Agriculture Department awards $18M for food donation support, with potential for price adjustments

Contract Overview

Contract Amount: $17,965,271 ($18.0M)

Contractor: Paris Brothers, Inc.

Awarding Agency: Department of Agriculture

Start Date: 2024-03-01

End Date: 2025-02-28

Contract Duration: 364 days

Daily Burn Rate: $49.4K/day

Competition Type: FULL AND OPEN COMPETITION

Pricing Type: FIXED PRICE WITH ECONOMIC PRICE ADJUSTMENT

Sector: Other

Official Description: SUPPORT SERVICES FOR USG FOOD DONATIONS: 2000009006/4400002005/4300012891/3PL SERVICES

Place of Performance

Location: KANSAS CITY, CLAY County, MISSOURI, 64161

State: Missouri Government Spending

Plain-Language Summary

Department of Agriculture obligated $18.0 million to PARIS BROTHERS, INC. for work described as: SUPPORT SERVICES FOR USG FOOD DONATIONS: 2000009006/4400002005/4300012891/3PL SERVICES Key points: 1. Contract value appears reasonable for the scope of third-party logistics services. 2. Full and open competition suggests a competitive bidding process. 3. Risk indicators are moderate, given the fixed-price with economic price adjustment structure. 4. Performance context is critical for ensuring efficient food donation logistics. 5. This contract fits within the broader agricultural support and logistics sector.

Value Assessment

Rating: good

The contract value of approximately $18 million for one year of support services for USG food donations appears to be within a reasonable range for third-party logistics (3PL) services. Benchmarking against similar contracts for warehousing and transportation of food products would provide a more precise assessment of value for money. The fixed-price with economic price adjustment (FPEPA) structure allows for some flexibility in managing fluctuating costs, which is common in the logistics sector.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit a bid. This approach generally fosters a competitive environment, which can lead to better pricing and service quality. The number of bidders is not specified, but the method of competition suggests that multiple entities vied for this contract.

Taxpayer Impact: Full and open competition is beneficial for taxpayers as it maximizes the potential for cost savings through a robust bidding process, ensuring that the government secures services at the most competitive rates available in the market.

Public Impact

Beneficiaries include food banks and charitable organizations receiving USG-donated food. Services delivered encompass warehousing, transportation, and logistics management for food donations. Geographic impact is likely national, supporting the distribution of food aid. Workforce implications may include jobs in warehousing, logistics, and administrative support.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Economic price adjustment clause could lead to cost overruns if not carefully monitored.
Dependence on a single contractor for critical logistics could pose a risk if performance falters.

Positive Signals

Full and open competition suggests a healthy market and potential for competitive pricing.
The contract duration of one year allows for periodic reassessment of needs and performance.
The Agricultural Marketing Service's oversight is expected to ensure proper execution of services.

Sector Analysis

This contract falls within the broader logistics and warehousing sector, specifically supporting government initiatives related to food distribution. The North American Industry Classification System (NAICS) code 493110 (General Warehousing and Storage) is applicable. The market for third-party logistics services is substantial, with government contracts forming a significant segment. Comparable spending benchmarks would involve analyzing other government contracts for similar warehousing and distribution services, particularly those involving perishable or sensitive goods.

Small Business Impact

The contract data indicates that small business participation was not a specific set-aside (ss: false, sb: false). Therefore, the primary impact on small businesses would be through potential subcontracting opportunities if Paris Brothers, Inc. engages them. Without specific subcontracting plans, it's difficult to assess the direct impact on the small business ecosystem, though larger prime contracts can sometimes indirectly benefit small businesses through the supply chain.

Oversight & Accountability

Oversight for this contract will likely be managed by the Agricultural Marketing Service (AMS) within the Department of Agriculture. Accountability measures are typically embedded in the contract terms, including performance standards, delivery schedules, and reporting requirements. Transparency is facilitated through contract award databases like FPDS. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse related to the contract.

Related Government Programs

USDA Food Purchase Programs
National School Lunch Program
Supplemental Nutrition Assistance Program (SNAP)
Federal Food Donation Improvement Act

Risk Flags

Potential for cost increases due to economic price adjustment.
Dependence on contractor performance for critical supply chain function.

Frequently Asked Questions

What is this federal contract paying for?

Department of Agriculture awarded $18.0 million to PARIS BROTHERS, INC.. SUPPORT SERVICES FOR USG FOOD DONATIONS: 2000009006/4400002005/4300012891/3PL SERVICES

Who is the contractor on this award?

The obligated recipient is PARIS BROTHERS, INC..

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $18.0 million.

What is the period of performance?

Start: 2024-03-01. End: 2025-02-28.

What is the track record of Paris Brothers, Inc. in performing similar government logistics contracts?

Information regarding Paris Brothers, Inc.'s specific track record in performing similar government logistics contracts is not detailed in the provided data. A thorough assessment would require reviewing past performance evaluations, contract histories, and any reported issues or commendations from previous government engagements. This would help determine their capacity, reliability, and experience in handling sensitive goods like food donations, and whether they have a history of meeting performance metrics and compliance standards. Without this, the current award is based on the expectation of satisfactory performance, but historical data would offer greater assurance.

How does the awarded amount compare to the estimated value or budget for these support services?

The provided data indicates an awarded amount of $17,965,271.19. To compare this to the estimated value or budget, one would need access to the government's initial cost estimates or budget allocations for this specific requirement. If the awarded amount is significantly lower than the estimate, it suggests successful cost competition. Conversely, if it's higher, it might warrant further investigation into the necessity of the additional funds or potential issues during the bidding process. Without the government's internal estimates, a direct comparison of value against budget is not possible from the award data alone.

What are the specific risks associated with the 'economic price adjustment' clause in this contract?

The 'economic price adjustment' (EPA) clause in this fixed-price contract allows for adjustments to the contract price based on fluctuations in specific economic factors, such as labor costs, material prices, or transportation rates. The primary risk for the government is potential cost increases beyond initial projections if these economic factors rise significantly. This can lead to the contract exceeding its initially budgeted amount. To mitigate this risk, the EPA clause typically includes specific indices or formulas for calculating adjustments, caps on the amount of adjustment, and requires robust documentation from the contractor to justify any requested price changes. Careful monitoring by the contracting officer is essential.

What performance metrics will be used to evaluate Paris Brothers, Inc.'s success in managing food donation logistics?

Specific performance metrics are not detailed in the provided award data. However, for a contract involving logistics and support services for food donations, typical performance metrics would likely include on-time delivery rates, accuracy of inventory management, condition of goods upon delivery (minimizing spoilage or damage), responsiveness to requests, compliance with food safety regulations, and overall cost-effectiveness. The contract itself would outline a Performance Work Statement (PWS) detailing these requirements and the methods for measuring performance, often tied to payment or award fee structures.

How does this contract's value and scope compare to previous contracts for similar food donation support services?

Comparing this $18 million, one-year contract to previous ones requires access to historical contract data for similar services. If previous contracts were for a similar duration and scope, a direct comparison of dollar values (adjusted for inflation) would indicate whether costs have increased, decreased, or remained stable. A larger contract value might suggest an expanded scope, increased service needs, or inflationary pressures. Conversely, a smaller value could indicate greater competition, improved efficiency, or a reduced scope. Without historical data, it's difficult to ascertain trends or relative value.

What is the potential impact of this contract on the efficiency and reach of USG food donation programs?

This contract is crucial for the efficient and effective distribution of U.S. Government-donated food. By outsourcing logistics to a specialized provider like Paris Brothers, Inc., the government aims to leverage expertise in warehousing, transportation, and supply chain management. This can lead to reduced spoilage, faster delivery times, and broader reach to recipient organizations, ultimately ensuring that more food reaches those in need. The success of the contractor in managing these complex operations directly impacts the overall effectiveness and reach of federal food assistance and donation initiatives.

Industry Classification

NAICS: Transportation and Warehousing › Warehousing and Storage › General Warehousing and Storage

Product/Service Code: TRANSPORT, TRAVEL, RELOCATION › TRANSPORTATION OF THINGS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: 123J1424R0148

Pricing Type: FIXED PRICE WITH ECONOMIC PRICE ADJUSTMENT (K)

Evaluated Preference: NONE

Contractor Details

Address: 8800 NE UNDERGROUND DR, KANSAS CITY, MO, 64161

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

Financial Breakdown

Contract Ceiling: $17,965,271

Exercised Options: $17,965,271

Current Obligation: $17,965,271

Actual Outlays: $17,965,271

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: 123J1424D0004

IDV Type: IDC

Timeline