Department of the Army awards $15.6M CPFF contract for remediation services to Hydrogeologic, Inc

Contract Overview

Contract Amount: $15,623,102 ($15.6M)

Contractor: Hydrogeologic, Inc.

Awarding Agency: Department of Defense

Start Date: 2025-07-18

End Date: 2026-11-30

Contract Duration: 500 days

Daily Burn Rate: $31.2K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 1

Pricing Type: COST PLUS FIXED FEE

Sector: Construction

Official Description: CONSTRUCTION ELEMENTS YEAR 1 (CPFF)

Place of Performance

Location: SILVERTON, SAN JUAN County, COLORADO, 81433

State: Colorado Government Spending

Plain-Language Summary

Department of Defense obligated $15.6 million to HYDROGEOLOGIC, INC. for work described as: CONSTRUCTION ELEMENTS YEAR 1 (CPFF) Key points: 1. Contract awarded via full and open competition after exclusion of sources, indicating a potentially specialized requirement. 2. The Cost Plus Fixed Fee (CPFF) structure allows for flexibility but requires careful monitoring of costs. 3. The contract duration of 500 days suggests a significant scope of work for remediation. 4. The award to Hydrogeologic, Inc. represents a specific capability within the remediation services sector. 5. The contract is for remediation services, a critical environmental function for the Department of Defense. 6. The base award value is $15.6 million, with potential for growth through subsequent orders.

Value Assessment

Rating: fair

The contract is a Cost Plus Fixed Fee (CPFF) type, which can sometimes lead to higher costs compared to fixed-price contracts if not managed tightly. Benchmarking CPFF contracts for similar remediation services is challenging without more detailed cost breakdowns. The base award of $15.6 million for 500 days of work provides a starting point for value assessment, but the ultimate cost will depend on actual expenses incurred and the fixed fee. The contract's 'after exclusion of sources' clause suggests a specific need that may limit direct price comparisons to broadly competed contracts.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

The contract was awarded under 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES.' This indicates that while the competition was intended to be open, specific criteria or circumstances led to the exclusion of certain potential bidders. The exact number of bidders is not provided, making it difficult to fully assess the level of competition. This type of competition suggests a need for specialized expertise or capabilities that may not be widely available, potentially impacting price discovery.

Taxpayer Impact: The limited competition may mean taxpayers are not benefiting from the lowest possible price achievable through broader market engagement. However, it could also ensure that the most qualified contractor is selected for a critical and specialized task.

Public Impact

The primary beneficiaries are the Department of the Army and potentially the environment, through the remediation of contaminated sites. Services delivered include specialized remediation activities, crucial for environmental compliance and safety. The geographic impact is likely localized to the specific site(s) requiring remediation within the Army's jurisdiction. Workforce implications may include the employment of environmental engineers, technicians, and support staff by the contractor.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

CPFF contracts can incentivize cost overruns if not rigorously overseen.
The 'after exclusion of sources' clause warrants scrutiny to ensure fair opportunity was appropriately considered.
Lack of detailed cost data makes independent value-for-money assessment difficult.

Positive Signals

Awarded under a competitive process, suggesting a selection based on merit.
Remediation services are essential for environmental stewardship and regulatory compliance.
The contract specifies a clear period of performance, aiding in project management.

Sector Analysis

The remediation services sector is a critical component of the environmental services industry, driven by regulatory requirements and corporate responsibility. This contract falls within the broader environmental consulting and remediation market, which includes cleanup of contaminated soil, water, and air. Spending in this sector is often influenced by government regulations (like EPA standards) and the operational needs of large organizations, including the Department of Defense. Comparable spending benchmarks would typically involve analyzing other large-scale environmental cleanup contracts awarded by federal agencies.

Small Business Impact

The provided data indicates that small business participation (ss: false, sb: false) was not a primary set-aside consideration for this specific contract award. This suggests the contract was likely awarded to a large business or that subcontracting opportunities for small businesses are not explicitly detailed in this award notice. Further analysis of the contract's subcontracting plan would be necessary to understand the potential impact on the small business ecosystem.

Oversight & Accountability

Oversight for this Cost Plus Fixed Fee contract will likely be managed by the contracting officer and the relevant program office within the Department of the Army. Accountability measures would include performance reviews, milestone tracking, and financial audits to ensure costs are reasonable and allocable. Transparency is typically facilitated through contract award databases and reporting requirements, though detailed cost breakdowns may be proprietary. Inspector General jurisdiction would apply if any fraud, waste, or abuse is suspected.

Related Government Programs

Environmental Remediation Services
Department of Defense Environmental Contracts
Hazardous Waste Management
Site Cleanup Contracts
Cost-Plus Contracts

Risk Flags

Cost Plus Fixed Fee contract type requires diligent oversight to manage costs.
Competition was not fully open, potentially limiting price discovery.
Specific details on performance metrics and cost breakdowns are not publicly available.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $15.6 million to HYDROGEOLOGIC, INC.. CONSTRUCTION ELEMENTS YEAR 1 (CPFF)

Who is the contractor on this award?

The obligated recipient is HYDROGEOLOGIC, INC..

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $15.6 million.

What is the period of performance?

Start: 2025-07-18. End: 2026-11-30.

What is the typical profit margin for Cost Plus Fixed Fee (CPFF) contracts in the environmental remediation sector?

Profit margins for CPFF contracts in environmental remediation can vary significantly based on contract complexity, risk, and the specific services provided. Generally, the 'fixed fee' component is negotiated as a percentage of the estimated cost, often ranging from 5% to 15%. However, this fee is fixed regardless of the final cost incurred by the contractor, incentivizing efficiency. Factors influencing the fee include the contractor's historical performance, the level of technical difficulty, and market competition. Without specific details on Hydrogeologic, Inc.'s fee structure for this contract, it's difficult to provide an exact benchmark. However, agencies aim to negotiate fees that are fair to the contractor while representing good value to the government, considering the risks assumed.

How does the 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES' clause impact the potential for cost savings?

The 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES' clause suggests that while the competition was intended to be open, certain potential offerors were excluded based on specific criteria. This exclusion might be due to unique technical requirements, security clearances, or past performance necessities that only a limited number of contractors could meet. While it aims for broad participation among qualified entities, the exclusion of some sources could potentially limit the competitive pressure on price. If only a few highly specialized firms can bid, the resulting price might be higher than if a wider range of competitors were involved. The government's justification for excluding sources is critical in determining if this approach truly serves the best interest of the taxpayer.

What are the key performance indicators (KPIs) typically monitored for environmental remediation contracts?

Key performance indicators (KPIs) for environmental remediation contracts typically focus on safety, environmental compliance, schedule adherence, cost control, and quality of work. Specific KPIs might include: 1) Safety: Lost Time Injury Frequency Rate (LTIFR), number of safety incidents. 2) Environmental Compliance: Compliance with permits, regulatory reporting timeliness, effectiveness of containment measures. 3) Schedule: Percentage of milestones completed on time, overall project completion date adherence. 4) Cost Control: Variance from estimated costs, efficiency of resource utilization. 5) Quality: Results of sampling and analysis confirming remediation goals, adherence to technical specifications, number of non-conformance reports. The contracting officer's representative (COR) and quality assurance personnel would monitor these KPIs throughout the contract's duration.

What is the historical spending trend for remediation services by the Department of the Army?

Historical spending by the Department of the Army on remediation services has been substantial and consistent, driven by the need to manage environmental liabilities across numerous installations worldwide. The Army is one of the largest federal agencies with significant environmental cleanup responsibilities, stemming from decades of training, operations, and infrastructure development. Annual spending fluctuates based on the number and scale of active cleanup projects, regulatory requirements, and budget allocations. While specific year-over-year figures for remediation alone require detailed database queries, the overall trend indicates a sustained, multi-billion dollar investment over the past two decades. This consistent spending reflects the long-term nature of environmental remediation and the ongoing commitment to addressing contamination.

How does the base award value of $15.6 million compare to other similar remediation contracts?

A base award value of $15.6 million for environmental remediation services is a significant but not uncommon figure for large-scale projects undertaken by federal agencies. The Department of Defense, including the Army, frequently awards contracts in this range and often higher for complex cleanup operations involving hazardous materials, large geographical areas, or long-term monitoring. To provide a precise comparison, one would need to analyze contracts with similar scopes of work (e.g., soil remediation, groundwater treatment, munitions response), contract types (CPFF, FFP), and durations. However, this award falls within the typical spectrum for major environmental remediation efforts managed by federal entities, suggesting a substantial project requiring specialized expertise and resources.

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: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: W9128F20R0038

Offers Received: 1

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Address: 11107 SUNSET HILLS RD STE 400, RESTON, VA, 20190

Business Categories: Asian Pacific American Owned Business, Category Business, Corporate Entity Not Tax Exempt, Minority Owned Business, Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $41,172,169

Exercised Options: $15,623,102

Current Obligation: $15,623,102

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: W9128F21D0006

IDV Type: IDC

Timeline