GSA's $3.7M switchgear replacement contract for FTC building raises concerns over code compliance and lifecycle costs

Contract Overview

Contract Amount: $3,697,908 ($3.7M)

Contractor: Huang's Inc.

Awarding Agency: General Services Administration

Start Date: 2023-06-13

End Date: 2026-11-23

Contract Duration: 1,259 days

Daily Burn Rate: $2.9K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: FTC BUILDING SWITCHGEAR IN ROOM B24 DOES NOT MEET CURRENT NATIONAL ELECTRICAL CODE (NFPA70) REQUIREMENTS AND ITS LIFE CYCLE USAGE TO BE COMPLIANT WITH THE NFPA70, EXISTING SWITCHGEAR MUST BE REPLACED WITH NEW SWITCHGEAR THAT MEETS THESE REQUIREMENTS.

Place of Performance

Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20580

State: District of Columbia Government Spending

Plain-Language Summary

General Services Administration obligated $3.7 million to HUANG'S INC. for work described as: FTC BUILDING SWITCHGEAR IN ROOM B24 DOES NOT MEET CURRENT NATIONAL ELECTRICAL CODE (NFPA70) REQUIREMENTS AND ITS LIFE CYCLE USAGE TO BE COMPLIANT WITH THE NFPA70, EXISTING SWITCHGEAR MUST BE REPLACED WITH NEW SWITCHGEAR THAT MEETS THESE REQUIREMENTS. Key points: 1. The contract addresses a critical safety and operational issue, replacing non-compliant switchgear. 2. The chosen solution aims to meet current National Electrical Code (NFPA70) standards. 3. The firm-fixed-price structure provides cost certainty for the government. 4. The duration of the contract suggests a significant scope of work. 5. The procurement method, while aiming for competition, warrants scrutiny for potential limitations. 6. The project's success hinges on effective execution and adherence to electrical safety standards.

Value Assessment

Rating: fair

The contract value of $3.7 million for switchgear replacement appears substantial, but a direct comparison to similar projects is difficult without more detailed specifications of the work. The firm-fixed-price nature of the contract helps manage cost overruns. However, the underlying issue of non-compliance suggests potential prior oversight gaps or evolving standards that may have impacted the initial installation or maintenance, leading to this necessary, albeit costly, replacement.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

The contract was awarded under 'Full and Open Competition After Exclusion of Sources,' which suggests that while competition was sought, certain sources may have been excluded for specific reasons. The record indicates only one awardee, Huang's Inc. This limited competition could potentially impact price discovery and may not represent the most cost-effective solution available in the market. Further details on the exclusion rationale are needed to fully assess the competitive landscape.

Taxpayer Impact: A limited competition may result in higher costs for taxpayers if a broader range of qualified vendors were not considered or able to participate, potentially missing out on more competitive pricing.

Public Impact

The primary beneficiaries are the Federal Trade Commission (FTC) staff and visitors who will occupy a building with compliant and safe electrical infrastructure. The services delivered include the replacement of critical electrical switchgear, ensuring operational continuity and safety. The geographic impact is localized to the specific FTC building located in the District of Columbia. The project will likely involve skilled tradespeople and electricians, potentially creating short-term employment opportunities in the construction sector.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

The 'Exclusion of Sources' in the competition method raises questions about whether the most competitive pricing was achieved.
The need for replacement due to non-compliance with current electrical codes suggests potential issues with initial installation, maintenance, or evolving standards.
The significant contract value warrants close monitoring to ensure the work is performed efficiently and effectively.

Positive Signals

The contract addresses a critical infrastructure need, ensuring the safety and operational integrity of the FTC facility.
The firm-fixed-price contract provides cost certainty for the government.
The project aims to bring the building's electrical systems up to current national safety standards (NFPA70).

Sector Analysis

The contract falls within the Commercial and Institutional Building Construction sector, specifically related to electrical infrastructure upgrades. This sector is characterized by a wide range of projects from minor repairs to major new constructions. The market for electrical contracting services is competitive, with numerous firms capable of performing such work. Benchmarking this specific contract's value would require detailed project scope, but it represents a significant investment in maintaining federal building infrastructure.

Small Business Impact

The contract details indicate that small business participation was not a specific set-aside (ss: false, sb: false). This suggests that the primary award was not targeted towards small businesses. There is no explicit information on subcontracting plans for small businesses. The impact on the small business ecosystem is likely minimal unless Huang's Inc. voluntarily engages small businesses for specialized services or materials.

Oversight & Accountability

Oversight for this contract is likely managed by the General Services Administration (GSA), specifically the Public Buildings Service, which is responsible for federal building management. Accountability measures are typically embedded in the contract terms, including performance standards and payment schedules tied to milestones. Transparency is facilitated through contract databases like FPDS. Inspector General jurisdiction would apply if any fraud, waste, or abuse is suspected.

Related Government Programs

Federal Building Maintenance and Repair
Electrical Infrastructure Upgrades
National Electrical Code Compliance Projects
General Services Administration Capital Investments

Risk Flags

Non-compliance with current electrical codes identified.
Limited competition in procurement process.
Significant contract value for infrastructure replacement.

Frequently Asked Questions

What is this federal contract paying for?

General Services Administration awarded $3.7 million to HUANG'S INC.. FTC BUILDING SWITCHGEAR IN ROOM B24 DOES NOT MEET CURRENT NATIONAL ELECTRICAL CODE (NFPA70) REQUIREMENTS AND ITS LIFE CYCLE USAGE TO BE COMPLIANT WITH THE NFPA70, EXISTING SWITCHGEAR MUST BE REPLACED WITH NEW SWITCHGEAR THAT MEETS THESE REQUIREMENTS.

Who is the contractor on this award?

The obligated recipient is HUANG'S INC..

Which agency awarded this contract?

Awarding agency: General Services Administration (Public Buildings Service).

What is the total obligated amount?

The obligated amount is $3.7 million.

What is the period of performance?

Start: 2023-06-13. End: 2026-11-23.

What specific issues led to the switchgear not meeting current National Electrical Code (NFPA70) requirements?

The provided data indicates that the existing switchgear 'DOES NOT MEET CURRENT NATIONAL ELECTRICAL CODE (NFPA70) REQUIREMENTS AND ITS LIFE CYCLE USAGE TO BE COMPLIANT WITH THE NFPA70, EXISTING SWITCHGEAR MUST BE REPLACED WITH NEW SWITCHGEAR THAT MEETS THESE REQUIREMENTS.' This suggests that either the original installation did not comply with the code in effect at that time, or more likely, that the code has been updated since the switchgear was installed, rendering the existing equipment non-compliant with current safety and operational standards. The exact nature of the non-compliance (e.g., capacity, safety features, grounding) is not detailed in the provided summary but necessitates a full replacement to ensure safety and operational integrity.

How does the $3.7 million cost compare to similar switchgear replacement projects in federal buildings?

A direct cost comparison for this $3.7 million contract is challenging without detailed project specifications, such as the size of the building, the complexity of the electrical system, the specific type and capacity of the switchgear being replaced, and the labor costs in the Washington D.C. area. However, major electrical infrastructure upgrades in large commercial or institutional buildings can range from hundreds of thousands to several million dollars. Given that this is for a Federal Trade Commission building, which likely houses significant operations and sensitive equipment, a multi-million dollar cost for a complete switchgear replacement to meet current code is plausible, though it warrants scrutiny for value.

What are the potential risks associated with replacing electrical switchgear in an occupied federal building?

Replacing electrical switchgear in an occupied building carries several risks. The primary risk is service interruption, which could disrupt critical operations within the FTC. Ensuring continuous power or managing planned outages effectively is paramount. There's also a risk of safety incidents during installation if proper protocols are not strictly followed, potentially endangering workers and building occupants. Furthermore, unforeseen issues within the existing electrical infrastructure could be uncovered during the replacement, leading to scope creep and cost increases, despite the firm-fixed-price contract. Coordination with building management and occupants is crucial to mitigate these risks.

What is the track record of Huang's Inc. in performing similar federal construction or electrical upgrade contracts?

Information regarding the specific track record of Huang's Inc. for similar federal construction or electrical upgrade contracts is not provided in the data summary. To assess their capability and past performance, one would typically review their contract history, including past performance evaluations, any reported disputes or claims, and the types and values of previous government contracts they have successfully completed. A thorough review would involve checking databases like the Federal Procurement Data System (FPDS) and potentially seeking past performance information from the contracting agency (GSA) to gauge their reliability and expertise in executing projects of this nature and scale.

How does the 'Full and Open Competition After Exclusion of Sources' procurement method impact the government's ability to secure the best value?

The 'Full and Open Competition After Exclusion of Sources' method is a variation of full and open competition where, after initial solicitation, certain sources are excluded. This can happen for various reasons, such as the need for specialized capabilities or security clearances. While it aims to maintain a competitive environment, excluding sources inherently limits the pool of potential bidders. If the exclusions are not well-justified or if they inadvertently remove highly capable and competitive firms, it could lead to less robust price competition and potentially a higher overall cost for the government, thereby impacting the ability to secure the absolute best value compared to unrestricted full and open competition.

What are the long-term implications of ensuring NFPA70 compliance for the FTC building's electrical system?

Ensuring NFPA70 compliance through this $3.7 million contract has significant long-term implications. Primarily, it enhances the safety of building occupants and reduces the risk of electrical fires or failures. It also improves the reliability and operational efficiency of the electrical system, minimizing downtime and associated costs. Compliance ensures the building meets modern standards, potentially reducing future upgrade requirements related to code changes for a period. Furthermore, it mitigates liability for the government and ensures the building's infrastructure is sound for its intended lifespan, supporting the FTC's mission without electrical system disruptions.

Industry Classification

NAICS: Construction › Nonresidential Building Construction › Commercial and Institutional Building Construction

Product/Service Code: MAINT, REPAIR, ALTER REAL PROPERTY › MAINT, ALTER, REPAIR NONBUILDINGS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: 47PM0323R0013

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 5601N GENERAL WASHINGTON DR, ALEXANDRIA, VA, 22312

Business Categories: 8(a) Program Participant, Asian Pacific American Owned Business, Category Business, Corporate Entity Not Tax Exempt, DoT Certified Disadvantaged Business Enterprise, Economically Disadvantaged Women Owned Small Business, Minority Owned Business, Self-Certified Small Disadvantaged Business, Small Business, Special Designations, Subchapter S Corporation, U.S.-Owned Business, Woman Owned Business, Women Owned Small Business

Financial Breakdown

Contract Ceiling: $3,697,908

Exercised Options: $3,697,908

Current Obligation: $3,697,908

Subaward Activity

Number of Subawards: 1

Total Subaward Amount: $2,553,101

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: 47PM0518D0023

IDV Type: IDC

Timeline