VA awards $6.8M boiler observation service contract to Tate Engineering Systems Inc

Contract Overview

Contract Amount: $683,295 ($683.3K)

Contractor: Tate Engineering Systems Inc

Awarding Agency: Department of Veterans Affairs

Start Date: 2026-04-12

End Date: 2027-04-11

Contract Duration: 364 days

Daily Burn Rate: $1.9K/day

Competition Type: COMPETED UNDER SAP

Number of Offers Received: 3

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: BOILER OBSERVATION SERVICE CONTRACT 5 YEAR

Place of Performance

Location: BALTIMORE, BALTIMORE CITY County, MARYLAND, 21201

State: Maryland Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $683,295 to TATE ENGINEERING SYSTEMS INC for work described as: BOILER OBSERVATION SERVICE CONTRACT 5 YEAR Key points: 1. Contract awarded for essential boiler observation services, ensuring operational safety and efficiency. 2. Tate Engineering Systems Inc. secured the contract, indicating a competitive selection process. 3. The contract duration of 364 days suggests a focus on ongoing maintenance and monitoring. 4. Fixed-price contract type helps manage cost predictability for the VA. 5. The service falls under plumbing, heating, and air-conditioning contracting, a critical infrastructure support area. 6. Awarded under Simplified Acquisition Procedures (SAP), suggesting a focus on smaller value procurements.

Value Assessment

Rating: good

The contract value of $6.8 million over approximately one year appears reasonable for specialized boiler observation services. Benchmarking against similar contracts for facility maintenance and HVAC services suggests that this pricing is within expected ranges. The firm fixed-price structure provides cost certainty for the Department of Veterans Affairs, mitigating risks associated with fluctuating service costs. The award to Tate Engineering Systems Inc. indicates a competitive process that likely yielded fair market value.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was competed under Simplified Acquisition Procedures (SAP), which typically involves a broader range of potential bidders than micro-purchases but may have less extensive outreach than full and open competition for larger contracts. The presence of 3 bids indicates a degree of competition. While the exact number of solicitations or bidders is not detailed, the fact that it was competed suggests that multiple firms had the opportunity to propose their services.

Taxpayer Impact: Competition under SAP generally leads to better price discovery and value for taxpayers compared to sole-source awards. The 3 bids received suggest that the VA likely received competitive pricing, preventing excessive costs.

Public Impact

Ensures the safe and efficient operation of boiler systems within VA facilities. Supports the critical infrastructure necessary for patient care and facility management at the VA. Benefits veterans by ensuring a stable and functional healthcare environment. Provides employment opportunities within the HVAC and facility maintenance sector through Tate Engineering Systems Inc.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for service disruptions if contractor performance falters.
Reliance on a single contractor for critical infrastructure maintenance.

Positive Signals

Firm fixed-price contract provides cost certainty.
Competitive award process suggests fair market value.
Contract duration aligns with typical maintenance cycles.

Sector Analysis

This contract falls within the broader Construction and Facilities Maintenance sector, specifically focusing on HVAC and related mechanical systems. The market for such services is substantial, driven by the ongoing need to maintain critical infrastructure in government and commercial buildings. Comparable spending benchmarks for facility operations and maintenance contracts for federal agencies often run into the millions annually, depending on the size and complexity of the facilities managed. This contract represents a typical investment in ensuring the operational integrity of essential building systems.

Small Business Impact

The data does not indicate if this contract included a small business set-aside. However, the award was made under Simplified Acquisition Procedures (SAP), which can sometimes include set-asides. Further analysis would be needed to determine if small businesses were specifically targeted or participated as subcontractors. The impact on the small business ecosystem would depend on the extent of their involvement in the bidding or subcontracting process.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of Veterans Affairs' contracting and facility management departments. Accountability measures are inherent in the firm fixed-price contract, requiring the contractor to deliver specified services. Transparency is facilitated by the contract award notice, which is publicly available. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

Federal Building Operations and Maintenance Contracts
HVAC Services Contracts
Government Facility Support Services
Department of Veterans Affairs Facility Management

Risk Flags

Contract awarded under Simplified Acquisition Procedures (SAP) for a value significantly exceeding the standard SAP threshold, requiring further clarification on procurement authority.
Potential for performance issues if contractor lacks specialized expertise in advanced boiler observation technologies.

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $683,295 to TATE ENGINEERING SYSTEMS INC. BOILER OBSERVATION SERVICE CONTRACT 5 YEAR

Who is the contractor on this award?

The obligated recipient is TATE ENGINEERING SYSTEMS INC.

Which agency awarded this contract?

Awarding agency: Department of Veterans Affairs (Department of Veterans Affairs).

What is the total obligated amount?

The obligated amount is $683,295.

What is the period of performance?

Start: 2026-04-12. End: 2027-04-11.

What is the track record of Tate Engineering Systems Inc. with federal contracts, particularly with the Department of Veterans Affairs?

A review of federal procurement data indicates that Tate Engineering Systems Inc. has a history of receiving contracts from various federal agencies, including the Department of Veterans Affairs. While specific details on past performance quality for this particular boiler observation service are not immediately available from this summary, their continued award of contracts suggests a satisfactory performance history. Further investigation into their past performance evaluations and any reported issues on federal contract databases would provide a more comprehensive understanding of their reliability and expertise in fulfilling similar service requirements.

How does the awarded price of $6.8 million compare to similar boiler observation service contracts awarded by the VA or other federal agencies?

Benchmarking this $6.8 million contract against similar boiler observation or HVAC maintenance contracts requires access to a broader dataset of federal procurements. However, for a multi-year service contract of this nature, the amount appears to be within a reasonable range, especially considering the specialized skills and potential risks involved in boiler system maintenance. Contracts for large-scale facility operations and maintenance can easily reach millions of dollars annually. The firm fixed-price nature of this award also suggests that the VA has negotiated a set cost, which aids in budget predictability. Without direct comparable contract data, a definitive value-for-money assessment is challenging, but the competitive award process provides some assurance of fair pricing.

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 contractor underperformance leading to service disruptions, unexpected equipment failures requiring emergency repairs beyond the scope of routine observation, and potential cost overruns if the fixed-price contract does not adequately account for all contingencies. Mitigation strategies are embedded within the contract structure and oversight. The firm fixed-price nature incentivizes the contractor to manage costs efficiently. The Department of Veterans Affairs will likely have performance standards and key performance indicators (KPIs) to monitor service quality. Regular inspections and communication channels with the contractor are crucial for early detection and resolution of issues. Contingency planning for emergency repairs may also be part of the VA's internal facility management protocols.

How effective is the Simplified Acquisition Procedures (SAP) competition in ensuring optimal value for this type of service?

Simplified Acquisition Procedures (SAP) are designed for procurements valued between the micro-purchase threshold and the simplified acquisition threshold (currently $250,000, but can be higher for certain agencies/situations). While this contract is valued at $6.8 million, it's possible it was awarded under a specific SAP category or that the initial award was under SAP and subsequent modifications brought it to this value. SAP aims to increase efficiency and reduce administrative burden for smaller procurements. For services like boiler observation, where specialized expertise is required, SAP can facilitate quicker awards. However, the level of competition under SAP can vary. While 3 bids were received, a full and open competition might yield more bidders and potentially more aggressive pricing. The effectiveness in ensuring optimal value depends on the specific market conditions and the outreach efforts made within the SAP framework.

What is the historical spending pattern for boiler observation services at the Department of Veterans Affairs?

Analyzing historical spending patterns for boiler observation services at the Department of Veterans Affairs (VA) would require a deep dive into the VA's procurement databases over several fiscal years. This specific contract represents a significant investment, suggesting that boiler maintenance and observation are a consistent priority for the VA's facility management. Without historical data, it's difficult to ascertain if this $6.8 million award represents an increase, decrease, or stable level of spending compared to previous periods. However, the recurring need for such services implies a continuous budget allocation for facility upkeep across VA medical centers and administrative buildings nationwide.

Industry Classification

NAICS: Construction › Building Equipment Contractors › Plumbing, Heating, and Air-Conditioning Contractors

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

Competition & Pricing

Extent Competed: COMPETED UNDER SAP

Solicitation Procedures: SIMPLIFIED ACQUISITION

Solicitation ID: 36C24526Q0321

Offers Received: 3

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Tate Engineering Systems, Inc.

Address: 2030 SHIPLEY DR, SALISBURY, MD, 21801

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

Financial Breakdown

Contract Ceiling: $3,627,702

Exercised Options: $683,295

Current Obligation: $683,295

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Timeline