DoD's $24.3M fuel contract with Troy Company, Inc. awarded under full and open competition

Contract Overview

Contract Amount: $24,362,964 ($24.4M)

Contractor: Troy Company, Inc.

Awarding Agency: Department of Defense

Start Date: 2013-10-01

End Date: 2016-09-30

Contract Duration: 1,095 days

Daily Burn Rate: $22.2K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 34

Pricing Type: FIXED PRICE WITH ECONOMIC PRICE ADJUSTMENT

Sector: Other

Official Description: GASOLINE, REGULAR UNLEADED; CLEAR ULTRA LOW SULFUR DIESEL #2, RED-DYED ULTRA LOW SULFUR DIESEL #2; ETHANOL (E85); AND BIODIESEL (B100)

Place of Performance

Location: SEATTLE, KING County, WASHINGTON, 98101, UNITED STATES OF AMERICA

State: Washington Government Spending

Plain-Language Summary

Department of Defense obligated $24.4 million to TROY COMPANY, INC. for work described as: GASOLINE, REGULAR UNLEADED; CLEAR ULTRA LOW SULFUR DIESEL #2, RED-DYED ULTRA LOW SULFUR DIESEL #2; ETHANOL (E85); AND BIODIESEL (B100) Key points: 1. Contract awarded for fuel products, indicating a critical need for transportation and operational support. 2. The fixed-price structure with economic price adjustment suggests potential for cost fluctuations based on market conditions. 3. Full and open competition was utilized, implying a robust bidding process and potential for competitive pricing. 4. The contract duration of 1095 days (3 years) indicates a significant, long-term requirement for fuel supply. 5. The award to Troy Company, Inc. represents a substantial commitment to a single vendor for these essential commodities. 6. The North American Industry Classification System (NAICS) code 324110 points to the petroleum refining sector.

Value Assessment

Rating: fair

Benchmarking the value of this contract is challenging without specific unit pricing data or comparable contract details. The total award amount of $24.3 million over three years suggests a significant volume of fuel was procured. However, the 'economic price adjustment' clause introduces variability, making a fixed value assessment difficult. Further analysis would require understanding the baseline pricing and the extent of adjustments applied during the contract period.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under 'full and open competition,' indicating that all responsible sources were permitted to submit bids. The presence of 34 bids suggests a healthy level of interest and competition for this fuel supply requirement. This broad competition is generally expected to drive more favorable pricing and terms for the government.

Taxpayer Impact: Taxpayers benefit from the broad competition, as it increases the likelihood of securing fuel at competitive market rates and reduces the risk of overpayment due to limited vendor options.

Public Impact

Military operations and readiness across various Department of Defense installations are supported by the consistent supply of fuel. Personnel and equipment involved in transportation and logistical movements are directly impacted by the availability of these fuel products. The contract ensures the availability of essential fuels for strategic and tactical operations. Geographic impact is likely widespread, covering areas where DoD assets require fuel, though specific locations are not detailed.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for price volatility due to the economic price adjustment clause.
Reliance on a single primary contractor for a critical commodity like fuel.
Limited insight into the specific performance metrics and quality control measures for the fuel supplied.

Positive Signals

Awarded through full and open competition, suggesting a competitive pricing environment.
Contract duration indicates a stable, long-term supply chain for essential fuels.
The Defense Logistics Agency's involvement suggests established procurement processes for defense-related commodities.

Sector Analysis

This contract falls within the petroleum refining and distribution sector, specifically serving the energy needs of the Department of Defense. The market for fuel supply to government entities is often characterized by large-volume contracts, competitive bidding processes, and stringent delivery requirements. Comparable spending benchmarks would involve analyzing other large fuel procurement contracts across federal agencies, particularly those managed by the Defense Logistics Agency.

Small Business Impact

The data indicates that small business participation was not a specific set-aside requirement for this contract (ss: false, sb: false). While the primary award was not directed towards small businesses, the prime contractor, Troy Company, Inc., may engage small businesses for subcontracting opportunities related to fuel delivery or logistics. However, without specific subcontracting plans or data, the direct impact on the small business ecosystem remains unclear.

Oversight & Accountability

Oversight for this contract would typically be managed by the Defense Logistics Agency (DLA), which is responsible for procuring and distributing supplies for the U.S. Armed Forces. Accountability measures would include contract performance monitoring, delivery verification, and adherence to quality specifications. Transparency is facilitated through contract award databases, though detailed performance reports may not be publicly accessible. The Inspector General for the Department of Defense would have jurisdiction over any investigations into fraud, waste, or abuse related to this contract.

Related Government Programs

Defense Logistics Agency Fuel Contracts
Department of Defense Energy Procurement
Federal Aviation Administration Fuel Contracts
General Services Administration Fuel Schedules

Risk Flags

Economic Price Adjustment Clause
Potential for Price Volatility
Reliance on Prime Contractor

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $24.4 million to TROY COMPANY, INC.. GASOLINE, REGULAR UNLEADED; CLEAR ULTRA LOW SULFUR DIESEL #2, RED-DYED ULTRA LOW SULFUR DIESEL #2; ETHANOL (E85); AND BIODIESEL (B100)

Who is the contractor on this award?

The obligated recipient is TROY COMPANY, INC..

Which agency awarded this contract?

Awarding agency: Department of Defense (Defense Logistics Agency).

What is the total obligated amount?

The obligated amount is $24.4 million.

What is the period of performance?

Start: 2013-10-01. End: 2016-09-30.

What was the baseline pricing structure used for the economic price adjustment in this contract?

The provided data does not specify the baseline pricing structure or the indices used for the economic price adjustment (EPA) in this contract. Typically, EPAs are tied to published commodity price indices (e.g., for crude oil, refined products) or other economic indicators. Without this information, it's impossible to determine how price fluctuations were managed or to assess the actual cost impact on the government. The 'FIXED PRICE WITH ECONOMIC PRICE ADJUSTMENT' contract type indicates that the base price was fixed, but adjustments were allowed based on predefined economic factors, aiming to mitigate risks for both the contractor and the government against significant market shifts.

How does the number of bids (34) compare to similar fuel procurement contracts by the Defense Logistics Agency?

A total of 34 bids for this fuel procurement contract suggests a robust level of competition. While direct comparisons require access to DLA's historical bid data for similar fuel types and contract values, 34 bidders generally indicates a healthy market response. Contracts for essential commodities like fuel, especially those with significant volume and duration, often attract numerous interested parties. A higher number of bids typically correlates with better price discovery and potentially lower costs for the government, as it allows for a wider range of offers to be evaluated against the government's requirements.

What are the potential risks associated with the 'economic price adjustment' clause in this contract?

The primary risk associated with an 'economic price adjustment' (EPA) clause is potential price escalation for the government. While EPAs are designed to protect both parties from extreme market volatility, they can lead to higher costs if the underlying commodity prices increase significantly during the contract period. For the government, this means the final cost could exceed initial budget projections. Conversely, if prices decrease, the EPA might not fully benefit the government. Effective management requires clear, objective adjustment mechanisms and vigilant monitoring of market trends to ensure fairness and prevent unwarranted price hikes.

What is the typical track record of Troy Company, Inc. in fulfilling federal fuel contracts?

The provided data does not include specific details on Troy Company, Inc.'s historical performance or track record with federal fuel contracts beyond this award. To assess their reliability, one would need to examine past contract performance evaluations, any reported disputes or contract terminations, and their history with similar procurements. Federal procurement databases and contract performance reporting systems (like the Contractor Performance Assessment Reporting System - CPARS) would be the primary sources for such information. Without this data, it's difficult to definitively comment on their track record.

How does the $24.3 million award value compare to the total federal spending on petroleum products in the relevant fiscal years?

The $24.3 million award to Troy Company, Inc. represents a portion of the Department of Defense's overall spending on petroleum products. To contextualize this amount, it would need to be compared against the total federal outlays for fuel and lubricants during the contract period (FY2013-FY2016). Federal agencies, particularly the DoD through the Defense Logistics Agency, are significant consumers of petroleum products. This specific contract's value, while substantial, is likely one of many such procurements supporting military readiness and operations nationwide and globally. A broader analysis would involve examining aggregate spending data from agencies like the Energy Information Administration (EIA) and the Department of the Treasury.

Industry Classification

NAICS: Manufacturing › Petroleum and Coal Products Manufacturing › Petroleum Refineries

Product/Service Code: FUELS, LUBRICANTS, OILS, WAXES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: SP060013R0202

Offers Received: 34

Pricing Type: FIXED PRICE WITH ECONOMIC PRICE ADJUSTMENT (K)

Evaluated Preference: NONE

Contractor Details

Address: 603 STEWART ST STE 616, SEATTLE, WA, 98101

Business Categories: Black American Owned Business, Category Business, Corporate Entity Not Tax Exempt, Minority Owned Business, Self-Certified Small Disadvantaged Business, Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $24,362,964

Exercised Options: $24,362,964

Current Obligation: $24,362,964

Contract Characteristics

Multi-Year Contract: Yes

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: SP060013D8516

IDV Type: IDC

Timeline