DoD Awards $225M for High Flow Pump Service to Airgas USA, LLC, with No Competition
Contract Overview
Contract Amount: $22,545,606 ($22.5M)
Contractor: Airgas USA, LLC
Awarding Agency: Department of Defense
Start Date: 2020-03-29
End Date: 2025-09-28
Contract Duration: 2,009 days
Daily Burn Rate: $11.2K/day
Competition Type: NOT COMPETED
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: 8507281543!HIGH FLOW PUMP SERV
Place of Performance
Location: JBSA LACKLAND, BEXAR County, TEXAS, 78236
State: Texas Government Spending
Plain-Language Summary
Department of Defense obligated $22.5 million to AIRGAS USA, LLC for work described as: 8507281543!HIGH FLOW PUMP SERV Key points: 1. Significant contract value of $225.4 million for industrial gas manufacturing. 2. Sole-source award indicates potential lack of competitive pricing. 3. Long contract duration (2020-2025) warrants close monitoring for cost efficiency. 4. Focus on industrial gas manufacturing within the Defense sector.
Value Assessment
Rating: questionable
The contract value of $225.4 million is substantial. Without competitive bidding, it's difficult to assess if this price is optimal compared to market rates for similar high-flow pump services and industrial gases.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was not competed, meaning a sole-source award was made to Airgas USA, LLC. This approach limits price discovery and may result in higher costs for taxpayers.
Taxpayer Impact: The lack of competition raises concerns about potential overspending and reduced value for taxpayer funds.
Public Impact
Taxpayers may be paying a premium due to the absence of competitive bidding. The Defense Logistics Agency relies on this service, highlighting its critical nature. Long-term commitment could lock the government into potentially suboptimal pricing.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Lack of competition
- Long contract duration
Positive Signals
- Essential service for DoD
- Established vendor
Sector Analysis
This contract falls under Industrial Gas Manufacturing, a sector crucial for various defense operations. Benchmarks for similar sole-source industrial gas contracts are difficult to establish without competitive data.
Small Business Impact
The data does not indicate any specific provisions or benefits for small businesses in this sole-source contract award.
Oversight & Accountability
Oversight is crucial for this sole-source contract to ensure Airgas USA, LLC is meeting all performance requirements and that pricing remains fair throughout the contract term.
Related Government Programs
- Industrial Gas Manufacturing
- Department of Defense Contracting
- Defense Logistics Agency Programs
Risk Flags
- Sole-source award limits price competition.
- Potential for inflated pricing due to lack of market pressure.
- Long contract duration increases exposure to price changes.
- Lack of transparency in the procurement process.
- No clear benefit or inclusion for small businesses.
Tags
industrial-gas-manufacturing, department-of-defense, tx, delivery-order, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $22.5 million to AIRGAS USA, LLC. 8507281543!HIGH FLOW PUMP SERV
Who is the contractor on this award?
The obligated recipient is AIRGAS USA, LLC.
Which agency awarded this contract?
Awarding agency: Department of Defense (Defense Logistics Agency).
What is the total obligated amount?
The obligated amount is $22.5 million.
What is the period of performance?
Start: 2020-03-29. End: 2025-09-28.
What is the justification for the sole-source award, and what steps were taken to ensure fair and reasonable pricing?
The justification for a sole-source award typically involves unique capabilities or circumstances where only one vendor can meet the requirement. Agencies must still conduct market research and negotiate to ensure the price is fair and reasonable, often by comparing to historical data or industry benchmarks, though this is less effective than open competition.
What are the potential risks associated with a long-term, sole-source contract for industrial gases?
Risks include paying above-market prices due to lack of competition, vendor lock-in limiting flexibility, and potential complacency from the vendor regarding service quality or innovation. The government also loses opportunities to benefit from competitive price reductions or new market entrants over the contract's life.
How does this contract contribute to the overall effectiveness of the Defense Logistics Agency's mission?
High-flow pumps and industrial gases are likely essential components for various military operations, maintenance, or support functions. Ensuring a reliable supply through this contract directly supports the DLA's mission to provide logistics and sustainment, though the cost-effectiveness of that supply is questionable without competition.
Industry Classification
NAICS: Manufacturing › Basic Chemical Manufacturing › Industrial Gas Manufacturing
Product/Service Code: OPERATION OF GOVT OWNED FACILITY › OPERATE GOVT OWNED BUILDINGS
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: L'air Liquide Societe Anonyme Pour L'etude ET L'exploitation DES Procedes Georges Claude
Address: 3737 WORSHAM AVE, LONG BEACH, CA, 90808
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Limited Liability Corporation, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $22,545,606
Exercised Options: $22,545,606
Current Obligation: $22,545,606
Actual Outlays: $1,238,440
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: SPE60120D1502
IDV Type: IDC
Timeline
Start Date: 2020-03-29
Current End Date: 2025-09-28
Potential End Date: 2025-09-28 00:00:00
Last Modified: 2025-08-22
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