VA awards $3.86M for Hospital Linen Services to Economy Linen & Towel Service of Zanesville, Inc

Contract Overview

Contract Amount: $3,860,595 ($3.9M)

Contractor: Economy Linen & Towel Service of Zanesville, Inc

Awarding Agency: Department of Veterans Affairs

Start Date: 2022-04-01

End Date: 2026-09-30

Contract Duration: 1,643 days

Daily Burn Rate: $2.4K/day

Competition Type: COMPETED UNDER SAP

Number of Offers Received: 2

Pricing Type: FIRM FIXED PRICE

Sector: Healthcare

Official Description: HOSPITAL LINEN SERVICES

Place of Performance

Location: CINCINNATI, HAMILTON County, OHIO, 45220

State: Ohio Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $3.9 million to ECONOMY LINEN & TOWEL SERVICE OF ZANESVILLE, INC for work described as: HOSPITAL LINEN SERVICES Key points: 1. Contract awarded to a single vendor for linen services. 2. The contract is for a duration of over 4 years. 3. The Department of Veterans Affairs is the contracting agency. 4. The North American Industry Classification System (NAICS) code is 812331.

Value Assessment

Rating: fair

The contract's firm fixed price structure provides cost certainty. However, without detailed cost breakdowns or benchmarks, assessing the value for money is challenging.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

The contract was competed under Simplified Acquisition Procedures (SAP), suggesting limited competition. This method may not always yield the most competitive pricing.

Taxpayer Impact: The total value of $3.86 million represents a significant taxpayer investment for essential hospital services.

Public Impact

Ensures essential laundry and linen services for veterans' healthcare facilities. Supports a local business in Zanesville, Ohio. Potential for price increases over the contract's 4-year duration.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Limited competition due to SAP.
Long contract duration may lead to price escalation.
Lack of detailed cost analysis for value assessment.

Positive Signals

Provides essential services to veterans.
Supports a small business (assuming Economy Linen & Towel Service qualifies).

Sector Analysis

The healthcare support sector, including linen services, is crucial for hospital operations. Spending benchmarks for such services can vary widely based on facility size and service scope.

Small Business Impact

The contract was awarded to Economy Linen & Towel Service of Zanesville, Inc. Further analysis is needed to confirm if this company qualifies as a small business and the extent of its role.

Oversight & Accountability

The award was made via a Purchase Order under SAP, which typically involves less stringent oversight than larger, more complex contracts. Accountability relies on performance monitoring by the VA.

Related Government Programs

Linen Supply
Department of Veterans Affairs Contracting
Department of Veterans Affairs Programs

Risk Flags

Limited competition
Potential for price escalation
Lack of detailed cost analysis
Long contract duration

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $3.9 million to ECONOMY LINEN & TOWEL SERVICE OF ZANESVILLE, INC. HOSPITAL LINEN SERVICES

Who is the contractor on this award?

The obligated recipient is ECONOMY LINEN & TOWEL SERVICE OF ZANESVILLE, INC.

Which agency awarded this contract?

Awarding agency: Department of Veterans Affairs (Department of Veterans Affairs).

What is the total obligated amount?

The obligated amount is $3.9 million.

What is the period of performance?

Start: 2022-04-01. End: 2026-09-30.

What is the typical cost per patient day for hospital linen services to benchmark this contract's value?

Benchmarking hospital linen service costs per patient day is complex, as it depends on factors like facility type (e.g., general hospital, long-term care), patient acuity, and the specific services included (e.g., uniforms, specialized linens). Industry averages can range from $5 to $20 per patient day, but a precise comparison requires detailed service scope and volume data.

What are the risks associated with a firm fixed-price contract for a service with potential for price fluctuations?

A firm fixed-price contract for services like linen can pose risks if input costs (e.g., water, energy, detergent, labor) increase significantly over the contract term. The vendor bears the risk of cost overruns, which could lead to reduced service quality if they attempt to cut corners, or potential requests for equitable adjustment if contract terms allow.

How effective is the Simplified Acquisition Procedure (SAP) in ensuring competitive pricing for essential services like hospital linens?

SAP is designed for efficiency and speed in acquiring goods and services below certain dollar thresholds. While it can be effective for routine purchases, it may limit the pool of potential bidders compared to full and open competition. This can potentially lead to less aggressive pricing, although the 'competed under SAP' notation suggests some level of competition was pursued.

Industry Classification

NAICS: Other Services (except Public Administration) › Drycleaning and Laundry Services › Linen Supply

Product/Service Code: UTILITIES AND HOUSEKEEPING › HOUSEKEEPING SERVICES

Competition & Pricing

Extent Competed: COMPETED UNDER SAP

Solicitation Procedures: SIMPLIFIED ACQUISITION

Solicitation ID: 36C25022Q0355

Offers Received: 2

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Economy Linen & Towel Service of Zanesville Inc

Address: 508 HOWARD ST, ZANESVILLE, OH, 43701

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Manufacturer of Goods, Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $3,860,595

Exercised Options: $3,860,595

Current Obligation: $3,860,595

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Timeline