Army awards $53M for water/sewer infrastructure, with a long-term focus on Hawaii's base needs
Contract Overview
Contract Amount: $53,030,697 ($53.0M)
Contractor: Aqua Engineers Inc
Awarding Agency: Department of Defense
Start Date: 2008-09-29
End Date: 2058-09-28
Contract Duration: 18,261 days
Daily Burn Rate: $2.9K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: Construction
Official Description: INITIAL CAPITAL IMPROVEMENTS
Place of Performance
Location: HONOLULU, HONOLULU County, HAWAII, 96819
State: Hawaii Government Spending
Plain-Language Summary
Department of Defense obligated $53.0 million to AQUA ENGINEERS INC for work described as: INITIAL CAPITAL IMPROVEMENTS Key points: 1. Contract awarded for critical infrastructure upgrades, ensuring long-term operational readiness. 2. The fixed-price structure aims to control costs over the extended performance period. 3. A single award suggests a focused approach to a specific project requirement. 4. The extensive duration indicates a need for sustained infrastructure development. 5. Construction NAICS code 237110 points to specialized utility system building. 6. The contract's value is significant for the specific construction sub-sector.
Value Assessment
Rating: fair
The contract value of $53 million over a 50-year period suggests a substantial investment in long-term infrastructure. Benchmarking this against similar large-scale utility construction projects is challenging due to the unique duration and specific scope. The firm fixed-price nature provides cost certainty for the government, but the long timeframe could introduce risks if market conditions change significantly. Without detailed cost breakdowns or comparisons to similar projects, a precise value-for-money assessment is difficult, but the extended period implies a strategic, long-term commitment to maintaining essential services.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under full and open competition, indicating that multiple bidders had the opportunity to submit proposals. This competitive process is generally expected to yield favorable pricing and innovative solutions. The fact that it resulted in a single award suggests that Aqua Engineers Inc. was the most advantageous offer based on the evaluation criteria, which could include technical capability, past performance, and price. The level of competition is a positive indicator for price discovery.
Taxpayer Impact: Full and open competition helps ensure that taxpayer dollars are used efficiently by fostering a competitive environment that drives down costs and improves service quality.
Public Impact
Benefits military personnel and their families by ensuring reliable water and sewer services at the Hawaii base. Delivers essential construction services for water and sewer lines, crucial for base operations. Geographic impact is concentrated in Hawaii, supporting critical defense infrastructure in the region. Requires a skilled construction workforce, potentially creating local employment opportunities. Ensures the long-term sustainability and operational readiness of a key military installation.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Long contract duration (50 years) increases risk of cost escalation or obsolescence of technology.
- Potential for scope creep over such an extended period without clear interim reviews.
- Reliance on a single contractor for such a critical, long-term service could pose continuity risks.
Positive Signals
- Firm fixed-price contract provides cost certainty for the government.
- Full and open competition suggests a well-vetted selection process.
- Long duration indicates a strategic, long-term commitment to infrastructure needs.
Sector Analysis
This contract falls within the construction sector, specifically focusing on utility infrastructure. The market for large-scale utility construction, particularly for government installations, is specialized and often involves significant project management and technical expertise. Comparable spending benchmarks would typically be found in large civil engineering projects or other major military base infrastructure developments. The $53 million value over 50 years represents a sustained investment in maintaining and upgrading essential services, reflecting the long-term needs of military bases.
Small Business Impact
The contract details indicate that small business participation was not a primary set-aside criterion (ss: false, sb: false). While this specific contract may not directly benefit small businesses through set-asides, the prime contractor, Aqua Engineers Inc., may engage small businesses as subcontractors for specialized tasks or material supply. The impact on the broader small business ecosystem would depend on the subcontracting opportunities generated by this large-scale project.
Oversight & Accountability
Oversight for this contract would primarily fall under the Department of the Army's contracting and project management offices. Accountability measures are embedded in the firm fixed-price contract terms, requiring delivery of specified services within agreed-upon costs. Transparency is facilitated by the contract's award under full and open competition, with records typically available through federal procurement databases. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.
Related Government Programs
- Military Base Infrastructure Modernization
- Department of Defense Utility Systems Contracts
- Water and Sewer System Construction
- Long-Term Government Service Contracts
- Hawaii Defense Spending
Risk Flags
- Long contract duration may increase risk of cost overruns or technological obsolescence.
- Potential for contractor performance issues over an extended 50-year period.
- Need for robust oversight to ensure sustained compliance and quality.
Tags
construction, department-of-defense, department-of-the-army, hawaii, definitive-contract, full-and-open-competition, firm-fixed-price, infrastructure, water-and-sewer, long-term-contract
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $53.0 million to AQUA ENGINEERS INC. INITIAL CAPITAL IMPROVEMENTS
Who is the contractor on this award?
The obligated recipient is AQUA ENGINEERS 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 $53.0 million.
What is the period of performance?
Start: 2008-09-29. End: 2058-09-28.
What is the historical spending pattern for water and sewer infrastructure at this specific military installation?
Historical spending data for water and sewer infrastructure at this specific military installation is not directly available from the provided contract details. However, the award of a new, long-term definitive contract valued at $53 million suggests a significant and sustained investment in addressing current and future needs. Previous spending may have involved shorter-term contracts for maintenance, repairs, or smaller upgrade projects. The sheer scale and duration of this new contract imply that prior efforts were either insufficient for long-term requirements or that a strategic shift towards comprehensive infrastructure renewal is underway. Further analysis would require access to historical procurement data for the specific base to identify trends in infrastructure investment and maintenance.
How does the per-unit cost of this contract compare to similar utility construction projects in Hawaii or for other military bases?
A direct per-unit cost comparison for this contract is challenging without specific unit cost breakdowns (e.g., cost per linear foot of pipe laid, cost per manhole installed) and detailed project scopes for comparable projects. The contract is for 'Water and Sewer Line and Related Structures Construction' (NAICS 237110) and is a definitive contract with a firm fixed price over a 50-year period. Benchmarking would require identifying other large-scale, long-duration utility infrastructure projects, ideally for military installations, and normalizing costs by factors such as inflation, labor rates, material costs, and specific site conditions. Given the long-term nature and the specialized requirements of military infrastructure, direct comparisons to typical municipal projects might not be entirely accurate. The $53 million total value over five decades suggests a significant but potentially cost-effective approach to long-term asset management if executed efficiently.
What are the key performance indicators (KPIs) and service level agreements (SLAs) associated with this long-term infrastructure contract?
The provided contract abstract does not detail the specific Key Performance Indicators (KPIs) or Service Level Agreements (SLAs) for this definitive contract. However, for a long-term infrastructure project of this nature, typical KPIs would likely include metrics related to system reliability (e.g., uptime percentage, number of service interruptions), water quality compliance, response times for emergency repairs, adherence to environmental regulations, and preventative maintenance schedules. SLAs would define the acceptable performance thresholds for these KPIs, potentially with associated penalties for non-compliance or incentives for exceeding targets. The firm fixed-price nature suggests that the contractor is responsible for delivering the specified infrastructure and maintaining its functionality to meet defined standards throughout the contract's extensive duration.
What is the track record of Aqua Engineers Inc. in managing large-scale, long-duration government construction contracts?
Aqua Engineers Inc. has been awarded this definitive contract for water and sewer line construction, valued at approximately $53 million over a 50-year period. While this specific award indicates a significant project, the provided data does not offer a comprehensive overview of their track record with other large-scale, long-duration government contracts. To assess their experience, one would need to examine their past performance on similar projects, including their history of meeting deadlines, staying within budget, quality of work, and any history of disputes or contract modifications. Their ability to secure such a long-term, high-value contract suggests they possess the necessary capabilities and have likely demonstrated competence in previous engagements, but a deeper dive into their contract history would be required for a thorough evaluation.
What are the potential risks associated with a 50-year contract duration for infrastructure construction?
A 50-year contract duration for infrastructure construction presents several potential risks. Firstly, technological advancements in water and sewer systems could render the initially installed infrastructure outdated or less efficient long before the contract ends, potentially requiring costly upgrades or modifications. Secondly, economic conditions, material costs, and labor rates can fluctuate significantly over five decades, making it difficult to accurately forecast and control expenses, even with a fixed-price structure, if scope changes are needed. Thirdly, the long timeframe increases the risk of contractor performance degradation, changes in corporate ownership or stability, or loss of institutional knowledge. Finally, ensuring consistent oversight and accountability over such an extended period requires robust management processes and sustained government commitment to monitor compliance and adapt to unforeseen challenges.
Industry Classification
NAICS: Construction › Utility System Construction › Water and Sewer Line and Related Structures Construction
Product/Service Code: UTILITIES AND HOUSEKEEPING › UTILITIES
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Offers Received: 1
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Address: 3560 KOLOA RD, KALAHEO, HI, 96741
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Small Business, Subchapter S Corporation
Financial Breakdown
Contract Ceiling: $196,505,504
Exercised Options: $196,505,504
Current Obligation: $53,030,697
Contract Characteristics
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Cost or Pricing Data: NO
Timeline
Start Date: 2008-09-29
Current End Date: 2058-09-28
Potential End Date: 2058-09-28 00:00:00
Last Modified: 2017-09-20
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