DHS Coast Guard awards $25.8M contract for oil spill response, raising questions on competition and value

Contract Overview

Contract Amount: $25,861,345 ($25.9M)

Contractor: Couvillion Group LLC

Awarding Agency: Department of Homeland Security

Start Date: 2019-11-19

End Date: 2020-11-19

Contract Duration: 366 days

Daily Burn Rate: $70.7K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: TIME AND MATERIALS

Sector: Other

Official Description: N13024 PROVIDE LABOR, MATERIALS AND EQUIPMENT TO MITIGATE THE HARMFUL AFFECT OF OIL SPILL OR HAZARDOUS CHEMICAL INCIDENT, AS DIRECTED BY THE (FOSC)

Place of Performance

Location: METAIRIE, JEFFERSON County, LOUISIANA, 70005

State: Louisiana Government Spending

Plain-Language Summary

Department of Homeland Security obligated $25.9 million to COUVILLION GROUP LLC for work described as: N13024 PROVIDE LABOR, MATERIALS AND EQUIPMENT TO MITIGATE THE HARMFUL AFFECT OF OIL SPILL OR HAZARDOUS CHEMICAL INCIDENT, AS DIRECTED BY THE (FOSC) Key points: 1. The contract's value of $25.8 million for a one-year period suggests a significant investment in emergency response capabilities. 2. The 'NOT COMPETED' status indicates a lack of competitive bidding, potentially leading to higher costs and reduced value for taxpayers. 3. The use of a 'TIME AND MATERIALS' contract type can introduce cost uncertainty if not closely managed. 4. The geographic focus on Louisiana (LA) highlights the specific regional risks addressed by this contract. 5. The North American Industry Classification System (NAICS) code 562119 points to services related to waste collection and remediation. 6. The contract was awarded as a Delivery Order, suggesting it's part of a larger indefinite-delivery/indefinite-quantity (IDIQ) or similar framework.

Value Assessment

Rating: questionable

Benchmarking the value of this contract is challenging without more data on the specific services rendered and the urgency of the incident. However, the absence of competition and the 'TIME AND MATERIALS' pricing structure raise concerns about potential overspending. Comparing this to similar, competitively bid emergency response contracts would be necessary to determine if the pricing is fair market value. The base award amount of $25.8 million for a single year of service requires scrutiny to ensure cost-effectiveness.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was explicitly marked as 'NOT COMPETED,' indicating it was awarded without a competitive solicitation process. This suggests that either there was a specific justification for a sole-source award, such as a unique capability or an urgent need where only one contractor could respond, or that it was a delivery order against a pre-existing contract that may or may not have been competitively awarded. The lack of competition limits the government's ability to leverage market forces to secure the best possible price and terms.

Taxpayer Impact: When a contract is not competed, taxpayers may not benefit from the cost savings typically achieved through competitive bidding. This can result in higher prices for the goods or services procured.

Public Impact

The primary beneficiaries are the residents and environment of Louisiana, protected from the harmful effects of oil spills and hazardous chemical incidents. The services delivered include labor, materials, and equipment necessary for mitigating environmental damage. The geographic impact is concentrated in Louisiana, a region prone to such environmental hazards. The contract supports a specialized workforce capable of responding to environmental emergencies.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may lead to inflated costs.
Time and Materials contract type can be prone to cost overruns if not managed diligently.
Limited transparency into the justification for sole-source award.

Positive Signals

Addresses critical environmental protection needs for a high-risk region.
Ensures rapid response capability for oil spills and hazardous material incidents.
Contract awarded to a company with apparent expertise in spill response (implied by award).

Sector Analysis

The oil spill and hazardous material response sector is a critical component of environmental protection and emergency management services. This contract falls under the broader waste collection and remediation industry (NAICS 562119). The market for such services is often characterized by specialized expertise and rapid deployment requirements. While specific market size data for this niche is not readily available, the federal government, particularly agencies like the Coast Guard, frequently procures these services due to the high stakes involved in environmental incidents. Comparable spending benchmarks would typically involve looking at other emergency response contracts awarded by EPA, NOAA, or state environmental agencies.

Small Business Impact

The data indicates that this contract was not awarded to a small business (ss: false) and there is no indication of small business subcontracting requirements (sb: false). Therefore, this specific award does not appear to directly benefit the small business ecosystem through set-asides or mandated subcontracting. The focus is on a large-scale response capability, likely requiring resources beyond the capacity of most small businesses.

Oversight & Accountability

Oversight for this contract would primarily fall under the U.S. Coast Guard, a component of the Department of Homeland Security. Accountability measures would include performance monitoring, adherence to contract terms, and timely delivery of services. Transparency is limited due to the sole-source nature of the award. Inspector General jurisdiction would apply to any allegations of fraud, waste, or abuse related to the contract's execution.

Related Government Programs

Oil Spill Response Contracts
Hazardous Material Remediation Services
Emergency Preparedness and Response
Environmental Services Contracts
Department of Homeland Security Procurement

Risk Flags

Lack of Competition
Time and Materials Contract Type
Potential for Cost Overruns
Limited Transparency in Award Justification

Frequently Asked Questions

What is this federal contract paying for?

Department of Homeland Security awarded $25.9 million to COUVILLION GROUP LLC. N13024 PROVIDE LABOR, MATERIALS AND EQUIPMENT TO MITIGATE THE HARMFUL AFFECT OF OIL SPILL OR HAZARDOUS CHEMICAL INCIDENT, AS DIRECTED BY THE (FOSC)

Who is the contractor on this award?

The obligated recipient is COUVILLION GROUP LLC.

Which agency awarded this contract?

Awarding agency: Department of Homeland Security (U.S. Coast Guard).

What is the total obligated amount?

The obligated amount is $25.9 million.

What is the period of performance?

Start: 2019-11-19. End: 2020-11-19.

What is the specific justification for awarding this contract on a sole-source basis?

The provided data indicates the contract was 'NOT COMPETED,' which typically implies a sole-source award. However, the specific justification for this determination is not included in the data. Common reasons for sole-source awards include urgent and compelling needs where only one responsible source can be identified, or when the services require unique capabilities or specialized knowledge that only one contractor possesses. Without further documentation from the Department of Homeland Security or the U.S. Coast Guard, the exact rationale remains unclear. This lack of transparency is a concern for ensuring fair and efficient use of taxpayer funds.

How does the $25.8 million cost compare to similar oil spill response contracts?

Direct comparison is difficult without knowing the exact scope of services, duration, and specific incident response requirements. However, $25.8 million for a one-year contract for labor, materials, and equipment for oil spill mitigation is a substantial amount. To assess value, one would need to benchmark against other competitively awarded contracts for similar services, considering factors like response time, geographic area, and the scale of potential incidents. The 'TIME AND MATERIALS' (T&M) contract type, coupled with the lack of competition, suggests a higher risk of cost escalation compared to fixed-price contracts, making a thorough value assessment critical.

What are the potential risks associated with a 'Time and Materials' contract for this service?

Time and Materials (T&M) contracts carry inherent risks, primarily related to cost control. Unlike fixed-price contracts, the final cost is not predetermined and depends on the actual hours worked and materials used. This can lead to cost overruns if the contractor's efficiency is low, if the scope of work expands unexpectedly, or if there is insufficient oversight from the contracting agency. For emergency response, T&M can be necessary due to the unpredictable nature of incidents, but it requires robust monitoring and management by the government to ensure that costs remain reasonable and that the contractor is incentivized to complete the work efficiently.

What is the track record of Couvillion Group LLC in handling large-scale environmental incidents?

The provided data does not include specific details on Couvillion Group LLC's past performance or track record. However, their selection for a significant contract by the U.S. Coast Guard suggests they possess the necessary qualifications and capabilities for oil spill and hazardous chemical incident response. A comprehensive assessment would require reviewing past performance evaluations, any reported incidents they managed, client feedback, and their certifications or specialized training relevant to environmental remediation and emergency response.

What is the historical spending pattern for oil spill response by the U.S. Coast Guard in Louisiana?

The provided data only covers this specific contract (N13024) awarded in November 2019. To understand historical spending patterns, one would need to analyze the U.S. Coast Guard's procurement data over several years, specifically looking for contracts related to oil spill and hazardous material response, particularly within the Louisiana region. This would involve querying federal procurement databases (like FPDS or USASpending.gov) for similar NAICS codes, contract types, and agencies. Analyzing trends in spending, contract types, and competition levels over time would reveal patterns and potential areas for efficiency improvements.

How does the duration of the contract (366 days) align with typical emergency response needs?

A contract duration of 366 days (one year) for oil spill and hazardous chemical incident response suggests a preparedness contract rather than a response to a single, immediate event. This timeframe allows for continuous readiness and availability of the contractor's resources. Emergency response needs can vary significantly; while immediate containment is crucial, the cleanup and mitigation process can extend for weeks, months, or even years depending on the scale and nature of the incident. A one-year contract provides a baseline level of support and ensures a pre-vetted provider is on standby, which is a common approach for maintaining critical response capabilities.

Industry Classification

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

Product/Service Code: NATURAL RESOURCES MANAGEMENT › ENVIRONMENTAL SYSTEMS PROTECTION

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Offers Received: 1

Pricing Type: TIME AND MATERIALS (Y)

Evaluated Preference: NONE

Contractor Details

Address: 371 WALKER RD, BELLE CHASSE, LA, 70037

Business Categories: Category Business, Small Business, Special Designations, Subchapter S Corporation, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $25,861,345

Exercised Options: $25,861,345

Current Obligation: $25,861,345

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Parent Contract

Parent Award PIID: HSCG8417AN00066

IDV Type: BOA

Timeline