Department of the Army awarded $15.4M for electrical services, highlighting potential for cost efficiencies in utility contracts

Contract Overview

Contract Amount: $15,405,777 ($15.4M)

Contractor: Foreign Utility Consolidated Reporting

Awarding Agency: Department of Defense

Start Date: 2010-02-01

End Date: 2010-09-30

Contract Duration: 241 days

Daily Burn Rate: $63.9K/day

Competition Type: NOT AVAILABLE FOR COMPETITION

Number of Offers Received: 1

Pricing Type: FIXED PRICE WITH ECONOMIC PRICE ADJUSTMENT

Sector: Other

Official Description: ELECTRICAL SERVICES FOR THE MONTH OF FEBRUARY 2010

Plain-Language Summary

Department of Defense obligated $15.4 million to FOREIGN UTILITY CONSOLIDATED REPORTING for work described as: ELECTRICAL SERVICES FOR THE MONTH OF FEBRUARY 2010 Key points: 1. The contract's fixed-price with economic price adjustment structure requires careful monitoring of market fluctuations. 2. Limited competition for this utility service may impact price discovery and potentially increase costs. 3. The duration of the contract (241 days) suggests a need for consistent service delivery. 4. Performance context is limited due to the absence of specific metrics in the provided data. 5. This contract falls within the broader category of facility maintenance and operations. 6. The award amount represents a significant investment in essential infrastructure support.

Value Assessment

Rating: fair

Benchmarking the $15.4 million award for electrical services against similar contracts is challenging without more specific details on the scope of work and location. However, the fixed-price with economic price adjustment (FP-EPA) contract type introduces a degree of risk, as costs can fluctuate with market conditions. While FP-EPA contracts can protect contractors from unforeseen price increases, they may not always represent the best value for the government if market prices remain stable. Further analysis would require comparing the per-unit costs for specific services rendered against industry averages.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

The contract was awarded on a sole-source basis, indicated by 'NOT AVAILABLE FOR COMPETITION'. This suggests that only one vendor was deemed capable of fulfilling the requirement, or that circumstances precluded a competitive process. Limited competition can lead to higher prices as the vendor faces less pressure to offer competitive rates. The absence of multiple bidders means there was no direct comparison of offers to ensure the government received the most advantageous terms.

Taxpayer Impact: Sole-source awards can result in taxpayers paying a premium, as the lack of competition removes a key mechanism for driving down costs and ensuring fair market pricing.

Public Impact

Military installations benefit from reliable electrical power, crucial for operational readiness and personnel support. The services delivered ensure the continuity of essential functions within the Department of the Army. Geographic impact is likely localized to the specific military facility or facilities served by this contract. The contract supports the workforce of the awarded contractor, contributing to employment in the utility services sector.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits price competition, potentially leading to higher costs for taxpayers.
The FP-EPA contract type carries inherent risk of price escalation due to market fluctuations.
Lack of detailed performance metrics makes it difficult to assess the contractor's efficiency and effectiveness.
The contract's duration and value warrant close monitoring to ensure continued value for money.

Positive Signals

Ensures essential electrical services are provided to a critical government agency.
The fixed-price component offers some cost certainty, provided economic adjustments are managed effectively.
The award supports the operational continuity of military facilities.

Sector Analysis

This contract falls within the Utilities and Energy Services sector, specifically focusing on electric power distribution. This sector is characterized by essential services that are critical for the functioning of government facilities and infrastructure. The market for such services can be highly localized and regulated, often leading to situations where competition is limited. Comparable spending benchmarks would typically involve analyzing utility costs for similar-sized military bases or government installations, considering factors like energy consumption, infrastructure complexity, and local utility rates.

Small Business Impact

The data indicates that small business participation was not a factor in this award, as the 'ss' (small business set-aside) field is false and the 'sb' (small business) field is also false. This suggests the contract was not specifically targeted towards small businesses, nor was it awarded to a small business prime contractor. Consequently, there are no direct subcontracting implications for small businesses stemming from this particular award. The impact on the small business ecosystem is therefore minimal for this specific contract.

Oversight & Accountability

Oversight for this contract would typically fall under the purview of the Department of the Army's contracting and financial management offices. Accountability measures would be tied to the terms and conditions of the fixed-price with economic price adjustment contract, including adherence to delivery schedules and service standards. Transparency is facilitated through contract award databases, though detailed performance reporting may be internal. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

Base Operations Support Contracts
Utility Privatization Programs
Energy Resilience and Conservation Investments

Risk Flags

Sole-source award may lead to higher costs.
Economic price adjustment clause introduces cost uncertainty.
Lack of detailed performance data hinders value assessment.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $15.4 million to FOREIGN UTILITY CONSOLIDATED REPORTING. ELECTRICAL SERVICES FOR THE MONTH OF FEBRUARY 2010

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 $15.4 million.

What is the period of performance?

Start: 2010-02-01. End: 2010-09-30.

What is the track record of 'FOREIGN UTILITY CONSOLIDATED REPORTING' with the Department of Defense?

Information regarding the specific track record of 'FOREIGN UTILITY CONSOLIDATED REPORTING' with the Department of Defense is not provided in the given data. To assess their track record, one would need to examine past performance evaluations, contract history, and any reported issues or successes on previous government contracts. This would involve searching databases like the Federal Procurement Data System (FPDS) or the Contractor Performance Assessment Reporting System (CPARS) for relevant information. A positive track record would indicate reliability and competence, while a history of issues might raise concerns about future performance and value for money.

How does the awarded amount compare to typical spending on electrical services for similar military facilities?

Direct comparison of the $15.4 million award for electrical services to similar military facilities is difficult without more granular data on the scope of services, duration, and specific location. However, the contract's duration of 241 days (approximately 8 months) suggests a substantial ongoing need. If this represents annual spending, it would be considered significant. To benchmark effectively, one would need to identify comparable facilities in terms of size, energy consumption, and operational complexity, and then compare their utility service contracts. The 'Electric Power Distribution' (NAICS 221122) code provides a general category, but specific contract values can vary widely based on infrastructure needs and local utility rates.

What are the primary risks associated with a 'FIXED PRICE WITH ECONOMIC PRICE ADJUSTMENT' contract for electrical services?

The primary risks associated with a Fixed Price with Economic Price Adjustment (FP-EPA) contract for electrical services revolve around cost volatility and administrative burden. While the fixed-price element provides a baseline cost, the economic price adjustment clause allows for modifications based on fluctuations in specified economic indicators, such as fuel or labor costs. This introduces uncertainty for the government, as the final cost could exceed the initial estimate if these indicators rise significantly. For the contractor, the risk is mitigated, but they must meticulously track and justify price adjustments. Effective oversight is crucial to ensure that adjustments are fair, documented, and aligned with the contract's intent, preventing unwarranted cost increases for the government.

What does the 'NOT AVAILABLE FOR COMPETITION' designation imply for the effectiveness of government procurement in this instance?

The 'NOT AVAILABLE FOR COMPETITION' designation, often referred to as a sole-source award, implies that the standard competitive procurement process was bypassed. This can occur for various reasons, such as the existence of only one responsible source, urgent and compelling needs, or specific national security requirements. While sometimes necessary, it inherently limits the government's ability to leverage competition to achieve the best possible price and terms. The effectiveness of government procurement in this instance is therefore questionable from a price discovery perspective. It places a greater onus on the contracting agency to ensure the negotiated price is fair and reasonable through other means, such as market research and cost analysis, to mitigate the lack of competitive pressure.

How has spending on 'Electric Power Distribution' services by the Department of the Army trended historically?

Historical spending data for 'Electric Power Distribution' services by the Department of the Army is not provided in the current dataset. To analyze historical trends, one would need to access and aggregate contract data over multiple fiscal years, filtering by the relevant agency (Department of the Army) and the specific product/service code or NAICS code for electric power distribution. This analysis would reveal patterns in spending levels, identify periods of significant increases or decreases, and potentially highlight shifts in procurement strategies or infrastructure investments. Understanding these trends is crucial for budget forecasting, identifying potential cost efficiencies, and assessing the long-term commitment to utility services.

Industry Classification

NAICS: Utilities › Electric Power Generation, Transmission and Distribution › Electric Power Distribution

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: 2011 CRYSTAL DR STE 911, ARLINGTON, VA, 08

Business Categories: Category Business, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $15,405,777

Exercised Options: $15,405,777

Current Obligation: $15,405,777

Contract Characteristics

Multi-Year Contract: Yes

Cost or Pricing Data: NO

Timeline