DoD awards $9.4M contract for hydrant services, raising questions on value and competition

Contract Overview

Contract Amount: $9,443,735 ($9.4M)

Contractor: GA Mechanical Inc

Awarding Agency: Department of Defense

Start Date: 2021-09-01

End Date: 2026-03-02

Contract Duration: 1,643 days

Daily Burn Rate: $5.7K/day

Competition Type: COMPETED UNDER SAP

Number of Offers Received: 2

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: THIS CONTRACT PROVIDES FIRE HYDRANT FLUSHING SERVICES IN COMPLIANCE WITH ARMY PUBLIC HEALTH COMMAND'S POLICIES AND PLAN.

Place of Performance

Location: GUNPOWDER, HARFORD County, MARYLAND, 21010

State: Maryland Government Spending

Plain-Language Summary

Department of Defense obligated $9.4 million to GA MECHANICAL INC for work described as: THIS CONTRACT PROVIDES FIRE HYDRANT FLUSHING SERVICES IN COMPLIANCE WITH ARMY PUBLIC HEALTH COMMAND'S POLICIES AND PLAN. Key points: 1. Contract value appears high relative to the scope of services. 2. Limited competition may have inflated pricing. 3. Potential for cost overruns due to firm-fixed-price structure. 4. Services are critical for public health and safety. 5. Contractor has a limited public track record for this specific service. 6. Geographic concentration in Maryland for essential infrastructure maintenance.

Value Assessment

Rating: fair

The contract's value of $9.4 million for fire hydrant flushing services seems substantial. Benchmarking against similar contracts is difficult without more detailed service scope and frequency data. However, the firm-fixed-price nature, combined with limited competition, suggests a potential for the government to overpay if the contractor's costs are significantly lower than the awarded price. The absence of detailed performance metrics in the provided data makes a definitive value assessment challenging.

Cost Per Unit: N/A

Competition Analysis

Competition Level: unknown

The contract was competed under Simplified Acquisition Procedures (SAP), which typically involves fewer bidders and less formal solicitation processes than full and open competition. While two bids were received, the limited number suggests that the competitive landscape may not have been robust enough to drive the lowest possible prices. This approach is often used for smaller value contracts, and its application here warrants scrutiny regarding whether a broader competition could have yielded better value.

Taxpayer Impact: The limited competition under SAP may have resulted in taxpayers paying a premium compared to what might have been achieved through a more extensive bidding process. This could mean less efficient use of public funds for essential infrastructure maintenance.

Public Impact

The primary beneficiaries are the Department of Defense and the Army, ensuring operational readiness and compliance with public health standards. The service delivered is the critical maintenance of fire hydrant systems, essential for emergency response. The geographic impact is concentrated in Maryland, where the services are performed. Workforce implications include potential employment for local technicians and maintenance staff.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for overpayment due to firm-fixed-price contract with limited competition.
Lack of detailed performance metrics makes value assessment difficult.
Reliance on a single contractor for essential infrastructure maintenance in a specific region.

Positive Signals

Contract ensures compliance with Army Public Health Command policies.
Services are essential for maintaining fire safety and operational readiness.
Firm-fixed-price contract provides cost certainty for the government, assuming efficient performance by the contractor.

Sector Analysis

This contract falls within the construction and maintenance services sector, specifically related to utility infrastructure. The North American Industry Classification System (NAICS) code 237110, 'Water and Sewer Line and Related Structures Construction,' encompasses this type of work. Spending in this area is crucial for maintaining public safety and operational capabilities across various government agencies. Comparable spending benchmarks would typically involve analyzing the cost per hydrant serviced or the cost per linear foot of pipe maintained.

Small Business Impact

The data indicates this contract was not specifically set aside for small businesses (ss: false, sb: false). While the contractor, GA MECHANICAL INC, may be a small business, the competition method (SAP) does not guarantee small business participation or subcontracting opportunities. Further analysis would be needed to determine if any subcontracting goals were established or met, and the overall impact on the small business ecosystem in the Maryland region.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of the Army's contracting and program management offices. Accountability measures are typically embedded in the contract terms, including delivery schedules and performance standards, though specific details are not provided. Transparency is facilitated through contract databases like FPDS, but detailed operational oversight and Inspector General jurisdiction would depend on the specific nature of any performance issues or audits initiated.

Related Government Programs

Army Public Health Command Services
Department of Defense Infrastructure Maintenance
Federal Fire Safety Contracts
Utility Infrastructure Services Contracts
Maryland Federal Contracts

Risk Flags

Limited competition may lead to higher prices.
Firm-fixed-price contract could mask contractor inefficiencies.
Scope of services and performance metrics lack detailed public information.
Contractor's specific experience in hydrant flushing requires further verification.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $9.4 million to GA MECHANICAL INC. THIS CONTRACT PROVIDES FIRE HYDRANT FLUSHING SERVICES IN COMPLIANCE WITH ARMY PUBLIC HEALTH COMMAND'S POLICIES AND PLAN.

Who is the contractor on this award?

The obligated recipient is GA MECHANICAL INC.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $9.4 million.

What is the period of performance?

Start: 2021-09-01. End: 2026-03-02.

What is the track record of GA MECHANICAL INC in performing fire hydrant flushing services for the federal government or other large entities?

Based on the provided data, GA MECHANICAL INC is the contractor for this $9.4 million Department of Defense contract. However, the data does not offer specific details about their past performance history, particularly concerning fire hydrant flushing services. To assess their track record, one would need to consult contract performance reports, past performance questionnaires, or databases that track contractor performance across multiple federal awards. Without this information, it's difficult to gauge their experience level and reliability for this critical infrastructure maintenance task. Further investigation into their contract history and client feedback would be necessary for a comprehensive understanding of their capabilities and past success rates in similar service delivery.

How does the awarded price compare to industry benchmarks for fire hydrant flushing services, considering the scope and frequency outlined in the contract?

The provided data indicates a contract value of $9,443,735.26 for fire hydrant flushing services. However, crucial details such as the number of hydrants serviced, the frequency of flushing (e.g., annually, bi-annually), and the specific geographic area covered are not detailed. Without this granular information, a direct comparison to industry benchmarks is challenging. Typically, cost per hydrant flushed or an annual maintenance cost per hydrant would be used for benchmarking. Given the firm-fixed-price nature and the limited competition (2 bidders), there's a risk that the price may not reflect optimal market value. A thorough benchmark analysis would require obtaining the detailed scope of work and comparing it against publicly available cost data for similar municipal or military base maintenance contracts.

What are the primary risks associated with this contract, and what mitigation strategies are in place?

The primary risks associated with this contract include potential cost overruns if the firm-fixed-price is significantly higher than the contractor's actual costs, especially given the limited competition. Another risk is performance failure, where the contractor may not adequately perform the flushing services, potentially impacting fire safety and public health compliance. The firm-fixed-price structure itself can be a risk if unforeseen issues arise that increase the contractor's costs substantially, leading to potential disputes or subpar performance to maintain profitability. Mitigation strategies typically involve robust contract oversight, clear performance standards, regular progress reviews, and potentially performance bonds. The Army Public Health Command's oversight and the contract's compliance requirements serve as initial mitigation steps, but the effectiveness of these measures depends on the rigor of their implementation and enforcement.

How effective is the current contract in ensuring compliance with Army Public Health Command's policies regarding fire hydrant maintenance?

The contract explicitly states that the fire hydrant flushing services are provided 'in compliance with Army Public Health Command's policies and plan.' This suggests that compliance is a core requirement. The effectiveness hinges on the clarity and specificity of these policies and the robustness of the oversight mechanisms to ensure adherence. Regular inspections, testing of water quality post-flushing, and verification of flushing schedules would be key indicators of effectiveness. Without access to the specific policies and the Army's internal compliance reporting, it's difficult to definitively assess the effectiveness. However, the contract's stated purpose directly addresses this compliance need, implying that it is a primary driver for the procurement.

What has been the historical spending pattern for fire hydrant flushing services by the Department of the Army or similar agencies in this region?

The provided data shows a single definitive contract award of $9,443,735.26 for fire hydrant flushing services from September 1, 2021, to March 2, 2026. This represents a significant investment over the contract duration. To understand historical spending patterns, one would need to examine prior contracts for similar services awarded by the Department of the Army, particularly within the Maryland region or to GA MECHANICAL INC. Analyzing spending trends over multiple fiscal years, contract types (e.g., fixed-price vs. cost-plus), and competition levels would reveal whether this current contract represents an increase, decrease, or stable level of spending for these essential services. Without access to historical contract data, it's impossible to establish a trend.

Industry Classification

NAICS: Construction › Utility System Construction › Water and Sewer Line and Related Structures Construction

Product/Service Code: QUALITY CONTROL, TEST, INSPECTION › QUALITY CONTROL SERVICES

Competition & Pricing

Extent Competed: COMPETED UNDER SAP

Solicitation Procedures: SIMPLIFIED ACQUISITION

Solicitation ID: W56ZTN21R0004

Offers Received: 2

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 12025 PHILADELPHIA RD, KINGSVILLE, MD, 21087

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

Financial Breakdown

Contract Ceiling: $9,631,235

Exercised Options: $9,631,235

Current Obligation: $9,443,735

Actual Outlays: $947,336

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Timeline