GSA awards $203M contract for measuring devices, raising questions about value and competition

Contract Overview

Contract Amount: $203,241,414 ($203.2M)

Contractor: Veteran Corps of America

Awarding Agency: General Services Administration

Start Date: 2010-07-23

End Date: 2015-07-25

Contract Duration: 1,828 days

Daily Burn Rate: $111.2K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 4

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: EQUIPMENT PURCHASE

Place of Performance

Location: BELLEVILLE, ST. CLAIR County, ILLINOIS, 62221

State: Illinois Government Spending

Plain-Language Summary

General Services Administration obligated $203.2 million to VETERAN CORPS OF AMERICA for work described as: EQUIPMENT PURCHASE Key points: 1. Contract value of $203M for measuring devices suggests significant investment in specialized equipment. 2. The contract was awarded under full and open competition, indicating a broad market solicitation. 3. A fixed-price contract type aims to control costs, but requires careful monitoring of scope. 4. The duration of 1828 days (approx. 5 years) suggests a long-term need for these devices. 5. The North American Industry Classification System (NAICS) code 334519 points to a niche manufacturing sector. 6. The award to VETERAN CORPS OF AMERICA warrants scrutiny regarding their capacity and past performance in this domain.

Value Assessment

Rating: questionable

Benchmarking the value of this $203M contract for measuring devices is challenging without specific details on the type and quantity of equipment. The fixed-price nature suggests an attempt to control costs, but the sheer scale of the award necessitates a thorough review of unit costs and comparison against similar procurements. Without more granular data on the specific devices and their intended use, it's difficult to definitively assess value for money. The absence of a specific Product Service Code (PSC) further complicates direct comparisons.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under 'full and open competition,' which theoretically allows any interested and qualified vendor to bid. The presence of 4 bids indicates some level of market interest, but the exact number of potential bidders in this specialized field is unknown. A higher number of bids typically leads to better price discovery and potentially lower costs for the government. The limited number of bids here might suggest a concentrated market or specific technical requirements that narrowed the field.

Taxpayer Impact: While full and open competition is generally favorable for taxpayers, the relatively low number of bids (4) for a contract of this magnitude warrants further investigation to ensure maximum price competition was achieved.

Public Impact

The primary beneficiaries are likely government agencies requiring precise measuring and controlling devices for operational or research purposes. The contract delivers essential equipment that supports various federal functions, potentially in areas like scientific research, quality control, or infrastructure monitoring. The geographic impact is likely nationwide, depending on where the awarded devices are deployed by federal agencies. Workforce implications could include jobs in manufacturing, distribution, and maintenance related to these specialized devices.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of specific details on the measuring devices procured makes it difficult to assess if the $203M represents a fair market price.
The limited number of bids (4) for a large contract could indicate potential issues with market competition or barriers to entry for other vendors.
The contractor, VETERAN CORPS OF AMERICA, may not be a primary manufacturer, raising questions about their role in the supply chain and potential markups.
The duration of the contract (5 years) could lead to technological obsolescence if the devices are not easily upgradeable or if the technology landscape shifts rapidly.

Positive Signals

Awarding under full and open competition maximizes the pool of potential offerors, theoretically leading to better pricing.
The firm fixed-price contract type provides cost certainty for the government, assuming the scope of work is well-defined.
The contract duration suggests a stable, long-term requirement, allowing for potential economies of scale in production or procurement.
The award to VETERAN CORPS OF AMERICA, if they are a service-disabled veteran-owned small business, could align with federal goals for supporting veteran entrepreneurs, though this is not explicitly stated.

Sector Analysis

This contract falls within the 'Other Measuring and Controlling Device Manufacturing' sector (NAICS 334519). This is a specialized segment of the manufacturing industry focused on producing instruments and devices for measurement, control, and testing. The market size for such devices can vary significantly depending on the specific application, ranging from highly specialized scientific equipment to more broadly used industrial sensors. Comparable spending benchmarks would require identifying the exact types of devices procured, but federal spending in scientific and industrial equipment is substantial.

Small Business Impact

The data indicates that small business participation (sb) was false, and there is no indication of a small business set-aside (ss). This suggests the contract was not specifically targeted towards small businesses. Therefore, the direct impact on the small business ecosystem is likely minimal, and there are no explicit subcontracting requirements mentioned that would mandate small business involvement. The focus appears to be on fulfilling the requirement through the broader market.

Oversight & Accountability

Oversight for this contract would primarily fall under the General Services Administration (GSA), specifically the Federal Acquisition Service. Accountability measures are inherent in the firm fixed-price contract type, which obligates the contractor to deliver specified goods at an agreed-upon price. Transparency would be enhanced by public contract databases, but detailed performance metrics and spending breakdowns are often not readily available. Inspector General jurisdiction would apply if any fraud, waste, or abuse is suspected.

Related Government Programs

General Services Administration (GSA) Schedules
Federal Supply Schedule (FSS) Contracts
Procurement of Scientific and Medical Equipment
Manufacturing Sector Contracts
Defense Logistics Agency (DLA) Equipment Procurement

Risk Flags

Potential for inadequate competition despite full and open solicitation.
Risk of technological obsolescence over the 5-year contract term.
Uncertainty regarding fair market value without specific device details.
Contractor's capacity and experience with large-scale equipment contracts requires verification.

Frequently Asked Questions

What is this federal contract paying for?

General Services Administration awarded $203.2 million to VETERAN CORPS OF AMERICA. EQUIPMENT PURCHASE

Who is the contractor on this award?

The obligated recipient is VETERAN CORPS OF AMERICA.

Which agency awarded this contract?

Awarding agency: General Services Administration (Federal Acquisition Service).

What is the total obligated amount?

The obligated amount is $203.2 million.

What is the period of performance?

Start: 2010-07-23. End: 2015-07-25.

What specific types of measuring and controlling devices were procured under this contract, and what are their intended applications?

The provided data identifies the contract under NAICS code 334519, 'Other Measuring and Controlling Device Manufacturing,' and indicates the award type as 'EQUIPMENT PURCHASE.' However, it does not specify the exact nature of these devices. They could range from sophisticated laboratory instruments for scientific research to industrial process control sensors, environmental monitoring equipment, or calibration tools. Without this specific information, it is impossible to determine their intended applications, which could span across various federal agencies such as the Department of Energy, National Science Foundation, EPA, or defense-related entities requiring precise measurement capabilities.

How does the awarded price of $203,241,413.91 compare to market rates for similar measuring devices?

A direct comparison of the total contract value to market rates is not feasible without knowing the specific types, quantities, and technical specifications of the measuring devices procured. The $203 million figure represents the total potential value over the contract's duration (approximately 5 years). To assess value for money, one would need to break this down into unit costs and compare them against industry benchmarks for comparable equipment. Factors such as technological sophistication, volume discounts, and warranty provisions significantly influence pricing. The limited number of bids (4) also suggests that a comprehensive price discovery process might not have been fully realized, potentially impacting the competitiveness of the final price.

What is the track record of VETERAN CORPS OF AMERICA in fulfilling large federal contracts, particularly for equipment manufacturing or supply?

Information regarding the track record of VETERAN CORPS OF AMERICA for large federal contracts, especially in equipment manufacturing or supply, is not detailed in the provided data. Standard government contracting databases (like SAM.gov or FPDS) would typically contain performance history reports, past performance evaluations, and details on previous awards. A thorough review would involve examining their contract portfolio, including the size and complexity of previous awards, on-time delivery rates, and any documented performance issues or disputes. Without this external data, assessing their capability and reliability for a $203 million contract remains speculative.

Given the 'full and open competition' award, why were there only 4 bids received for this substantial contract?

The receipt of only 4 bids for a contract valued at over $203 million, despite being awarded under 'full and open competition,' suggests potential factors limiting market participation. These could include highly specialized technical requirements that only a few firms possess, significant barriers to entry such as extensive research and development costs or proprietary technology, or perhaps a lack of awareness within the broader market about the solicitation. It's also possible that the contract's geographic scope, specific performance standards, or stringent qualification criteria inadvertently narrowed the field of eligible bidders. Further analysis would require examining the solicitation documents and market research conducted by the GSA.

What are the potential risks associated with a 5-year contract for measuring devices, considering technological advancements?

A significant risk associated with a 5-year contract for measuring devices is technological obsolescence. The field of measurement and control technology can advance rapidly. Devices procured today might be outdated or less efficient by the end of the contract period, potentially impacting the government's operational effectiveness or requiring costly workarounds. Mitigation strategies could include clauses for technology refresh, upgradeability, or ensuring the initial procurement specifications allow for future enhancements. The firm fixed-price nature also means the government bears the risk if the procured technology becomes less capable relative to emerging market solutions over the contract's lifespan.

Industry Classification

NAICS: Manufacturing › Navigational, Measuring, Electromedical, and Control Instruments Manufacturing › Other Measuring and Controlling Device Manufacturing

Product/Service Code: SPECIAL INDUSTRY MACHINERY

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: R1BK21100034

Offers Received: 4

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 220 E STATE ST STE 2F, O FALLON, IL, 90

Business Categories: 8(a) Program Participant, Category Business, Corporate Entity Not Tax Exempt, Manufacturer of Goods, Self-Certified Small Disadvantaged Business, Service Disabled Veteran Owned Business, Small Business, Special Designations, U.S.-Owned Business, Veteran Owned Business

Financial Breakdown

Contract Ceiling: $203,241,454

Exercised Options: $203,241,454

Current Obligation: $203,241,414

Timeline