DOE's $431M Remediation Services Contract Awarded to CH2M HILL COMPANIES, LTD
Contract Overview
Contract Amount: $431,408,706 ($431.4M)
Contractor: CH2M Hill Companies, Ltd.
Awarding Agency: Department of Energy
Start Date: 2002-12-15
End Date: 2006-03-31
Contract Duration: 1,202 days
Daily Burn Rate: $358.9K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 2
Pricing Type: COST PLUS INCENTIVE
Sector: Other
Place of Performance
Location: GREENWOOD VILLAGE, ARAPAHOE County, COLORADO, 80111
State: Colorado Government Spending
Plain-Language Summary
Department of Energy obligated $431.4 million to CH2M HILL COMPANIES, LTD. for work described as: Key points: 1. The contract value of $431.4 million for remediation services represents a significant investment in environmental cleanup. 2. Full and open competition was utilized, suggesting a robust market for these services. 3. The cost-plus-incentive contract type indicates a focus on managing costs while incentivizing performance. 4. The contract falls under the Remediation Services NAICS code (562910), a critical sector for environmental management.
Value Assessment
Rating: fair
The contract was awarded using a cost-plus-incentive pricing structure. Without specific performance data and final costs, it's difficult to definitively assess value. However, the base award amount of $358,909 suggests initial costs were managed, but the total contract value indicates significant potential expenditure.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The use of full and open competition suggests that multiple qualified contractors were able to bid, fostering a competitive environment. This method typically leads to better price discovery and potentially more favorable terms for the government.
Taxpayer Impact: The competitive bidding process aims to ensure taxpayer funds are used efficiently for essential environmental remediation services.
Public Impact
Environmental cleanup efforts are directly funded by taxpayers, making efficient contract management crucial. The long duration of the contract (1202 days) implies a substantial and ongoing need for these services. The contract's focus on remediation services addresses potential environmental hazards and compliance requirements.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Cost-plus-incentive contracts can lead to cost overruns if not closely monitored.
- The absence of small business participation is noted.
- The contract's significant value warrants close scrutiny of performance and cost.
Positive Signals
- Full and open competition promotes market efficiency.
- The contract addresses a critical environmental need.
Sector Analysis
The Department of Energy frequently engages in contracts for environmental remediation services due to legacy issues from nuclear and energy production. Spending in this sector is driven by regulatory requirements and the need to mitigate environmental risks, often involving complex and long-term projects.
Small Business Impact
This contract does not appear to have specific provisions for small business participation, as indicated by 'sb': false. Larger contracts for specialized services like remediation often go to prime contractors who may or may not subcontract to small businesses.
Oversight & Accountability
The contract's duration and cost necessitate robust oversight from the Department of Energy to ensure compliance with terms, manage costs effectively, and achieve the intended remediation outcomes. Performance metrics and regular reporting are key to accountability.
Related Government Programs
- Remediation Services
- Department of Energy Contracting
- Department of Energy Programs
Risk Flags
- Potential for cost overruns in cost-plus-incentive contracts.
- Lack of explicit small business participation.
- Long contract duration requires sustained oversight.
- Significant financial commitment necessitates rigorous performance monitoring.
Tags
remediation-services, department-of-energy, co, dca, 100m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Energy awarded $431.4 million to CH2M HILL COMPANIES, LTD.. See the official description on USAspending.
Who is the contractor on this award?
The obligated recipient is CH2M HILL COMPANIES, LTD..
Which agency awarded this contract?
Awarding agency: Department of Energy (Department of Energy).
What is the total obligated amount?
The obligated amount is $431.4 million.
What is the period of performance?
Start: 2002-12-15. End: 2006-03-31.
What was the final cost of the contract compared to the initial estimates and incentives, and how did this impact overall value for money?
Assessing the final cost against initial estimates and incentive structures is crucial for determining the true value for money. Cost-plus-incentive contracts can be effective if well-managed, but they also carry the risk of cost overruns if performance targets are not met or if the scope expands. Detailed post-award analysis would reveal if the government received the expected benefits within a reasonable cost framework.
What were the specific remediation challenges addressed by this contract, and were there any unforeseen environmental risks encountered?
The contract focused on remediation services, likely involving the cleanup of contaminated sites. Understanding the specific challenges, such as the type and extent of contamination, geological conditions, and regulatory hurdles, is key. Unforeseen environmental risks could significantly impact project timelines, costs, and the overall effectiveness of the remediation efforts, requiring adaptive management strategies.
How effectively did the full and open competition process ensure competitive pricing and contractor performance for these specialized remediation services?
Full and open competition is designed to maximize the pool of potential bidders, thereby driving competitive pricing and encouraging high performance. For specialized services like environmental remediation, the success of this process hinges on the clarity of the solicitation, the evaluation criteria, and the government's ability to accurately assess technical capabilities and cost proposals. Post-award performance data would indicate if the competition yielded the desired outcomes.
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
Offers Received: 2
Pricing Type: COST PLUS INCENTIVE (V)
Contractor Details
Address: 9191 S JAMAICA ST, ENGLEWOOD, CO, 06
Business Categories: Category Business, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $430,999,919
Exercised Options: $430,999,919
Current Obligation: $431,408,706
Timeline
Start Date: 2002-12-15
Current End Date: 2006-03-31
Potential End Date: 2006-03-31 00:00:00
Last Modified: 2012-06-20
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