VA awards $22.3M natural gas contract for Tampa Medical Center, highlighting long-term service delivery

Contract Overview

Contract Amount: $22,260,767 ($22.3M)

Contractor: Peoples GAS System, Inc

Awarding Agency: Department of Veterans Affairs

Start Date: 2015-12-08

End Date: 2022-02-28

Contract Duration: 2,274 days

Daily Burn Rate: $9.8K/day

Competition Type: NOT AVAILABLE FOR COMPETITION

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: IGF::OT::IGF THE CONTRACTOR WILL PERFORM ENERGY MANAGEMENT SERVICES AT THE JAMES A. HALEY VETERANS AFFAIRS MEDICAL CENTER IN TAMPA, FLORIDA UNDER A GENERAL SERVICES ADMINISTRATION AREA-WIDE CONTRACT.

Place of Performance

Location: TAMPA, HILLSBOROUGH County, FLORIDA, 33612

State: Florida Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $22.3 million to PEOPLES GAS SYSTEM, INC for work described as: IGF::OT::IGF THE CONTRACTOR WILL PERFORM ENERGY MANAGEMENT SERVICES AT THE JAMES A. HALEY VETERANS AFFAIRS MEDICAL CENTER IN TAMPA, FLORIDA UNDER A GENERAL SERVICES ADMINISTRATION AREA-WIDE CONTRACT. Key points: 1. Contract provides essential energy services for a major VA medical facility. 2. Sole-source award indicates potential limitations in competitive bidding for this specific service. 3. Long contract duration suggests a need for stable, ongoing utility provision. 4. Fixed-price contract type offers cost certainty for the government. 5. Geographic concentration in Florida for service delivery. 6. No small business set-aside noted, potentially impacting smaller local providers.

Value Assessment

Rating: fair

The contract value of $22.3 million over approximately 6.5 years for natural gas distribution services at a large VA medical center appears to be within a reasonable range for such a critical utility. However, without specific benchmarks for energy management services at comparable federal facilities or detailed breakdowns of the services included, a precise value-for-money assessment is challenging. The fixed-price nature provides predictability, but the lack of competition raises questions about whether the most cost-effective pricing was achieved.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning it was not openly competed. This approach is typically used when only one vendor can provide the required goods or services, often due to unique capabilities, existing infrastructure, or specific regulatory requirements. The lack of competition means that price discovery through market forces was limited, and the government relied on negotiation with the single identified source.

Taxpayer Impact: Sole-source awards can potentially lead to higher costs for taxpayers as competitive pressure to offer the lowest price is absent. It also limits opportunities for other qualified vendors to secure government contracts.

Public Impact

Benefits the James A. Haley Veterans Affairs Medical Center by ensuring a reliable supply of natural gas for operations. Supports the delivery of healthcare services to veterans in the Tampa, Florida area. Impacts the local energy utility infrastructure and workforce in Florida. Ensures continuity of essential services for a critical federal facility.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits competitive pricing and opportunities for other vendors.
Long contract duration may not reflect current market pricing fluctuations.
Lack of transparency on specific service components within the natural gas distribution.

Positive Signals

Ensures continuity of essential utility services for a major VA facility.
Fixed-price contract provides budget certainty.
Awarded under a GSA Area-Wide Contract, suggesting adherence to established procurement vehicles.

Sector Analysis

Natural gas distribution is a fundamental utility service essential for the operation of large facilities, including healthcare centers. The market is typically characterized by regional providers due to the infrastructure required for delivery. This contract fits within the broader energy sector, specifically focusing on the provision of a critical commodity. Comparable spending benchmarks would likely be based on utility rates in the Tampa region and the energy consumption patterns of similar-sized medical facilities.

Small Business Impact

This contract was not set aside for small businesses, and there is no indication of subcontracting requirements for small businesses. This means that opportunities for small businesses to participate in this contract are limited, potentially excluding them from a significant federal expenditure.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of Veterans Affairs' contracting and program management offices. As a GSA Area-Wide Contract delivery order, GSA also likely has oversight responsibilities. Transparency is moderate, with the award details available, but specific performance metrics and detailed cost breakdowns may not be publicly accessible. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

GSA Federal Supply Schedule
VA Medical Facility Operations
Energy Utility Contracts
Natural Gas Supply Contracts

Risk Flags

Sole-source award
Lack of competition
Potential for non-competitive pricing

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $22.3 million to PEOPLES GAS SYSTEM, INC. IGF::OT::IGF THE CONTRACTOR WILL PERFORM ENERGY MANAGEMENT SERVICES AT THE JAMES A. HALEY VETERANS AFFAIRS MEDICAL CENTER IN TAMPA, FLORIDA UNDER A GENERAL SERVICES ADMINISTRATION AREA-WIDE CONTRACT.

Who is the contractor on this award?

The obligated recipient is PEOPLES GAS SYSTEM, INC.

Which agency awarded this contract?

Awarding agency: Department of Veterans Affairs (Department of Veterans Affairs).

What is the total obligated amount?

The obligated amount is $22.3 million.

What is the period of performance?

Start: 2015-12-08. End: 2022-02-28.

What is the historical spending pattern for natural gas at the James A. Haley Veterans Affairs Medical Center?

Historical spending data for natural gas at the James A. Haley Veterans Affairs Medical Center prior to this $22.3 million contract (2015-2022) is not explicitly detailed in the provided information. However, the contract's duration and value suggest a consistent need for natural gas services over an extended period. To understand historical patterns, one would need to examine previous contracts for utility services at this specific facility, looking at annual expenditures, price fluctuations, and the incumbent contractor. This would help establish a baseline for assessing the current contract's value and identify any significant deviations in cost or service delivery over time.

How does the pricing of this contract compare to similar natural gas contracts for federal facilities?

A direct comparison of the pricing for this $22.3 million sole-source contract to similar natural gas contracts for federal facilities is challenging without access to detailed pricing structures and regional market data. As a sole-source award, competitive benchmarking is inherently limited. However, general assessments can be made by comparing the per-unit cost of natural gas (if derivable) against prevailing market rates in the Tampa, Florida area during the contract period (2015-2022). Factors such as volume discounts, contract length, and specific service inclusions (e.g., maintenance, delivery guarantees) would influence the overall value. The absence of competition suggests that the government may not have secured the most advantageous pricing available in a fully competitive market.

What are the key performance indicators (KPIs) for this natural gas distribution contract?

The provided data does not specify the key performance indicators (KPIs) for this natural gas distribution contract. Typically, for utility services, KPIs would focus on reliability of supply (e.g., uptime percentage, number of service interruptions), delivery accuracy, response times to outages or emergencies, and adherence to safety standards. For a fixed-price contract, the focus might be more on ensuring uninterrupted service delivery as per the agreement. The Department of Veterans Affairs would likely have internal metrics to monitor the contractor's performance against the contract's requirements, ensuring the James A. Haley Veterans Affairs Medical Center receives consistent and adequate natural gas supply.

What is the track record of Peoples Gas System, Inc. with federal contracts, particularly with the VA?

Peoples Gas System, Inc. has a history of providing natural gas services, including to federal entities. As this contract was awarded under a GSA Area-Wide Contract, it suggests Peoples Gas System, Inc. is an approved provider within the General Services Administration's procurement framework. While specific details on their overall federal contract performance, including past performance ratings or any disputes, are not provided here, their selection for this significant VA contract indicates a level of capability and prior experience deemed sufficient by the contracting officers. Further due diligence would involve reviewing their performance history on other government contracts, particularly those with the Department of Veterans Affairs, to assess reliability and satisfaction.

What are the risks associated with a sole-source award for essential utility services like natural gas?

The primary risk associated with a sole-source award for essential utility services like natural gas is the potential for inflated costs due to the lack of competitive bidding. Without competing offers, taxpayers may bear a higher price than could be achieved in an open market. Another risk is vendor lock-in, where the government becomes dependent on a single provider, potentially limiting flexibility in service upgrades or contract renegotiations. Furthermore, a sole-source award might reduce the incentive for the contractor to innovate or provide exceptional service, as there is no immediate threat of losing the contract to a competitor. Ensuring fair pricing and robust contract management becomes critical in mitigating these risks.

Industry Classification

NAICS: Utilities › Natural Gas Distribution › Natural Gas Distribution

Product/Service Code: UTILITIES AND HOUSEKEEPING › UTILITIES

Competition & Pricing

Extent Competed: NOT AVAILABLE FOR COMPETITION

Solicitation Procedures: ONLY ONE SOURCE

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: NEW Mexico GAS Company Inc.

Address: 702 N. FRANKLIN ST, TAMPA, FL, 33602

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

Financial Breakdown

Contract Ceiling: $22,634,247

Exercised Options: $22,634,247

Current Obligation: $22,260,767

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: GS00P08BSD0653

IDV Type: IDC

Timeline