CH2M Hill

CH2M HILL Companies Ltd.

Type	Employee owned corporation
Industry	Engineering, procurement, construction, and operations
Founded	Corvallis, Oregon (1946) (as Cornell, Howland, Hayes, and Merryfield)
Headquarters	Meridian, Colorado, United States
Key people	Jacqueline Hinman, President and Chief Executive Officer
Revenue	US$5.88 Billion (FY 2013)
Operating income	US$192.4M (FY 2013)
Net income	US$118.3M (FY 2013)
Total assets	US$3.06 Billion (FY 2013)
Total equity	US$642.6M (FY 2013)
Number of employees	26,000 (2013)
Website	www.ch2m.com

CH2M Hill is an American engineering company that provides consulting, design, construction, and operations services for corporations, and federal, state, and local governments. The firm's headquarters is in Meridian, an unincorporated area of Douglas County, Colorado in the Denver-Aurora Metropolitan Area. The postal designation of nearby Englewood is commonly listed as the company's location in corporate filings and local news accounts. As of December 2013 CH2M Hill had approximately 26,000 employees and 2013 revenues totaled $5.88 billion. The firm is employee-owned, with an internal stock market that operates buy/sell events quarterly. CH2M Hill announced a global rebrand on 13 April 2015, adopting the nickname ch2m while retaining CH2M HILL Companies Ltd. as the firm's legal name.

History

CH2M was founded in 1946 in Corvallis, Oregon by Oregon State University civil engineering professor Fred Merryfield and three of his students: Holly Cornell, James Howland and Thomas Burke Hayes (the firm was named after the founders, with Howland and Hayes making up the H2 portion). Cornell, Howland, and Hayes were all graduates of Oregon State University. The company became CH2M Hill name after a 1971 merger with Clair A. Hill and Associates of Redding, California. The firm remained headquartered in Oregon until 1980, when a decision was made to relocate to Colorado, a more central location in the United States.

Other key acquisitions include Black, Crow & Eidsness (a southeast U.S. engineering firm) in 1977, Gore & Storrie (a Canadian water and wastewater engineering firm) in 1995, Gee & Jensen (a Florida-based Ports and Harbor firm) in 2002, DeMil International (a U.S.-based weapons destruction firm) in 2002, EHS Consultants Ltd (a Hong Kong-based consulting firm), Lockwood Greene, the oldest continuously operating professional services firm in the United States in 2003, and BBS Corporation (an Ohio-based environmental engineering firm) in 2005. On September 7, 2007, CH2M Hill finalized the purchase of most of the components of VECO, an Alaska-based firm specializing in services to the oil, gas, and energy sector that had become embroiled in the Alaska political corruption probe. In December 2007, CH2M Hill acquired Trigon EPC. In March 2008, CH2M Hill acquired Texas-based Goldston Engineering, a company specializing in marine and coastal transportation engineering services. In July 2011, CH2M Hill finalized the acquisition of Booz Allen Hamilton’s State & Local Government Transportation Consulting (S&L Transportation) business. In September 2011, CH2M Hill announced that it intended to acquire the share capital of Halcrow Group Limited, a UK-based engineering consultancy that operates worldwide. The acquisition for £124m was completed on November 10, 2011. In 2014, CH2M Hill acquired TERA Environmental Consultants of Calgary, Alberta.

CH2M Hill adopted the shortened nickname CH2M on April 13, 2015.

Services

CH2M Hill offices at the Parkside Tower in Salt Lake City, Utah

The former VECO building, now CH2M Hill's Alaska headquarters

The company operates in multiple business units, among the operating divisions, Water, Energy & Facilities; Government, Environment & Infrastructure; and International. Business groups served include: Water; Transportation; Operations and Maintenance; Government Facilities and Infrastructure; Nuclear; Environmental; Energy and Chemicals; Power; and Industrial and Advanced Technology.

The company developed, maintains and publishes its own method for managing projects for clients, called the CH2M Hill Project Delivery System, which may be found at popular internet book retailers. As a firm specializing in project management, CH2M Hill has been associated in several large, complex projects around the world. In 2005, a CH2M Hill joint-venture known as Kaiser-Hill decommissioned and closed a former nuclear weapons facility at the Rocky Flats site in Colorado (former Rocky Flats Plant).

In Singapore, the company was part of a joint venture to replace the country's sanitary services infrastructure. The new Singapore Deep Tunnel System was designed to improve reliability, ease, and economy of operation, and to help handle Singapore's increasing waterfront utilization. CH2M Hill assisted in reconstruction efforts along the US Gulf Coast in the wake of Hurricane Katrina. Its main assignments included providing temporary housing, debris removal, and other services.

Other large projects include a $660 million gas-fired power plant in Australia, in conjunction with General Electric, and an $11.7 billion project to relocate American military bases in Korea. In August 2007, the Panama Canal Authority selected CH2M Hill to manage the $5.25 billion Panama Canal expansion project, which will add new locks to the Pacific and Atlantic ends of the canal and allow Post Panamax ships passage through the canal for the first time. In 2009, a CH2M Hill consortium was named program partner to oversee construction of the Crossrail project to expand London’s transit system.

On August 30, 2006, as part of joint venture CLM, CH2M Hill was a supplier for the London 2012 Olympics. The other two members of the venture are project management service provider Mace Group and Laing O'Rourke, the largest privately owned construction firm in the UK.

The company manages projects for the clients, taking into account the environmental footprint, aiming to use sustainable technology. The firm reduced its own internal environmental footprint in 2011.

In 2008, the U.S. Department of Energy (DOE) contracted a CH2M Hill company, CH2M Hill Plateau Remediation Company, LLC (CHPRC), to manage deconstruction and remediation of the Central Plateau on the Hanford Nuclear Site in eastern Washington, one of the world’s largest environmental cleanup projects. The project focused on shrinking the environmental footprint of the Hanford Site from a 586-square-mile (1,520 km²) area (large enough to fit the city of Los Angeles) to 75 square miles (190 km²) or less. More importantly, the project will reduce legacy infrastructure costs on site by more than $25 million per year starting in 2015. Using American Recovery and Reinvestment Act (ARRA) funding, CHPRC sped up cleanup of the site over two years, reducing the site footprint 25 percent, employing an additional 1,350 people in the process. When ARRA funded work concludes in September 2012, the site footprint was targeted to shrink to a total of 290 square miles (750 km²), roughly half its previous size. Without ARRA funding, however, the scope of DOE contracted work at Hanford will be reduced. The company also announced that its workforce would reduce by up to 1,350 workers later that year through a combination of voluntary and involuntary separations.

In February 2012, the Qatar 2022 Supreme Committee appointed the company to manage the delivery of the 2022 FIFA World Cup in Qatar.

Awards and honors

The firm was named by Fortune magazine as one of the top 100 companies to work for in 2013, marking the company's sixth time on the list. In October 2009, the company's Canadian division, CH2M Hill Canada Ltd., was named one of "Canada's Top 100 Employers" by Mediacorp Canada Inc., and was featured in Maclean's newsmagazine. Later that month, CH2M Hill Canada Ltd. was also named one of Greater Toronto's Top Employers, which was announced by the Toronto Star newspaper. The firm continues to be recognized on this annual list.

In 2000, the firm won the prestigious Malcomb Baldridge National Quality Award that recognizes U.S. organizations in the business, health care, education, and nonprofit sectors for performance excellence. CH2M Hill won the service sector award, adding itself to a list of winners including Federal Express, Cadillac Motor Division, and Motorola.

In 2009, the firm became the first company in the heavily male-dominated engineering and construction industry to receive the Catalyst Award in recognition of its efforts to develop and advance women in the company. The firm also was named one of the World’s Most Ethical Companies by Ethisphere Institute for four consecutive years (2009, 2010, 2011, 2012).

In May 2012, CH2M Hill was named the Water Company of the Year in the annual Global Water Awards, sponsored by the International Desalination Association and Global Water Intelligence.

Controversies

Sewer Tunnel Explosion

In May 1989, CH2M Hill was fined $470,000 by OSHA as one of two contractors involved in a methane gas explosion that killed three workers in a sewer tunnel project, citing safety and health violations. They were cited for 47 willful violations, which are the most serious issued by OSHA and are based on a finding that the contractors knew that a dangerous condition violated safety standards but made no effort to correct it. The fines were overturned on an appeal to the United States Court of Appeals for the Seventh Circuit and the company was found not liable for the deaths of the workers.

Formaldehyde in FEMA Trailers

In 2005, after Hurricane Katrina ravaged the United States Gulf Coast, the company entered into contracts with federal and state governments worth hundreds of millions to assist with the cleanup and recovery effort. It was one of several companies to be awarded a no-bid contract to install or maintain Federal Emergency Management Agency (FEMA) trailers to provide temporary housing for hurricane victims. A review from the Department of Homeland Security's Office of Inspector General found that the $400 million in no-bid temporary housing contracts awarded to CH2M Hill, Shaw Environmental Inc., Bechtel Corp., and Fluor Enterprises Inc. wasted at least $45.9 million in taxpayer dollars. The trailers later turned out to contain formaldehyde, and exposed the hurricane victims to toxic fumes. Residents of Louisiana, Mississippi, Alabama and Texas brought a class action lawsuit against CH2M Hill and others for their injuries. In May 2012, CH2M and three other contractors (Shaw Environmental Inc., Bechtel Corp., Fluor Enterprises Inc.) that installed or maintained the government issued trailers agreed to pay $5 million to settle the case against them. The overall case settled for $42 million in September 2012.

Violation of Clean Water Act

In January 2006, a CH2M subsidiary “entered into a Deferred Prosecution Agreement (DPA) with the office of the United States Attorney for the District of Connecticut. The DPA relates to a previously disclosed investigation of a Clean Water Act (CWA) violation at [two] wastewater treatment facilities in Connecticut. Pursuant to the DPA, [the] subsidiary will contribute $2.0 million to community projects and take other agreed upon steps to enhance CWA compliance procedures at the two wastewater treatment facilities in Connecticut...The violation related to failure to comply with sampling and reporting requirements of the CWA and there is no evidence the violation resulted in harm to human health or the environment.”

Alaska Fish Hatchery Delays and High Costs

CH2M Hill was hired by the state of Alaska to build the Ruth Burnett Sport Fish Hatchery. The project was intended to be completed by 2009, but the fish hatchery was not functional until 2013 due to construction delays and issues with the water filtration system. It ended up costing the state $50 million, twice as much as originally projected. The state finalized a settlement costing CH2M Hill $2.9 million, which removed the contractor from any liability at the time but left liability of future claims open.

LA Utility Controversy

In 2007, CH2M Hill was accused of over-billing the Los Angeles Department of Water and Power by $3.3 million on contracts to control dust on the dry bed of Owens Lake. An audit "found that CH2M Hill allowed subcontractors to pass on improper markups for services to the department. The audit also found that the company lacked effective oversight of cost controls, subcontractor management and construction management," the Denver Post reported. In 2008, the department filed a lawsuit against the company for $13.5 million, plus punitive damages and $10,000 for each false claim submitted by the contractor. The lawsuit accused the firm of breach of contract, fraud, and providing negligent representation. The lawsuit was settled in July 2009 for an undisclosed amount.

Hanford Nuclear Project Scandals

Time Card Lawsuit: In September 2012, the U.S. federal government became involved in a False Claims Act lawsuit alleging that CH2M Hill over-billed the government for the number of hours worked at the Department of Energy’s (DOE's) Hanford Nuclear Site. CH2M Hill allegedly hired employees for eight-hour shifts but allowed them to leave early, because it was reportedly unable to recruit workers otherwise without losing a profit. CH2M Hill then submitted the falsified timecards to the federal government. The Justice Department alleged that upper management knew about the practice but failed to stop it. CH2M Hill settled the case by agreeing to pay $19 million (including a $16.55 million civil penalty; disgorgement of $1.95 million in profits, and $500,000 to improve accountability systems at Hanford). The settlement also included a three-year non-prosecution agreement, the hiring of a corporate monitor, and an agreement they would cooperate with the government’s ongoing fraud investigation. CH2M Hill agreed to a statement of facts that it had committed federal criminal violations.

Fine for Kickbacks

Between 2003 and 2005, two CH2M Hill employees allegedly defrauded taxpayers by making over 200 purchases of substantially marked-up goods from companies owned and run by the employees' spouses, then charged the cost to the DOE. Despite being alerted by internal audits to the misuse of federal funds, CH2M failed to address the issue, allowing these schemes to go undetected for years. Four individuals were indicted on charges of fraud. The company agreed to pay $1.5 million to settle the allegations.

See also

• Top 100 US Federal Contractors

External links

• CH2M website