Siemens Industry Inc. awarded $2.29M contract for Smithsonian Institution's LSS preventative maintenance

Contract Overview

Contract Amount: $2,286,919 ($2.3M)

Contractor: Siemens Industry Inc

Awarding Agency: Smithsonian Institution

Start Date: 2024-06-24

End Date: 2026-04-15

Contract Duration: 660 days

Daily Burn Rate: $3.5K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: ANNUAL OPERATIONS OF LSS PREVENTATIVE MAINTENANCE.

Place of Performance

Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20008

State: District of Columbia Government Spending

Plain-Language Summary

Smithsonian Institution obligated $2.3 million to SIEMENS INDUSTRY INC for work described as: ANNUAL OPERATIONS OF LSS PREVENTATIVE MAINTENANCE. Key points: 1. Contract value appears reasonable for a multi-year maintenance agreement. 2. Sole-source award limits price discovery and potential for competitive savings. 3. Contract duration of nearly two years presents moderate performance risk. 4. Electrical maintenance services are critical for facility operations. 5. This contract falls within the broader facilities maintenance sector. 6. No small business set-aside was applied, indicating potential missed opportunities.

Value Assessment

Rating: fair

The contract value of $2.29 million over approximately 22 months for annual operations of LSS preventative maintenance suggests an average annual cost of roughly $1.04 million. Without specific details on the scope of 'LSS preventative maintenance' (e.g., number of systems, criticality, geographic spread), direct comparison is difficult. However, for large institutional facilities, this figure is within a plausible range for specialized electrical and wiring maintenance. The firm-fixed-price nature provides cost certainty, but the lack of competition raises questions about whether this represents the best possible value.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning the Smithsonian Institution did not solicit bids from multiple vendors. This approach is typically used when only one vendor possesses the necessary qualifications, proprietary knowledge, or when urgency dictates a direct award. The lack of competition means taxpayers do not benefit from the price reductions that can arise from a competitive bidding process, potentially leading to a higher price than if multiple firms had vied for the contract.

Taxpayer Impact: The sole-source nature of this award means taxpayers may not be receiving the most cost-effective solution, as competitive pressures that drive down prices were absent.

Public Impact

The Smithsonian Institution benefits from the continued operational integrity of its LSS systems. Essential preventative maintenance services ensure the reliable functioning of electrical infrastructure. Services are geographically concentrated within the District of Columbia. The contract supports specialized technical jobs in electrical maintenance and repair.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits competitive pricing, potentially increasing costs for taxpayers.
Lack of transparency in the justification for sole-source award.
Contract duration could lead to vendor lock-in if not managed carefully.
No small business participation noted, potentially excluding smaller specialized firms.

Positive Signals

Firm-fixed-price contract provides cost certainty for the agency.
Siemens Industry Inc. is a known entity in industrial maintenance.
Preventative maintenance is crucial for asset longevity and operational continuity.

Sector Analysis

This contract falls within the broader facilities management and specialized maintenance services sector, specifically focusing on electrical systems. The market for such services is substantial, driven by the need to maintain complex infrastructure in government buildings, museums, and other large institutions. Benchmarking against similar contracts is challenging without detailed scope, but large-scale electrical preventative maintenance for institutional clients can range from hundreds of thousands to millions of dollars annually, depending on the scale and complexity of the systems.

Small Business Impact

The contract was not set aside for small businesses, nor does it appear to have specific subcontracting requirements for small businesses mentioned. This indicates that the primary award went to a large corporation, and opportunities for small businesses to participate in this specific contract are likely limited unless Siemens Industry Inc. voluntarily engages them. This could represent a missed opportunity to foster small business growth within the federal contracting ecosystem for specialized electrical maintenance.

Oversight & Accountability

Oversight for this contract would primarily reside with the Smithsonian Institution's contracting officers and program managers. As a firm-fixed-price contract, the focus will be on ensuring Siemens Industry Inc. fulfills the defined scope of preventative maintenance services within the agreed-upon timeframe and budget. Transparency is limited due to the sole-source nature, but contract performance metrics and payment milestones would be subject to internal review. The Inspector General for the Smithsonian Institution could investigate if any fraud, waste, or abuse is suspected.

Related Government Programs

Federal Buildings Maintenance Contracts
Government Electrical Services
Museum and Cultural Institution Operations
Preventative Maintenance Services

Risk Flags

Sole-source award lacks competitive justification.
Potential for inflated pricing due to lack of competition.
Limited transparency regarding specific maintenance scope.
No small business participation noted.

Frequently Asked Questions

What is this federal contract paying for?

Smithsonian Institution awarded $2.3 million to SIEMENS INDUSTRY INC. ANNUAL OPERATIONS OF LSS PREVENTATIVE MAINTENANCE.

Who is the contractor on this award?

The obligated recipient is SIEMENS INDUSTRY INC.

Which agency awarded this contract?

Awarding agency: Smithsonian Institution (Smithsonian Institution).

What is the total obligated amount?

The obligated amount is $2.3 million.

What is the period of performance?

Start: 2024-06-24. End: 2026-04-15.

What specific systems or components does 'LSS preventative maintenance' encompass for the Smithsonian Institution?

The provided data does not specify the exact components covered under 'LSS preventative maintenance.' LSS could potentially refer to Life Safety Systems, Lighting Systems, or a specific internal designation for a set of building systems. Preventative maintenance typically involves scheduled inspections, cleaning, lubrication, testing, and minor repairs to ensure optimal performance and prevent unexpected failures. For electrical systems, this could include switchgear, transformers, emergency generators, uninterruptible power supplies (UPS), lighting controls, and fire alarm systems. A detailed scope of work within the contract would clarify the precise systems and maintenance tasks included.

What is the historical spending pattern for LSS preventative maintenance at the Smithsonian Institution?

The provided data only includes details for this specific contract award. To understand historical spending patterns, one would need to access historical contract databases (like FPDS or USASpending) for the Smithsonian Institution, searching for similar maintenance services over previous fiscal years. Analyzing this data would reveal if spending has been consistent, increasing, or decreasing, and whether this contract represents a continuation of a long-standing service or a new initiative. It would also help determine if previous contracts for similar services were competed or awarded sole-source.

What is the justification for awarding this contract on a sole-source basis?

The data indicates the contract was 'NOT COMPETED,' implying a sole-source justification. Common reasons for sole-source awards include that the service is available only from a single responsible source (e.g., proprietary technology, unique expertise), or that there is an urgent and compelling need that cannot be met through competition. Without further documentation from the Smithsonian Institution (such as a Justification and Approval document), the specific reason remains unknown. This lack of competition raises concerns about potential overpayment and missed opportunities for better value.

How does the annual cost of this contract compare to industry benchmarks for similar facilities?

The annual cost for this contract is approximately $1.04 million ($2.29M / ~22 months). Benchmarking this figure requires detailed information about the size and complexity of the Smithsonian Institution's facilities, the specific LSS components maintained, and the scope of preventative maintenance tasks. General industry benchmarks for large institutional facilities can vary widely. However, for specialized electrical preventative maintenance, this annual figure appears within a plausible range, assuming a significant number of critical systems are covered. The lack of competition makes it difficult to ascertain if this price is competitive.

What is Siemens Industry Inc.'s track record with the Smithsonian Institution and similar federal agencies?

The provided data shows Siemens Industry Inc. as the contractor for this specific award. To assess their track record, a broader search of federal procurement databases (FPDS, USASpending) would be necessary. This would reveal the number and value of contracts Siemens Industry Inc. has held with the Smithsonian Institution and other federal agencies, the types of services provided, and their performance history (e.g., any contract disputes, terminations, or positive performance reviews). A strong history with positive past performance could partially mitigate concerns about a sole-source award, though it doesn't replace the benefits of competition.

Are there any performance risks associated with this contract, given its duration and sole-source nature?

The contract duration of approximately 22 months (from June 2024 to April 2026) presents a moderate performance risk. While not excessively long, it still requires diligent oversight to ensure Siemens Industry Inc. meets all contractual obligations. The primary risk stems from the sole-source award, which can reduce the contractor's incentive to perform exceptionally well, as there is no immediate competitive threat. Additionally, without competition, there's a risk that the quality of service may not be as high as could be achieved through a competitive process, or that the agency is paying a premium for the service.

Industry Classification

NAICS: Construction › Building Equipment Contractors › Electrical Contractors and Other Wiring Installation Contractors

Product/Service Code: ELECTRIC WIRE, POWER DISTRIB EQPT

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 1000 E DEERFIELD PKWY, BUFFALO GROVE, IL, 60089

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

Financial Breakdown

Contract Ceiling: $2,286,919

Exercised Options: $2,286,919

Current Obligation: $2,286,919

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline