Interior's $56.9M Electric Power Contract with Southwest Public Power Agency Faces Scrutiny for Lack of Competition
Contract Overview
Contract Amount: $56,882,512 ($56.9M)
Contractor: Southwest Public Power Agency Inc
Awarding Agency: Department of the Interior
Start Date: 2015-08-08
End Date: 2020-06-30
Contract Duration: 1,788 days
Daily Burn Rate: $31.8K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: Energy
Official Description: IGF::OT::IGF - A15PC00087 REPLACES A15PC00005 AND INCREASES FUNDS FOR AUGUST 2015 SERVICES.
Place of Performance
Location: MESA, MARICOPA County, ARIZONA, 85201
State: Arizona Government Spending
Plain-Language Summary
Department of the Interior obligated $56.9 million to SOUTHWEST PUBLIC POWER AGENCY INC for work described as: IGF::OT::IGF - A15PC00087 REPLACES A15PC00005 AND INCREASES FUNDS FOR AUGUST 2015 SERVICES. Key points: 1. The contract value is substantial at $56.9 million, primarily for electric power distribution. 2. Competition was explicitly 'NOT COMPETED', raising concerns about price discovery and potential overpayment. 3. The risk of inflated costs is high due to the sole-source nature of the award. 4. This spending falls within the Energy sector, specifically electric power infrastructure.
Value Assessment
Rating: questionable
The contract's pricing is difficult to assess without competitive benchmarks. Given the lack of competition, it's questionable whether the firm fixed price represents fair market value.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
The contract was awarded on a sole-source basis, meaning no competitive bidding process occurred. This significantly limits price discovery and potentially leads to higher costs for taxpayers.
Taxpayer Impact: The lack of competition in this $56.9 million contract raises concerns about taxpayer value and the potential for overspending on essential electric power services.
Public Impact
Taxpayers may be overpaying for electric power services due to the absence of a competitive bidding process. The Bureau of Indian Affairs and Bureau of Indian Education rely on this contract, impacting essential services. Long contract duration (2015-2020) amplifies the potential financial impact of non-competitive pricing.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Lack of competition
- Potential for overpayment
- Sole-source award
Positive Signals
- Definitive contract type
- Firm fixed price contract
Sector Analysis
This contract for electric power distribution falls under the Energy sector. Spending benchmarks for similar services can vary widely based on geographic location, demand, and infrastructure complexity. The $56.9 million value over nearly five years suggests a significant scale of service.
Small Business Impact
The data indicates this contract was not awarded to small businesses, as the 'sb' field is false. Further analysis would be needed to determine if small businesses had an opportunity to compete or if this was a deliberate sole-source decision.
Oversight & Accountability
The sole-source nature of this contract warrants close oversight to ensure the Department of the Interior is receiving fair value. Accountability for the decision not to compete is crucial.
Related Government Programs
- Electric Power Distribution
- Department of the Interior Contracting
- Bureau of Indian Affairs and Bureau of Indian Education Programs
Risk Flags
- Lack of competition
- Potential for cost overruns
- Limited transparency in pricing
- Sole-source award justification unclear
Tags
electric-power-distribution, department-of-the-interior, az, definitive-contract, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of the Interior awarded $56.9 million to SOUTHWEST PUBLIC POWER AGENCY INC. IGF::OT::IGF - A15PC00087 REPLACES A15PC00005 AND INCREASES FUNDS FOR AUGUST 2015 SERVICES.
Who is the contractor on this award?
The obligated recipient is SOUTHWEST PUBLIC POWER AGENCY INC.
Which agency awarded this contract?
Awarding agency: Department of the Interior (Bureau of Indian Affairs and Bureau of Indian Education).
What is the total obligated amount?
The obligated amount is $56.9 million.
What is the period of performance?
Start: 2015-08-08. End: 2020-06-30.
What justification was provided for not competing this significant electric power contract?
The provided data states the contract was 'NOT COMPETED' but does not offer a specific justification. Typically, sole-source awards require documented reasons, such as the unavailability of other sources or urgent, unforeseen needs. Without this justification, it's difficult to assess the necessity of the non-competitive approach.
What is the estimated cost savings if this contract had been competitively bid?
Estimating savings without a competitive benchmark is speculative. However, studies often show competitive contracting can yield savings of 10-30% compared to sole-source awards. For this $56.9 million contract, that could translate to potential savings ranging from $5.7 million to over $17 million over its duration.
How does the per-unit cost of electricity compare to market rates in Arizona for similar services?
The provided data does not include per-unit cost details or specific service metrics, making a direct comparison to market rates impossible. A detailed analysis of the contract's line items and service delivery would be required to benchmark pricing against similar utility contracts in Arizona.
Industry Classification
NAICS: Utilities › Electric Power Generation, Transmission and Distribution › Electric Power Distribution
Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › PROFESSIONAL SERVICES
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Solicitation ID: A15PS00047
Offers Received: 1
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Address: 160 N PASADENA STE 101, MESA, AZ, 85201
Business Categories: Category Business, Corporate Entity Tax Exempt, Nonprofit Organization, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $56,882,512
Exercised Options: $56,882,512
Current Obligation: $56,882,512
Actual Outlays: $5,373,083
Contract Characteristics
Multi-Year Contract: Yes
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Cost or Pricing Data: NO
Timeline
Start Date: 2015-08-08
Current End Date: 2020-06-30
Potential End Date: 2020-06-30 00:00:00
Last Modified: 2020-07-07
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