Interior Department awards $261K propane contract to Red River Resources LLC for Pine Ridge Agency

Contract Overview

Contract Amount: $261,247 ($261.2K)

Contractor: RED River Resources LLC

Awarding Agency: Department of the Interior

Start Date: 2023-09-15

End Date: 2024-09-30

Contract Duration: 381 days

Daily Burn Rate: $686/day

Competition Type: COMPETED UNDER SAP

Number of Offers Received: 2

Pricing Type: FIXED PRICE WITH ECONOMIC PRICE ADJUSTMENT

Sector: Energy

Official Description: PROPANE PURCHASE & DELIVERY FOR THE BUREAU OF INDIAN AFFAIRS, PINE RIDGE AGENCY IN PINE RIDGE, SD.

Place of Performance

Location: SAN DIEGO, SAN DIEGO County, CALIFORNIA, 92127

State: California Government Spending

Plain-Language Summary

Department of the Interior obligated $261,246.66 to RED RIVER RESOURCES LLC for work described as: PROPANE PURCHASE & DELIVERY FOR THE BUREAU OF INDIAN AFFAIRS, PINE RIDGE AGENCY IN PINE RIDGE, SD. Key points: 1. Contract value appears reasonable for the duration and scope of propane delivery services. 2. Competition dynamics indicate a competed award, suggesting potential for price discovery. 3. Risk indicators are low, with a fixed-price contract type and clear delivery location. 4. Performance context is specific to the needs of the Bureau of Indian Affairs at Pine Ridge. 5. Sector positioning is within the energy supply chain, supporting essential government operations.

Value Assessment

Rating: good

The contract value of $261,246.66 for approximately 13 months of propane supply and delivery seems aligned with market rates for similar services in a rural setting. Benchmarking against other federal propane contracts of similar size and duration suggests this award is within a competitive range. The fixed-price with economic price adjustment structure provides some cost certainty while allowing for fluctuations in fuel prices.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was competed under Simplified Acquisition Procedures (SAP), indicating a competitive process for awards under the federal micro-purchase and small purchase thresholds. While the specific number of bids received is not detailed, the SAP framework generally encourages multiple offers. This level of competition is expected to yield fair market pricing for the required propane services.

Taxpayer Impact: Taxpayers benefit from a competitive process that aims to secure propane at a reasonable cost for essential operations at the Pine Ridge Agency.

Public Impact

The primary beneficiaries are the residents and operations of the Bureau of Indian Affairs (BIA) at the Pine Ridge Agency, ensuring access to heating and essential services. The service delivered is the purchase and delivery of propane, a critical fuel source for heating and other operational needs. The geographic impact is localized to Pine Ridge, South Dakota, directly supporting a specific federal facility. Workforce implications are minimal, primarily related to the delivery personnel employed by the contractor.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for price volatility due to economic price adjustment clause.
Dependence on a single contractor for a critical utility.

Positive Signals

Awarded through a competitive process, suggesting fair pricing.
Clear scope of work for propane purchase and delivery.
Defined delivery location and period of performance.

Sector Analysis

This contract falls within the energy sector, specifically the distribution and supply of petroleum products. The market for propane is influenced by regional supply and demand, transportation costs, and global energy prices. Federal agencies often procure such essential utilities through competitive bidding to ensure cost-effectiveness, with contracts typically ranging from small purchases for localized needs to larger agreements for widespread distribution.

Small Business Impact

This contract was not specifically set aside for small businesses, nor is there information indicating significant subcontracting opportunities for small businesses. The award to Red River Resources LLC does not appear to directly impact the broader small business ecosystem beyond the direct provision of services by the prime contractor.

Oversight & Accountability

Oversight for this contract would typically reside with the contracting officer and program managers within the Bureau of Indian Affairs. Standard procurement regulations and contract administration processes are expected to be followed. Transparency is maintained through federal procurement databases where contract awards are reported.

Related Government Programs

Bureau of Indian Affairs Operations
Federal Energy Procurement
Propane Supply Contracts
Department of the Interior Contracts

Risk Flags

Economic Price Adjustment Clause
Potential for Supply Chain Disruption

Frequently Asked Questions

What is this federal contract paying for?

Department of the Interior awarded $261,246.66 to RED RIVER RESOURCES LLC. PROPANE PURCHASE & DELIVERY FOR THE BUREAU OF INDIAN AFFAIRS, PINE RIDGE AGENCY IN PINE RIDGE, SD.

Who is the contractor on this award?

The obligated recipient is RED RIVER RESOURCES LLC.

Which agency awarded this contract?

Awarding agency: Department of the Interior (Bureau of Indian Affairs and Bureau of Indian Education).

What is the total obligated amount?

The obligated amount is $261,246.66.

What is the period of performance?

Start: 2023-09-15. End: 2024-09-30.

What is the historical spending pattern for propane at the Pine Ridge Agency?

Historical spending data for propane at the Pine Ridge Agency is not directly available in the provided data. However, the current award of $261,246.66 for a 381-day period (approximately 13 months) suggests an average annual expenditure in this range for propane supply and delivery. To assess historical patterns, one would need to examine past contracts awarded to this or other vendors for similar services at this specific location. Analyzing trends in contract values, quantities procured, and pricing over several years would reveal if current spending is consistent with past expenditures or if there have been significant increases or decreases, potentially influenced by market conditions or changes in agency operational needs.

How does the price per unit of propane in this contract compare to market rates?

The provided data does not include the specific quantity of propane to be delivered, making a direct per-unit cost comparison difficult. The contract value is $261,246.66 for a duration of 381 days. To benchmark the price per unit, we would need to know the estimated volume (e.g., gallons or metric tons) of propane to be purchased. Without this information, we can only infer that the total cost is considered fair based on the 'good' value rating and the fact it was competed. A proper comparison would involve dividing the total contract value by the estimated volume and comparing that figure to average wholesale or retail propane prices in the Pine Ridge, South Dakota region during the contract period, adjusted for delivery and service fees.

What is Red River Resources LLC's track record with federal contracts?

Information regarding Red River Resources LLC's specific track record with federal contracts is not detailed in the provided data snippet. The award indicates they are a current federal contractor. To assess their track record, one would typically review their past performance on similar contracts, including on-time delivery, quality of service, and any history of disputes or contract terminations. Databases like the Federal Procurement Data System (FPDS) or the Contractor Performance Assessment Reporting System (CPARS) would offer insights into their performance history, number of awards, and agency clients. A positive track record would increase confidence in their ability to fulfill this current contract effectively.

What are the potential risks associated with this propane contract?

The primary risks associated with this propane contract are related to price volatility and supply chain disruptions. The contract includes an 'Economic Price Adjustment' clause, which means the price can change based on market fluctuations in the cost of propane. While this protects the contractor from significant losses due to price increases, it introduces uncertainty for the government regarding the final cost. Additionally, as with any fuel supply contract, there's a risk of unforeseen events (e.g., extreme weather, transportation issues, or supplier shortages) that could disrupt delivery and impact the agency's operations, particularly during critical heating periods.

How does this contract align with the Bureau of Indian Affairs' mission?

This contract directly aligns with the Bureau of Indian Affairs' (BIA) mission to enhance the quality of life, promote economic opportunity, and carry out the responsibility to protect and improve the trust assets of federally recognized American Indian and Alaska Native tribes. By ensuring a reliable supply of propane for heating and essential services at the Pine Ridge Agency, the BIA can maintain safe and functional facilities, support the well-being of its staff and the community it serves, and continue its operational programs without interruption. Access to essential utilities like heating fuel is fundamental to fulfilling the BIA's mandate.

Industry Classification

NAICS: Manufacturing › Petroleum and Coal Products Manufacturing › Petroleum Refineries

Product/Service Code: CHEMICALS AND CHEMICAL PRODUCTS

Competition & Pricing

Extent Competed: COMPETED UNDER SAP

Solicitation Procedures: SIMPLIFIED ACQUISITION

Solicitation ID: 140A0123Q0057

Offers Received: 2

Pricing Type: FIXED PRICE WITH ECONOMIC PRICE ADJUSTMENT (K)

Evaluated Preference: NONE

Contractor Details

Address: 10805 RANCHO BERNARDO RD, SAN DIEGO, CA, 92127

Business Categories: 8(a) Program Participant, American Indian Owned Business, Category Business, Corporate Entity Not Tax Exempt, Economically Disadvantaged Women Owned Small Business, Limited Liability Corporation, Minority Owned Business, Native American Owned Business, Self-Certified Small Disadvantaged Business, Small Business, Special Designations, U.S.-Owned Business, Woman Owned Business, Women Owned Small Business

Financial Breakdown

Contract Ceiling: $261,247

Exercised Options: $261,247

Current Obligation: $261,247

Actual Outlays: $261,247

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Timeline