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NAICS Newsletter September 2, 2011

NAICS 562910

Remediation Services

Government Contract and Procurement Analysis Report

Report Summary

This report, offered by epipeline, contains a brief analysis of the Federal government's procurement practices with regards to purchasing Remediation Services.


You will find information on the top federal government agencies that purchase these services, as well as their procurement strategy (i.e. full and open competition, set-asides and more). Finally, there is a review of the top companies that are awarded federal government contracts for Remediation Services.


To get a more comprehensive analysis and learn more about how epipeline can help you identify current and future bid opportunities, register for a live Demo.

This report takes an in-depth look at the 'Remediation Services' industry, NAICS 562910. epipeline's Contract History Plus* provides you with a broad context and several perspectives that enable you to develop the best positioning and strategy for your company to more effectively compete for government contracts. The following graph illustrates one such perspective: the top Government departments/agencies buying these services over the last four fiscal years.

Top 10 Federal Agencies by % of Total Market FY07 through FY11 for NAICS 562910

WHAT IS NAICS 562910?

This industry comprises establishments primarily engaged in one or more of the following: (1) remediation and cleanup of contaminated buildings, mine sites, soil, or ground water; (2) integrated mine reclamation activities, including demolition, soil remediation, waste water treatment, hazardous material removal, contouring land, and revegetation; and (3) asbestos, lead paint, and other toxic material abatement.

The description of NAICS 562910 is further broken out to include these additional specific topics:

  • Asbestos abatement services
  • Asbestos removal contractors
  • Environmental remediation services
  • Lead paint abatement services
  • Lead paint removal contractors
  • Mine reclamation services, integrated (e.g., demolition, hazardous material removal, soil remediation)
  • Oil spill cleanup services
  • Remediation and clean up of contaminated buildings, mine sites, soil, or ground water
  • Remediation services, environmental
  • Site remediation services
  • Soil remediation services
  • Toxic material abatement services
  • Toxic material removal contractors

Please be aware that establishments primarily engaged in developing remedial action plans are classified in Industry 541620, Environmental Consulting Services; establishments primarily engaged in excavating soil are classified in Industry 238910, Site Preparation Contractors; establishments primarily engaged in individual activities as part of a reclamation or remediation project are classified according to the primary activity; establishments primarily engaged in building modifications to alleviate radon gas are classified in Industry 238990, All Other Specialty Trade Contractors; and establishments primarily engaged in collecting, treating, and disposing waste water through sewer systems or sewage treatment facilities are classified in Industry 221320, Sewage Treatment Facilities.

The size standard associated with NAICS 562910 (except for Environmental Remediation Services) is $14.0 Million (effective November 5, 2010), which means that a company, including its affiliates, would be considered a "small business" if their average annual gross receipts does not exceed $16.5 Million for the past three years. For Environmental Remediation Services the size standard is 500, which means that a company, including its affiliates, would be considered a "small business" if it does not exceed an average of 500 employees annually.

The U.S. Small Business Administration's Table of Size Standards includes a special note for Environmental Remediation Services specifically:

For SBA assistance as a small business concern in the industry of Environmental Remediation Services, other than for Government procurement, a concern must be engaged primarily in furnishing a range of services for the remediation of a contaminated environment to an acceptable condition including, but not limited to, preliminary assessment, site inspection, testing, remedial investigation, feasibility studies, remedial design, containment, remedial action, removal of contaminated materials, storage of contaminated materials and security and site closeouts. If one of such activities accounts for 50 percent or more of a concern's total revenues, employees, or other related factors, the concern's primary industry is that of the particular industry and not the Environmental Remediation Services Industry.

For purposes of classifying a Government procurement as Environmental Remediation Services, the general purpose of the procurement must be to restore or directly support the restoration of a contaminated environment. This includes activities such as preliminary assessment, site inspection, testing, remedial investigation, feasibility studies, remedial design, remediation services, containment, and removal of contaminated materials or security and site closeouts. The general purpose of the procurement need not necessarily include remedial actions. Also, the procurement must be composed of activities in three or more separate industries with separate NAICS codes or, in some instances (e.g., engineering), smaller sub-components of NAICS codes with separate and distinct size standards. These activities may include, but are not limited to, separate activities in industries such as: Heavy Construction; Special Trade Contractors; Engineering Services; Architectural Services; Management Consulting Services; Hazardous and Other Waster Collection; Remediation Services; Testing Laboratories; and Research and Development in the Physical, Engineering, and Life Sciences. If any activity in the procurement can be identified with a separate NAICS code, or component of a code with a separate distinct size standard, and that industry accounts for 50 percent or more of the value of the entire procurement, then the proper size standard is the one for that particular industry, and not the Environmental Remediation Service size standard.

Total reported spending under NAICS 562910 for the period of Fiscal Year 2007 (FY07) through Fiscal Year 2011 (FY11) was nearly $17.5 billion. FY11 reported spending of $1.2 billion for services under NAICS 562910. The chart below illustrates the reported** spending by year for FY07 through FY11.

Reported Contract Spending for NAICS 562910 FY07 through FY11

Source: epipeline's Contract History Plus*

** Note: it is possible that some Defense spending for the more recent fiscal years (FY06 to present) is not as widely reported as earlier years. These numbers will likely increase as more departments and agencies report their current and historic contract spending.

WHO ISSUES THE CONTRACTS?

The Department of Energy was the largest procurer for these services for the last five fiscal years (FY07 through FY11), with close to $8.8 billion in contract spending, comprising 50.0% of the market share for NAICS 562910. The Department of the Army took the second spot, with just over $2.6 billion in reported spending for this period. The Environmental Protection Agency and the Department of the Air Force took third and fourth places, respectively, making up a combined market share of 24.94% for all spending in NAICS 562910.

The Department of the Navy and the US Coast Guard spent $1.1 billion and $166.5 million respectively during this time period with the rest of the top ten reporting spending over $230.2 million for NAICS 562910.

Top 10 Federal Agencies by % of Total Market FY07 through FY11 for NAICS 562910

Source: epipeline's Contract History Plus*

WHO WINS THE CONTRACTS?

According to the Central Contractor Registry (CCR), there are 9,885 companies registered under NAICS 562910 (source: active registrants, www.ccr.gov as of 8/31/2011). Of this number, 7,628 qualify as small businesses, which includes the following breakout by socioeconomic categories (some companies may qualify under more than one category):

  • 1,030 SBA Certified 8(a) contractors;
  • 631 SBA Certified HUBZone contractors; and
  • 1,102 Service Disabled Veteran Owned Small Businesses (SDVOSB).

NOTE, the CCR website states, "As of the July 30, 2008 release (4.08.2), CCR-registered vendors may elect not to display their registration in the CCR/FedReg Public Search." This could mean that there are more active contractors registered with the CCR than the resulting totals above represent.

The two charts below identify the top 10 Companies, by market share, for the period of FY07 through FY11. The first chart represents the top 10 companies that were awarded their contracts under ANY type of competition, whether it was full and open, small business set-aside, sole-sourced, etc. This list primarily consists of large businesses. The second chart, however, lists the top 10 companies that won their contracts under RESTRICTED competition. Specifically, epipeline limited this to those contracts awarded under the acquisition strategies listed below. The contract dollars represented on this second chart may not include all contract dollars for the individual contractor.

  • 8(a) Competed
  • 8(a) Small Disadvantaged (SDB) set-aside
  • 8(a) sole-source
  • SDB set-aside
  • SDB, 8(a) with HUBZone
  • Combination HUBZone and 8(a)
  • HUBZone set-aside
  • HUBZone sole-source
  • Service Disabled Veteran-Owned Small Business (SDVOSB) set-aside
  • SDVOSB sole-source
  • Emerging Small Business set-aside
  • Very Small Business set-aside
  • Reserved for Small Businesses ($2501 to $100,000)
  • Total Small Business set-aside

Ch2m Hill Plateau Remediation Company achieved the top spot on the unrestricted competition list, with over $2.5 billion in contract dollars for FY07 to FY11 and over 15.2% of market share. Ch2m Wg Idaho landed over $2.1 billion in contract dollars with Washington Closure earning roughly $1.4 billion. Latamerrick Engineering Environment and Shaw Environmental round out the top five with $458.9 and $444.4 million, respectively. Three additional firms, Weston Roy F, Paducah Remediation Services LLC and West Valley Environmental Services, each topped $300 million in contracting dollars for this same time period.

PLEASE NOTE: as this is a listing by Company name, rather than PARENT company, some companies may have more than one ranking, which may not be reflected in the chart below.

Top 10 NAICS 562910 Contractors by % of Total Market for FY07 through FY11 - All Acquisition Strategies

Source: epipeline's Contract History Plus*

The combined contract spending for contracts awarded under "restricted competition," as outlined above, totaled nearly $3.3 billion for FY07 through FY11. Paducah Remediation Services LLC takes the top spot, with reported spending of over $378.1 million for this period, or 11.52% of market share. Latamerrick Engineering Environment also secured close to $359.7 million in contracting dollars for this time period. Two other firms in the top ten, The S.M. Stoller Corporation, Sevenson Environmental Services and Stn Environmental Jv, also exceeded $100 million in reported spending for NAICS 562910.

It should be noted that Paducah Remediation Services LLC, Latamerrick Engineering Environment and The S.M. Stoller Corporation are all found in both the list of the top ten contractors using unrestricted competion as well with $1.1 billion in combined contract dollars for FY07 through FY11.

PLEASE NOTE: as this is a listing by Company name, rather than PARENT company, some companies may have more than one ranking, which may not reflected in the chart below.

Top 10 NAICS 562910 Contractors by % of Total Market for FY07 through FY11 - Restricted Competition

Source: epipeline's Contract History Plus*

HOW ARE THESE CONTRACTS PROCURED?

Over 74.9% of contract spending reported for the FY07 through FY11 timeframe under NAICS 562910 used full and open (unrestricted aka "N/A") competition. This equated to over $13.1 billion. Contracts that did not indicate their acquisition strategy (which means they could represent any acquisition strategy) reported contract spending of nearly $970.1 million. Contracts that were small business set-aside reported spending of almost $2.4 billion. The combined value of contracts representing all other acquisition strategies was more than $1.0 billion, or 5.87% of the market.

Acquisition Breakout under NAICS 562910 for FY07 through FY11

Source: epipeline's Contract History Plus*

WHERE ARE THESE CONTRACTS PERFORMED?

These contracts are being performed across the continental United States and abroad. The 50 states plus Washington, DC have reported spending for the FY07 through FY11 period of $16.4 billion and contracts for locations outside the United States (or unlisted) totaled $1.1 billion.

The highest total of reported contract spending is reported for Washington state, with $4.1 billion. Idaho ($2.1 billion) and California ($1.4 billion) took the second and third spots. Together, the top five states represent 52.59% of market under NAICS 562910. Besides those in the top ten, an additional 15 states reported at least $100 million for NAICS 562910 during this time period.

Contract Place of Performance under NAICS 562910 for FY07 through January 2011

Source: epipeline's Contract History Plus*

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