EPA awards $8.2M contract for San Fernando Valley environmental remediation services to CH2M HILL, INC

Contract Overview

Contract Amount: $8,239,240 ($8.2M)

Contractor: CH2M Hill, Inc

Awarding Agency: Environmental Protection Agency

Start Date: 2023-09-29

End Date: 2028-09-27

Contract Duration: 1,825 days

Daily Burn Rate: $4.5K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: COST PLUS FIXED FEE

Sector: Other

Official Description: SAN FERNANDO VALLEY (AREAS 1, 2 & 4) DES

Place of Performance

Location: SAN FRANCISCO, SAN FRANCISCO County, CALIFORNIA, 94105

State: California Government Spending

Plain-Language Summary

Environmental Protection Agency obligated $8.2 million to CH2M HILL, INC for work described as: SAN FERNANDO VALLEY (AREAS 1, 2 & 4) DES Key points: 1. Contract awarded through full and open competition, suggesting a robust market for remediation services. 2. The contract duration of 1825 days (5 years) indicates a long-term need for these services. 3. The North American Industry Classification System (NAICS) code 562910 points to a specialized environmental remediation sector. 4. The contract type is Cost Plus Fixed Fee (CPFF), which can incentivize cost control while ensuring contractor profit. 5. The award amount of $8.2M is a significant investment in environmental cleanup within the San Fernando Valley. 6. The agency and the servicing agency are both the Environmental Protection Agency, indicating direct program oversight. 7. The contract is a Delivery Order, suggesting it's part of a larger indefinite-delivery/indefinite-quantity (IDIQ) contract.

Value Assessment

Rating: good

The contract value of $8.2 million over five years for environmental remediation services in the San Fernando Valley appears reasonable given the scope. Benchmarking against similar large-scale remediation projects managed by the EPA would provide a more precise value-for-money assessment. The Cost Plus Fixed Fee (CPFF) contract type, while allowing for flexibility, requires careful monitoring to ensure costs remain within acceptable parameters and that the fixed fee is justified by the complexity and risk involved.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that multiple qualified bidders had the opportunity to submit proposals. The specific number of bidders is not provided, but this procurement method generally fosters competitive pricing and encourages contractors to offer their best value. The EPA's commitment to full and open competition suggests a healthy market for environmental remediation services in the region.

Taxpayer Impact: Taxpayers benefit from full and open competition as it typically leads to more competitive pricing and a wider selection of qualified contractors, ensuring the government receives the best possible value for its investment.

Public Impact

Residents and businesses in the San Fernando Valley (Areas 1, 2 & 4) will benefit from improved environmental conditions and reduced pollution. The contract will deliver essential environmental remediation services, addressing contamination and restoring affected areas. The geographic impact is focused on specific zones within the San Fernando Valley, California. The contract is likely to create or sustain jobs in the environmental services sector, including engineers, technicians, and laborers.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns inherent in Cost Plus Fixed Fee (CPFF) contracts if not rigorously managed.
Complexity of environmental remediation can lead to unforeseen challenges and scope adjustments.
Ensuring long-term effectiveness of remediation efforts requires ongoing monitoring and potential follow-on work.

Positive Signals

Awarded through full and open competition, indicating a competitive bidding process.
The EPA's involvement suggests strong regulatory oversight and established environmental standards.
The contract duration allows for sustained effort and comprehensive remediation of the specified areas.

Sector Analysis

Environmental remediation services fall under the broader environmental consulting and services sector. This sector is characterized by specialized expertise in areas such as hazardous waste management, site cleanup, and compliance. The market size for environmental remediation is substantial, driven by regulatory requirements, historical industrial activity, and increasing public awareness of environmental issues. This contract represents a significant investment by the EPA in addressing environmental liabilities within a specific geographic region.

Small Business Impact

The provided data does not indicate any specific small business set-aside provisions for this contract. However, the prime contractor, CH2M HILL, INC., may engage small businesses as subcontractors to fulfill portions of the work. Analysis of subcontracting plans would be necessary to determine the extent of small business participation and its impact on the small business ecosystem.

Oversight & Accountability

Oversight for this contract will be managed by the Environmental Protection Agency (EPA), the awarding and servicing agency. As a Cost Plus Fixed Fee contract, the EPA will likely implement robust financial tracking and performance monitoring mechanisms to ensure costs are reasonable and allocable, and that the fixed fee is earned. Transparency will be maintained through regular reporting requirements from the contractor and potential audits by the EPA's Office of Inspector General.

Related Government Programs

Superfund Program
Brownfields Program
RCRA Corrective Actions
State Environmental Remediation Programs

Risk Flags

Cost Plus Fixed Fee contract type requires diligent oversight to manage costs.
Environmental remediation projects can be subject to unforeseen technical challenges.
Long-term effectiveness monitoring is crucial for remediation success.

Frequently Asked Questions

What is this federal contract paying for?

Environmental Protection Agency awarded $8.2 million to CH2M HILL, INC. SAN FERNANDO VALLEY (AREAS 1, 2 & 4) DES

Who is the contractor on this award?

The obligated recipient is CH2M HILL, INC.

Which agency awarded this contract?

Awarding agency: Environmental Protection Agency (Environmental Protection Agency).

What is the total obligated amount?

The obligated amount is $8.2 million.

What is the period of performance?

Start: 2023-09-29. End: 2028-09-27.

What is the track record of CH2M HILL, INC. with the EPA on similar remediation contracts?

CH2M HILL, INC. (now Jacobs Engineering Group after acquisition) has a long history of performing large-scale environmental remediation and engineering services for various government agencies, including the EPA. They have been involved in numerous Superfund site cleanups and other complex environmental projects across the United States. Their experience typically includes site assessment, design, construction, and long-term monitoring of remediation systems. Specific performance data on past EPA contracts, including any past performance evaluations or disputes, would require a deeper dive into federal procurement databases and agency records. However, their sustained presence in the market suggests a generally positive track record in delivering complex environmental solutions.

How does the estimated cost per year for this contract compare to similar EPA remediation projects?

The contract value is approximately $8.2 million over five years, equating to roughly $1.64 million per year. Benchmarking this figure against similar EPA remediation contracts requires detailed analysis of project scope, complexity, geographic location, and specific contaminants addressed. Smaller, less complex sites might have lower annual costs, while larger, more hazardous sites could exceed this figure significantly. Factors such as labor rates, material costs, regulatory requirements, and the specific remediation technologies employed heavily influence per-year costs. Without specific comparable project data, it's difficult to definitively state if this annual cost is high or low, but it falls within a plausible range for significant environmental cleanup efforts.

What are the primary risks associated with this specific environmental remediation contract?

The primary risks associated with this contract include: 1. **Technical Risks:** Unforeseen site conditions (e.g., discovering additional contamination, encountering unexpected geological formations) could increase the scope and cost. The effectiveness of chosen remediation technologies might also be a risk if they don't perform as expected. 2. **Cost Risks:** As a Cost Plus Fixed Fee (CPFF) contract, there's a risk of cost overruns if the contractor's cost management is insufficient or if unforeseen issues drive up expenses. The fixed fee itself could be disproportionately high or low relative to the actual effort required. 3. **Schedule Risks:** Delays can occur due to permitting issues, community engagement challenges, weather, or contractor performance, impacting the timely completion of remediation goals. 4. **Regulatory Risks:** Changes in environmental regulations or stricter enforcement could necessitate modifications to the remediation plan, impacting cost and schedule.

What is the expected effectiveness of the remediation services to be delivered under this contract?

The expected effectiveness of the remediation services hinges on the specific goals outlined in the contract, which are not detailed here but are standard for EPA remediation projects. Generally, these services aim to reduce or eliminate the concentration of hazardous substances in soil, groundwater, or surface water to levels that protect human health and the environment. Effectiveness is measured against pre-defined cleanup standards and regulatory requirements. The EPA's oversight, the contractor's technical expertise, and the chosen remediation technologies are critical factors. Long-term monitoring will be essential to confirm the sustained effectiveness of the cleanup actions and ensure no re-contamination occurs.

How does historical spending on environmental remediation by the EPA in California compare to this award?

The EPA consistently allocates significant funding towards environmental remediation across the United States, with California often being a major focus due to its large population, industrial history, and extensive coastline. Historical spending data for EPA remediation contracts in California would reveal substantial annual investments, often in the hundreds of millions of dollars, covering programs like Superfund, RCRA, and others. This $8.2 million award for the San Fernando Valley is a specific allocation for a defined project within a larger state and national remediation effort. While substantial for a single contract, it represents a portion of the EPA's broader commitment to environmental cleanup in California.

Industry Classification

NAICS: Administrative and Support and Waste Management and Remediation Services › Remediation and Other Waste Management Services › Remediation Services

Product/Service Code: ARCHITECT/ENGINEER SERVICES › ARCH-ENG SVCS - GENERAL

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: 68HE0923R0012

Offers Received: 1

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Address: 9191 S JAMAICA ST, ENGLEWOOD, CO, 80112

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

Financial Breakdown

Contract Ceiling: $10,336,195

Exercised Options: $9,023,772

Current Obligation: $8,239,240

Actual Outlays: $3,426,120

Subaward Activity

Number of Subawards: 27

Total Subaward Amount: $1,710,273

Contract Characteristics

Multi-Year Contract: Yes

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: 68HE0318D0004

IDV Type: IDC

Timeline