GSA awards $15M contract for HVAC services to Northern Management Services, Inc. over 6 years

Contract Overview

Contract Amount: $14,951,757 ($15.0M)

Contractor: Northern Management Services, Inc.

Awarding Agency: General Services Administration

Start Date: 2005-08-24

End Date: 2011-08-31

Contract Duration: 2,198 days

Daily Burn Rate: $6.8K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 11

Pricing Type: NOT REPORTED

Sector: Other

Place of Performance

Location: ROANOKE, BOTETOURT County, VIRGINIA, 24012

State: Virginia Government Spending

Plain-Language Summary

General Services Administration obligated $15.0 million to NORTHERN MANAGEMENT SERVICES, INC. for work described as: Key points: 1. Contract value appears reasonable given the 6-year duration and scope of services. 2. Full and open competition suggests a competitive bidding process. 3. Contract duration of 6 years may present some risk if needs change significantly. 4. Services provided are essential for maintaining federal building infrastructure. 5. Contract falls within the broad category of facilities maintenance and operations. 6. No indication of small business participation, warranting further investigation.

Value Assessment

Rating: good

The contract value of approximately $15 million over six years averages to about $2.5 million annually. Benchmarking this against similar large-scale HVAC maintenance contracts for federal facilities suggests this is within a reasonable range, assuming the scope of work is comprehensive. Without specific details on the services rendered (e.g., preventative maintenance, emergency repairs, system upgrades), a precise value-for-money assessment is challenging. However, the competitive award process likely contributed to a fair price.

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. With 11 bids received, this suggests a healthy level of competition for this requirement. A higher number of bidders generally leads to better price discovery and potentially more favorable terms for the government.

Taxpayer Impact: A competitive bidding process ensures that taxpayer dollars are used efficiently by driving down costs through market forces.

Public Impact

Federal buildings in Virginia will benefit from reliable HVAC services. Ensures comfortable and safe working environments for federal employees. Supports the operational continuity of government facilities. Indirectly supports the local economy through employment opportunities for HVAC technicians and support staff.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Long contract duration (6 years) could lead to price increases or service obsolescence if not managed proactively.
Lack of specific performance metrics or quality assurance details in the provided data.
No clear indication of small business participation or subcontracting goals.

Positive Signals

Awarded through full and open competition, suggesting a robust vetting process.
Multiple bids received (11) indicate market interest and competitive pricing.
Contractor has a long-term engagement, suggesting satisfactory performance historically.

Sector Analysis

This contract falls within the facilities maintenance and operations sector, specifically focusing on HVAC services. The market for these services is substantial, driven by the continuous need to maintain critical infrastructure in commercial and government buildings. Federal spending in this area is consistent, as agencies rely on these services to ensure building functionality and occupant comfort. Comparable spending benchmarks would typically look at the total cost of ownership for HVAC systems across a portfolio of buildings.

Small Business Impact

The provided data indicates that this contract was not set aside for small businesses, and there is no explicit mention of subcontracting requirements. This suggests that large businesses were the primary participants in the competition. Further analysis would be needed to determine if any small business subcontracting opportunities were mandated or voluntarily pursued by the prime contractor.

Oversight & Accountability

Oversight for this contract would typically fall under the purview of the General Services Administration's Public Buildings Service. Accountability measures would be outlined in the contract's performance work statement, including service level agreements and quality control processes. Transparency is generally maintained through contract award databases, though specific performance details may be less public.

Related Government Programs

Federal Buildings Fund
General Services Administration Facilities Management
HVAC Maintenance Services Contracts
Public Buildings Service Operations

Risk Flags

Long-term contract duration may not adapt to technological advancements.
Potential for cost escalation over the 6-year period.
Lack of explicit small business subcontracting goals requires monitoring.

Frequently Asked Questions

What is this federal contract paying for?

General Services Administration awarded $15.0 million to NORTHERN MANAGEMENT SERVICES, INC.. See the official description on USAspending.

Who is the contractor on this award?

The obligated recipient is NORTHERN MANAGEMENT SERVICES, INC..

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $15.0 million.

What is the period of performance?

Start: 2005-08-24. End: 2011-08-31.

What is the historical spending pattern for HVAC services by the General Services Administration?

The General Services Administration (GSA) consistently spends significant amounts on HVAC services to maintain its vast portfolio of federal buildings. While specific historical data for this exact contract is limited to its $15 million award over six years, GSA's overall spending on facilities maintenance, including HVAC, runs into hundreds of millions annually. This spending fluctuates based on infrastructure needs, modernization projects, and the age of the building stock. Analyzing GSA's budget allocations and contract awards over the past decade would reveal trends in HVAC spending, potentially showing an increase due to aging infrastructure or a focus on energy efficiency upgrades. The $15 million awarded here represents a portion of that broader spending, likely for a specific region or set of buildings.

How does the number of bidders (11) compare to similar GSA HVAC contracts?

Receiving 11 bids for a federal contract, especially one valued at $15 million over six years, generally indicates a healthy level of competition. For large-scale facilities maintenance contracts like this, the number of interested bidders can vary significantly based on geographic scope, complexity of services, and market conditions. While 11 bids suggest good market engagement, comparing this to similar GSA HVAC contracts awarded in the same region or for comparable building portfolios would provide a more precise benchmark. Contracts with fewer than 3 bidders might raise concerns about market saturation or restrictive requirements, while an unusually high number could indicate a highly commoditized service or aggressive bidding strategies. The 11 bids here suggest the market was sufficiently accessible and the requirements were clear enough to attract multiple qualified contractors.

What are the potential risks associated with a 6-year contract duration for HVAC services?

A 6-year contract duration for HVAC services presents several potential risks. Firstly, technology in HVAC systems evolves rapidly; a 6-year-old contract might not incorporate the latest energy-efficient or smart technologies, potentially leading to higher operating costs or missed upgrade opportunities. Secondly, the cost of labor and parts can fluctuate significantly over six years, potentially leading to the government paying above-market rates if the contract doesn't include adequate price adjustment clauses. Thirdly, the specific needs of the federal buildings being serviced might change due to renovations, changes in occupancy, or new environmental regulations, making the original scope of work less relevant. Finally, long-term contracts can sometimes reduce the incentive for the contractor to innovate or provide exceptional service beyond the minimum requirements, as the business is secured for an extended period.

What performance metrics are typically used to evaluate HVAC contractors for federal buildings?

Performance metrics for evaluating HVAC contractors in federal buildings typically focus on reliability, efficiency, responsiveness, and compliance. Key metrics often include system uptime percentages (e.g., ensuring HVAC systems are operational 99% of the time), response times for emergency service calls (e.g., within 2 hours), preventative maintenance completion rates (e.g., 100% of scheduled PMs completed on time), energy consumption reduction targets, and compliance with safety and environmental regulations. Customer satisfaction surveys from building occupants and facility managers are also common. The contract's Performance Work Statement (PWS) would detail these specific metrics, associated Key Performance Indicators (KPIs), and the methods for measuring and reporting performance, often tied to payment incentives or penalties.

Are there specific federal programs aimed at improving energy efficiency in buildings that this contract might support?

Yes, this contract could directly or indirectly support several federal programs aimed at improving energy efficiency in buildings. The Energy Policy Act of 2005 and subsequent executive orders mandate federal agencies to improve energy efficiency and reduce greenhouse gas emissions. Contracts for HVAC services are crucial as HVAC systems are major energy consumers in buildings. Northern Management Services, Inc. could be tasked with maintaining systems to operate at peak efficiency, implementing energy-saving operational strategies (like optimized start/stop times), or supporting the integration of newer, more efficient equipment. Furthermore, the GSA itself has sustainability goals and initiatives, such as the Green Building Council's LEED standards, which often require high-performance HVAC operations and maintenance. The contractor's adherence to energy-saving protocols would be a key performance indicator.

Industry Classification

NAICS: Construction › Building Equipment Contractors › Plumbing, Heating, and Air-Conditioning Contractors

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

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation ID: GS-03P-02-CDC-0004

Offers Received: 11

Pricing Type: NOT REPORTED (NO)

Contractor Details

Address: 607 CHURCH ST, SANDPOINT, ID, 01

Business Categories: HUBZone Firm, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $14,951,757

Exercised Options: $14,951,757

Current Obligation: $14,951,757

Timeline