VA awards $149K for water chiller support, raising questions on competition and value

Contract Overview

Contract Amount: $149,348 ($149.3K)

Contractor: THE Filtrine Manufacturing Company, Inc.

Awarding Agency: Department of Veterans Affairs

Start Date: 2022-08-07

End Date: 2027-08-06

Contract Duration: 1,825 days

Daily Burn Rate: $82/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: FULL-SERVICE SUPPORT FOR OUR FILTRINE MODEL #SMS-500G-60A-WP-QCP-1-AS CHILLING

Place of Performance

Location: DALLAS, DALLAS County, TEXAS, 75216

State: Texas Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $149,348 to THE FILTRINE MANUFACTURING COMPANY, INC. for work described as: FULL-SERVICE SUPPORT FOR OUR FILTRINE MODEL #SMS-500G-60A-WP-QCP-1-AS CHILLING Key points: 1. Limited competition raises concerns about potential overpayment and lack of market-driven pricing. 2. The contract's duration of five years may exceed the typical need for such equipment maintenance. 3. Sole-source award suggests a lack of proactive market research or a failure to identify alternatives. 4. The fixed-price contract type offers some cost certainty but doesn't mitigate initial pricing concerns. 5. Performance is tied to a specific model, potentially limiting flexibility and future upgrade options. 6. Geographic focus on Texas for this specific equipment support.

Value Assessment

Rating: questionable

The contract value of $149,348 for five years of support for a single water chiller model appears high, especially given the lack of competition. Without comparable contract data or market benchmarks for this specific equipment and service, it's difficult to definitively assess value. However, the sole-source nature suggests the VA may not have explored more cost-effective options or negotiated a more competitive price. The price per year is approximately $29,870, which warrants further investigation into what services are included.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning only one vendor, The Filtrine Manufacturing Company, Inc., was solicited. This significantly limits price discovery and suggests that the VA either did not conduct adequate market research to identify potential competitors or determined that only this specific vendor could provide the required services. The lack of competition prevents the government from leveraging market forces to obtain the best possible price and terms.

Taxpayer Impact: Taxpayers may have paid a premium due to the absence of competitive bidding. Without exploring alternative suppliers or service providers, the government misses opportunities to secure lower prices and potentially better service agreements.

Public Impact

Veterans in Texas will benefit from reliable access to chilled water, crucial for comfort and potentially for medical equipment. The contract ensures the continued operation of a specific Filtrine Model #SMS-500G-60A-WP-QCP-1-AS water chilling unit. Services are geographically focused within Texas, supporting a specific VA facility. The contract supports the maintenance and repair workforce employed by The Filtrine Manufacturing Company, Inc.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits price competition and may lead to higher costs for taxpayers.
Long contract duration (5 years) for equipment support could be excessive and lock the government into a potentially suboptimal arrangement.
Lack of transparency regarding the justification for a sole-source award.
Potential for vendor lock-in with a specific equipment model and manufacturer.
No indication of performance metrics or service level agreements within the provided data.

Positive Signals

The contract ensures the continued functionality of essential equipment for the VA.
Firm Fixed Price contract type provides cost predictability for the awarded amount.
The vendor is the original manufacturer, potentially offering specialized knowledge for repairs.
The contract is for a specific, identified need related to facility operations.

Sector Analysis

This contract falls within the industrial machinery and equipment repair and maintenance sector. The market for specialized industrial equipment support can be niche, with original equipment manufacturers (OEMs) often holding significant leverage, particularly for proprietary systems. While the broader market for HVAC and industrial equipment maintenance is competitive, contracts for specific, older, or proprietary models can sometimes lead to limited competition, especially if the OEM is the only entity with the necessary parts and expertise. Benchmarking spending in this area is challenging without more specific details on the equipment's function and criticality.

Small Business Impact

This contract was not awarded to a small business, nor does the data indicate any specific small business subcontracting requirements. The sole-source nature of the award further reduces the likelihood of small business participation through subcontracting opportunities. This award does not appear to actively support the small business ecosystem.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of Veterans Affairs' contracting officers and program managers. The Inspector General's office may review contracts, particularly those with sole-source justifications or significant dollar values, to ensure compliance and prevent waste, fraud, and abuse. Transparency is limited by the sole-source award and the lack of publicly available detailed justifications or performance reports.

Related Government Programs

VA Facility Maintenance Contracts
Industrial Equipment Repair Services
Commercial Chiller Maintenance
Government Purchase Orders
Sole-Source Service Contracts

Risk Flags

Sole-source award lacks competition
Potential for inflated pricing due to lack of competition
Long contract duration may not be optimal
Lack of transparency regarding justification for sole-source
No clear performance metrics provided

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $149,348 to THE FILTRINE MANUFACTURING COMPANY, INC.. FULL-SERVICE SUPPORT FOR OUR FILTRINE MODEL #SMS-500G-60A-WP-QCP-1-AS CHILLING

Who is the contractor on this award?

The obligated recipient is THE FILTRINE MANUFACTURING COMPANY, 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 $149,348.

What is the period of performance?

Start: 2022-08-07. End: 2027-08-06.

What is the specific function and criticality of the Filtrine Model #SMS-500G-60A-WP-QCP-1-AS water chiller at the VA facility?

The provided data does not specify the exact function or criticality of the Filtrine Model #SMS-500G-60A-WP-QCP-1-AS water chiller. However, water chillers are typically used for cooling purposes in commercial and industrial settings. In a VA facility, this could range from providing chilled water for HVAC systems to support sensitive medical equipment that requires precise temperature control. Understanding its role is crucial for assessing the impact of potential downtime and justifying the contract's necessity and duration. Without this context, the $149,348 expenditure over five years is difficult to fully evaluate in terms of its essentiality to patient care or facility operations.

What market research was conducted to justify the sole-source award for this water chiller support?

The provided data indicates the contract was 'NOT COMPETED' and was a 'SOLE SOURCE'. This implies that the Department of Veterans Affairs (VA) did not solicit bids from multiple vendors. Standard government procurement regulations require agencies to conduct market research to determine if competitive sources exist before awarding a sole-source contract. The justification for this sole-source award is not detailed in the provided data. Typically, such justifications would cite reasons like the unique capabilities of the contractor, the unavailability of the item from other sources, or urgent and compelling needs where competition is not feasible. Without access to the VA's market research documentation, it's impossible to verify if adequate efforts were made to find competitive alternatives or if the sole-source determination was fully warranted.

Are there any performance metrics or service level agreements (SLAs) associated with this contract?

The provided data does not include information on specific performance metrics or service level agreements (SLAs) for this contract. While the contract type is 'FIRM FIXED PRICE', which sets the cost, it doesn't inherently detail the expected quality or timeliness of the support services. Effective oversight would typically involve defined SLAs, such as response times for service calls, repair completion times, and equipment uptime guarantees. The absence of this information in the summary data makes it challenging to assess the contractor's performance objectively and ensure the VA is receiving adequate value for the funds expended over the five-year period.

How does the annual cost of this contract compare to industry benchmarks for similar equipment maintenance?

The annual cost for this contract is approximately $29,870 ($149,348 / 5 years). Benchmarking this figure against industry standards for maintaining a specific model of industrial water chiller is challenging without more detailed information about the equipment's specifications, age, condition, and the scope of services included (e.g., preventative maintenance, emergency repairs, parts coverage). However, given the sole-source nature of the award, there is a heightened risk that this annual cost may be higher than what could be achieved through a competitive bidding process. Industry benchmarks for large commercial chiller maintenance can vary widely, but costs often range from 5% to 15% of the equipment's replacement value annually for comprehensive service contracts. Without knowing the replacement value or specific service inclusions, a direct comparison is speculative.

What is the track record of The Filtrine Manufacturing Company, Inc. in fulfilling government contracts?

The provided data indicates that The Filtrine Manufacturing Company, Inc. was awarded this specific purchase order. Beyond this single data point, the summary does not offer information on the company's broader track record with government contracts, including past performance ratings, history of contract awards, or any instances of disputes or terminations. A comprehensive assessment of the contractor's reliability and past performance would require accessing databases like the Federal Awardee Performance and Integrity Information System (FAPIIS) or other government performance repositories. This information is crucial for understanding the risk associated with awarding a five-year sole-source contract.

Industry Classification

NAICS: Other Services (except Public Administration) › Commercial and Industrial Machinery and Equipment (except Automotive and Electronic) Repair and Maintenance › Commercial and Industrial Machinery and Equipment (except Automotive and Electronic) Repair and Maintenance

Product/Service Code: MAINT, REPAIR, REBUILD EQUIPMENT › MAINT, REPAIR, REBUILD OF EQUIPMENT

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 15 KIT ST, KEENE, NH, 03431

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

Financial Breakdown

Contract Ceiling: $149,348

Exercised Options: $149,348

Current Obligation: $149,348

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Timeline