VA awards $153K for bulk oxygen to Air Products and Chemicals, Inc. in California

Contract Overview

Contract Amount: $153,675 ($153.7K)

Contractor: AIR Products and Chemicals, Inc

Awarding Agency: Department of Veterans Affairs

Start Date: 2026-04-01

End Date: 2027-03-31

Contract Duration: 364 days

Daily Burn Rate: $422/day

Competition Type: FULL AND OPEN COMPETITION

Pricing Type: FIRM FIXED PRICE

Sector: Healthcare

Official Description: BULK OXYGEN VA SAN DIEGO

Place of Performance

Location: SAN DIEGO, SAN DIEGO County, CALIFORNIA, 92161

State: California Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $153,674.59 to AIR PRODUCTS AND CHEMICALS, INC for work described as: BULK OXYGEN VA SAN DIEGO Key points: 1. Contract awarded through full and open competition, suggesting a competitive bidding process. 2. The contract duration is one year, aligning with typical supply needs for industrial gases. 3. The fixed-price contract type provides cost certainty for the government. 4. The award is a delivery order under a larger contract vehicle, indicating potential for future taskings. 5. The North American Industry Classification System (NAICS) code 325120 points to industrial gas manufacturing. 6. The contract is managed by the Department of Veterans Affairs, serving a critical healthcare need.

Value Assessment

Rating: good

The contract value of $153,674.59 for a one-year supply of bulk oxygen appears reasonable for a federal agency. Without specific volume requirements or detailed service level agreements, a direct comparison to similar contracts is challenging. However, the firm fixed-price structure suggests that the contractor has assumed the risk for cost fluctuations, which is generally favorable for the government. The award being a delivery order under a broader contract vehicle implies that pricing was likely established through a prior competitive process.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under a full and open competition, indicating that all responsible sources were permitted to submit bids. The specific number of bidders is not provided, but the designation suggests a robust competitive environment. This approach is designed to foster price discovery and ensure the government receives competitive pricing by allowing multiple vendors to vie for the contract.

Taxpayer Impact: A full and open competition generally benefits taxpayers by driving down costs through market forces. It ensures that the government is not limited to a single provider, which could lead to inflated prices.

Public Impact

Veterans in the San Diego area will benefit from a reliable supply of bulk oxygen, essential for medical treatments and procedures. The contract ensures the availability of critical medical gases for the VA San Diego healthcare system. The geographic impact is localized to the San Diego region, supporting local VA facilities. The contract supports the industrial gas manufacturing sector, specifically companies capable of supplying medical-grade oxygen.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of specific volume and unit pricing makes it difficult to assess true value for money.
The contract is a delivery order, meaning the full scope and potential future costs are not entirely defined within this single award.
No information provided on small business subcontracting, which could limit opportunities for smaller firms.

Positive Signals

Awarded through full and open competition, indicating a competitive pricing environment.
Firm fixed-price contract provides cost certainty for the government.
The contract supports essential healthcare services for veterans.

Sector Analysis

The industrial gas manufacturing sector is a mature industry characterized by significant capital investment and specialized production capabilities. Companies in this sector produce a range of gases, including oxygen, nitrogen, and argon, for various industrial, medical, and scientific applications. The market is often dominated by a few large global players, but regional suppliers also play a crucial role. Federal spending in this area typically supports healthcare facilities, research institutions, and defense operations. Benchmarks for bulk oxygen pricing can vary widely based on volume, purity, delivery method, and geographic location.

Small Business Impact

The data indicates that this contract was not set aside for small businesses (ss: false, sb: false). As a delivery order under a larger contract, it's possible that subcontracting opportunities for small businesses may exist within the prime contractor's overall agreement, but this specific award does not detail such provisions. The impact on the small business ecosystem is likely minimal for this particular contract, as it appears to be awarded to a larger, established industrial gas supplier.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of Veterans Affairs (VA) contracting officers and program managers. Accountability measures are inherent in the firm fixed-price contract type, requiring the contractor to deliver the specified goods within the agreed-upon terms. Transparency is facilitated by the public nature of federal contract awards, allowing for review of basic contract details. The VA has an Office of Inspector General that could investigate any potential fraud, waste, or abuse related to this or any other contract.

Related Government Programs

VA Medical Supplies Contracts
Federal Healthcare Procurement
Industrial Gas Supply Contracts
Department of Veterans Affairs Operations

Risk Flags

Potential for price increases if market conditions change significantly.
Dependence on the prime contract vehicle's terms and conditions.
Limited visibility into specific performance metrics and bidder numbers.

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $153,674.59 to AIR PRODUCTS AND CHEMICALS, INC. BULK OXYGEN VA SAN DIEGO

Who is the contractor on this award?

The obligated recipient is AIR PRODUCTS AND CHEMICALS, 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 $153,674.59.

What is the period of performance?

Start: 2026-04-01. End: 2027-03-31.

What is the historical spending pattern for bulk oxygen at VA San Diego?

To determine the historical spending pattern for bulk oxygen at VA San Diego, one would need to analyze past contract awards for this specific service and location. This would involve querying federal procurement databases (like FPDS or USASpending) for contracts with similar descriptions, NAICS codes (325120), and the specific agency and facility. Analyzing the award amounts, durations, and competition levels over several fiscal years would reveal trends in spending, identify any significant increases or decreases, and highlight changes in contracting strategies (e.g., shifts from sole-source to competitive awards). Without access to this historical data, it's impossible to provide a specific spending pattern. However, consistent awards suggest a sustained need for the service.

How does the awarded price compare to market rates for bulk oxygen in California?

Comparing the awarded price of $153,674.59 for a one-year supply of bulk oxygen to market rates in California requires detailed information on the specific volume, purity, delivery frequency, and contract terms (e.g., tank rental, maintenance). Bulk oxygen pricing is highly variable. Generally, larger volumes and longer-term commitments can lead to lower per-unit costs. Federal contracts often benefit from competitive bidding, which can drive prices down. However, specialized medical-grade oxygen and delivery to remote or specific facility requirements can incur premiums. To perform a true market comparison, one would need to obtain quotes from multiple industrial gas suppliers for a similar scope of service in the San Diego area and analyze the pricing structures.

What are the key performance indicators (KPIs) for this bulk oxygen contract?

Key performance indicators (KPIs) for a bulk oxygen supply contract typically focus on reliability, quality, and responsiveness. Essential KPIs would include: On-time delivery rate (ensuring oxygen is delivered as scheduled to prevent shortages), Purity levels (confirming the oxygen meets medical-grade specifications, e.g., USP standards), Equipment reliability (ensuring tanks and delivery systems are functional and safe), Response time for emergency deliveries or service calls, and Invoice accuracy. The contract documents would specify these KPIs and the associated remedies or penalties for non-performance. The VA would monitor these metrics to ensure the contractor meets its obligations.

What is the track record of Air Products and Chemicals, Inc. with the Department of Veterans Affairs?

Air Products and Chemicals, Inc. is a major global supplier of industrial gases, including medical oxygen, and likely has a significant history of contracting with various federal agencies, including the Department of Veterans Affairs (VA). To assess their specific track record with the VA, one would need to examine past contract awards to this company by the VA. This analysis would look at the types of goods and services provided, the total value of contracts awarded, the duration of these contracts, and importantly, any performance evaluations or past performance reviews. A history of successful contract completions, positive performance ratings, and minimal disputes would indicate a reliable track record. Conversely, a history of performance issues or contract disputes would raise concerns.

What are the risks associated with relying on a single delivery order for a critical supply like oxygen?

Relying on a single delivery order for a critical supply like oxygen presents several risks, even if awarded competitively. Firstly, the delivery order itself might not fully capture the long-term needs or potential price escalations over the contract period, which extends to March 2027. Secondly, if the prime contract vehicle under which this delivery order was issued has limitations or if the prime contractor faces financial instability or operational disruptions, it could impact the supply chain. Thirdly, while this specific order was competitively sourced, future needs might be fulfilled via other mechanisms that could be less competitive. The primary risk is ensuring continuity of supply and managing potential cost increases if market conditions change significantly and are not adequately addressed in the contract's pricing structure.

Industry Classification

NAICS: Manufacturing › Basic Chemical Manufacturing › Industrial Gas Manufacturing

Product/Service Code: CHEMICALS AND CHEMICAL PRODUCTS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 1940 AIR PRODUCTS BLVD, ALLENTOWN, PA, 18106

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

Financial Breakdown

Contract Ceiling: $153,675

Exercised Options: $153,675

Current Obligation: $153,675

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: 36C26222D0041

IDV Type: IDC

Timeline