Parsons Government Services awarded $25.1M for Guam missile defense site remediation and construction support

Contract Overview

Contract Amount: $25,147,914 ($25.1M)

Contractor: Parsons Government Services Inc.

Awarding Agency: Department of Defense

Start Date: 2023-08-18

End Date: 2028-08-17

Contract Duration: 1,826 days

Daily Burn Rate: $13.8K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 5

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: MEC AND MPPEH REMOVAL ACTION AND CONSTRUCTION SUPPORT AT PROPOSED MISSILE DEFENSE AGENCY SITES THE ISLAND OF GUAM

Place of Performance

Location: SINAJANA, GUAM County, GUAM, 96910

Plain-Language Summary

Department of Defense obligated $25.1 million to PARSONS GOVERNMENT SERVICES INC. for work described as: MEC AND MPPEH REMOVAL ACTION AND CONSTRUCTION SUPPORT AT PROPOSED MISSILE DEFENSE AGENCY SITES THE ISLAND OF GUAM Key points: 1. Contract value represents a significant investment in critical infrastructure for national defense. 2. The fixed-price nature of the contract aims to control costs and provide predictability. 3. A long performance period suggests a complex, multi-phase project. 4. The award to a single entity indicates a focused approach to project execution. 5. Geographic location on Guam highlights strategic importance for defense operations. 6. The contract falls under remediation services, suggesting environmental considerations are key.

Value Assessment

Rating: good

Benchmarking this contract's value is challenging without specific details on the scope of remediation and construction. However, the $25.1 million award for a five-year period on Guam for missile defense site support suggests a substantial undertaking. The firm-fixed-price structure is generally favorable for the government in managing costs, provided the scope is well-defined. Compared to similar large-scale environmental remediation and construction projects for defense installations, the pricing appears within a reasonable range, though detailed cost breakdowns would be needed for a definitive assessment.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that multiple qualified bidders had the opportunity to submit proposals. The presence of 5 bids suggests a competitive environment, which typically drives better pricing and service offerings for the government. This level of competition is a positive sign for price discovery and ensures that the award was made to the most advantageous offer.

Taxpayer Impact: Full and open competition generally leads to better value for taxpayers by fostering a competitive marketplace that can drive down costs and improve service quality.

Public Impact

The primary beneficiaries are the Department of Defense and the Missile Defense Agency, ensuring the readiness and security of strategic defense sites. Services delivered include environmental remediation (MEC and MPPEH removal) and construction support, crucial for site preparation and operational capability. The geographic impact is concentrated on the island of Guam, a key strategic location in the Pacific. Workforce implications may include the creation of specialized jobs in environmental services, construction, and project management in the Guam region.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if the scope of remediation or construction proves more complex than initially assessed.
Logistical challenges associated with performing work on a remote island location like Guam.
Ensuring adequate oversight and quality control for both environmental remediation and construction activities.
Dependency on a single contractor for a critical, long-term project.

Positive Signals

Awarded through full and open competition, suggesting a robust selection process.
Firm-fixed-price contract type helps mitigate cost uncertainty for the government.
Long performance period allows for phased execution and adaptation to evolving requirements.
Contractor's established presence and experience in government contracting are likely positive factors.

Sector Analysis

This contract falls within the broader 'Environmental Remediation Services' and 'Construction Services' sectors, which are critical components of the defense industrial base. The market for these services is substantial, driven by ongoing military base operations, infrastructure upgrades, and environmental compliance requirements. Spending in this area is often influenced by geopolitical considerations and the need to maintain readiness in strategic locations. Comparable spending benchmarks would typically involve other large-scale remediation and construction projects at military installations, both domestically and internationally.

Small Business Impact

The provided data indicates that small business participation (ss and sb fields) was not a specific set-aside criterion for this contract. Therefore, there are no direct small business set-aside implications. However, the prime contractor, Parsons Government Services Inc., may engage small businesses as subcontractors to fulfill portions of the work, contributing to the broader small business ecosystem. An analysis of subcontracting plans would be necessary to determine the extent of small business involvement.

Oversight & Accountability

Oversight for this contract will likely be managed by the contracting officer and the relevant program management office within the Department of the Army or Missile Defense Agency. Accountability measures are inherent in the firm-fixed-price contract structure, which incentivizes the contractor to meet defined milestones and quality standards. Transparency is typically facilitated through contract award notices and reporting requirements, though detailed project progress and financial data may not always be publicly accessible. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse.

Related Government Programs

Missile Defense Agency Site Support Contracts
Environmental Remediation Services for Federal Facilities
Defense Infrastructure Construction Projects
Pacific Theater Defense Operations Support
Base Realignment and Closure (BRAC) Environmental Actions

Risk Flags

Potential for unforeseen environmental hazards impacting scope and cost.
Logistical complexities of working on a remote island location.
Dependency on specialized equipment and personnel for MEC/MPPEH removal.
Long contract duration increases exposure to changing regulatory or geopolitical landscapes.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $25.1 million to PARSONS GOVERNMENT SERVICES INC.. MEC AND MPPEH REMOVAL ACTION AND CONSTRUCTION SUPPORT AT PROPOSED MISSILE DEFENSE AGENCY SITES THE ISLAND OF GUAM

Who is the contractor on this award?

The obligated recipient is PARSONS GOVERNMENT SERVICES 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 $25.1 million.

What is the period of performance?

Start: 2023-08-18. End: 2028-08-17.

What is the track record of Parsons Government Services Inc. in handling large-scale environmental remediation and construction projects for the Department of Defense?

Parsons Government Services Inc. has a significant and established track record in executing complex projects for the Department of Defense and other federal agencies. They are known for their capabilities in areas such as environmental engineering, remediation, infrastructure design and construction, and program management. Their experience often includes work on military bases, hazardous material removal, and large-scale construction efforts. A detailed review of their past performance on similar contracts, including client satisfaction, adherence to schedule and budget, and safety records, would provide further insight into their suitability for this specific Guam-based project. Publicly available contract databases and agency performance evaluations can offer more granular data on their historical performance.

How does the $25.1 million contract value compare to similar remediation and construction support contracts awarded by the DoD in the Pacific region?

Comparing the $25.1 million contract value requires context regarding the specific scope, duration, and complexity of the work. However, for large-scale environmental remediation and construction support at strategic defense locations in the Pacific, this figure appears substantial but not necessarily outside the norm. Projects involving hazardous material removal (like MEC and MPPEH), coupled with new construction or upgrades to critical infrastructure, can incur significant costs due to specialized labor, equipment, logistics, and regulatory compliance. Similar contracts in regions like Guam, Hawaii, or Japan, supporting major defense installations, often range from tens to hundreds of millions of dollars depending on the project's scale and duration. The five-year performance period for this contract also suggests a significant, multi-phase effort contributing to the overall value.

What are the primary risks associated with executing environmental remediation and construction projects on an island like Guam?

Executing projects on an island like Guam presents several inherent risks. Logistical challenges are paramount, including the transportation of personnel, equipment, and materials, which can lead to delays and increased costs. Limited local resources may necessitate importing specialized labor and supplies. Environmental risks are also significant, particularly with MEC (Munitions and Explosives of Concern) and MPPEH (Material Potentially Presenting Explosive Hazards) removal, where unforeseen discoveries or complex site conditions can complicate remediation efforts and extend timelines. Furthermore, the remote location can impact communication, emergency response capabilities, and the availability of specialized support services. Ensuring robust project management, contingency planning, and strong communication channels are crucial to mitigating these risks.

What is the significance of the 'Remediation Services' classification for this contract?

The 'Remediation Services' classification signifies that a primary objective of this contract is the cleanup and restoration of environmental conditions at the proposed Missile Defense Agency sites on Guam. This specifically includes the removal of MEC and MPPEH, which are hazardous materials that pose a direct threat to personnel and the environment. Such services are critical for ensuring that land designated for defense infrastructure is safe for use and complies with environmental regulations. It implies that the contractor must possess specialized expertise, certifications, and equipment for handling and disposing of explosive materials and other contaminants, adhering to strict safety protocols and regulatory frameworks established by agencies like the EPA and DoD.

How does the firm-fixed-price (FFP) contract type influence cost control and risk allocation for this project?

The Firm-Fixed-Price (FFP) contract type is designed to provide the government with cost certainty and transfer most of the cost risk to the contractor. Under an FFP agreement, the contractor agrees to perform a specific scope of work for a predetermined price, regardless of the actual costs incurred. This incentivizes the contractor to manage their costs efficiently and effectively to maximize profit. For the government, it means the total expenditure is largely fixed, barring any contract modifications. However, if the scope of work is not clearly defined or if unforeseen issues arise that necessitate changes, the FFP structure can lead to disputes or change orders, potentially increasing the overall cost. The success of an FFP contract heavily relies on a well-defined SOW and thorough risk assessment during the bidding phase.

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

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: W912DY20R0016

Offers Received: 5

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Parsons Corporation

Address: 100 W WALNUT ST, PASADENA, CA, 91124

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

Financial Breakdown

Contract Ceiling: $30,755,022

Exercised Options: $25,147,914

Current Obligation: $25,147,914

Subaward Activity

Number of Subawards: 1

Total Subaward Amount: $47,027

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: W912DY22D0084

IDV Type: IDC

Timeline