FEMA's $42M Katrina housing support contract awarded to Bechtel National, Inc. without competition

Contract Overview

Contract Amount: $42,040,909 ($42.0M)

Contractor: Bechtel National, Inc.

Awarding Agency: Department of Homeland Security

Start Date: 2005-09-04

End Date: 2006-02-27

Contract Duration: 176 days

Daily Burn Rate: $238.9K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: COST PLUS FIXED FEE

Sector: Other

Official Description: MANAGEMENT AND ADMINISTRATIVE SUPPORT - IDENTIFY POTENTIAL TEMPORARY HOUSING SOLUTIONS, RESOURCES, AND REQUIREMENT FOR PEOPLE DISPLACED AS A RESULT OF HURRICANE KATRINA (MS), TO INCLUDE MANAGEMENT AND ADMINISTRATION STAFFING IN SUPPORT OF THE RECOVERY DIVISION MISSION AND DISASTER ASSOCIATED ACTIVITIES SUCH AS INITIAL MANAGEMENT MOBILIZATION AND OVERALL PROGRAM MANAGEMENT

Place of Performance

Location: FREDERICK, FREDERICK County, MARYLAND, 21703, UNITED STATES OF AMERICA

State: Maryland Government Spending

Plain-Language Summary

Department of Homeland Security obligated $42.0 million to BECHTEL NATIONAL, INC. for work described as: MANAGEMENT AND ADMINISTRATIVE SUPPORT - IDENTIFY POTENTIAL TEMPORARY HOUSING SOLUTIONS, RESOURCES, AND REQUIREMENT FOR PEOPLE DISPLACED AS A RESULT OF HURRICANE KATRINA (MS), TO INCLUDE MANAGEMENT AND ADMINISTRATION STAFFING IN SUPPORT OF THE RECOVERY DIVISION MISSION AND DISASTE… Key points: 1. Contract focused on critical post-disaster housing solutions and program management for Hurricane Katrina. 2. Awarded on a Cost Plus Fixed Fee basis, indicating potential for cost overruns. 3. Sole-source award raises questions about the extent of market research and potential for competitive pricing. 4. Short performance period suggests a rapid response to an urgent need. 5. Contractor's role in disaster recovery highlights the importance of specialized support services. 6. Lack of small business participation noted, with no set-aside or subcontracting requirements.

Value Assessment

Rating: questionable

The contract's value of over $42 million for a short duration (less than 9 months) for management and administrative support in disaster recovery is substantial. Without comparable contracts for similar rapid-response housing solutions post-disaster, it is difficult to benchmark the value for money. The Cost Plus Fixed Fee (CPFF) contract type, while common in complex or uncertain environments, can lead to higher costs than fixed-price contracts if not managed carefully. The fixed fee component needs to be assessed against the scope of work to determine if it represents fair compensation for the contractor's efforts.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning that only one contractor, Bechtel National, Inc., was solicited. This approach is typically used when there is a compelling justification, such as an urgent and unexpected need where competition is not feasible. The lack of competition means that the government did not benefit from potential price reductions or innovative solutions that might have emerged from a competitive bidding process. The justification for this sole-source award would need to be thoroughly reviewed to ensure it was appropriate.

Taxpayer Impact: The absence of competition for a contract of this magnitude means taxpayers may have paid a premium. Without competitive bids, there is less assurance that the government secured the most cost-effective solution for providing temporary housing and management support.

Public Impact

Provides essential management and administrative support for temporary housing solutions for individuals displaced by Hurricane Katrina. Aims to facilitate the recovery process for affected populations in Mississippi and surrounding areas. Supports the Federal Emergency Management Agency's (FEMA) mission in disaster response and recovery. Involves staffing and program management critical for the efficient deployment of resources.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits price discovery and potentially increases costs for taxpayers.
Cost-plus contract type carries inherent risks of cost overruns if not rigorously managed.
Short performance period may indicate rushed execution, potentially impacting quality or thoroughness.
Lack of small business involvement means limited opportunities for smaller firms in disaster recovery efforts.

Positive Signals

Awarded to a contractor with significant experience in large-scale engineering and construction projects.
Addresses a critical and urgent need for housing and support services post-natural disaster.
Contract structure (CPFF) allows for flexibility in adapting to evolving recovery needs.
Focus on management and administration ensures organized and efficient deployment of resources.

Sector Analysis

This contract falls within the 'Professional, Scientific, and Technical Services' sector, specifically related to disaster management and recovery. The market for such services is often characterized by urgent needs and specialized expertise, which can sometimes lead to non-competitive or limited-competition awards. The size of this contract, over $42 million, is significant for a single task order, reflecting the scale of the Hurricane Katrina disaster and the complexity of providing housing solutions and program management.

Small Business Impact

This contract did not include any small business set-aside provisions, nor were there explicit subcontracting requirements for small businesses. Given the sole-source nature of the award and the specialized expertise required, it is understandable that opportunities for small businesses might have been limited. However, the absence of such provisions means that the potential economic benefits to the small business ecosystem from this significant federal expenditure were not maximized.

Oversight & Accountability

Oversight for this contract would primarily reside with the Department of Homeland Security (DHS) and its Federal Emergency Management Agency (FEMA). As a Cost Plus Fixed Fee contract, rigorous financial oversight and performance monitoring would be crucial to ensure that costs are reasonable and that the contractor is meeting its obligations. Transparency regarding the justification for the sole-source award and the subsequent expenditures would be key to public accountability.

Related Government Programs

Hurricane Katrina Disaster Relief Efforts
FEMA Temporary Housing Programs
Post-Disaster Management and Administration Contracts
Federal Emergency Management Agency Support Services

Risk Flags

Sole-source award without clear justification.
Cost-plus contract type increases risk of cost overruns.
Lack of transparency on performance metrics and final cost reconciliation.
No small business participation or subcontracting requirements.

Frequently Asked Questions

What is this federal contract paying for?

Department of Homeland Security awarded $42.0 million to BECHTEL NATIONAL, INC.. MANAGEMENT AND ADMINISTRATIVE SUPPORT - IDENTIFY POTENTIAL TEMPORARY HOUSING SOLUTIONS, RESOURCES, AND REQUIREMENT FOR PEOPLE DISPLACED AS A RESULT OF HURRICANE KATRINA (MS), TO INCLUDE MANAGEMENT AND ADMINISTRATION STAFFING IN SUPPORT OF THE RECOVERY DIVISION MISSION AND DISASTER ASSOCIATED ACTIVITIES SUCH AS INITIAL MANAGEMENT MOBILIZATION AND OVERALL PROGRAM MANAGEMENT

Who is the contractor on this award?

The obligated recipient is BECHTEL NATIONAL, INC..

Which agency awarded this contract?

Awarding agency: Department of Homeland Security (Federal Emergency Management Agency).

What is the total obligated amount?

The obligated amount is $42.0 million.

What is the period of performance?

Start: 2005-09-04. End: 2006-02-27.

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

The provided data does not detail the specific justification for the sole-source award. However, sole-source contracts are typically awarded under circumstances where there is an urgent, unexpected need, and competition is not feasible or practical. For a disaster like Hurricane Katrina, the immediate requirement for housing solutions and management support could have been deemed an emergency, potentially limiting the time available for a full and open competition. A thorough review of FEMA's contracting records from that period would be necessary to ascertain the precise justification, which might include factors like unique capabilities of the contractor or extreme time constraints.

How did the final costs compare to the initial estimated costs for this contract?

The provided data only includes the awarded amount ($42,040,909.03) and does not contain information on initial estimates or the final incurred costs. As this was a Cost Plus Fixed Fee (CPFF) contract, the total cost would be the sum of the actual allowable costs incurred by the contractor plus a fixed fee. To determine how final costs compared to estimates, one would need access to the contract's financial execution reports, including any modifications or supplemental funding actions. Without this detailed financial data, a comparison is not possible.

What specific management and administrative tasks were performed under this contract?

The contract description indicates that the tasks involved 'IDENTIFY POTENTIAL TEMPORARY HOUSING SOLUTIONS, RESOURCES, AND REQUIREMENT FOR PEOPLE DISPLACED AS A RESULT OF HURRICANE KATRINA (MS), TO INCLUDE MANAGEMENT AND ADMINISTRATION STAFFING IN SUPPORT OF THE RECOVERY DIVISION MISSION AND DISASTER ASSOCIATED ACTIVITIES SUCH AS INITIAL MANAGEMENT MOBILIZATION AND OVERALL PROGRAM MANAGEMENT.' This suggests a broad scope encompassing research into housing options, resource identification, staffing for the recovery division, and overall program oversight during the critical initial phases of disaster recovery operations.

Were there any performance issues or contract disputes during the execution of this contract?

The provided data does not include information regarding performance issues or contract disputes. Such details are typically found in contract performance reports, contractor past performance databases, or agency procurement records. For a contract of this nature and duration, it is possible that performance was closely monitored, especially given the critical mission. However, without access to specific performance evaluations or dispute logs, it is impossible to assess whether any issues arose during its execution.

How does Bechtel National, Inc.'s performance on this contract compare to their other federal contracts?

Assessing Bechtel National, Inc.'s performance on this specific contract relative to their broader federal contract history requires access to comprehensive past performance information. This contract, awarded in 2005 for Hurricane Katrina relief, was a sole-source award for management and administrative support. To compare, one would need to examine performance evaluations (e.g., CPARS reports) for this contract and other contracts held by Bechtel National, Inc. across various agencies and contract types. Factors like timeliness, cost control, quality of service, and adherence to requirements would be key comparison points.

What was the total amount spent on temporary housing solutions and related management for Hurricane Katrina by FEMA?

The provided data only pertains to this specific $42 million contract awarded to Bechtel National, Inc. Hurricane Katrina relief efforts involved a massive federal response, and FEMA utilized numerous contracts and programs for temporary housing, debris removal, infrastructure repair, and other recovery activities. The total federal spending on Hurricane Katrina recovery is in the tens of billions of dollars. This single contract represents a portion of the funds allocated for management and housing solutions, but a comprehensive figure would require aggregating data from many different contracts and appropriations across multiple agencies over several years.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Other Professional, Scientific, and Technical Services › All Other Professional, Scientific, and Technical Services

Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › PROFESSIONAL SERVICES

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: HSFEHQ05R0045

Offers Received: 1

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

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

Address: 5275 WESTVIEW DRIVE, FREDERICK, MD, 21703

Business Categories: Category Business, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $42,140,909

Exercised Options: $42,140,909

Current Obligation: $42,040,909

Parent Contract

Parent Award PIID: HSFEHQ05D0572

IDV Type: IDC

Timeline