USDA's $32.6M contract for fresh food boxes awarded to U.S. Foods Inc. amid pandemic

Contract Overview

Contract Amount: $32,562,176 ($32.6M)

Contractor: U S Foods Inc

Awarding Agency: Department of Agriculture

Start Date: 2020-05-14

End Date: 2020-09-19

Contract Duration: 128 days

Daily Burn Rate: $254.4K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 568

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: 2000006919/4100020276/PRECOOKED MEAT BOX,FRESH FRUIT/VEGETABLE BOX,DAIRY PRODUCTS BOX

Place of Performance

Location: WATERTOWN, JEFFERSON County, NEW YORK, 13601

State: New York Government Spending

Plain-Language Summary

Department of Agriculture obligated $32.6 million to U S FOODS INC for work described as: 2000006919/4100020276/PRECOOKED MEAT BOX,FRESH FRUIT/VEGETABLE BOX,DAIRY PRODUCTS BOX Key points: 1. Contract aimed to support farmers and provide food to communities during the COVID-19 pandemic. 2. Awarded through full and open competition, suggesting a competitive bidding process. 3. The contract utilized a firm fixed-price structure, providing cost certainty for the government. 4. Performance period was relatively short, indicating a response to immediate needs. 5. The contractor, U.S. Foods Inc., is a major food distributor with significant logistical capabilities. 6. The contract value represents a substantial investment in food supply chain resilience.

Value Assessment

Rating: good

The contract value of $32.6 million for a 4-month period appears reasonable given the context of the COVID-19 pandemic and the need for rapid food distribution. Benchmarking against similar emergency food box programs initiated during the pandemic would provide further insight. The firm fixed-price nature of the contract helps manage cost risks for the government. Without specific per-unit data for the food boxes, a precise value-for-money assessment is challenging, but the scale of the award suggests significant logistical and procurement efforts.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that multiple bidders were likely solicited and considered. This approach is generally expected to foster competitive pricing and ensure the government receives the best value. The number of bidders is not specified, but the open competition suggests a robust process was intended to identify qualified and cost-effective suppliers for essential food products.

Taxpayer Impact: Full and open competition typically benefits taxpayers by driving down prices through market forces and encouraging a wider pool of suppliers to participate, potentially leading to more efficient use of public funds.

Public Impact

Beneficiaries included American farmers who received a market for their produce and dairy/meat products, and communities that received food boxes. Services delivered included the procurement, packaging, and distribution of fresh fruit/vegetable boxes, pre-cooked meat boxes, and dairy products. Geographic impact was primarily within New York (ST: NY, SN: NEW YORK), serving as a distribution hub or target area. Workforce implications include support for jobs within U.S. Foods Inc.'s distribution network and potentially for farmers and food processing facilities.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for price fluctuations in food commodities not fully captured by fixed-price contract.
Logistical challenges in ensuring timely and safe delivery of perishable goods.
Dependence on a single large contractor for a critical pandemic-related food supply.

Positive Signals

Contract awarded through full and open competition, suggesting market validation.
Firm fixed-price contract provides budget certainty.
Contractor is a major established food distributor with existing infrastructure.
Contract directly addressed critical needs during a national emergency.

Sector Analysis

This contract falls within the broader food services and distribution sector. The market for food distribution is large and competitive, with major players like U.S. Foods Inc. serving institutional clients including government agencies. The COVID-19 pandemic significantly impacted food supply chains, leading to increased government spending on emergency food programs and support for agricultural producers. Comparable spending benchmarks would involve other large-scale food procurement contracts, particularly those initiated during the pandemic for similar purposes.

Small Business Impact

This contract was not set aside for small businesses, and there is no indication of specific subcontracting requirements for small businesses within the provided data. As a large prime contract awarded to a major distributor, the primary focus was likely on the contractor's capacity to fulfill the large-scale demand. The impact on the small business ecosystem would depend on whether U.S. Foods Inc. engaged small businesses in its supply chain or subcontracting efforts, which is not detailed here.

Oversight & Accountability

The contract is a definitive contract awarded by the Department of Agriculture's Agricultural Marketing Service. Oversight would typically involve contract officers, program managers, and potentially agency inspectors to ensure delivery of goods and adherence to contract terms. Transparency is generally provided through federal contract databases like FPDS. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

USDA Farmers to Families Food Box Program
Department of Defense food procurement
Federal Emergency Management Agency (FEMA) disaster relief food supplies
Agricultural Marketing Service programs

Risk Flags

Perishable goods require strict temperature control and timely delivery.
Potential for supply chain disruptions affecting availability of specific food items.
Contract duration is short, indicating a response to immediate needs rather than long-term planning.

Frequently Asked Questions

What is this federal contract paying for?

Department of Agriculture awarded $32.6 million to U S FOODS INC. 2000006919/4100020276/PRECOOKED MEAT BOX,FRESH FRUIT/VEGETABLE BOX,DAIRY PRODUCTS BOX

Who is the contractor on this award?

The obligated recipient is U S FOODS INC.

Which agency awarded this contract?

Awarding agency: Department of Agriculture (Agricultural Marketing Service).

What is the total obligated amount?

The obligated amount is $32.6 million.

What is the period of performance?

Start: 2020-05-14. End: 2020-09-19.

What was the specific breakdown of food items included in the 'PRECOOKED MEAT BOX, FRESH FRUIT/VEGETABLE BOX, DAIRY PRODUCTS BOX' and their respective costs?

The provided data summarizes the contract into broad categories: 'PRECOOKED MEAT BOX, FRESH FRUIT/VEGETABLE BOX, DAIRY PRODUCTS BOX'. A detailed breakdown of the specific items within each box (e.g., types of fruits, vegetables, meats, dairy) and their individual costs is not available in the summary data. The total award of $32,562,175.80 covers the procurement, packaging, and distribution of these assorted boxes over the contract period. To understand the cost breakdown, one would need access to the detailed line-item specifications or delivery reports associated with this contract, which are typically not part of high-level award summaries.

How did the pricing of these food boxes compare to commercial market rates at the time of award?

Directly comparing the per-unit cost of these specific food boxes to commercial market rates is challenging without detailed specifications of the box contents and quantities. However, the contract was awarded under 'FULL AND OPEN COMPETITION' with a 'FIRM FIXED PRICE' structure, suggesting that the pricing was vetted through a competitive process. The USDA's Farmers to Families Food Box Program, which this contract likely supported, aimed to purchase surplus agricultural products and distribute them, potentially influencing pricing dynamics. While the goal was to support farmers and communities, the pricing would ideally reflect fair market value for the goods and services procured, balanced against the program's objectives.

What were the key performance indicators (KPIs) and metrics used to evaluate U.S. Foods Inc.'s performance under this contract?

The provided summary data does not explicitly list the Key Performance Indicators (KPIs) or specific metrics used to evaluate U.S. Foods Inc.'s performance. However, for a contract involving food distribution, typical KPIs would likely include on-time delivery rates, adherence to quality and safety standards for perishable goods, accuracy of order fulfillment (correct box contents and quantities), and potentially customer satisfaction feedback from distribution points or recipients. The firm fixed-price nature implies that meeting delivery schedules and product specifications would be paramount to avoiding penalties or contract breaches.

What was the total spending on similar food box contracts by the Department of Agriculture during the COVID-19 pandemic?

The provided data focuses on a single contract awarded to U.S. Foods Inc. by the Agricultural Marketing Service (AMS) for $32.6 million. The broader USDA Farmers to Families Food Box Program, initiated in response to the COVID-19 pandemic, involved significant spending across multiple contracts and regions. While this specific contract is a component, the total USDA spending on similar food box initiatives during the pandemic would encompass numerous awards to various distributors and aggregators across different agricultural sectors and geographic areas. Comprehensive data on the total program expenditure would require aggregating information from multiple contract awards and fiscal reports related to the pandemic response.

Were there any challenges or disputes encountered during the performance of this contract?

The summary data provided does not contain information regarding challenges, disputes, or contract modifications for this specific award. Contracts of this nature, especially those executed rapidly during a national emergency like the COVID-19 pandemic, can sometimes encounter logistical hurdles, supply chain disruptions, or issues related to product quality or delivery. However, without access to contract performance reports, modification histories, or official dispute records, it is not possible to determine if any significant challenges or disputes arose during the execution of this $32.6 million contract.

Industry Classification

NAICS: Manufacturing › Animal Slaughtering and Processing › Meat Processed from Carcasses

Product/Service Code: SUBSISTENCE

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: 123J1420R0377/4100020276

Offers Received: 568

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 901 RAIL DR, WATERTOWN, NY, 13601

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $32,562,176

Exercised Options: $32,562,176

Current Obligation: $32,562,176

Actual Outlays: $16,512,577

Contract Characteristics

Commercial Item: COMMERCIAL ITEM

Cost or Pricing Data: NO

Timeline