DOJ's $31.8M contract for correctional facility operations awarded to CoreCivic, Inc. shows fair value

Contract Overview

Contract Amount: $31,790,879 ($31.8M)

Contractor: Corecivic, Inc.

Awarding Agency: Department of Justice

Start Date: 2018-12-01

End Date: 2019-09-30

Contract Duration: 303 days

Daily Burn Rate: $104.9K/day

Competition Type: FULL AND OPEN COMPETITION

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: IGF::CL::IGF - OPERATION OF PRIVATIZED CORRECTIONAL FACILITY

Place of Performance

Location: MC RAE, TELFAIR County, GEORGIA, 31055

State: Georgia Government Spending

Plain-Language Summary

Department of Justice obligated $31.8 million to CORECIVIC, INC. for work described as: IGF::CL::IGF - OPERATION OF PRIVATIZED CORRECTIONAL FACILITY Key points: 1. The contract represents a significant investment in correctional facility management, underscoring the government's reliance on private sector partners for essential services. 2. Competition dynamics indicate a full and open process, suggesting a competitive environment that should drive favorable pricing. 3. Risk indicators appear manageable, with a firm-fixed-price structure that shifts cost overruns to the contractor. 4. Performance context is crucial, as the quality of services directly impacts inmate welfare and facility security. 5. Sector positioning highlights the role of private companies in supplementing government capacity for correctional services. 6. The contract's duration and value place it within a typical range for such specialized service agreements.

Value Assessment

Rating: good

The contract's total value of $31.8 million over approximately 10 months suggests a monthly expenditure of around $3.18 million. Benchmarking against similar contracts for correctional facility operations requires access to a broader dataset of comparable services, but the firm-fixed-price nature indicates that the government has secured a defined scope of work at a set cost. This structure generally provides good value by limiting the government's exposure to cost escalations, provided the contractor can manage their expenses effectively.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under a full and open competition, indicating that all responsible sources were permitted to submit offers. The specific number of bidders is not provided, but the 'full and open' designation implies a robust competitive process. This level of competition is generally expected to lead to more competitive pricing and better service offerings as contractors vie for the award.

Taxpayer Impact: A full and open competition is beneficial for taxpayers as it increases the likelihood of securing services at the most economical price, fostering a market where efficiency and cost-effectiveness are rewarded.

Public Impact

The primary beneficiaries are the Federal Prison System (Bureau of Prisons), which receives operational support for a correctional facility. Services delivered include the day-to-day management and operation of a correctional facility, encompassing security, inmate services, and facility maintenance. The geographic impact is localized to the specific facility being operated, likely within the state of Georgia (ST: GA, SN: GEORGIA). Workforce implications include the employment of correctional officers, administrative staff, and support personnel by the contractor, CoreCivic, Inc.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost-saving measures by the contractor that could impact service quality if not adequately monitored.
Reliance on a single contractor for critical correctional services necessitates strong oversight to ensure compliance and performance standards.
The firm-fixed-price contract, while beneficial for budget certainty, could incentivize the contractor to minimize costs, potentially affecting staffing levels or program offerings.

Positive Signals

The use of a firm-fixed-price contract shifts cost overrun risks to the contractor, providing budget certainty for the government.
Awarding through full and open competition suggests a competitive process that likely yielded a fair market price.
The contractor, CoreCivic, Inc., is an established entity in the correctional services industry, implying experience in managing such facilities.

Sector Analysis

The correctional services industry is a significant sector within the broader facilities support services market. Private companies play a crucial role in supplementing government capacity, particularly in corrections, by managing and operating facilities. This contract fits within the government's strategy to leverage private sector expertise and resources for specialized functions. Comparable spending benchmarks would involve analyzing the per-inmate operational costs across various federal, state, and local correctional facilities, as well as other private contracts for similar services.

Small Business Impact

The provided data does not indicate any specific small business set-aside provisions for this contract. As a large-scale service contract, it is likely that the prime contractor, CoreCivic, Inc., would be responsible for managing any subcontracting opportunities. Analysis of subcontracting plans would be necessary to determine the extent to which small businesses might participate in fulfilling the contract requirements.

Oversight & Accountability

Oversight for this contract would primarily fall under the purview of the Federal Prison System (Bureau of Prisons) within the Department of Justice. Accountability measures would be defined in the contract's statement of work, performance standards, and payment terms. Transparency is typically managed through contract reporting requirements and performance reviews. While no specific Inspector General jurisdiction is mentioned, the DOJ's Office of the Inspector General would likely have oversight authority over federal contracts to ensure efficiency and prevent fraud, waste, and abuse.

Related Government Programs

Federal Prison System Operations
Correctional Facility Management Services
Private Correctional Facility Contracts
Department of Justice Contracts
Facilities Support Services

Risk Flags

Potential for cost-cutting impacting service quality
Contractor performance monitoring complexity
Reliance on a single provider for critical services

Frequently Asked Questions

What is this federal contract paying for?

Department of Justice awarded $31.8 million to CORECIVIC, INC.. IGF::CL::IGF - OPERATION OF PRIVATIZED CORRECTIONAL FACILITY

Who is the contractor on this award?

The obligated recipient is CORECIVIC, INC..

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 $31.8 million.

What is the period of performance?

Start: 2018-12-01. End: 2019-09-30.

What is the historical spending pattern for correctional facility operations by the Federal Prison System?

The Federal Prison System (FPS) has a history of utilizing private correctional facilities to manage inmate populations, particularly when federal facilities reach capacity or to house specific inmate types. Historical spending reflects a fluctuating reliance on private sector partners, influenced by legislative changes, budget allocations, and inmate population trends. While specific aggregate spending figures require detailed analysis of historical budget documents and contract awards, the FPS has consistently allocated substantial funds towards contracts for facility operation, detention services, and inmate transportation. This particular contract, valued at approximately $31.8 million for a 10-month period, represents a segment of this broader spending. Analyzing trends over multiple fiscal years would reveal patterns in contract values, durations, and the number of private facilities utilized, providing context for the current expenditure.

How does the per-diem cost of this contract compare to other federal or state correctional facilities?

To accurately compare the per-diem cost, we would need to calculate it from the provided data and then benchmark it against similar contracts. The total contract value is $31,790,878.59 over 303 days (approximately 10 months). This yields a daily cost of approximately $104,920. The duration is 303 days, which is roughly 10 months. If we assume a standard 30-day month, that's 300 days, making the daily rate $31,790,878.59 / 303 days = $104,920.22 per day. Without knowing the inmate capacity of the facility or the specific services included, a direct per-inmate per-diem comparison is difficult. However, federal per-diem rates for private facilities can range significantly, often between $70 to $150 per inmate per day, depending on security levels, services, and location. This contract's daily rate, if spread across a typical federal facility capacity (e.g., 1000-2000 inmates), would fall within or potentially slightly above the higher end of this range, suggesting a need for further scrutiny on efficiency and service scope.

What are the key performance indicators (KPIs) typically monitored for correctional facility operations contracts?

Key Performance Indicators (KPIs) for correctional facility operations contracts are critical for ensuring the contractor meets the government's requirements for safety, security, and inmate welfare. Common KPIs include inmate disciplinary infractions, escape rates, use of force incidents, contraband seizures, and inmate grievances. Additionally, operational KPIs such as staffing levels, staff turnover rates, response times to emergencies, facility maintenance completion rates, and healthcare service delivery metrics are closely monitored. Compliance with all federal regulations, Bureau of Prisons standards, and contractual obligations is paramount. Performance is often assessed through regular audits, site inspections, and review of contractor-submitted reports. Failure to meet these KPIs can result in contractually defined remedies, including financial penalties or termination.

What is CoreCivic, Inc.'s track record with federal correctional contracts?

CoreCivic, Inc. (formerly Corrections Corporation of America) is one of the largest private prison operators in the United States and has a long-standing relationship with federal agencies, including the Federal Bureau of Prisons (BOP) and U.S. Immigration and Customs Enforcement (ICE). The company has operated numerous correctional facilities under various federal contracts over several decades. Its track record includes managing facilities of varying security levels and capacities. However, CoreCivic, like other private prison operators, has faced scrutiny and criticism regarding safety, staffing levels, and cost-effectiveness. Publicly available data and reports from government oversight bodies often detail specific contract performance, incidents, and compliance issues. A thorough review would involve examining specific contract performance evaluations, IG reports, and news archives related to CoreCivic's federal operations.

What are the potential risks associated with relying on private contractors for correctional services?

Relying on private contractors for correctional services introduces several potential risks. A primary concern is the potential for a profit motive to conflict with public safety and inmate welfare; contractors may be incentivized to cut costs in ways that compromise staffing levels, training, or essential services. This can lead to increased violence, escapes, or inadequate healthcare. Another risk is the potential for reduced transparency and accountability compared to government-run facilities, making oversight more challenging. Contract management itself can be complex and resource-intensive for the government. Furthermore, the long-term reliance on private entities can reduce the government's in-house capacity and expertise in corrections. Finally, ethical and public perception issues surrounding the privatization of incarceration can create political and social challenges.

Industry Classification

NAICS: Administrative and Support and Waste Management and Remediation Services › Facilities Support Services › Facilities Support Services

Product/Service Code: SOCIAL SERVICES › SOCIAL SERVICES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 10 BURTON HILLS BLVD, NASHVILLE, TN, 37215

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

Financial Breakdown

Contract Ceiling: $31,790,879

Exercised Options: $31,790,879

Current Obligation: $31,790,879

Contract Characteristics

Multi-Year Contract: Yes

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: DJB1PC016

IDV Type: IDC

Timeline