DHS FEMA awarded $17.7M for Katrina temporary housing solutions, a sole-source contract

Contract Overview

Contract Amount: $17,740,195 ($17.7M)

Contractor: CH2M Hill Constructors, Inc.

Awarding Agency: Department of Homeland Security

Start Date: 2005-09-19

End Date: 2006-09-30

Contract Duration: 376 days

Daily Burn Rate: $47.2K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: COST PLUS FIXED FEE

Sector: Construction

Official Description: CONSTRUCTION; IDENTIFY POTENTIAL TEMPORARY HOUSING SOLUTIONS, RESOURCES, AND REQUIREMENT FOR PEOPLE DISPLACED AS A RESULT OF HURRICANE KATRINA, TO INCL. SITE IDENTIFICATION AND ASSESSMENT AND SUPPORTING THE RECOVERY DIVISION MISSION.

Place of Performance

Location: ENGLEWOOD, DENVER County, COLORADO, 80112

State: Colorado Government Spending

Plain-Language Summary

Department of Homeland Security obligated $17.7 million to CH2M HILL CONSTRUCTORS, INC. for work described as: CONSTRUCTION; IDENTIFY POTENTIAL TEMPORARY HOUSING SOLUTIONS, RESOURCES, AND REQUIREMENT FOR PEOPLE DISPLACED AS A RESULT OF HURRICANE KATRINA, TO INCL. SITE IDENTIFICATION AND ASSESSMENT AND SUPPORTING THE RECOVERY DIVISION MISSION. Key points: 1. Contract focused on immediate post-disaster housing needs, highlighting rapid response capabilities. 2. Sole-source award suggests limited market availability or urgent, specific expertise required. 3. Contract duration of 376 days indicates a focused, short-term recovery effort. 4. Awarded by FEMA, underscoring the agency's role in disaster relief and resource management. 5. The contract type (Cost Plus Fixed Fee) allows for flexibility in unforeseen circumstances during recovery.

Value Assessment

Rating: fair

Benchmarking the value of this contract is challenging due to its specific, emergency-driven nature and sole-source award. The $17.7 million total obligation for identifying temporary housing solutions and supporting recovery efforts in the wake of Hurricane Katrina reflects the immense scale of the disaster. Without comparable sole-source contracts for similar disaster-response scenarios, it's difficult to definitively assess value for money. However, the urgency of the situation likely prioritized rapid deployment of resources over competitive pricing.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, indicating that the Federal Emergency Management Agency (FEMA) identified CH2M HILL CONSTRUCTORS, INC. as the only responsible source capable of meeting the specific requirements for identifying temporary housing solutions and supporting recovery efforts following Hurricane Katrina. The lack of competition means that price discovery through market forces was bypassed, which is common in urgent disaster response situations where time is critical.

Taxpayer Impact: The absence of competition for this emergency contract means taxpayers did not benefit from potential cost savings that could have arisen from a competitive bidding process. The focus was on immediate needs and ensuring solutions were deployed quickly.

Public Impact

Provides essential support for individuals and families displaced by Hurricane Katrina, offering a pathway to temporary shelter. Facilitates the identification and assessment of suitable sites for temporary housing, a critical step in disaster recovery. Supports the broader mission of FEMA's Recovery Division in restoring essential services and housing. The geographic impact is concentrated in areas affected by Hurricane Katrina, primarily the Gulf Coast region. Indirectly impacts the construction and logistics workforce involved in setting up and managing temporary housing solutions.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits transparency and potential for cost savings.
Cost-plus contract type can lead to higher final costs if not carefully managed.
Focus on immediate needs may not fully account for long-term sustainability of housing solutions.

Positive Signals

Addresses critical, immediate need for housing in a major disaster.
Leverages specialized expertise of a known contractor for rapid deployment.
Contract duration aligns with the urgent, short-term nature of initial recovery phases.

Sector Analysis

This contract falls within the Construction sector, specifically related to commercial and institutional building construction, but with a unique focus on emergency temporary housing solutions. The market for disaster response construction services is often characterized by rapid mobilization and specialized capabilities. While general construction benchmarks exist, contracts for immediate post-disaster housing are highly situational and driven by the scale and nature of the event, making direct comparisons difficult.

Small Business Impact

This contract does not appear to have a small business set-aside component, as indicated by 'sb': false. The nature of emergency response and large-scale construction projects often involves prime contractors with significant resources and capabilities, potentially limiting subcontracting opportunities for small businesses unless specifically mandated or pursued by the prime. The focus here was on rapid, large-scale deployment.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of Homeland Security (DHS) and the Federal Emergency Management Agency (FEMA). As a cost-plus fixed fee contract, rigorous financial oversight and auditing would be expected to ensure that costs are reasonable and allocable to the contract. Transparency might be limited due to the sole-source nature and the exigencies of disaster response, but accountability would be managed through contract performance reviews and financial reporting.

Related Government Programs

Hurricane Katrina Disaster Relief Efforts
FEMA Temporary Housing Programs
Emergency Construction Services
Disaster Recovery and Resilience

Risk Flags

Sole-source award
Cost-plus contract type
Emergency procurement

Frequently Asked Questions

What is this federal contract paying for?

Department of Homeland Security awarded $17.7 million to CH2M HILL CONSTRUCTORS, INC.. CONSTRUCTION; IDENTIFY POTENTIAL TEMPORARY HOUSING SOLUTIONS, RESOURCES, AND REQUIREMENT FOR PEOPLE DISPLACED AS A RESULT OF HURRICANE KATRINA, TO INCL. SITE IDENTIFICATION AND ASSESSMENT AND SUPPORTING THE RECOVERY DIVISION MISSION.

Who is the contractor on this award?

The obligated recipient is CH2M HILL CONSTRUCTORS, 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 $17.7 million.

What is the period of performance?

Start: 2005-09-19. End: 2006-09-30.

What was the specific expertise of CH2M HILL CONSTRUCTORS, INC. that made them the sole source for this contract?

While the provided data does not detail the specific expertise, CH2M HILL CONSTRUCTORS, INC. (now part of Jacobs) is a well-established engineering and construction firm with extensive experience in large-scale infrastructure projects, program management, and disaster recovery. For this contract, their capabilities likely included rapid site assessment, logistics planning for temporary housing deployment, coordination with various stakeholders, and potentially the design and management of temporary housing structures. The sole-source justification would have detailed why their unique qualifications were essential for meeting FEMA's urgent requirements in the immediate aftermath of Hurricane Katrina, possibly related to pre-existing relationships, specialized knowledge of the affected region, or demonstrated capacity for immediate mobilization.

How does the Cost Plus Fixed Fee (CPFF) contract type influence the final cost compared to other contract types in disaster scenarios?

The Cost Plus Fixed Fee (CPFF) contract type allows the contractor to be reimbursed for all allowable costs incurred, plus a predetermined fixed fee representing profit. In disaster scenarios, CPFF offers flexibility, enabling the contractor to adapt to unforeseen challenges and changing requirements without constant renegotiation of the price. However, it carries a risk of cost overruns if the initial cost estimates are inaccurate or if the scope expands significantly. For taxpayers, this means the final cost can be higher than anticipated, but it prioritizes rapid response and task completion over strict cost certainty. FEMA would have implemented robust oversight to manage allowable costs and ensure the fixed fee remained appropriate for the scope of work.

What were the primary challenges faced by FEMA in identifying temporary housing solutions post-Hurricane Katrina?

Post-Hurricane Katrina, FEMA faced immense challenges in identifying temporary housing solutions. These included the sheer scale of displacement, with hundreds of thousands of people needing shelter. Logistical hurdles were significant, involving the procurement, transportation, and setup of vast numbers of temporary units (like trailers and mobile homes) across a wide, disaster-affected area. Identifying suitable land for these temporary communities, ensuring access to utilities (water, power, sanitation), and managing the environmental and social impacts were also major concerns. Furthermore, the rapid pace required meant that traditional procurement and site selection processes had to be accelerated, often leading to the use of sole-source contracts and the CPFF structure to expedite solutions.

Can we compare the spending on this specific contract to other FEMA housing initiatives?

Directly comparing the $17.7 million spent on this specific contract to other FEMA housing initiatives is difficult without more context on the scope and duration of those other initiatives. This contract was for identifying solutions and supporting recovery, a specific phase. FEMA's overall housing mission involves various programs, including direct provision of temporary housing units, rental assistance, and support for permanent housing reconstruction. The total spending on housing after a disaster like Katrina runs into billions of dollars across all these categories. This particular contract represents a fraction of the total, focused on the critical initial steps of assessment and planning for temporary solutions.

What are the long-term implications of relying on temporary housing solutions identified under contracts like this?

The long-term implications of relying on temporary housing solutions identified under contracts like this can be mixed. While crucial for immediate relief, temporary housing often lacks the durability and amenities of permanent homes, potentially leading to prolonged stays and dissatisfaction among residents. The rapid deployment of temporary units can also raise environmental concerns regarding land use and waste disposal. Furthermore, the focus on temporary solutions might divert resources or attention from long-term rebuilding efforts. However, effective management and transition planning can mitigate these issues, ensuring that temporary housing serves its intended purpose as a bridge to permanent housing and community recovery.

Industry Classification

NAICS: Construction › Nonresidential Building Construction › Commercial and Institutional Building Construction

Product/Service Code: RESEARCH AND DEVELOPMENT › DEFENSE (OTHER) R&D

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 1

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Parent Company: CH2M Hill Companies, Ltd. (UEI: 027620574)

Address: 9191 SOUTH JAMAICA STREET, ENGLEWOOD, CO, 80112

Business Categories: Category Business, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $19,207,752

Exercised Options: $19,207,752

Current Obligation: $17,740,195

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Parent Contract

Parent Award PIID: HSFEHQ05D0592

IDV Type: IDC

Timeline