Army awarded $239.6M contract for environmental impact statement services, with Bechtel National Inc. as the primary contractor

Contract Overview

Contract Amount: $239,598,908 ($239.6M)

Contractor: Bechtel National, Inc.

Awarding Agency: Department of Defense

Start Date: 1999-11-04

End Date: 2019-07-31

Contract Duration: 7,209 days

Daily Burn Rate: $33.2K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: COST PLUS AWARD FEE

Sector: Other

Official Description: 200002!2100!000071!AA09 !U.S. ARMY INDUSTRIAL OPERATIONS !DAAA0998C0080 !A!*!P00023 !19991104!20000930!089176176!094878998!094878980!N!1S307!BECHTEL NATIONAL, INC !50 BEALE ST !SAN FRANCISCO !CA!94105!67000!075!06!SAN FRANCISCO !SAN FRANCISCO !CALIFORNIA!0001!+000054400000!N!N!000000000000!F110!DEV OF ENVIRON IMPACT STATEMENTS & ASSESSMENTS !S1 !SERVICES !1000!NOT DISCERNABLE OR CLASSIFIED !4953!3!*!*!*!B!N!B!A !N!R!2!001!B!* !C!N!Z!* !* !N!C!*!A!A!A!A!A!A!* !*!N!A!C!N!*!*!*!*!*!

Place of Performance

Location: ABERDEEN, HARFORD County, MARYLAND, 21001

State: Maryland Government Spending

Plain-Language Summary

Department of Defense obligated $239.6 million to BECHTEL NATIONAL, INC. for work described as: 200002!2100!000071!AA09 !U.S. ARMY INDUSTRIAL OPERATIONS !DAAA0998C0080 !A!*!P00023 !19991104!20000930!089176176!094878998!094878980!N!1S307!BECHTEL NATIONAL, INC !50 BEALE ST !SAN FRANCISCO !CA!94105!67000!075!06!SAN FRANCISCO !SAN FRANCISCO !CALIFORNIA!0001!+000054400000!N!N!00… Key points: 1. Contract value of $239.6M over its lifecycle suggests significant investment in environmental impact assessments. 2. The contract was awarded through full and open competition, indicating a competitive bidding process. 3. The duration of the contract (over 19 years) points to long-term needs for environmental services. 4. The Cost Plus Award Fee (CPAF) pricing structure allows for flexibility but requires careful oversight to manage costs. 5. The services provided are crucial for regulatory compliance and informed decision-making in Army operations. 6. The contract's focus on environmental impact statements positions it within a critical sector for infrastructure and development projects.

Value Assessment

Rating: good

The total award amount of $239.6 million for environmental impact statement services over nearly two decades appears substantial. Benchmarking against similar large-scale environmental consulting contracts for federal agencies is necessary for a precise value-for-money assessment. However, the extended duration suggests a consistent need and potentially a competitive pricing strategy over time. The Cost Plus Award Fee structure implies that performance incentives were in place, which can drive efficiency if managed effectively.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, meaning all responsible sources were permitted to submit bids. The data indicates two bids were received. While the number of bidders is relatively low for a contract of this magnitude, full and open competition generally fosters price discovery and encourages contractors to offer competitive terms. The specific details of the bidding process and the evaluation criteria would provide further insight into the level of competition achieved.

Taxpayer Impact: Full and open competition is generally favorable for taxpayers as it aims to secure the best value through a wide range of potential providers, driving down costs through market forces.

Public Impact

The U.S. Army benefits from expert services in assessing the environmental impact of its projects and operations. Services delivered include the development of environmental impact statements and assessments, crucial for regulatory compliance. The geographic impact is likely widespread, covering various Army installations and operational areas requiring environmental review. The contract supports a specialized workforce in environmental consulting and engineering.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Long contract duration (over 19 years) could lead to potential cost overruns if not closely monitored.
Cost Plus Award Fee contracts require diligent oversight to ensure performance targets are met without excessive cost escalation.
Limited number of bidders (2) might indicate potential barriers to entry or a niche market, warranting further investigation into competition dynamics.

Positive Signals

Awarded through full and open competition, suggesting a fair and accessible process for potential bidders.
The contract addresses critical environmental compliance needs for the Department of the Army.
The long-term nature of the contract provides stability for both the agency and the contractor in delivering essential services.

Sector Analysis

This contract falls within the professional services sector, specifically environmental consulting and assessment. The market for such services is driven by regulatory requirements, infrastructure development, and operational needs of government agencies. The U.S. Army's significant footprint and ongoing projects necessitate substantial investment in environmental impact analysis. Comparable spending benchmarks would involve analyzing other large federal contracts for environmental consulting services across agencies like the EPA, Department of the Interior, and Department of Transportation.

Small Business Impact

The provided data does not indicate any specific small business set-aside provisions or subcontracting goals for this contract. As a large definitive contract awarded to Bechtel National, Inc., it is unlikely to have a direct small business set-aside. However, the prime contractor may engage small businesses for specialized services as subcontractors, which would be detailed in their subcontracting plan if applicable.

Oversight & Accountability

Oversight for this contract would primarily reside with the Department of the Army contracting and program management offices. Given the Cost Plus Award Fee structure, performance metrics and financial reporting would be subject to rigorous review. Transparency is generally maintained through contract award databases and reporting requirements. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse.

Related Government Programs

Environmental Compliance Services
Environmental Impact Analysis
Department of Defense Consulting Contracts
Army Infrastructure Support Services
Federal Professional Services Contracts

Risk Flags

Long contract duration
Cost Plus Award Fee structure
Limited number of bidders

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $239.6 million to BECHTEL NATIONAL, INC.. 200002!2100!000071!AA09 !U.S. ARMY INDUSTRIAL OPERATIONS !DAAA0998C0080 !A!*!P00023 !19991104!20000930!089176176!094878998!094878980!N!1S307!BECHTEL NATIONAL, INC !50 BEALE ST !SAN FRANCISCO !CA!94105!67000!075!06!SAN FRANCISCO !SAN FRANCISCO !CALIFORNIA!0001!+000054400000!N!N!000000000000!F110!DEV OF ENVIRON IMPACT STATEMENTS & ASSESSMENTS !S1 !SERVICES !1000!NOT DISCERNABLE OR CLASSIFIED !4953!3!*!*!*!B!N!B!A !N!R!2!001!B!* !C!N!Z!* !* !N!C!*!A!A!A!A!A!A!* !*!N!A!C!N!*!*!*!*!*!

Who is the contractor on this award?

The obligated recipient is BECHTEL NATIONAL, 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 $239.6 million.

What is the period of performance?

Start: 1999-11-04. End: 2019-07-31.

What is the historical spending trend for environmental impact statement services by the Department of the Army?

Analyzing the historical spending trend for environmental impact statement (EIS) services by the Department of the Army reveals a consistent and significant investment in this area. Prior to this $239.6 million definitive contract awarded in 1999, the Army likely engaged in numerous smaller contracts and task orders for EIS development. Over the contract's extended period (1999-2019), spending would have fluctuated based on project pipelines, regulatory changes, and budget allocations. While this specific contract represents a large portion of spending, it's crucial to consider other contracts and the overall budget dedicated to environmental compliance and assessments to understand the complete picture. Without access to detailed historical procurement data for EIS services across all Army commands and fiscal years, a precise trend analysis is challenging. However, the sustained need for such services suggests a steady demand driven by ongoing military operations, base realignments, and new construction projects.

How does the per-unit cost of developing an Environmental Impact Statement under this contract compare to industry benchmarks?

Determining the precise per-unit cost for developing an Environmental Impact Statement (EIS) under this specific contract is complex due to the nature of the award. The contract's total value of $239.6 million covers a period of nearly two decades and likely encompasses a wide range of EIS projects with varying scopes and complexities. The Cost Plus Award Fee (CPAF) structure means costs are reimbursed plus a fee that is adjusted based on performance. To benchmark per-unit costs, one would need to identify individual EIS projects completed under this contract, their specific deliverables, and associated costs. Industry benchmarks for EIS development can vary significantly based on project scale, geographic location, environmental sensitivities, and the level of detail required by regulatory agencies (e.g., NEPA). Typical costs can range from tens of thousands for smaller assessments to millions for large-scale projects involving extensive infrastructure or complex ecosystems. Without granular data on individual EIS projects awarded through this contract, a direct comparison to industry benchmarks is not feasible.

What are the key performance indicators (KPIs) used to evaluate Bechtel National, Inc.'s performance under this contract?

Under a Cost Plus Award Fee (CPAF) contract like this one, Key Performance Indicators (KPIs) are critical for determining the award fee and ensuring contractor performance meets or exceeds requirements. While the specific KPIs are not detailed in the provided summary data, they typically revolve around factors such as adherence to schedule, quality of deliverables (e.g., accuracy and completeness of EIS reports), cost control within estimated ranges, compliance with environmental regulations, and responsiveness to agency feedback. The 'Award Fee' component suggests that the government established specific performance targets and evaluation criteria. Bechtel National, Inc.'s performance would be assessed against these criteria, and the resulting award fee would reflect how well they achieved these objectives. Regular performance reviews and progress reports would be integral to monitoring these KPIs throughout the contract's extensive duration.

What is the potential risk associated with the long duration (over 19 years) of this contract?

The extended duration of this contract, spanning over 19 years, presents several potential risks. Firstly, there is a risk of cost escalation over such a long period due to inflation, changes in labor rates, and evolving material costs, even with cost-reimbursement elements. Secondly, the scope of work might need significant adjustments over time as environmental regulations, technologies, and the Army's operational needs evolve; managing these changes effectively without scope creep or significant contract modifications can be challenging. Thirdly, maintaining consistent oversight and performance management over nearly two decades requires sustained institutional knowledge and commitment from the contracting agency, which can be difficult given personnel turnover. Finally, there's a risk that the initial pricing or fee structure may become less competitive or reflective of market conditions as the contract matures, potentially impacting overall value for money if not periodically reviewed and adjusted.

How does the competition level (2 bidders) for this contract potentially impact pricing and innovation?

A competition level involving only two bidders for a contract of this magnitude ($239.6 million) raises questions about the extent of price discovery and potential for innovation. While 'full and open competition' was utilized, a limited number of bids can sometimes indicate barriers to entry, such as high qualification requirements, specialized expertise needed, or a concentrated market. With only two bidders, the government has less leverage to negotiate aggressively on price compared to a scenario with numerous competing offers. This could potentially lead to higher prices than might be achieved in a more robustly competitive environment. Furthermore, a limited number of bidders might also reduce the pressure on contractors to innovate aggressively, as the competitive landscape is less intense. However, the presence of an award fee structure could still incentivize innovation and high performance if the criteria are well-defined and challenging.

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 2

Pricing Type: COST PLUS AWARD FEE (R)

Evaluated Preference: NONE

Contractor Details

Parent Company: Bechtel Group, Inc. (UEI: 094878980)

Address: 50 BEALE ST, SAN FRANCISCO, CA, 94105

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $13,863

Exercised Options: $13,863

Current Obligation: $239,598,908

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline