and infrastructure. Specific details on their performance on coastal dune barrier reconstruction or similar large-scale environmental restoration projects would require a deeper dive into contract performance reports and past performance evaluations. Without access to these specific metrics, it's challenging to definitively assess their suitability and past success rate for this particular type of complex environmental construction.

How does the awarded amount compare to the estimated cost or budget for this Shoalwater Dune Barrier Reconstruction project?

The provided data indicates an award amount of $32,412,020.44. However, there is no information available regarding the initial estimated cost or the allocated budget for this project. This makes it impossible to determine if the awarded amount represents an overage, an underrun, or if it was precisely in line with expectations. Understanding the relationship between the estimated cost and the final award is crucial for assessing the efficiency of the procurement process and the contractor's ability to manage costs within a defined financial framework.

What are the key performance indicators (KPIs) for this contract, and how will the success of the dune barrier reconstruction be measured?

Specific Key Performance Indicators (KPIs) for the Shoalwater Dune Barrier Reconstruction contract are not publicly detailed in the provided data. Typically, for such projects, KPIs would focus on factors like the structural integrity of the reconstructed barrier, its effectiveness in mitigating erosion and storm surge, adherence to environmental protection standards during construction, project completion within schedule, and overall cost control. The success measurement would likely involve post-construction surveys, environmental monitoring, and potentially long-term performance assessments to ensure the barrier's resilience and ecological function.

What is the historical spending pattern for dune barrier reconstruction or similar coastal protection projects by the Department of Defense?

Historical spending patterns for dune barrier reconstruction and similar coastal protection projects by the Department of Defense are varied and depend heavily on geographic location, specific threats (e.g., erosion, sea-level rise, storm surge), and the scale of the intervention. The Army Corps of Engineers, often involved in such projects, manages significant budgets for coastal infrastructure. While specific figures for 'dune barrier reconstruction' as a distinct category are not readily available, the DoD does allocate substantial funds annually towards military installation resilience, which often includes coastal defense measures. This $32.4 million award is a significant investment for a single project, but it aligns with the increasing need for such infrastructure due to environmental changes.

What are the potential risks associated with the Cost Plus Fixed Fee (CPFF) contract type for this project, and what mitigation strategies are in place?

The primary risk associated with a Cost Plus Fixed Fee (CPFF) contract is that the contractor is reimbursed for all allowable costs plus a fixed fee representing profit. This structure can incentivize higher spending, as the contractor's profit is fixed regardless of the total cost incurred. If cost controls are weak, this can lead to cost overruns. Mitigation strategies typically involve stringent oversight of allowable costs, detailed audits, clear definition of 'fixed fee' scope, and performance incentives tied to efficiency and timely completion. The government contracting officer and project managers play a critical role in monitoring expenditures and ensuring adherence to the contract terms to manage these risks.

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

Solicitation ID: W9128F19R0043

Offers Received: 3

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Parent Company: Environmental Chemical Corporation

Address: 1240 BAYSHORE HWY STE 317, BURLINGAME, CA, 94010

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

Financial Breakdown

Contract Ceiling: $32,412,020

Exercised Options: $32,412,020

Current Obligation: $32,412,020

Actual Outlays: $10,440,418

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: W9128F20D0006

IDV Type: IDC

Timeline