Commerce Dept. Awards $3.89M for Natural Gas Utility Service to Vectren LLC in Indiana
Contract Overview
Contract Amount: $3,886,812 ($3.9M)
Contractor: Vectren LLC
Awarding Agency: Department of Commerce
Start Date: 2014-12-01
End Date: 2026-12-31
Contract Duration: 4,413 days
Daily Burn Rate: $881/day
Competition Type: NOT AVAILABLE FOR COMPETITION
Pricing Type: FIRM FIXED PRICE
Sector: Energy
Official Description: IGF::OT::IGF NATURAL GAS UTILITY SERVICE AT JEFFERSONVILLE, INDIANA.
Place of Performance
Location: JEFFERSONVILLE, CLARK County, INDIANA, 47190
State: Indiana Government Spending
Plain-Language Summary
Department of Commerce obligated $3.9 million to VECTREN LLC for work described as: IGF::OT::IGF NATURAL GAS UTILITY SERVICE AT JEFFERSONVILLE, INDIANA. Key points: 1. Contract awarded to Vectren LLC for natural gas utility services. 2. The contract value is $3.89 million over its duration. 3. The contract is for natural gas distribution services in Indiana. 4. The contract type is Firm Fixed Price. 5. This is a delivery order under an existing contract.
Value Assessment
Rating: fair
Pricing is based on a Firm Fixed Price contract, which offers cost certainty. However, without specific benchmarks or comparison data for similar natural gas utility services, a precise value assessment is difficult. The total award amount of $3.89 million over the contract period needs further analysis against market rates.
Cost Per Unit: N/A
Competition Analysis
Competition Level: limited
The contract is noted as 'NOT AVAILABLE FOR COMPETITION,' indicating a limited competition scenario. This could be due to the nature of utility services requiring specific infrastructure or existing provider relationships. The lack of open competition may limit price discovery and potentially lead to less favorable pricing for the government.
Taxpayer Impact: The government is procuring essential utility services. While the competition is limited, the firm fixed price contract aims to control costs. The ultimate taxpayer impact depends on whether the negotiated price reflects fair market value for the services provided.
Public Impact
Ensures consistent and reliable natural gas supply for a government facility. Supports local utility infrastructure and services within Indiana. Provides essential services to a federal agency, enabling its operations.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Limited competition raises concerns about potential overpayment.
- Lack of detailed cost breakdown makes value assessment challenging.
Positive Signals
- Firm Fixed Price contract provides cost predictability.
- Long-term contract ensures service continuity.
Sector Analysis
The contract falls under the natural gas distribution sector, providing essential utility services. Spending in this sector is often characterized by regulated pricing and established infrastructure, which can influence competition and cost structures. Benchmarks for similar utility contracts are crucial for evaluating value.
Small Business Impact
There is no indication of small business participation in this contract. The nature of utility services and the limited competition may present challenges for small businesses to engage directly, though they might be involved as subcontractors to the prime vendor.
Oversight & Accountability
The contract is a delivery order, suggesting it's part of a larger framework agreement. Oversight would focus on ensuring the delivery order aligns with the parent contract's terms and that services are rendered as specified. Accountability rests with the Department of Commerce and the U.S. Census Bureau for contract management.
Related Government Programs
- Natural Gas Distribution
- Department of Commerce Contracting
- U.S. Census Bureau Programs
Risk Flags
- Limited competition
- Lack of detailed cost breakdown
- Potential for price escalation over contract term
- Absence of clear value benchmarks
Tags
natural-gas-distribution, department-of-commerce, in, delivery-order, 1m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Commerce awarded $3.9 million to VECTREN LLC. IGF::OT::IGF NATURAL GAS UTILITY SERVICE AT JEFFERSONVILLE, INDIANA.
Who is the contractor on this award?
The obligated recipient is VECTREN LLC.
Which agency awarded this contract?
Awarding agency: Department of Commerce (U.S. Census Bureau).
What is the total obligated amount?
The obligated amount is $3.9 million.
What is the period of performance?
Start: 2014-12-01. End: 2026-12-31.
What is the specific justification for the limited competition for this natural gas utility service?
The justification for limited competition is crucial for understanding the pricing and value. Utility services often rely on existing infrastructure and service territories, which can naturally restrict the number of potential providers. A detailed explanation from the agency would clarify if this is due to sole-source provider status, geographic necessity, or other factors that preclude a broader solicitation process.
How does the firm fixed price compare to market rates for natural gas distribution in the Jeffersonville, Indiana area?
A comprehensive comparison of the firm fixed price against prevailing market rates for natural gas distribution in Jeffersonville, Indiana, is essential. This involves analyzing historical pricing trends, competitor bids (if any were solicited), and industry benchmarks. Without this data, it's difficult to ascertain if the government is receiving a competitive price or if the fixed price might be inflated due to the limited competition.
What are the potential risks associated with a long-term, limited-competition utility contract?
Long-term contracts with limited competition carry risks such as price escalation beyond market trends, reduced incentive for the provider to innovate or offer cost savings, and potential vendor lock-in. If the utility provider's costs decrease significantly over the contract period, the government might continue paying a higher fixed price. Furthermore, if the provider's service quality declines, options for recourse might be limited.
Industry Classification
NAICS: Utilities › Natural Gas Distribution › Natural Gas Distribution
Product/Service Code: UTILITIES AND HOUSEKEEPING › UTILITIES
Competition & Pricing
Extent Competed: NOT AVAILABLE FOR COMPETITION
Solicitation Procedures: ONLY ONE SOURCE
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: Centerpoint Energy, Inc.
Address: ONE VECTREN SQUARE, EVANSVILLE, IN, 47708
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $3,886,812
Exercised Options: $3,886,812
Current Obligation: $3,886,812
Actual Outlays: $3,509,563
Contract Characteristics
Multi-Year Contract: Yes
Commercial Item: COMMERCIAL PRODUCTS/SERVICES
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: GS00P14BSD1078
IDV Type: IDC
Timeline
Start Date: 2014-12-01
Current End Date: 2026-12-31
Potential End Date: 2026-12-31 00:00:00
Last Modified: 2026-03-25
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