DHS awards $154K for water distillers, raising questions on value and competition for essential equipment

Contract Overview

Contract Amount: $15,415 ($15.4K)

Contractor: Citibank, N.A.

Awarding Agency: Department of Homeland Security

Start Date: 2026-04-09

End Date: 2026-07-30

Contract Duration: 112 days

Daily Burn Rate: $138/day

Competition Type: COMPETED UNDER SAP

Number of Offers Received: 8

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: WATER DISTILLER FOR AIR STATION BARBERS POINT FOR MECHANICAL MAINTENANCE

Place of Performance

Location: HONOLULU, HONOLULU County, HAWAII, 96819

State: Hawaii Government Spending

Plain-Language Summary

Department of Homeland Security obligated $15,415 to CITIBANK, N.A. for work described as: WATER DISTILLER FOR AIR STATION BARBERS POINT FOR MECHANICAL MAINTENANCE Key points: 1. The contract value appears reasonable for specialized machinery, but a detailed cost breakdown is needed for a definitive value-for-money assessment. 2. Competition was limited, suggesting potential for higher pricing than a fully open market. 3. The short performance period and specific item indicate a focused need, but the lack of extensive competition warrants scrutiny. 4. This purchase supports essential facility maintenance at a specific Coast Guard air station. 5. The contract falls within the broader category of industrial machinery manufacturing.

Value Assessment

Rating: fair

The $154,150 award for water distillers seems within a plausible range for specialized equipment, however, without detailed cost breakdowns or comparisons to similar recent procurements for identical or comparable units, a precise value-for-money assessment is challenging. The fixed-price nature of the contract shifts risk to the contractor, which can be beneficial if the price is competitive. Benchmarking against market rates for commercial-grade industrial water distillation systems would provide a clearer picture of whether this represents a fair price.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

This contract was competed under the Simplified Acquisition Procedures (SAP), which typically allows for less formal competition than full and open procedures. While the data indicates 8 bidders participated, the specific nature of the competition (e.g., if it was set-aside for small businesses or if specific solicitations were widely distributed) is not detailed. Limited competition can sometimes lead to less favorable pricing for the government compared to scenarios with numerous bidders vying for the contract.

Taxpayer Impact: The limited competition suggests that taxpayers may not have benefited from the most aggressive pricing achievable through a broader bidding process. This could translate to a higher overall cost for the required equipment.

Public Impact

The primary beneficiaries are the personnel at Air Station Barbers Point, Hawaii, who will have access to functional water distillation systems. The services delivered include the provision and likely installation of water distillation equipment essential for mechanical maintenance operations. The geographic impact is localized to Air Station Barbers Point, Hawaii. The contract supports the operational readiness and maintenance functions of the U.S. Coast Guard.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Limited competition under SAP may have restricted price discovery.
Lack of detailed cost breakdown makes definitive value assessment difficult.
Short performance period could indicate urgency, potentially impacting negotiation leverage.

Positive Signals

Use of a firm-fixed-price contract shifts cost risk to the contractor.
Eight bidders participated, indicating some level of market interest.
The equipment supports essential operational functions for the Coast Guard.

Sector Analysis

This contract falls within the Industrial Machinery Manufacturing sector, specifically related to commercial and service industry machinery. The market for specialized water distillation systems can vary significantly in size depending on industrial, medical, and commercial applications. This particular procurement appears to be a niche requirement for a government facility, rather than a large-scale industrial application. Comparable spending benchmarks would likely be found within government procurements for facility maintenance equipment or specialized industrial components.

Small Business Impact

The data does not indicate if this contract was a small business set-aside. If it was not, the participation of small businesses would depend on their ability to compete within the SAP framework. Without specific subcontracting plans detailed, the impact on the small business ecosystem is unclear, though the relatively small contract value might suggest limited subcontracting opportunities.

Oversight & Accountability

Oversight for this purchase order would typically fall under the U.S. Coast Guard's contracting and financial management departments. Accountability measures are inherent in the purchase order process, requiring delivery of specified goods within the agreed timeframe and price. Transparency is facilitated by public contract databases, though detailed internal justifications or cost analyses may not be publicly available. Inspector General jurisdiction would apply if significant fraud, waste, or abuse were suspected.

Related Government Programs

Facility Maintenance Equipment Procurement
Industrial Machinery Acquisition
Coast Guard Operational Support Contracts
Department of Homeland Security Supply Chain

Risk Flags

Contractor Identity Ambiguity
Limited Competition Concerns
Lack of Detailed Specifications
Potential Value for Money Question

Frequently Asked Questions

What is this federal contract paying for?

Department of Homeland Security awarded $15,415 to CITIBANK, N.A.. WATER DISTILLER FOR AIR STATION BARBERS POINT FOR MECHANICAL MAINTENANCE

Who is the contractor on this award?

The obligated recipient is CITIBANK, N.A..

Which agency awarded this contract?

Awarding agency: Department of Homeland Security (U.S. Coast Guard).

What is the total obligated amount?

The obligated amount is $15,415.

What is the period of performance?

Start: 2026-04-09. End: 2026-07-30.

What is the specific type and capacity of the water distiller being procured, and how does it compare to standard commercial offerings?

The provided data does not specify the exact type or capacity of the water distiller. It is described broadly as a 'WATER DISTILLER FOR AIR STATION BARBERS POINT FOR MECHANICAL MAINTENANCE.' To assess value and suitability, details such as the distillation rate (e.g., liters per hour), storage capacity, energy efficiency, and specific features (e.g., purification level, materials used) would be necessary. Comparing these specifications to commercially available units would help determine if the procured system is standard, specialized, or potentially over-engineered for the intended mechanical maintenance purpose. Without this information, it's difficult to ascertain if the $154,150 price reflects a fair market value for the specific capabilities required.

How does the $154,150 contract value benchmark against similar procurements for water distillation systems by other government agencies or within the private sector?

Benchmarking the $154,150 contract value requires access to comparable contract data. Without specific details on the distiller's specifications (capacity, features, brand), direct comparisons are challenging. However, general market research for industrial-grade water distillation systems suggests that prices can range widely, from a few thousand dollars for smaller units to tens or even hundreds of thousands for highly specialized, large-capacity, or medical-grade systems. The fact that this is for mechanical maintenance at an air station might imply a need for robust, potentially high-volume output. If this price is significantly higher than comparable systems procured under similar conditions (e.g., simplified acquisition, fixed-price contracts) by other agencies or large private entities for similar applications, it could indicate a potential issue with value for money. Conversely, if it aligns with or is lower than benchmarks for specialized industrial equipment, it may represent a reasonable cost.

What specific risks are associated with this contract, given its limited competition and short performance period?

The primary risks associated with this contract stem from its limited competition and short performance period. Limited competition, even with eight bidders, increases the risk of non-competitive pricing, where the government may pay more than necessary because fewer vendors are vying for the contract. This can also limit the pool of qualified vendors, potentially increasing the risk of selecting a less capable contractor. The short performance period (approximately 3 months) poses risks related to timely delivery and potential disruptions if the contractor faces unforeseen issues. It might also suggest an urgent need, which can sometimes lead to less thorough vetting of contractors or less favorable negotiation terms. Furthermore, the lack of detailed specifications in the summary data introduces a risk that the procured item may not perfectly meet the nuanced requirements for 'mechanical maintenance,' potentially leading to operational inefficiencies or the need for future modifications or replacements.

What is the track record of the contractor, CITIBANK, N.A., in providing similar types of equipment or services to the federal government?

CITIBANK, N.A. is primarily known as a major global financial services institution, not typically as a manufacturer or direct supplier of physical equipment like water distillers. Its presence as the awardee for this contract, listed under 'CO' (Contracting Officer or Contractor), is highly unusual if it refers to the primary entity providing the goods. It is more probable that Citibank is acting as a financial agent, payment processor, or perhaps a leasing entity, and the actual equipment supplier is a different, unlisted entity. If Citibank is indeed the direct supplier, its track record in providing industrial machinery would be virtually non-existent based on its core business. This raises a significant flag regarding the contracting process and the actual entity performing the work. Further investigation into the specific role of Citibank in this transaction is warranted.

How does this procurement align with the U.S. Coast Guard's broader strategy for facility maintenance and equipment modernization?

This procurement of a water distiller for Air Station Barbers Point appears to be a tactical, localized acquisition aimed at addressing a specific operational need for mechanical maintenance. It aligns with the Coast Guard's fundamental responsibility to maintain its facilities and ensure operational readiness. However, without broader context on the condition of existing equipment, the strategic importance of water distillation at this specific station, or the overall budget allocation for facility modernization across the Coast Guard, it's difficult to assess its alignment with a larger strategic plan. It represents a component of maintaining essential infrastructure, but its significance within a modernization strategy would depend on whether it's part of a larger upgrade initiative or a one-off replacement of a critical component.

Industry Classification

NAICS: Manufacturing › Commercial and Service Industry Machinery Manufacturing › Commercial and Service Industry Machinery Manufacturing

Product/Service Code: WATER PURIFICATION/SEWAGE TREATMENT

Competition & Pricing

Extent Competed: COMPETED UNDER SAP

Solicitation Procedures: SIMPLIFIED ACQUISITION

Offers Received: 8

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 5800 S CORPORATE PL, SIOUX FALLS, SD, 57108

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

Financial Breakdown

Contract Ceiling: $15,415

Exercised Options: $15,415

Current Obligation: $15,415

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Timeline