Tetra Tech EC Inc. awarded $14.2M contract for services, with a significant portion spent on labor

Contract Overview

Contract Amount: $14,167,731 ($14.2M)

Contractor: Tetra Tech EC, Inc.

Awarding Agency: Department of Defense

Start Date: 2008-02-22

End Date: 2011-09-30

Contract Duration: 1,316 days

Daily Burn Rate: $10.8K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: TIME AND MATERIALS

Sector: Other

Official Description: FUNDING

Place of Performance

Location: COMMERCE CITY, ADAMS County, COLORADO, 80022

State: Colorado Government Spending

Plain-Language Summary

Department of Defense obligated $14.2 million to TETRA TECH EC, INC. for work described as: FUNDING Key points: 1. Contract value of $14.2 million indicates a substantial investment in specialized services. 2. The 'Time and Materials' contract type suggests potential for cost overruns if not closely managed. 3. A duration of 1316 days (over 3.5 years) implies a long-term need for the services provided. 4. The contract was awarded under full and open competition, suggesting a competitive bidding process. 5. The absence of small business set-aside flags indicates a focus on larger, established contractors. 6. The contract's performance period spans a significant historical timeframe, allowing for analysis of trends.

Value Assessment

Rating: fair

The contract's total value of $14.2 million over 1316 days averages approximately $10,766 per day. Without specific details on the services rendered, it's challenging to benchmark against similar contracts. However, the 'Time and Materials' pricing structure, while common, can lead to higher costs compared to fixed-price contracts if labor hours and material costs are not rigorously controlled and justified. The daily average cost suggests a moderate level of expenditure, but the value proposition hinges entirely on the criticality and effectiveness of the services delivered.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under 'Full and Open Competition,' indicating that all responsible sources were permitted to submit bids. This suggests a robust bidding process where multiple companies likely vied for the contract. The level of competition is generally positive for price discovery, as it incentivizes bidders to offer competitive pricing to win the award. The fact that it was fully competed implies the government sought the best value through a broad market solicitation.

Taxpayer Impact: A fully competed contract generally benefits taxpayers by driving down prices through market forces. This ensures that the government is not overpaying for services and that taxpayer dollars are used more efficiently. The competitive nature of the award suggests that the selected contractor, Tetra Tech EC, Inc., offered terms deemed most advantageous.

Public Impact

The primary beneficiaries are likely the Department of the Army, receiving essential services to support its operations. The services delivered are not explicitly detailed but are procured through a significant federal contract. The geographic impact is tied to the operational needs of the Department of the Army, potentially across various locations. Workforce implications could include direct employment by Tetra Tech EC, Inc. and potential indirect support roles.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

The 'Time and Materials' pricing model carries inherent risks of cost escalation if not managed diligently.
Lack of specific service details makes it difficult to assess the true value and necessity of the expenditure.
The contract's age means current market rates and technological capabilities may have evolved significantly since its award.

Positive Signals

Awarded under full and open competition, indicating a potentially competitive and fair bidding process.
The contract was awarded to a single entity, suggesting a clear line of responsibility for service delivery.
The substantial funding indicates a recognized need for the services provided by the Department of the Army.

Sector Analysis

This contract falls within the broad professional services sector, likely encompassing areas such as engineering, environmental services, or technical support, which are crucial for government operations. The Department of Defense, as a major federal agency, represents a significant market for such services. Benchmarking this $14.2 million contract requires comparison against similar service contracts awarded by the DoD or other large federal agencies, considering the specific nature of the services rendered and the duration of the contract.

Small Business Impact

The contract does not indicate any specific small business set-aside provisions (ss: false, sb: false). This suggests that the competition was open to all responsible contractors, regardless of size. While this ensures broad market access, it may limit direct opportunities for small businesses unless they participate as subcontractors to larger prime contractors like Tetra Tech EC, Inc. The absence of set-asides means the primary impact on the small business ecosystem would be through potential subcontracting relationships.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and the administrative contracting officer within the Department of the Army. Accountability measures are embedded in the contract terms, including performance standards and payment schedules tied to deliverables. Transparency is generally facilitated through contract award databases, though specific performance details and audits may not always be publicly accessible. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

Department of Defense Services Contracts
Army Operational Support Contracts
Time and Materials Service Agreements
Professional Services Procurement
Long-Term Government Service Contracts

Risk Flags

Time and Materials Pricing Risk
Lack of Specific Service Details
Potential for Cost Overruns
Contract Age and Relevance

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $14.2 million to TETRA TECH EC, INC.. FUNDING

Who is the contractor on this award?

The obligated recipient is TETRA TECH EC, 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 $14.2 million.

What is the period of performance?

Start: 2008-02-22. End: 2011-09-30.

What specific services did Tetra Tech EC, Inc. provide under this $14.2 million contract?

The provided data does not specify the exact services rendered by Tetra Tech EC, Inc. under this $14.2 million contract. The contract type is 'Time and Materials' (PT: TIME AND MATERIALS), and the awarding agency is the Department of the Army (SA: Department of the Army). Such contracts are often used for services where the scope of work is not precisely defined at the outset or is expected to evolve. Common services procured under this model by the Army include engineering, technical support, environmental remediation, construction management, or IT services. Without further details from the contract's statement of work or performance reports, the precise nature of the services remains unknown, making a detailed assessment of their value and impact difficult.

How does the daily average cost of approximately $10,766 compare to industry benchmarks for similar services?

The daily average cost of approximately $10,766 for this contract (calculated as $14,167,730.66 / 1316 days) is difficult to benchmark without knowing the specific services provided. For 'Time and Materials' contracts, costs are driven by labor rates, overhead, materials, and profit. If the services involved highly specialized engineering or technical expertise, this daily rate might be considered reasonable or even low in certain high-cost regions or for niche skill sets. Conversely, if the services were more general, this rate could be on the higher side. Benchmarking requires comparing against contracts with similar scopes of work, labor categories, geographic locations, and contract types within the Department of the Army or similar agencies. The 'full and open competition' aspect suggests the government aimed for competitive pricing, but the actual value depends on the efficiency and necessity of the hours billed and materials used.

What are the potential risks associated with the 'Time and Materials' contract type used for this award?

The primary risk associated with a 'Time and Materials' (T&M) contract type is the potential for cost escalation. Unlike fixed-price contracts, T&M contracts reimburse the contractor for the actual cost of labor (at specified hourly rates) and materials, plus a fee or profit. This structure can incentivize contractors to bill more hours or use more expensive materials if not carefully monitored. For the government, this means the final cost can exceed initial estimates, making budgeting more challenging. Effective risk mitigation requires robust oversight, detailed tracking of hours and materials, clear definition of tasks, and strong negotiation of labor rates. The long duration of this contract (1316 days) amplifies these risks, as there is a longer period during which costs could potentially increase without a fixed ceiling.

Given the contract's award date (2008), how might its value and effectiveness be viewed in today's context?

A contract awarded in 2008 and ending in 2011, with a total value of $14.2 million, represents a historical expenditure. In today's context, its value and effectiveness are viewed retrospectively. The $14.2 million figure, while substantial, would need to be adjusted for inflation to compare its real purchasing power to current contract values. Furthermore, the services provided might be obsolete or superseded by newer technologies or methodologies. Assessing effectiveness would require examining performance reports from the time, user satisfaction, and whether the contract achieved its intended objectives within the Department of the Army. The 'Time and Materials' nature also means its cost-effectiveness is judged against the efficiency of labor and material usage during that period, rather than a pre-defined outcome.

What does the lack of small business participation (set-aside or subcontracting flags) imply for the small business ecosystem?

The absence of flags indicating small business set-asides (ss: false, sb: false) suggests that this $14.2 million contract was not specifically targeted to encourage small business prime contracting. This means that large businesses were likely the primary bidders and recipients of the contract funds. While this doesn't preclude small businesses from benefiting, their involvement would primarily be through subcontracting opportunities offered by the prime contractor, Tetra Tech EC, Inc. The lack of explicit subcontracting goals or reporting requirements in the provided data makes it difficult to ascertain the extent of small business participation. This approach prioritizes competition among all firms, potentially overlooking opportunities to foster growth within the small business sector unless specific subcontracting plans were mandated and fulfilled outside the scope of this summary data.

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 1

Pricing Type: TIME AND MATERIALS (Y)

Contractor Details

Parent Company: Tetra Tech, Inc. (UEI: 045224250)

Address: 143 UNION BLVD STE 1010, LAKEWOOD, CO, 07

Business Categories: Category Business, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $14,167,731

Exercised Options: $14,167,731

Current Obligation: $14,167,731

Contract Characteristics

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: DAAM0297D0012

IDV Type: IDC

Timeline