VA awards $2.1M contract for propane tanks, highlighting construction needs in Utah

Contract Overview

Contract Amount: $2,058,637 ($2.1M)

Contractor: RHI LLC

Awarding Agency: Department of Veterans Affairs

Start Date: 2024-05-29

End Date: 2026-02-06

Contract Duration: 618 days

Daily Burn Rate: $3.3K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 2

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: REPLACE PROPANE TANKS

Place of Performance

Location: SALT LAKE CITY, SALT LAKE County, UTAH, 84148

State: Utah Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $2.1 million to RHI LLC for work described as: REPLACE PROPANE TANKS Key points: 1. Contract value appears reasonable for the scope of replacing propane tanks. 2. Full and open competition suggests a competitive bidding process. 3. Contract duration of over 600 days indicates a significant, ongoing need. 4. Fixed-price contract type helps manage cost certainty for the VA. 5. The award to RHI LLC requires monitoring for performance and delivery. 6. This contract addresses essential infrastructure maintenance for VA facilities.

Value Assessment

Rating: good

The contract value of approximately $2.1 million for propane tank replacement seems aligned with typical infrastructure projects of this nature. Without specific details on the number and size of tanks, a direct per-unit cost comparison is difficult. However, the fixed-price nature of the contract provides cost certainty. Benchmarking against similar construction or maintenance contracts for VA facilities would offer further insight into value for money.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under 'Full and Open Competition After Exclusion of Sources,' indicating that while initial solicitations might have had limitations, the final award was made after a broad competitive process. The presence of 2 bidders suggests a moderate level of competition, which is generally positive for price discovery and ensuring a fair market price.

Taxpayer Impact: A competitive process, even with a limited number of bidders, helps ensure that taxpayer funds are used efficiently by driving down costs compared to a sole-source award.

Public Impact

Veterans in Utah will benefit from reliable access to essential services supported by these propane tanks. The contract ensures the continued operation of critical infrastructure at VA facilities. The geographic impact is focused on the state of Utah. This contract supports the construction and maintenance workforce within the specified region.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for delays in delivery or installation of propane tanks impacting facility operations.
Ensuring RHI LLC meets all safety and regulatory compliance standards for propane storage and handling.

Positive Signals

Fixed-price contract limits the risk of cost overruns for the VA.
Awarded after a competitive process, suggesting a fair market price was likely achieved.
Contract duration allows for phased implementation and minimizes disruption.

Sector Analysis

This contract falls within the Commercial and Institutional Building Construction sector, specifically addressing infrastructure maintenance and upgrades. The market for construction services, particularly for government facilities, is substantial. This award represents a typical expenditure for maintaining essential operational capabilities within the federal real property portfolio.

Small Business Impact

The contract does not indicate any specific small business set-aside provisions. Further analysis would be needed to determine if RHI LLC is a small business or if subcontracting opportunities exist for small businesses within this project.

Oversight & Accountability

Oversight will likely be managed by the contracting officer and relevant VA facility management personnel. Accountability is tied to the terms of the firm fixed-price contract, with performance metrics and delivery schedules to be monitored. Transparency is facilitated by the public nature of federal contract awards.

Related Government Programs

VA Facility Maintenance Contracts
Federal Infrastructure Improvement Projects
Energy Infrastructure Contracts

Risk Flags

Potential for supply chain disruptions affecting material delivery.
Risk of unforeseen site conditions impacting installation timelines and costs.
Dependence on contractor's ability to meet stringent safety and environmental regulations.

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $2.1 million to RHI LLC. REPLACE PROPANE TANKS

Who is the contractor on this award?

The obligated recipient is RHI LLC.

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 $2.1 million.

What is the period of performance?

Start: 2024-05-29. End: 2026-02-06.

What is the specific scope of work for replacing these propane tanks, including the number, size, and type of tanks involved?

The provided data does not detail the specific scope of work beyond 'REPLACE PROPANE TANKS.' A comprehensive understanding would require reviewing the contract's statement of work (SOW). This would typically include the quantity of tanks, their capacity (e.g., gallons), whether they are above-ground or underground, associated piping, installation requirements, and any necessary site preparation or decommissioning of old tanks. Without this granular detail, assessing the appropriateness of the $2.1 million award is challenging, as the scale of the project could vary significantly.

How does the awarded price of $2.1 million compare to similar propane tank replacement projects for federal agencies or commercial entities of similar size?

Benchmarking the $2.1 million award requires access to comparable contract data. Factors influencing cost include geographic location (labor and material costs vary), the number and size of tanks, site accessibility, and specific regulatory requirements. If this contract involves replacing a large number of tanks or undertaking complex installations at multiple VA facilities in Utah, the price could be considered competitive. Conversely, if it's for a smaller number of standard tanks, it might warrant closer scrutiny. Accessing a database of similar federal or commercial construction contracts would be necessary for a robust comparison.

What are the key performance indicators (KPIs) or milestones outlined in the contract to ensure successful completion and timely delivery?

The contract details do not specify the key performance indicators (KPIs) or milestones. Typically, for a construction contract of this duration (618 days), milestones would be established for phases such as design finalization, procurement of materials, site preparation, tank installation, system testing, and final handover. Performance would likely be evaluated based on adherence to schedule, quality of work, safety compliance, and meeting all technical specifications outlined in the Statement of Work. The contracting officer's representative (COR) would be responsible for monitoring progress against these metrics.

What is the track record of RHI LLC in performing similar government contracts, particularly those involving infrastructure or construction?

Information regarding RHI LLC's specific track record on government contracts is not provided in the data. A thorough assessment would involve reviewing the company's past performance evaluations (e.g., Contractor Performance Assessment Reporting System - CPARS), its history with the Department of Veterans Affairs or other federal agencies, and the successful completion of projects of similar scope and value. Examining their experience with infrastructure projects, particularly those involving hazardous materials like propane, would be crucial for evaluating their capability and reliability for this contract.

Are there any specific risks identified in the contract or by the agency that could impact the successful execution of this project?

The provided data does not explicitly list identified risks for this contract. However, potential risks inherent in such projects could include supply chain disruptions for materials, unforeseen site conditions (e.g., underground utilities, soil stability), weather-related delays impacting installation, labor shortages, or changes in regulatory requirements. The fixed-price nature of the contract shifts some risk to the contractor, but the agency must still manage risks related to contractor performance, safety, and timely completion. A review of the contract's risk mitigation plan, if available, would provide further insight.

Industry Classification

NAICS: Construction › Nonresidential Building Construction › Commercial and Institutional Building Construction

Product/Service Code: MAINT, REPAIR, ALTER REAL PROPERTY › MAINT, ALTER, REPAIR NONBUILDINGS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: 36C25924R0013

Offers Received: 2

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 668 N 2075 W, MARRIOT-SLATERVILLE, UT, 84404

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Limited Liability Corporation, Service Disabled Veteran Owned Business, Small Business, Special Designations, U.S.-Owned Business, Veteran Owned Business

Financial Breakdown

Contract Ceiling: $2,058,637

Exercised Options: $2,058,637

Current Obligation: $2,058,637

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline