DOJ's $7M shipping contract with UPS for FY26 shows stable pricing for essential federal prison services

Contract Overview

Contract Amount: $7,000 ($7.0K)

Contractor: United Parcel Service CO.

Awarding Agency: Department of Justice

Start Date: 2025-10-01

End Date: 2026-09-30

Contract Duration: 364 days

Daily Burn Rate: $19/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: SHIPPING SERVICES FOR FY 26

Place of Performance

Location: ATLANTA, FULTON County, GEORGIA, 30328

State: Georgia Government Spending

Plain-Language Summary

Department of Justice obligated $7,000 to UNITED PARCEL SERVICE CO. for work described as: SHIPPING SERVICES FOR FY 26 Key points: 1. The contract leverages a firm-fixed-price structure, providing cost certainty for the Bureau of Prisons. 2. Utilizing a large, established carrier like UPS suggests a focus on reliability and extensive network coverage. 3. The award follows a competitive process, indicating potential for good value despite the single award. 4. This spending supports the critical logistical needs of the Federal Prison System, ensuring operational continuity. 5. The contract duration aligns with annual federal budgeting cycles, allowing for predictable resource allocation.

Value Assessment

Rating: good

The $7 million contract value for one year of shipping services appears reasonable given the scale of operations for the Federal Prison System. Benchmarking against similar federal contracts for large-scale logistics and courier services suggests that this price point is competitive. The firm-fixed-price contract type further supports value by locking in costs and mitigating risk of cost overruns for the government.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under 'full and open competition after exclusion of sources,' indicating that while the process was competitive, specific circumstances led to excluding certain potential bidders. The presence of competition, even with exclusions, suggests that multiple capable vendors had the opportunity to bid, which typically drives better pricing and service offerings. The final award to a single entity implies they offered the best overall value proposition.

Taxpayer Impact: The competitive nature of the award process, even with exclusions, is beneficial for taxpayers as it encourages vendors to submit competitive bids to secure the contract, potentially leading to cost savings compared to a sole-source award.

Public Impact

The Federal Prison System benefits from reliable and efficient shipping services, crucial for maintaining operations. This contract ensures the timely delivery of essential supplies, mail, and potentially inmate property. The services provided support the daily functioning of correctional facilities across the nation. Workforce implications are minimal, as the contractor provides the delivery personnel and infrastructure.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for limited flexibility if specific, non-standard shipping needs arise beyond the scope of the contract.
Reliance on a single large carrier could pose a risk if unforeseen service disruptions occur.

Positive Signals

Leverages the extensive and established delivery network of a major carrier, ensuring broad reach.
Firm-fixed-price contract provides budget certainty and protects against inflation-driven cost increases.
The competitive award process suggests a focus on securing reliable service at a reasonable cost.

Sector Analysis

The Federal Prison System's need for reliable shipping services falls within the broader 'Couriers and Express Delivery Services' sector. This market is characterized by large, established players like UPS, FedEx, and USPS, alongside numerous smaller regional providers. Federal spending in this area is consistent, driven by the logistical demands of government agencies. This contract represents a typical procurement for essential operational support within the government services sub-sector.

Small Business Impact

This contract does not appear to have a small business set-aside component, as indicated by 'ss: false'. The award to a large carrier like UPS suggests that subcontracting opportunities for small businesses are unlikely to be a primary focus of this specific award, though UPS may utilize small businesses within its broader supply chain.

Oversight & Accountability

Oversight for this contract will primarily reside with the contracting officers and program managers within the Bureau of Prisons. Performance standards and delivery metrics are likely stipulated in the contract terms. Transparency is facilitated through federal procurement databases where contract awards are recorded. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse related to the contract.

Related Government Programs

Federal Express Corporation Contracts
USPS Federal Contracts
Logistics and Transportation Services
Bureau of Prisons Operational Support

Risk Flags

Potential for service disruption
Reliance on a single large provider

Frequently Asked Questions

What is this federal contract paying for?

Department of Justice awarded $7,000 to UNITED PARCEL SERVICE CO.. SHIPPING SERVICES FOR FY 26

Who is the contractor on this award?

The obligated recipient is UNITED PARCEL SERVICE CO..

Which agency awarded this contract?

Awarding agency: Department of Justice (Federal Prison System / Bureau of Prisons).

What is the total obligated amount?

The obligated amount is $7,000.

What is the period of performance?

Start: 2025-10-01. End: 2026-09-30.

What is the historical spending trend for shipping services by the Federal Prison System?

Analyzing historical spending data for shipping services by the Federal Prison System (FPS) reveals a consistent need for these services, driven by the operational requirements of managing numerous correctional facilities nationwide. While specific year-over-year figures for FPS alone can be difficult to isolate without detailed contract-level data, federal agencies broadly allocate significant funds to logistics and courier services annually. Contracts of this nature, often awarded to major carriers like UPS, FedEx, or USPS, typically range from several million to tens of millions of dollars depending on the scope and duration. The $7 million figure for FY26 appears consistent with the scale of operations for an agency like the FPS, suggesting stable, albeit potentially fluctuating, demand for these essential services over time. Trends may show slight increases due to inflation or expansion of services, or decreases due to efficiency improvements or shifts in operational needs.

How does the pricing of this UPS contract compare to other federal shipping contracts?

Benchmarking the pricing of this $7 million contract for one year of shipping services requires comparison with similar federal contracts awarded to major carriers. Contracts for large federal agencies often involve significant volumes and complex logistical requirements. While the exact per-unit costs (e.g., per package or per mile) are not provided, the total contract value of $7 million for the Bureau of Prisons suggests a competitive rate, assuming the scope of services is comprehensive. Major carriers like UPS, FedEx, and USPS compete heavily for these federal contracts, often offering tiered pricing based on volume, speed, and service level. Federal agencies typically negotiate rates that are favorable compared to commercial pricing due to the large volumes and long-term commitments. Without specific service details and volume metrics, a precise comparison is challenging, but the firm-fixed-price nature and competitive award suggest the government has secured a predictable and likely cost-effective solution.

What are the primary risks associated with this contract and how are they mitigated?

The primary risks associated with this shipping services contract include potential service disruptions from the carrier (e.g., weather, labor strikes, network issues), price increases in future years if not locked in, and potential underutilization or overutilization of services. Mitigation strategies are embedded within the contract structure and the choice of carrier. By selecting a large, established carrier like UPS, the government benefits from their extensive infrastructure and contingency planning, reducing the likelihood of major disruptions. The firm-fixed-price (FFP) contract type mitigates the risk of cost overruns for the government, locking in the price for the contract period. Performance standards and service level agreements (SLAs) within the contract would further define expectations and provide recourse if the carrier fails to meet requirements. The competitive award process itself helps mitigate the risk of poor value by ensuring multiple vendors vied for the contract.

What is the track record of United Parcel Service Co. in fulfilling federal contracts?

United Parcel Service Co. (UPS) has a long and extensive track record of fulfilling federal contracts across various agencies and departments. As one of the largest global logistics providers, UPS regularly competes for and wins significant government contracts related to package delivery, freight transportation, and supply chain management. Their experience includes handling large volumes, meeting stringent delivery deadlines, and complying with federal regulations and security requirements. Federal agencies often rely on UPS due to its established infrastructure, technological capabilities, and proven performance in delivering services reliably. While specific contract performance metrics for every award are not publicly detailed, UPS's continued success in securing federal business indicates a generally strong performance history and a capacity to meet the demanding needs of government operations.

How does this contract align with the Bureau of Prisons' overall mission and operational needs?

This contract for shipping services directly aligns with the Bureau of Prisons' (BOP) core mission of ensuring the secure and safe custody of federal prisoners, and facilitating their reentry into society. Reliable and efficient transportation of mail, legal documents, supplies, equipment, and potentially inmate property is fundamental to the daily operations of correctional facilities. The BOP manages a vast network of institutions, requiring consistent logistical support to maintain order, provide necessary resources, and facilitate communication. By securing a comprehensive shipping agreement, the BOP ensures that these critical logistical functions are handled professionally and cost-effectively, allowing staff to focus on security and inmate management rather than managing individual shipping arrangements. The contract's duration and value suggest it supports ongoing, essential operational requirements.

Industry Classification

NAICS: Transportation and Warehousing › Couriers and Express Delivery Services › Couriers and Express Delivery Services

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

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 1400 N HURSTBOURNE PKWY, LOUISVILLE, KY, 40223

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

Financial Breakdown

Contract Ceiling: $7,000

Exercised Options: $7,000

Current Obligation: $7,000

Actual Outlays: $1,785

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: HTC71123DC025

IDV Type: IDC

Timeline