USDA awards $37.7M for property preservation and inspection services in Texas

Contract Overview

Contract Amount: $37,723,170 ($37.7M)

Contractor: Mortgage Contracting Services LLC

Awarding Agency: Department of Agriculture

Start Date: 2020-08-11

End Date: 2022-07-08

Contract Duration: 696 days

Daily Burn Rate: $54.2K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: TIME AND MATERIALS

Sector: Other

Official Description: MISSION CRITICAL TASK ORDER: COR: NATASHA STEWART-JENKINS PROPERTY PRESERVATION AND INSPECTION SERVICES

Place of Performance

Location: LEWISVILLE, DENTON County, TEXAS, 75067

State: Texas Government Spending

Plain-Language Summary

Department of Agriculture obligated $37.7 million to MORTGAGE CONTRACTING SERVICES LLC for work described as: MISSION CRITICAL TASK ORDER: COR: NATASHA STEWART-JENKINS PROPERTY PRESERVATION AND INSPECTION SERVICES Key points: 1. Contract awarded to Mortgage Contracting Services LLC for property preservation and inspection. 2. Services are critical for maintaining USDA-owned properties. 3. The contract duration is 696 days. 4. This is a time and materials contract, which can pose cost control challenges. 5. The contract was awarded under full and open competition. 6. The base award amount is $54,200, with a total potential value of $37.7M. 7. The contract is managed by the Rural Housing Service. 8. The contractor is based in Texas.

Value Assessment

Rating: fair

The contract's value of $37.7 million over approximately two years for property preservation and inspection services appears substantial. Benchmarking against similar contracts is difficult without more specific service details and geographic scope. However, the time and materials pricing structure introduces inherent risk for cost overruns if not closely managed, potentially impacting overall value for money. The relatively low base award of $54,200 compared to the total potential value suggests significant flexibility and potential for growth, but also necessitates vigilant oversight to ensure costs remain reasonable.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that multiple vendors had the opportunity to bid. The fact that it was competed broadly is a positive sign for price discovery and potentially achieving competitive pricing. However, the number of actual bidders is not specified, which would provide further insight into the level of competition. A robust competition typically leads to better value for taxpayers.

Taxpayer Impact: Full and open competition generally benefits taxpayers by driving down prices through vendor rivalry. It ensures that the government explores a wide range of options and selects the most cost-effective solution.

Public Impact

Benefits USDA's Rural Housing Service by ensuring the proper maintenance and inspection of properties. Services include property preservation and inspections, crucial for maintaining the condition of real estate assets. Geographic impact is focused on Texas, where the properties are located. Workforce implications include potential employment opportunities for inspectors and property preservation specialists in Texas.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Time and materials contract type can lead to cost escalation if not managed tightly.
The significant difference between the base award and total potential value requires careful monitoring of task order execution and pricing.
Limited information on the number of bidders in the full and open competition makes it hard to fully assess competitive pressure.

Positive Signals

Awarded through full and open competition, suggesting a fair and broad solicitation process.
Services are mission-critical for property maintenance, indicating a necessary function.
Contractor is based in Texas, potentially offering local expertise and responsiveness.

Sector Analysis

The property preservation and inspection services sector is a niche but essential part of the real estate and government contracting landscape. It supports the management of distressed or government-owned properties. Spending in this area is often tied to economic conditions and the volume of foreclosures or government-held assets. Comparable spending benchmarks are difficult to establish without detailed service scope and geographic data, but the scale of this award suggests a significant portfolio of properties requiring management within Texas.

Small Business Impact

This contract does not appear to have a small business set-aside component, as indicated by 'sb': false. There is no explicit mention of subcontracting goals for small businesses. This means that opportunities for small businesses to participate in this contract are likely limited to those that can secure subcontracts directly from Mortgage Contracting Services LLC, or if the prime contractor voluntarily engages them.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of Agriculture's Rural Housing Service. As a delivery order under a larger contract vehicle, oversight would focus on the execution of individual task orders, adherence to pricing, and quality of services rendered. Transparency is facilitated through contract award databases, but detailed performance metrics and specific oversight reports are not publicly available. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse.

Related Government Programs

USDA Property Management Services
HUD Property Disposition
Fannie Mae Property Preservation
Freddie Mac Property Maintenance

Risk Flags

Potential for cost overruns due to Time and Materials pricing structure.
Need for robust oversight to manage T&M contract effectively.
Mission critical designation requires high assurance of contractor performance.
Limited visibility into the number of bidders in the competition.

Frequently Asked Questions

What is this federal contract paying for?

Department of Agriculture awarded $37.7 million to MORTGAGE CONTRACTING SERVICES LLC. MISSION CRITICAL TASK ORDER: COR: NATASHA STEWART-JENKINS PROPERTY PRESERVATION AND INSPECTION SERVICES

Who is the contractor on this award?

The obligated recipient is MORTGAGE CONTRACTING SERVICES LLC.

Which agency awarded this contract?

Awarding agency: Department of Agriculture (Rural Housing Service).

What is the total obligated amount?

The obligated amount is $37.7 million.

What is the period of performance?

Start: 2020-08-11. End: 2022-07-08.

What is the typical cost range for property preservation and inspection services for a single-family home in Texas?

The cost for property preservation and inspection services can vary significantly based on the specific services required (e.g., basic inspection, lawn maintenance, winterization, minor repairs) and the geographic location within Texas. Basic inspections might range from $75 to $150 per property. More intensive preservation tasks, such as boarding up windows, securing the property, or performing essential repairs, could cost several hundred to a few thousand dollars per property. For a portfolio of properties managed under a contract like this, the average cost per property per month for a comprehensive service package could range from $200 to $600, depending on the level of service and property condition. The $37.7 million contract, spread over approximately 22 months, implies an average monthly expenditure of around $1.7 million, suggesting a substantial number of properties are being managed or that the services are extensive.

How does the Time and Materials (T&M) contract type impact the value for money compared to a fixed-price contract for these services?

A Time and Materials (T&M) contract, like the one awarded to Mortgage Contracting Services LLC, pays the contractor for the direct labor hours at specified hourly rates and for the actual cost of materials used. This contract type offers flexibility, allowing for adjustments in scope as needed without formal change orders. However, it places a greater burden on the government to monitor labor hours and material costs to ensure they are reasonable and allocable to the contract. For property preservation and inspection, where the exact scope of work can be unpredictable (e.g., unexpected damage requiring repairs), T&M can be suitable. However, it carries a higher risk of cost overruns if not managed diligently. A fixed-price contract would offer more cost certainty for the government but might be less adaptable to unforeseen property conditions, potentially leading to disputes or change orders anyway. The value for money in a T&M contract hinges heavily on robust government oversight and the contractor's integrity in reporting hours and costs.

What are the potential risks associated with a 'mission critical' designation for this property preservation contract?

A 'mission critical' designation for this property preservation and inspection contract signifies that the services are essential for the continuity of the USDA's operations, specifically related to managing its housing assets. The primary risks associated with this designation are related to service disruption and performance failure. If the contractor fails to perform adequately, it could lead to the deterioration of USDA-owned properties, potentially resulting in significant financial losses, damage to the agency's reputation, and non-compliance with regulatory requirements. This designation also implies that the government may have fewer options for immediate recourse or replacement of the contractor in case of performance issues, as the services are deemed indispensable. Consequently, the government must ensure stringent performance standards, robust oversight, and contingency plans are in place to mitigate these risks.

How does the Rural Housing Service typically manage contracts for property preservation and inspection?

The Rural Housing Service (RHS), as part of the USDA, typically manages contracts for property preservation and inspection by establishing clear performance work statements (PWS) that detail the required services, standards, and timelines. Contract administration involves regular monitoring of contractor performance through site visits, review of inspection reports, and verification of preservation work completed. For T&M contracts, this includes diligent tracking and auditing of labor hours and material costs. RHS likely utilizes a contracting officer's representative (COR) to oversee day-to-day activities and ensure compliance. Performance metrics, such as response times for inspections, quality of repairs, and adherence to property standards, are crucial. Given the 'mission critical' nature, RHS would likely have established protocols for addressing any performance deficiencies promptly to prevent property degradation.

What is the track record of Mortgage Contracting Services LLC in performing similar government contracts?

Assessing the track record of Mortgage Contracting Services LLC (MCS) requires examining their past performance on federal contracts. Publicly available data, such as contract award histories and performance ratings (if available through systems like the Contractor Performance Assessment Reporting System - CPARS), would provide insights. Generally, companies that secure large, mission-critical contracts from agencies like the USDA have demonstrated a capacity to handle such responsibilities. However, specific details regarding MCS's performance on previous property preservation contracts, including any past issues, disputes, or commendations, would be necessary for a comprehensive assessment. Without direct access to detailed performance evaluations, it's difficult to definitively gauge their track record beyond their ability to win competitive bids.

Industry Classification

NAICS: Finance and Insurance › Activities Related to Credit Intermediation › Mortgage and Nonmortgage Loan Brokers

Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › PROFESSIONAL SERVICES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 1

Pricing Type: TIME AND MATERIALS (Y)

Evaluated Preference: NONE

Contractor Details

Address: 350 HIGHLAND DR STE 100, LEWISVILLE, TX, 75067

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: $49,930,357

Exercised Options: $37,723,170

Current Obligation: $37,723,170

Actual Outlays: $5,834,032

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Parent Contract

Parent Award PIID: GS00F107GA

IDV Type: FSS

Timeline