HHS Awards $4.9M for Utility Services to Navajo Tribal Utility Authority in Arizona

Contract Overview

Contract Amount: $4,912,300 ($4.9M)

Contractor: Navajo Tribal Utility Authority

Awarding Agency: Department of Health and Human Services

Start Date: 2023-12-05

End Date: 2033-12-31

Contract Duration: 3,679 days

Daily Burn Rate: $1.3K/day

Competition Type: FULL AND OPEN COMPETITION

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: UTILITY SERVICES FOR CHINLE COMPREHENSIVE HEALTH CARE FACILITY AND MANY FARMS CLINIC

Place of Performance

Location: CHINLE, APACHE County, ARIZONA, 86503

State: Arizona Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $4.9 million to NAVAJO TRIBAL UTILITY AUTHORITY for work described as: UTILITY SERVICES FOR CHINLE COMPREHENSIVE HEALTH CARE FACILITY AND MANY FARMS CLINIC Key points: 1. Significant contract awarded to a tribal entity, potentially supporting local economic development. 2. Long-term contract (10 years) indicates a stable need for utility services. 3. Competition method is 'Full and Open', suggesting a competitive bidding process. 4. The contract is for Natural Gas Distribution, a critical utility service.

Value Assessment

Rating: fair

The contract value of $4.9M over 10 years averages $491,230 annually. Benchmarking against similar utility service contracts is difficult without more specific service details and geographic comparisons. The firm fixed price structure provides cost certainty.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating multiple vendors had the opportunity to bid. This method generally promotes competitive pricing and ensures the government receives fair market value.

Taxpayer Impact: The firm fixed price contract provides predictable costs for taxpayers over the 10-year period, avoiding potential cost overruns due to fluctuating service needs.

Public Impact

Ensures essential utility services for healthcare facilities and farms, directly impacting community well-being. Supports the operational continuity of critical infrastructure in Arizona. Potential economic benefit to the Navajo Nation through contract award.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of detailed service scope and performance metrics.
Long contract duration may not account for future technological changes in utility delivery.
Limited information on the specific farms served, making impact assessment broad.

Positive Signals

Award to a tribal entity aligns with federal goals of supporting indigenous communities.
Long-term contract provides stability for essential services.
Firm fixed price contract offers budget predictability.

Sector Analysis

This contract falls under utility services, specifically natural gas distribution, for healthcare and agricultural sectors. Spending benchmarks for such services vary widely based on location, scale, and specific needs. The IHS typically procures services to support its mission of improving the health of American Indians and Alaska Natives.

Small Business Impact

The data indicates this contract was not set aside for small businesses (sb: false). While the primary awardee is the Navajo Tribal Utility Authority, further analysis would be needed to determine if any subcontracting opportunities exist for small businesses.

Oversight & Accountability

The contract was awarded via a delivery order under a larger contract vehicle (implied by 'AW': 'DELIVERY ORDER'). Oversight would involve monitoring performance against the contract terms and ensuring timely delivery of services as specified.

Related Government Programs

Natural Gas Distribution
Department of Health and Human Services Contracting
Indian Health Service Programs

Risk Flags

Long contract duration without clear price adjustment mechanisms.
Lack of detailed service scope and performance metrics.
Potential for price to become uncompetitive over the 10-year term.
Limited transparency on the specific farms benefiting from the services.

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $4.9 million to NAVAJO TRIBAL UTILITY AUTHORITY. UTILITY SERVICES FOR CHINLE COMPREHENSIVE HEALTH CARE FACILITY AND MANY FARMS CLINIC

Who is the contractor on this award?

The obligated recipient is NAVAJO TRIBAL UTILITY AUTHORITY.

Which agency awarded this contract?

Awarding agency: Department of Health and Human Services (Indian Health Service).

What is the total obligated amount?

The obligated amount is $4.9 million.

What is the period of performance?

Start: 2023-12-05. End: 2033-12-31.

What is the specific breakdown of utility services provided to the healthcare facility versus the farms, and how does this impact the overall value assessment?

The provided data does not specify the allocation of utility services between the Chinle Comprehensive Health Care Facility and the 'many farms'. Understanding this breakdown is crucial for accurately assessing the value proposition. If a significant portion serves the healthcare facility, the value might be justified by critical health needs. If it primarily supports agriculture, the economic impact and return on investment would be the key metrics.

Given the 10-year duration, what mechanisms are in place to ensure the pricing remains competitive and reflects market changes for natural gas distribution?

The contract utilizes a 'FIRM FIXED PRICE' structure, which locks in the price. While this offers budget certainty, it may not inherently account for significant market fluctuations in natural gas prices over a decade. The contract terms would need to be reviewed for any escalation clauses or provisions for price adjustments based on market indices to ensure continued competitiveness and taxpayer value.

How effectively does this contract support the IHS mission of improving health outcomes for the Navajo Nation, beyond just providing basic utility services?

Providing reliable natural gas is fundamental to the operation of healthcare facilities, enabling essential services like heating, sterilization, and power generation, which directly impact patient care and health outcomes. For the farms, reliable energy can support food production, contributing to community health and economic stability. The effectiveness is measured by the uninterrupted provision of these critical services.

Industry Classification

NAICS: Utilities › Natural Gas Distribution › Natural Gas Distribution

Product/Service Code: UTILITIES AND HOUSEKEEPING › UTILITIES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: TWO STEP

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: HWY 12 N, FORT DEFIANCE, AZ, 86504

Business Categories: Category Business, Government, Native American Tribal Government, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $4,912,300

Exercised Options: $4,912,300

Current Obligation: $4,912,300

Actual Outlays: $2,831,327

Contract Characteristics

Multi-Year Contract: Yes

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: GS00P14BSD1060

IDV Type: IDC

Timeline