Department of the Army awarded $28.4M for utility services, with limited competition impacting price discovery

Contract Overview

Contract Amount: $28,433,934 ($28.4M)

Contractor: Foreign Utility Consolidated Reporting

Awarding Agency: Department of Defense

Start Date: 2016-10-01

End Date: 2017-09-30

Contract Duration: 364 days

Daily Burn Rate: $78.1K/day

Competition Type: NOT AVAILABLE FOR COMPETITION

Number of Offers Received: 1

Pricing Type: FIXED PRICE WITH ECONOMIC PRICE ADJUSTMENT

Sector: Other

Official Description: IGF::OT::IGF, CONSOLIDATED REPORT FOR UTILITY SERVICES (HEAT) OCTOBER 2016

Plain-Language Summary

Department of Defense obligated $28.4 million to FOREIGN UTILITY CONSOLIDATED REPORTING for work described as: IGF::OT::IGF, CONSOLIDATED REPORT FOR UTILITY SERVICES (HEAT) OCTOBER 2016 Key points: 1. The contract for utility services was awarded on a fixed-price basis with economic price adjustment, suggesting potential for cost fluctuations. 2. Limited competition for this contract may have led to less favorable pricing for the government. 3. The contract duration of 364 days is standard for this type of service. 4. The North American Industry Classification System (NAICS) code 221330 indicates a focus on steam and air-conditioning supply. 5. The award was a definitive contract, implying a firm commitment from the government. 6. The absence of small business set-aside flags suggests this contract was not specifically targeted to small businesses.

Value Assessment

Rating: fair

Benchmarking the value of this $28.4 million contract for utility services is challenging without specific performance metrics or comparable contract data. The fixed-price with economic price adjustment structure introduces a degree of uncertainty regarding the final cost. However, the limited competition raises concerns about whether the government secured the best possible price.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

The contract was awarded under 'NOT AVAILABLE FOR COMPETITION,' indicating a limited competition scenario. This suggests that only one or a very small number of bidders were considered. Such limited competition can reduce the government's leverage in price negotiations and potentially lead to higher costs compared to a fully open and competitive process.

Taxpayer Impact: Limited competition means taxpayers may have paid a premium for these utility services, as the lack of robust bidding limits opportunities for price reductions.

Public Impact

The Department of the Army is the primary beneficiary, receiving essential steam and air-conditioning supply. This contract ensures the operational readiness of military facilities by providing critical utility services. The geographic impact is localized to the facilities managed by the Department of the Army where these utilities are supplied. The contract supports the workforce involved in the provision and maintenance of utility infrastructure.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Limited competition may result in higher costs for taxpayers.
Economic price adjustment clauses can lead to cost overruns if market prices increase significantly.
Lack of transparency in the limited competition process could obscure potential inefficiencies.

Positive Signals

The contract ensures the provision of essential utility services for military operations.
A definitive contract provides a clear framework for service delivery.
The fixed-price element, despite adjustments, offers some cost predictability.

Sector Analysis

This contract falls within the Utilities and Energy Services sector, specifically focusing on steam and air-conditioning supply. The market for such services is often characterized by regional monopolies or limited providers due to infrastructure requirements. Comparable spending benchmarks would typically involve analyzing other government or large commercial contracts for similar utility provisions in specific geographic areas.

Small Business Impact

The data indicates that this contract was not set aside for small businesses (ss: false, sb: false). Therefore, there are no direct subcontracting implications for small businesses arising from a specific set-aside. The primary contractor is likely a larger entity capable of managing these utility services.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of the Army's contracting and financial management offices. Accountability measures would be defined by the contract terms and conditions, including performance standards and payment schedules. Transparency is limited by the 'NOT AVAILABLE FOR COMPETITION' designation, making detailed public scrutiny of the procurement process difficult.

Related Government Programs

Utility Services Contracts
Department of Defense Facilities Management
Steam and Air-Conditioning Supply Contracts

Risk Flags

Limited competition
Economic price adjustment clause introduces cost uncertainty

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $28.4 million to FOREIGN UTILITY CONSOLIDATED REPORTING. IGF::OT::IGF, CONSOLIDATED REPORT FOR UTILITY SERVICES (HEAT) OCTOBER 2016

Who is the contractor on this award?

The obligated recipient is FOREIGN UTILITY CONSOLIDATED REPORTING.

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Army).

What is the total obligated amount?

The obligated amount is $28.4 million.

What is the period of performance?

Start: 2016-10-01. End: 2017-09-30.

What is the historical spending pattern for utility services by the Department of the Army under NAICS code 221330?

Analyzing historical spending for utility services under NAICS code 221330 by the Department of the Army requires access to comprehensive federal procurement databases. Without direct access to such historical data, it's difficult to provide specific figures. However, generally, spending in this category can fluctuate based on facility needs, energy market prices, and the number and type of contracts awarded. Contracts for steam and air-conditioning supply are often long-term and can represent significant annual expenditures, especially for large military installations. Trends might show increased spending during periods of high energy costs or significant infrastructure upgrades. A detailed analysis would involve querying databases like FPDS-NG or USAspending.gov for contracts matching the agency, NAICS code, and relevant timeframes.

How does the awarded price compare to market rates for similar steam and air-conditioning supply services?

Directly comparing the awarded price of $28.4 million to market rates for similar steam and air-conditioning supply services is challenging without specific details on the scope of work, service levels, and geographic location. The 'NOT AVAILABLE FOR COMPETITION' status also suggests that a robust market comparison might not have been fully utilized during the procurement. To assess value, one would ideally benchmark against other government contracts for similar services or consult industry reports on utility pricing. Factors like the economic price adjustment clause can also influence the final cost, making a static comparison difficult. A thorough assessment would require detailed knowledge of the specific utility infrastructure and service requirements at the Army facility.

What are the specific risks associated with the 'fixed price with economic price adjustment' contract type for this utility service?

The primary risk associated with a 'fixed price with economic price adjustment' (FPEPA) contract for utility services is cost volatility. While the fixed-price component provides a baseline, the economic price adjustment allows for changes based on fluctuations in specific economic indicators, often related to fuel or labor costs. For utility services, this means the government's final cost could be higher than initially anticipated if the cost of energy or other inputs rises significantly during the contract period. This can impact budget predictability. Conversely, if input costs decrease, the price adjustment could lead to savings. The effectiveness of the price adjustment formula in accurately reflecting market changes is crucial for mitigating this risk.

What performance metrics are typically used to evaluate utility service contracts of this nature?

Performance metrics for utility service contracts like this typically focus on reliability, efficiency, and responsiveness. Key indicators often include: uptime percentages for critical systems (e.g., steam availability), response times for service calls or emergencies, energy efficiency targets (e.g., reduction in energy consumption per unit of output), compliance with environmental regulations, and adherence to safety standards. For steam and air-conditioning supply, metrics might also involve maintaining specific temperature and humidity levels within facilities. The contract itself would outline specific performance standards and the associated remedies or incentives for meeting or failing to meet them.

What is the contractor's track record in providing similar utility services to the federal government?

Information regarding the specific contractor's track record for this contract (CO: FOREIGN UTILITY CONSOLIDATED REPORTING) is not provided in the given data. To assess their track record, one would need to research their past performance on federal contracts, particularly those involving utility services, steam, and air-conditioning supply. This would involve checking contract databases for past awards, performance evaluations (e.g., Contractor Performance Assessment Reporting System - CPARS), and any history of disputes or contract terminations. A contractor with a history of successful, on-time, and within-budget performance on similar projects would generally be considered a lower risk.

Industry Classification

NAICS: Utilities › Water, Sewage and Other Systems › Steam and Air-Conditioning Supply

Product/Service Code: UTILITIES AND HOUSEKEEPING › UTILITIES

Competition & Pricing

Extent Competed: NOT AVAILABLE FOR COMPETITION

Solicitation Procedures: ONLY ONE SOURCE

Offers Received: 1

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

Evaluated Preference: NONE

Contractor Details

Address: 1800 F ST NW, WASHINGTON, DC, 20405

Business Categories: Category Business, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $28,433,934

Exercised Options: $28,433,934

Current Obligation: $28,433,934

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline