VA Spends $192,820 on Natural Gas for Sheridan VA Health Care System

Contract Overview

Contract Amount: $192,821 ($192.8K)

Contractor: MDU Resources Group, Inc.

Awarding Agency: Department of Veterans Affairs

Start Date: 2019-10-01

End Date: 2020-09-30

Contract Duration: 365 days

Daily Burn Rate: $528/day

Competition Type: NOT AVAILABLE FOR COMPETITION

Pricing Type: FIRM FIXED PRICE

Sector: Energy

Official Description: NATURAL GAS UTILITY SERVICE FOR SHERIDAN, WY VA HEALTH CARE SYSTEM.

Place of Performance

Location: SHERIDAN, SHERIDAN County, WYOMING, 82801

State: Wyoming Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $192,820.7 to MDU RESOURCES GROUP, INC. for work described as: NATURAL GAS UTILITY SERVICE FOR SHERIDAN, WY VA HEALTH CARE SYSTEM. Key points: 1. Spending focused on essential utility services for a specific VA facility. 2. Limited competition due to the nature of utility services. 3. Risk of price volatility in natural gas markets. 4. Sector is energy, specifically natural gas supply.

Value Assessment

Rating: fair

The contract value of $192,820 for a one-year period appears reasonable for utility services. Benchmarking against similar utility contracts for healthcare facilities of comparable size would provide a more precise assessment.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

The contract was not available for competition, likely due to the nature of utility service provision requiring proximity and existing infrastructure. This limits price discovery and negotiation opportunities.

Taxpayer Impact: Taxpayer funds are used to ensure essential services for veterans are maintained, with potential for higher costs due to limited competition.

Public Impact

Ensures continuous operation of the Sheridan VA Health Care System. Supports veteran healthcare services by providing necessary utilities. Potential for price fluctuations impacting budget predictability.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Limited competition
Price volatility risk

Positive Signals

Essential service provision
Dedicated facility support

Sector Analysis

This contract falls within the energy sector, specifically natural gas utility services. Spending benchmarks for utility services can vary significantly based on facility size, location, and consumption patterns.

Small Business Impact

There is no indication that small businesses were involved in this contract, as it was not available for competition and the awardee is a large corporation.

Oversight & Accountability

Oversight would involve ensuring the utility service meets quality standards and that billing is accurate. Accountability rests with the Department of Veterans Affairs to manage the contract effectively.

Related Government Programs

Fossil Fuel Electric Power Generation
Department of Veterans Affairs Contracting
Department of Veterans Affairs Programs

Risk Flags

Limited competition
Price volatility
Potential for cost overruns
Lack of transparency in pricing

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $192,820.7 to MDU RESOURCES GROUP, INC.. NATURAL GAS UTILITY SERVICE FOR SHERIDAN, WY VA HEALTH CARE SYSTEM.

Who is the contractor on this award?

The obligated recipient is MDU RESOURCES GROUP, 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 $192,820.7.

What is the period of performance?

Start: 2019-10-01. End: 2020-09-30.

What is the historical pricing trend for natural gas in Wyoming?

Analyzing historical natural gas pricing trends in Wyoming is crucial for understanding the potential for cost savings or overspending in future contracts. Factors like regional supply, demand, weather patterns, and regulatory changes significantly influence these prices. A detailed trend analysis would inform negotiation strategies and budget forecasting for the VA.

What are the risks associated with a sole-source or limited competition utility contract?

Sole-source or limited competition utility contracts carry risks of inflated pricing due to lack of competitive pressure, potential for service quality degradation if the provider faces no market incentive to improve, and reduced innovation. It also limits the government's ability to leverage market competition for better terms and value.

How does this spending align with the VA's overall energy procurement strategy?

This spending represents a localized, essential utility procurement for a specific facility. Its alignment with the VA's broader energy strategy would depend on whether the VA prioritizes renewable energy sources, long-term fixed-price contracts, or energy efficiency initiatives across its network. This single contract's impact on the overall strategy is likely minimal but contributes to operational continuity.

Industry Classification

NAICS: Utilities › Electric Power Generation, Transmission and Distribution › Fossil Fuel Electric Power Generation

Product/Service Code: UTILITIES AND HOUSEKEEPING › UTILITIES

Competition & Pricing

Extent Competed: NOT AVAILABLE FOR COMPETITION

Solicitation Procedures: ONLY ONE SOURCE

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 1200 W CENTURY AVE, BISMARCK, ND, 58503

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

Financial Breakdown

Contract Ceiling: $3,520,277

Exercised Options: $192,821

Current Obligation: $192,821

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: GS00P15BSD1169

IDV Type: IDC

Timeline