HHS awards $36.75M for fire alarm and safety equipment inspection services to API Group Life Safety USA LLC

Contract Overview

Contract Amount: $36,750 ($36.8K)

Contractor: API Group Life Safety USA LLC

Awarding Agency: Department of Health and Human Services

Start Date: 2023-07-01

End Date: 2027-06-30

Contract Duration: 1,460 days

Daily Burn Rate: $25/day

Competition Type: COMPETED UNDER SAP

Number of Offers Received: 2

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: FIRE ALARM & SAFETY EQUIPMENT INSPECTION - UMUHC

Place of Performance

Location: TOWAOC, MONTEZUMA County, COLORADO, 81334

State: Colorado Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $36,750 to API GROUP LIFE SAFETY USA LLC for work described as: FIRE ALARM & SAFETY EQUIPMENT INSPECTION - UMUHC Key points: 1. The contract value of $36.75 million over four years suggests a significant investment in maintaining critical safety infrastructure. 2. The service falls under Security Systems Services, indicating a specialized niche within the broader facilities management sector. 3. The award was competed under Simplified Acquisition Procedures (SAP), suggesting a focus on smaller value procurements. 4. The contract type is Firm Fixed Price, which transfers risk to the contractor and provides cost certainty for the government. 5. The contractor, API Group Life Safety USA LLC, has been awarded this contract, implying a level of trust and capability. 6. The geographic location of service delivery is Colorado, as indicated by the state code 'CO'.

Value Assessment

Rating: good

The contract value of $36.75 million over approximately four years for fire alarm and safety equipment inspection services appears reasonable given the critical nature of the service and the specialized expertise required. Benchmarking against similar contracts for large-scale facility maintenance and safety inspections would provide a more precise value assessment. The firm fixed-price structure helps control costs for the government, assuming the scope of work is well-defined.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

This contract was competed under Simplified Acquisition Procedures (SAP), which typically involves a less formal bidding process than full and open competition. While the data indicates two bidders participated, the specific details of the solicitation and evaluation process are not provided. SAP is generally used for procurements under the micro-purchase threshold or for specific circumstances allowing for limited competition, which may not always yield the lowest possible price.

Taxpayer Impact: The use of SAP suggests that while competition was sought, it may not have been as robust as a full and open competition, potentially leading to a slightly higher cost for taxpayers than if a wider range of vendors had been involved.

Public Impact

The primary beneficiaries are the facilities and personnel within the Indian Health Service (IHS) facilities in Colorado, ensuring their safety through regular fire alarm and safety equipment inspections. The services delivered include the inspection, testing, and maintenance of fire alarm and safety systems, crucial for emergency preparedness and life safety. The geographic impact is concentrated in Colorado, where the IHS facilities requiring these services are located. This contract supports specialized technical jobs related to fire safety systems maintenance and inspection within the contractor's organization.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for increased costs if the scope of work under SAP was not fully detailed, leading to change orders.
Limited competition under SAP might mean taxpayers are not receiving the absolute best price available in the market.
Reliance on a single contractor for critical safety inspections could pose a risk if performance issues arise.

Positive Signals

Firm Fixed Price contract provides cost certainty and shifts risk to the contractor.
The contract duration of approximately four years allows for consistent service delivery and planning.
The service is essential for maintaining safety standards and compliance in healthcare facilities.

Sector Analysis

The fire alarm and safety equipment inspection market is a specialized segment within the broader facilities management and security services industry. This sector requires certified technicians and adherence to stringent regulatory standards. Government spending in this area is driven by the need to ensure the safety and operational integrity of federal buildings and facilities. Comparable spending benchmarks would typically look at per-square-foot inspection costs or contract values for similar-sized facilities across different agencies.

Small Business Impact

The data indicates that this contract was not set aside for small businesses (ss: false, sb: false). As a result, there are no direct subcontracting implications for small businesses stemming from a set-aside requirement. The primary contractor, API Group Life Safety USA LLC, will be responsible for delivering the services. Further analysis would be needed to determine if the prime contractor utilizes small businesses in its own supply chain.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of Health and Human Services (HHS) and the Indian Health Service (IHS). As a Purchase Order, it is likely managed by a contracting officer and program manager within IHS. Accountability measures are embedded in the firm fixed-price contract terms, requiring the contractor to meet specific service level agreements. Transparency is generally maintained through contract award databases, though detailed performance reports may not always be publicly accessible.

Related Government Programs

Federal Buildings and Facilities Maintenance
Healthcare Facility Safety Compliance
Emergency Preparedness and Response Services
Security Systems Services

Risk Flags

Simplified Acquisition Procedures (SAP) may limit robust competition.
Contract performance history for the specific vendor is not detailed.
Geographic concentration in Colorado might limit broader market price discovery.

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $36,750 to API GROUP LIFE SAFETY USA LLC. FIRE ALARM & SAFETY EQUIPMENT INSPECTION - UMUHC

Who is the contractor on this award?

The obligated recipient is API GROUP LIFE SAFETY USA LLC.

Which agency awarded this contract?

Awarding agency: Department of Health and Human Services (Indian Health Service).

What is the total obligated amount?

The obligated amount is $36,750.

What is the period of performance?

Start: 2023-07-01. End: 2027-06-30.

What is the track record of API Group Life Safety USA LLC in performing similar fire alarm and safety inspection services for federal agencies?

A comprehensive review of API Group Life Safety USA LLC's track record would involve examining past federal contract awards, performance evaluations (e.g., Contractor Performance Assessment Reporting System - CPARS), and any reported issues or disputes. Without access to these specific databases, it's difficult to definitively assess their past performance. However, being awarded a contract of this value suggests they have met the necessary qualifications and demonstrated capability to the awarding agency. Further investigation into their history with the Indian Health Service or other agencies performing similar services would provide a clearer picture of their reliability and quality of work.

How does the awarded price of $36.75 million compare to market rates for similar fire alarm and safety inspection services?

The awarded price of $36.75 million over approximately four years translates to an average annual value of roughly $9.19 million. To benchmark this effectively, one would need to compare it against contracts for similar-sized facilities or portfolios of facilities, considering factors like the number of buildings, square footage, types of systems inspected, and geographic location. The North American Industry Classification System (NAICS) code 561621 (Security Systems Services (except Locksmiths)) provides a general category, but specific pricing data for fire alarm inspections is often proprietary or found in specialized market research reports. The firm fixed-price nature suggests the government has negotiated a set price, but without detailed cost breakdowns or comparable contract data, a precise value-for-money assessment is challenging.

What are the primary risks associated with this contract, and how are they being mitigated?

Key risks include potential underperformance by the contractor leading to compromised safety, cost overruns if the scope is not well-defined (though mitigated by FFP), and reliance on a single vendor. Mitigation strategies likely involve clear performance standards in the contract, regular progress reviews by the agency, and potentially penalties for non-compliance. The firm fixed-price structure inherently mitigates financial risk for the government by capping costs. The agency's oversight and the contractor's incentive to maintain a good performance record for future contracts also serve as risk mitigation factors.

How effective is the Indian Health Service in managing contracts for essential safety services like fire alarm inspections?

The effectiveness of IHS contract management for essential safety services can be gauged by the consistent delivery of services, adherence to safety standards, and the absence of major safety incidents related to equipment failure. Awarding a multi-year contract suggests a degree of confidence in their ability to manage such services. However, the specific effectiveness would depend on the agency's internal processes, the expertise of their contracting officers and program managers, and the robustness of their oversight mechanisms. Analyzing past performance data and any audit findings related to IHS's contract management practices would provide a more definitive answer.

What are the historical spending patterns for fire alarm and safety equipment inspection services within the Indian Health Service or HHS?

To assess historical spending, one would need to analyze contract data for IHS and HHS over several fiscal years, specifically looking for contracts with NAICS code 561621 or similar service descriptions related to fire safety. This would reveal trends in contract values, the number of contracts awarded, and the types of contractors utilized. Understanding these patterns can help determine if the current $36.75 million award represents an increase, decrease, or stable level of spending for these critical services, and whether competition has remained consistent or changed over time.

Industry Classification

NAICS: Administrative and Support and Waste Management and Remediation Services › Investigation and Security Services › Security Systems Services (except Locksmiths)

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

Competition & Pricing

Extent Competed: COMPETED UNDER SAP

Solicitation Procedures: SIMPLIFIED ACQUISITION

Offers Received: 2

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Precision Mechanical Services LLC

Address: 1485 TUSKEGEE PL, COLORADO SPRINGS, CO, 80915

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

Financial Breakdown

Contract Ceiling: $46,500

Exercised Options: $36,750

Current Obligation: $36,750

Actual Outlays: $24,620

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Timeline