GSA awards $347M for natural gas distribution services over 10 years to Washington Gas Light Company

Contract Overview

Contract Amount: $347,037,395 ($347.0M)

Contractor: Washington GAS Light Company

Awarding Agency: General Services Administration

Start Date: 2009-01-14

End Date: 2019-01-14

Contract Duration: 3,652 days

Daily Burn Rate: $95.0K/day

Competition Type: NOT AVAILABLE FOR COMPETITION

Number of Offers Received: 1

Pricing Type: COST NO FEE

Sector: Other

Official Description: GAS SERVICES AT THE CENTRAL HEATING & REFRIGERATION PLANT, 13TH & C STREETS, SW., WASHINGTON,DC

Place of Performance

Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20407

State: District of Columbia Government Spending

Plain-Language Summary

General Services Administration obligated $347.0 million to WASHINGTON GAS LIGHT COMPANY for work described as: GAS SERVICES AT THE CENTRAL HEATING & REFRIGERATION PLANT, 13TH & C STREETS, SW., WASHINGTON,DC Key points: 1. Contract value represents significant, long-term commitment for essential utility services. 2. Sole-source award raises questions about potential for competitive pricing and value. 3. Extended duration of contract may limit flexibility and opportunities for cost savings. 4. Performance context is critical given the essential nature of the service. 5. Sector positioning is within public infrastructure and utility services for federal facilities.

Value Assessment

Rating: fair

The contract's value of over $347 million for natural gas distribution over a decade suggests a substantial commitment. Without comparable sole-source contracts for similar services in the region, a direct value-for-money assessment is challenging. However, the lack of competition inherently limits the government's ability to secure the most competitive pricing. The fixed nature of utility services makes benchmarking difficult, but the absence of competitive bidding is a primary concern for ensuring optimal value.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning it was not competed. This approach is typically used when only one responsible source is available or in the interest of the government. The lack of competition means that multiple bidders were not considered, which can lead to higher prices than might be achieved in a competitive environment. Price discovery is therefore limited, as there was no market test to determine the lowest feasible price.

Taxpayer Impact: Taxpayers may be paying a premium due to the absence of competitive bidding. The government did not have the opportunity to leverage multiple offers to drive down costs for this essential service.

Public Impact

Federal facilities in Washington D.C. benefit from a continuous supply of natural gas. The General Services Administration (GSA) ensures operational continuity for its managed properties. The contract supports the reliable functioning of heating and refrigeration systems. The District of Columbia benefits from the consistent utility service provision.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits competitive pressure on pricing.
Long contract duration (10 years) may not reflect evolving market conditions or opportunities for cost reduction.
Lack of transparency in the justification for sole-source award.

Positive Signals

Ensures reliable and continuous supply of essential utility service.
Long-term commitment provides stability for federal facility operations.
Washington Gas Light Company is an established utility provider in the region.

Sector Analysis

This contract falls within the utility services sector, specifically natural gas distribution, which is critical for the operation of federal buildings. The market for natural gas distribution is often characterized by regional monopolies or oligopolies due to infrastructure requirements. Comparable spending benchmarks are difficult to establish for sole-source utility contracts, but the scale of this award indicates a significant portion of GSA's utility budget for the region.

Small Business Impact

This contract does not appear to have a small business set-aside component, nor is there information suggesting significant subcontracting opportunities for small businesses. The nature of utility distribution services typically involves large, established providers with extensive infrastructure, making it less conducive to small business participation as prime contractors.

Oversight & Accountability

Oversight for this contract would primarily fall under the General Services Administration's Public Buildings Service. Accountability measures would likely involve performance metrics related to service reliability, billing accuracy, and adherence to safety standards. Transparency is limited by the sole-source nature of the award, but contract performance and payment data are generally subject to federal reporting requirements.

Related Government Programs

Federal Utility Contracts
Natural Gas Supply Contracts
GSA Facility Management Contracts
Public Infrastructure Services

Risk Flags

Sole-source award lacks competitive pricing.
Long contract duration may not capture market efficiencies.
Limited transparency on justification for sole-source.

Frequently Asked Questions

What is this federal contract paying for?

General Services Administration awarded $347.0 million to WASHINGTON GAS LIGHT COMPANY. GAS SERVICES AT THE CENTRAL HEATING & REFRIGERATION PLANT, 13TH & C STREETS, SW., WASHINGTON,DC

Who is the contractor on this award?

The obligated recipient is WASHINGTON GAS LIGHT COMPANY.

Which agency awarded this contract?

Awarding agency: General Services Administration (Public Buildings Service).

What is the total obligated amount?

The obligated amount is $347.0 million.

What is the period of performance?

Start: 2009-01-14. End: 2019-01-14.

What was the specific justification provided by GSA for awarding this contract on a sole-source basis?

The provided data indicates the contract was 'NOT AVAILABLE FOR COMPETITION,' which is a common designation for sole-source awards. Typically, such justifications stem from reasons like the existence of only one responsible source, urgent and compelling needs where competition is not feasible, or specific statutory authority. For utility services like natural gas distribution, the justification often relates to the extensive and exclusive infrastructure required, meaning only the existing utility provider in a specific geographic area can fulfill the requirement. A detailed review of GSA's contract file and justification documents would be necessary to ascertain the precise rationale.

How does the per-unit cost of natural gas under this contract compare to market rates or other federal contracts?

Benchmarking the per-unit cost of natural gas for this contract is challenging without access to the specific pricing structure and rates. Natural gas prices fluctuate based on market conditions, volume, and contract terms. As a sole-source award, there was no direct competitive comparison to establish a market-driven price. To assess value, one would need to compare the contract's rate structure against publicly available utility tariffs for Washington Gas Light Company in the District of Columbia, as well as potentially against other federal contracts for similar services, though finding directly comparable sole-source utility contracts can be difficult.

What are the key performance indicators (KPIs) and service level agreements (SLAs) associated with this natural gas distribution contract?

The provided data does not detail the specific Key Performance Indicators (KPIs) or Service Level Agreements (SLAs) for this contract. However, for essential utility services like natural gas distribution, typical KPIs would likely include metrics related to service reliability (e.g., uptime, frequency of interruptions), response times for service calls or emergencies, accuracy of billing, and adherence to safety and environmental regulations. Service Level Agreements would define the expected standards for these KPIs and potential remedies or penalties if they are not met. These details would be found within the contract's statement of work and performance clauses.

What is the historical spending pattern for natural gas services at the GSA's Central Heating & Refrigeration Plant?

The provided data pertains to a single contract awarded in 2009 with an end date of 2019, totaling approximately $347 million. This suggests a significant and consistent expenditure over that decade. To understand the historical spending pattern, one would need to examine prior contracts for natural gas services at this facility, potentially looking at contracts preceding 2009, and compare the annual average spending under those contracts to the average annual spending under this $347 million award ($34.7 million per year). This would reveal trends in cost escalation or changes in service volume.

Are there any provisions in the contract for energy efficiency improvements or alternative energy sources?

The provided data summary does not contain information regarding provisions for energy efficiency improvements or alternative energy sources within this specific contract. Typically, such provisions would be explicitly stated in the contract's statement of work, performance requirements, or special clauses. Given the contract's focus on natural gas distribution, it's possible that energy efficiency discussions might be separate or addressed through broader GSA sustainability initiatives rather than embedded directly in the distribution service contract itself. Further review of the full contract document would be necessary.

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

Offers Received: 1

Pricing Type: COST NO FEE (S)

Evaluated Preference: NONE

Contractor Details

Parent Company: WGL Holdings Inc. (UEI: 153776278)

Address: 101 CONSTITUTION AVE NW, WASHINGTON, DC, 98

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $347,037,395

Exercised Options: $347,037,395

Current Obligation: $347,037,395

Parent Contract

Parent Award PIID: GS00P06BSD0393

IDV Type: IDC

Timeline