Utilities Privatization - Privatization of the Water Utility Systems at U.S. Army Garrison - Hawaii, Island of Oahu

This is a Sources Sought Notice (hereinafter "Notice"). This Notice is an essential step in determining market interest and feasibility in accordance with FAR Part 10 and is for information and planning purposes only. This Notice is solely for the Government's use as a market research tool. This Notice does not constitute a request for proposals, a solicitation or a request for quotes. If determined appropriate, then both a synopsis and a solicitation may be anticipated in the 2026 timeframe. All responsible sources are encouraged to submit a response to this Notice. All information received will be considered. Failure to respond to this Notice does not preclude a firm from offering on any resultant solicitation; however, a lack of interest in this requirement may keep this effort from moving forward competitively. The potential opportunity for set-asides for small businesses and small disadvantaged businesses will be considered on the basis of the responses received. This Notice shall not be construed as a commitment or authorization to incur costs in anticipation of an award. The Government is not bound to make any awards under this Notice.

Interested parties should provide a statement of interest on company letterhead by no later than 3:00 P.M. EDT on June 29, 2026. Responses are preferred via email, but hard copies will also be accepted. If the statement of interest will be provided via hard copy, please notify the primary or secondary point of contact identified herein.

At a minimum, the statement of interest shall address the following criteria:

1. Capability and experience in the ownership and/or leasing, operation and maintenance of a water utility system;
2. Financial capacity with regard to leasing or ownership interest, expansion, and operation of a utility system;
3. Understanding of any applicable state or local utility law or franchise requirements and capability of complying with such requirements;
4. Understanding of the federal, state and local environmental laws and regulations and its familiarity and experience with environmental compliance procedures and regulations for the state of Hawaii;
5. Capabilities and estimated timeframes to initiate and complete extensive water infrastructure capital projects, which will be referred to as Initial System Deficiency Corrections (ISDC)*, to include financing, procurement, installation (including necessary phasing to maintain continuity of Government operations), commissioning, and initial system operation;
6. A primary point of contact, including phone number and email address;
7. Business size (other-than-small, small, or any subcategory of small business) relative to the NAICS codes 221310; and
8. Status as a regulated or non-regulated utility currently operating in the state of Hawaii.

* ISDCs are projects necessary to reach the standards typically maintained by the Contractor on its utility systems or to ensure compliance with applicable law and regulation, so that subsequent renewals and replacements (recapitalization) will permit the long-term safe and reliable operation of the utility systems.

If you are interested in this effort, please provide the information requested above to the Defense Logistics Agency Energy (DLA Energy) Contracting Office.

Requirement:

The Defense Logistics Agency Energy (DLA Energy) seeks to identify and obtain information from responsible sources in connection with the acquisition of utility services for the privatization of the Water (NAICS 221310) distribution system at U.S. Army Garrison-Hawaii, Island of Oahu. Privatization is defined as the conveyance of a utility system to a municipal, private, regional, district or cooperative utility company or other entity. The conveyance may consist of rights, title and interest of the United States in the utility system. Utilities Privatization (UP) will be accomplished in accordance with 10 U.S.C. § 2688 - Utility Systems: Conveyance Authority. It is intended that privatization will reduce the Government's life cycle costs; expand capabilities; repair failing equipment; and improve system Availability, Resiliency, & Efficiency within 5 years after conveyance. The resulting privatization will include ownership, operation, and maintenance of the system. The new owner shall operate and maintain the system and provide utility services to the Government. The Contractor/System Owner shall furnish all management, supervision, permits, equipment, supplies, materials, transportation and any other incidental items or services required for the complete ownership and provision of utility services by the use of these utility systems being privatized, including operation, maintenance, repair, upgrades and improvements to the utility systems. All responsibility for maintaining reliable service, including such items as environmental compliance, maintenance costs, major system renovations, construction, equipment, manpower and overhead costs shall become the responsibility of the new utility system owner.

Installation Description

U.S. Army Garrsion-Hawaii (USAG-HI) is responsible for all of the U.S. Army installations located on Oahu and the Big Island of Hawaii, which includes three fixed-wing airfields, 22 helipads and six major training areas over nearly 200,000 acres. USAG-HI supports the needs of service members from the Army, Marines, Navy, Air Force, Hawaii Army National Guard, Hawaii Air National Guard, and Reserves. USAG-HI is headquartered at Wheeler Army Airfield, which is approximately 20 miles from the state capital of Honolulu. USAG-HI has more than 24,000 service members (active, reserve, guard), 12,000 civilian workers, and supports more than 28,000 retirees and more than 32,000 family members living both on and off base. The Garrison’s day-time population is estimated to include nearly 100,000 active-duty military personnel, civilians, family members and retirees across 22 military installations and training areas.

System Description

USAG-HI is considering the potential privatization of the water utility systems serving Schofield Barracks – Main Post, Wheeler Army Airfield (WAAF), Schofield Barracks – East Range, Pililaau Army Recreation Center (PARC), Fort Shafter, Tripler Army Medical Center (TAMC), Fort DeRussy, Helemano Military Reservation (HMR), Kahuku Training Area, Aliamanu Military Reservation (AMR), and Makua Valley Training Area, Coast Guard Housing, Field Station Kunia (FSK), Dillingham Military Reservation (DMR), and Lightning Academy. The USAG-HI water utility systems to be privatized under this solicitation include the distribution systems within the housing areas. Details for the water utility systems at each of these locations are included below.

Schofield Barracks (SB)

The SB system includes groundwater source wells, a centralized water treatment plant (WTP), and a comprehensive distribution network. The WTP has a treatment capacity of approximately 4 to 9 million gallons per day (MGD) and serves Schofield Barracks along with several adjacent military installations and supported sites. Source water withdrawal is regulated and allocated by the State of Hawaii Department of Land and Natural Resources, Commission on Water Resources Management. The facility operates via an automated SCADA system and includes specialized treatment infrastructure, including stripping towers for the removal of volatile organic compounds (VOCs).

Water is sourced from a deep groundwater aquifer. The extraction and delivery infrastructure involves highly complex, deep subterranean shafts and reinforced routing that passes beneath major civilian transportation corridors. Interested vendors must possess the capability to operate and maintain large-scale, deep-well pumping operations and structurally complex underground assets.

Schofield Barracks – Main Post

The SB distribution infrastructure consists of multi-million gallon storage tanks, booster pump stations (BPS), and a comprehensive network of piping and valves. The distribution system is topographically divided into multiple pressure zones to manage flow and demand across the installation. The system utilizes centralized pumping infrastructure to transfer water between the lower and upper pressure zones.

The primary booster pump station is equipped with multiple high-capacity pumps and industrial-scale motors designed to maintain necessary system head and flow rates across the varied elevation. This station also features dedicated emergency backup power generation.

Schofield Barracks – East Range

The distribution system extending to the East Range and adjacent supported areas is supplied by the main water treatment plant via dedicated booster pump stations and multiple large-capacity storage tanks. The network is tiered across several pressure zones (lower, middle, and upper) to manage elevation changes and ensure adequate pressure to various end-users.

Water is conveyed through a combination of pumped and gravity-fed distribution mains. The infrastructure supports a variety of installation functions, including logistical and maintenance operations, as well as critical joint-service communications facilities. Notably, portions of the transmission infrastructure traverse off-installation areas, including public rights-of-way and civilian residential neighborhoods.

Wheeler Army Airfield (WAAF)

WAAF is adjacent to SB, separated by Kunia Road. WAAF is serviced by a large diameter water line from the SBWTP as previously mentioned. Water system pressure within WWAF is provided by the lower pressure zone's ground storage tanks within SB.

Pililaau Army Recreation Center (PARC)

PARC does not possess its own source generation; instead, water is supplied by the local municipal provider (Hawaii Board of Water Supply) via a primary master meter. Downstream of the master meter, the installation owns and operates the distribution network. The internal system consists of a primary transmission main that branches into dedicated domestic service lines and a separate network of distribution mains specifically supporting the installation’s fire protection hydrants and suppression systems.

PARC sits above an archaeological site with identified burial locations. Based on previous archaeology, the Cultural Resources Section of the Directorate of Public Works (DPW) Environmental Division has determined that the entire PARC area has a high likelihood of encountering additional burials. Potential offerors must include plans to coordinate with the DPW Cultural Resources Manager and abide by the strict requirements set forth in the Native American Graves Protection and Repatriation Act (NAGPRA) during any ground-disturbing maintenance or capital improvement activities.

Fort Shafter (FS)

The Fort Shafter water system is a self-contained utility encompassing source water extraction, treatment, storage, and distribution. The primary water source consists of on-installation basal groundwater wells drawing from the local aquifer. Extraction is strictly regulated by the State Commission on Water Resource Management (CWRM) via an issued Ground Water Use permit, which dictates sustainable yield allowances. Following extraction, raw groundwater undergoes standard municipal-level treatment, including chlorination and fluoridation, prior to entering the distribution network.

The distribution system is topographically divided into three distinct pressure zones—Lower, Middle, and Upper—to accommodate significant elevation changes across the installation. Flow and pressure between these zones are managed through a network of booster pump stations, pressure reducing valves, and backflow prevention infrastructure. Storage is provided by multiple large-capacity concrete ground tanks and elevated reservoirs distributed across these zones to maintain necessary hydraulic head. The current storage infrastructure utilizes legacy common inlet/outlet piping configurations, which inherently impacts circulation and requires active management to ensure continuous water quality and turnover.

The integrated system supports domestic, housing, administrative, and logistical facilities across the Fort Shafter cantonment area. The distribution network is comprised of primary transmission mains and secondary distribution loops of varying diameters, typical of a mid-sized municipal system. System operations, including source cycling, reservoir levels, and pressure telemetry, are monitored continuously via a centralized, automated SCADA system. Additionally, to ensure continuity of service and system resilience, the network maintains an emergency supply interconnection with the local municipal water provider (Hawaii Board of Water Supply).

Tripler Army Medical Center (TAMC)

The TAMC water system is supplied by dedicated, off-site basal aquifer wells equipped with high-capacity pumps. These source wells are situated in close physical proximity to one another at a low elevation near sea level. Extracted groundwater undergoes standard treatment, including chlorination and fluoridation, prior to entering the installation's distribution network.The distribution system is topographically divided into a lower and an upper pressure zone to manage significant elevation gradients across the medical campus. The lower pressure zone is supported by a large-capacity ground storage tank that provides primary service to the main medical center and associated support facilities. Flow is transferred to the upper pressure zone via a dedicated booster pump station, which fills an elevated ground storage reservoir serving the installation's residential and lodging facilities.Given the critical nature of the medical mission, system resilience is supported by a limited-capacity emergency interconnection with the local municipal water provider (Hawaii Board of Water Supply), which can supplement the TAMC network during contingency operations.

Fort DeRussy (FD)

The FD water system does not possess its own source generation; water is supplied entirely by the local municipal provider (Hawaii Board of Water Supply) via a primary transmission main. The internal distribution network consists of primary and secondary looping mains that support both the military reservation facilities and the adjacent Armed Forces Recreation Center (Hale Koa Hotel). Portions of the distribution infrastructure are co-located with registered archaeological sites, specifically buried historical fishponds designated on the State Inventory of Historic Places. Due to the high sensitivity of these cultural resources, any ground-disturbing maintenance or capital improvement activities within the system footprint are subject to strict regulatory compliance and mandatory coordination with the Directorate of Public Works (DPW) Cultural Resources Management program.

Helemano Military Reservation (HMR)

HMR does not possess independent source generation; rather, it receives its water supply through an integrated network fed by the main Schofield Barracks water treatment plant and adjacent joint-service infrastructure. The transmission mains supply a large-capacity ground storage reservoir at HMR. From this reservoir, water is transferred via booster pumps to an elevated storage tank, which then utilizes hydraulic head to gravity-feed the reservation's distribution system.

Kahuku Training Area (KTA)

The KTA infrastructure operates as a dedicated, non-potable water system specifically constructed to support the installation's tactical vehicle wash facility. The self-contained system utilizes a dedicated on-site groundwater well for source generation, alongside associated transfer and storage tanks, piping, and valving. Extraction operations are governed by a State-issued Ground Water Use permit, which dictates the system's maximum daily withdrawal allowances.

Aliamanu Military Reservation (AMR)

The AMR distribution system is supplied by adjacent joint-service (Navy) source wells and primary storage infrastructure. The internal AMR network is topographically divided into three distinct pressure zones to manage varying elevations. The lowest pressure zone (Zone 1) is primarily gravity-fed utilizing the hydraulic head from the adjacent joint-service primary storage, supplemented by a large-capacity, Army-owned ground storage tank. The intermediate and upper pressure zones (Zones 2 and 3) are supported by dedicated booster pump stations and independent Army-owned storage tanks to maintain adequate head. System flow and pressure between the intermediate and upper zones are dynamically managed via integrated booster pumps and pressure reducing valves.

Makua Valley Training Area (MVTA)

The MVTA water system is a relatively small, austere distribution network designed to support remote training operations. The system does not possess independent source generation; rather, it is supplied by a primary transmission main that interconnects with the local municipal provider (Hawaii Board of Water Supply) south of the installation. The internal infrastructure consists of a limited site distribution system, necessary backflow prevention, and a small-capacity ground storage tank to manage local demand.

Coast Guard Housing

The Coast Guard housing distribution system is a unique jurisdictional asset. The primary water source, storage, and pumping infrastructure are owned and operated by the U.S. Navy and are expressly excluded from this solicitation. However, the internal distribution network serving the housing area is included in the scope. The system requires management of distribution mains that traverse under major civilian transportation corridors to connect disparate housing tracts. Additionally, the network features an integrated alternate supply interconnection with the AMR system, maintained via isolation valving, to provide emergency redundancy.

Field Station Kunia (FSK)

Field Station Kunia (FSK) is a secure, joint-service installation located in Central Oahu. The installation does not possess independent source generation and relies on primary transmission mains extending from the centralized Schofield Barracks water network. The scope of responsibility at this location is highly limited. The Army maintains a small footprint of the potable water system, primarily consisting of service mains, metering infrastructure, and fire suppression assets. A significant portion of the internal infrastructure is owned and operated by the U.S. Navy and is excluded from this solicitation. Because FSK operates as a secure facility, vendors must possess the capability to meet stringent personnel security and access control requirements to perform maintenance or read metering infrastructure located within secured perimeters.

Dillingham Military Reservation (DMR)

The Dillingham Airfield water infrastructure operates as a regulated community Public Water System (PWS), serving a mixed-use population that includes the military airfield, adjacent joint-service installations, and local civilian and recreational areas. The system relies on a single, primary groundwater well for source generation. The active wellhead infrastructure is situated below grade and requires active management for localized environmental factors, including flood mitigation. An additional inactive, capped legacy well exists within the installation footprint and requires baseline physical security oversight to prevent unauthorized access. Extracted groundwater undergoes standard chemical disinfection immediately downstream of the wellhead utilizing a redundant dosing pump configuration. Treated water is transferred to a dedicated concrete ground storage reservoir, which subsequently gravity-feeds the distribution network. The reservoir is equipped with isolation valving to facilitate periodic offline maintenance and cleaning operations. The distribution network consists of a varied mix of legacy and modern piping materials (e.g., cast iron, galvanized, PVC, HDPE). The system functions as an isolated network without emergency interconnections to municipal water supplies. Consequently, operational continuity is maintained via dedicated on-site emergency power generation for the primary well and treatment assets.

Lightning Academy

Lightning Academy’s potable water is supplied by BWS. The water is distributed via the Army owned water system.

New Approaches to Contract Pricing for Utilities Privatization

The Government previously solicited input from industry on several facets of this contemplated procurement via a Request For Information (RFI) published on SAM.gov on February 18, 2026. That feedback has contributed to the Government’s contemplated approaches to two primary topics under consideration as it prepares the final requirements for this procurement. Interested respondents to this RFI are encouraged to provide continued feedback on these plans.

Hybrid Contract Pricing Model

If this requirement proceeds as a competitive action, the Government intends the solicitation will permit both regulated tariff and unregulated fixed-price offers for the contract’s monthly Utility Services Charge (USC). For unregulated offers, the Army intends to solicit a hybrid fixed-price model where the two components of the USC, Operations and Maintenance (O&M) and Renewals and Replacements (R&R), are escalated differently over the contemplated 50-year contract term. Specifically, the Government intends to permit an annual Economic Price Adjustment (EPA) escalation for O&M costs, and a Prospective Price Redetermination (PPR) escalation once every three or five years for R&R costs. This approach aims to minimize cost escalation for the Government, while ensuring the prospective system owner receives appropriate inflation-adjusted revenue and an adequate capital allowance to recapitalize the system as needed.

Novel Approach to Initial System Deficiency Correction (ISDC) Projects

The requirements under this procurement will entail a significant ISDC program where dozens of recognized system deficiencies must be addressed immediately. The Government has historically included these ISDCs in UP solicitations and required line-item, firm-fixed prices for the offeror’s approach to remedying each deficiency, with higher priced projects being paid on an amortized basis. Because of the lack of due diligence, knowledge of the system deficiency specifics, and the latent conditions in which they exist, there are often unforeseen challenges for the Government to resolve. Additionally, system owners often communicate that certain ISDCs are not even the most critical deficiencies in the system, or they disagree with the Government’s suggested approach to remedy.

The Government’s RFI asked industry whether utilizing the R&R program would be a better approach for ISDCs. Industry responses indicated a preference for the flexibility this approach would provide a prospective system owner. However, shifting significant upfront ISDC investments completely into the R&R program increase the long-term R&R costs of the contract. Therefore, the Government is seeking industry feedback on whether establishing a separate, short-term amortized funding stream to specifically address the ISDCs would help industry balance risk and capital recovery. The Government further requests industry input and suggestions on the structure of such a mechanism, to include its duration.

Cybersecurity Requirements

For this effort, the Government has designated the requirements as falling under the Cybersecurity Maturity Model Certification (CMMC) Level 2 certification with an independent assessment by an accredited CMMC Third-Party Assessment Organization (C3PAO). Under the CMMC rule, this evaluation replaces basic self-attestation for prioritized acquisitions, making independent validation mandatory to bid on sensitive Government contracts.

Secure Documents

If sufficient interest is identified and this requirement proceeds in a competitive action, access to many solicitation attachments will be controlled. In order to view and download controlled attachments, interested parties will need to request access in the Contract Opportunities system. The process of obtaining access is somewhat lengthy, therefore all interested vendors are encouraged to begin that process as soon as possible.

Instructions for access to the Contract Opportunities Controlled Site:

To access the controlled, but unclassified, documents in the SAM.gov system, Offerors are required to be registered in SAM.gov.  A CAGE Code and Unique Entity Identifier (UEI) are created through the SAM.gov registration process at https://sam.gov/.

Offerors must create a login.gov account in SAM.gov. Instructions are below. For additional help, contact the Federal Service Desk at www.fsd.gov or toll free at 1.866.606.8220.

1. To link to an existing login.gov account
   1. From https://sam.gov/ go to Sign In on the toolbar.
   2. Enter an email address and password for the existing login.gov account.
   3. Offerors will then receive an email to associate the existing login.gov account with SAM.gov. Offerors will now use this login.gov account to sign into SAM.gov. New users will be asked to complete their SAM.gov profile.
2. To create a new login.gov account
   1. From https://sam.gov/ go to Sign In on the toolbar.
   2. Select Create an account.
   3. Enter an email.
   4. Offerors will receive a link with a security code via email. Go to the link and enter that security code and press continue.
   5. Create a password. Press continue.
   6. Select the method to receive one-time security codes in the future. Note: The recommended method is Text message/SMS. As part of the registration process, Offerors will be prompted to select a second authentication method.
3. Once the login.gov user account is created, sign in at SAM.gov and navigate to the solicitation using the “Search Contract Opportunities” link. 
   1. Click on a controlled attachment to initiate the request for access.
   2. A pop-up message will appear. Enter a “Reason for Access” and click Submit. Offerors will be notified of the response to the request.
   3. Please note that Offerors will now need to request access for each attachment individually.
4. Offerors that already have Joint Certification Program (JCP) certification are encouraged to verify their information in the JCP system at https://www.public.dacs.dla.mil/jcp/ext/. Incorrect information may result in rejection of request and delays in access to controlled documents.
5. Instructions for obtaining JCP certification or for correcting a current JCP certification are as follows:
   1. Applicants for JCP certification are required to have an updated and correct SAM.gov registration, UEI, CAGE Code, and login.gov account.
   2. Applicants for JCP certification are required to complete a NIST assessment and upload it to SPRS.  NIST assessments are valid for 3 years, must be documented in SPRS, and must be current more than 90+ days.
   3. Applicants must review and completion the Introduction to Proper Handling of DoD Export-Controlled Technical Data through https://www.dla.mil/Logistics-Operations/Services/JCP/. 
   4. All applications must be completed through the JCP Portal. The portal may be accessed through https://www.dla.mil/Logistics-Operations/Services/JCP/ or directly at https://www.public.dacs.dla.mil/jcp/ext/. 

                        (i) Click the Registration link below the Login button to navigate to the Registration page.

                       (ii) Register with a username and password. The Register – User Name and Password page is for use by users not in possession of a Government Common Access Card (CAC).

                      (iii) All JCP Portal users logging in with a username and password must enable Two Factor Authentication (TFA) on the JCP Portal account.

                                1. Log in to the JCP Portal account with the username and password.

                                2. A prompt requires the TFA set-up on the account.

                                3. Set-up Google Authenticator on a smartphone.

                                4. Google Authenticator will be used upon each log in attempt.

                                5. Either scan the QR code in the Google Authenticator application or manually enter the verification code.                                              Select verify and save.

                     (iv) After registering, click Profile in the header of the main page. To update your Profile information (First Name, Last name, Email, or Telephone), make a change in any or all the form fields and save by clicking the Save button.

                     (v) Upon first login after registration, an organization will not be attached to the profile. The Dashboard page will display an Actions drop down in the upper right corner. Click either Request to Join an Organization or Create New Organization.

             5. Applicants will complete the DD Form 2345, Military Critical Technical Data Agreement, through the JCP Portal.

            6. Notify the DLA Energy Solicitation POCs of the request submission together with company name and CAGE Code used on the request form.

            7. The JCP office will contact the Offeror with additional instructions.

            8. JCP will return an approved and signed certified form, which will include the certification and expiration date.

            9. For assistance with the DD2345 or to inquire about the acceptability of providing documentation electronically, please contact the U.S./Canada Joint Certification Office, DLIS:

                                                           U.S./Canada Joint Certification Office

                                                           Logistics Information Services

                                                           Federal Center, 74 Washington Ave., North

                                                           Battle Creek, Michigan USA 49037-3084

                                                           Phone: 877-352-2255

                                                           E-mail: JCP-Admin@DLA.MIL

           10. Once approval is received, it can take up to 24 hours for the JCP information to reach all systems.

  6. Once Offerors receive the approved DD2345 from JCP, have verified the status, and have verified that all information is correct and matches the SAM registration for the same CAGE Code at https://www.public.dacs.dla.mil/jcp/ext/, follow the steps for requesting access to controlled documents in #3, above.

 7. All JCP account registrants must log in to the JCP Portal at least every 35 days to keep their accounts active. Accounts not active past 35 days will be disabled. A warning email from j62.dacs@dla.mil will be sent five (5) days and then one (1) day prior to your account being locked. If you find that your account is locked/disabled, please go to the DACS Portal: https://www.public.dacs.dla.mil/portal/ and click the "Unlock Account" link. You will need to provide your username and email address to unlock/enable your JCP Portal account.

  8. Further JCP account instruction may be found at https://www.dla.mil/Logistics-Operations/Services/JCP/.

Once the MPIN has been verified in the Contract Opportunities system and explicit access has been granted, vendors will be able to enter the system and view the secure documents.