DoD's $37.3M Utility Services Contract Awarded to Foreign Utility Consolidated Reporting Faces Competition Concerns

Contract Overview

Contract Amount: $37,281,647 ($37.3M)

Contractor: Foreign Utility Consolidated Reporting

Awarding Agency: Department of Defense

Start Date: 2009-10-01

End Date: 2010-07-31

Contract Duration: 303 days

Daily Burn Rate: $123.0K/day

Competition Type: NOT AVAILABLE FOR COMPETITION

Number of Offers Received: 1

Pricing Type: FIXED PRICE WITH ECONOMIC PRICE ADJUSTMENT

Sector: Other

Official Description: UTILITY SERVICES

Plain-Language Summary

Department of Defense obligated $37.3 million to FOREIGN UTILITY CONSOLIDATED REPORTING for work described as: UTILITY SERVICES Key points: 1. Awarded for utility services, this contract represents a significant expenditure. 2. The sole-source nature raises questions about competitive pricing and value. 3. Limited competition increases the risk of overpayment and reduced innovation. 4. The sector is essential government support, but specific benchmarks are unavailable.

Value Assessment

Rating: questionable

The contract value is substantial, but without a competitive process or available benchmarks, assessing its value for money is difficult. The fixed-price with economic price adjustment structure can lead to cost overruns if not carefully managed.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

The contract was not available for competition, indicating a sole-source award. This limits price discovery and potentially leads to higher costs for taxpayers as there is no market pressure to offer the best price.

Taxpayer Impact: The lack of competition for this $37.3M contract means taxpayers may not be receiving the most cost-effective solution available.

Public Impact

Taxpayers may be overpaying due to the absence of competitive bidding. Reliance on a single provider could lead to service disruptions if the contractor fails. The economic price adjustment clause introduces uncertainty in final costs.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award
Lack of competition
Economic price adjustment
No benchmark data

Positive Signals

Essential utility services provided

Sector Analysis

Utility services are critical for government operations, encompassing electricity, water, and gas. Benchmarking is difficult without specific service details, but significant contracts typically undergo rigorous competition to ensure value.

Small Business Impact

There is no indication that small businesses were involved in this contract, either as prime contractors or subcontractors. The sole-source nature further limits opportunities for small business participation.

Oversight & Accountability

The sole-source nature of this award warrants close oversight to ensure the contractor is delivering services at a fair and reasonable price, especially given the economic price adjustment clause.

Related Government Programs

Other General Government Support
Department of Defense Contracting
Department of the Army Programs

Risk Flags

Sole-source award limits competition.
Potential for inflated pricing.
Economic price adjustment clause adds cost uncertainty.
Lack of benchmark data hinders value assessment.
No small business participation evident.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $37.3 million to FOREIGN UTILITY CONSOLIDATED REPORTING. UTILITY SERVICES

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 $37.3 million.

What is the period of performance?

Start: 2009-10-01. End: 2010-07-31.

What specific utility services are covered under this contract, and how was the initial price determined without competition?

The provided data does not specify the exact utility services. However, without competition, the initial price is typically negotiated directly with the sole-source provider. This negotiation should ideally be based on cost analysis, historical pricing, or industry standards, but transparency is often limited in sole-source procurements.

What are the potential risks associated with a sole-source award for essential utility services, particularly with an economic price adjustment?

The primary risks include inflated pricing due to lack of market pressure, potential for complacency in service quality, and vulnerability to price shocks from the economic price adjustment clause. If the contractor faces increased costs, these are passed on, potentially exceeding what a competitive market would bear.

How can the Department of Defense ensure effective oversight and accountability for this contract to mitigate risks and ensure value?

Effective oversight requires diligent monitoring of service delivery, regular review of cost data supporting the economic price adjustment, and comparison with any available market intelligence or alternative service costs. Periodic re-evaluation of the necessity for a sole-source arrangement is also crucial.

Industry Classification

NAICS: Public Administration › Executive, Legislative, and Other General Government Support › Other General Government Support

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: $37,282,647

Exercised Options: $37,282,647

Current Obligation: $37,281,647

Contract Characteristics

Cost or Pricing Data: NOT OBTAINED - WAIVED

Timeline