State Department awards $76M in facility management services to T&H Services, LLC, with limited competition

Contract Overview

Contract Amount: $76,020,529 ($76.0M)

Contractor: T&H Services, LLC

Awarding Agency: Department of State

Start Date: 2019-09-01

End Date: 2026-08-31

Contract Duration: 2,556 days

Daily Burn Rate: $29.7K/day

Competition Type: NOT AVAILABLE FOR COMPETITION

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: FACILITY MANAGEMENT SERVICES FOR SELECTED DEPARTMENT OF STATE FACILITIES (INCLUDES OPERATIONS AND MAINTENANCE AND REIMBURSABLES)

Place of Performance

Location: BLACKSTONE, NOTTOWAY County, VIRGINIA, 23824

State: Virginia Government Spending

Plain-Language Summary

Department of State obligated $76.0 million to T&H SERVICES, LLC for work described as: FACILITY MANAGEMENT SERVICES FOR SELECTED DEPARTMENT OF STATE FACILITIES (INCLUDES OPERATIONS AND MAINTENANCE AND REIMBURSABLES) Key points: 1. Contract value of $76M over 7 years suggests a significant investment in maintaining critical State Department infrastructure. 2. The 'NOT AVAILABLE FOR COMPETITION' status raises questions about the justification for limited bidding and potential impact on pricing. 3. The firm-fixed-price contract type aims to provide cost certainty, but the absence of competition may limit downward price pressure. 4. Performance context is crucial given the long duration and the essential nature of facility operations and maintenance. 5. Sector positioning within Facilities Support Services (NAICS 561210) indicates a focus on core operational support rather than specialized technical services. 6. The contract's value places it in the mid-to-large tier for facility management contracts within the federal government.

Value Assessment

Rating: fair

Benchmarking the $76M value against similar multi-year facility management contracts for federal agencies is challenging without more specific service details. However, the average annual value of approximately $10.8M falls within a common range for comprehensive facility operations and maintenance. The firm-fixed-price structure suggests an attempt to control costs, but the lack of competition prevents a robust assessment of whether the pricing represents optimal value for money compared to a fully competed scenario. Further analysis would require detailed breakdowns of services and comparison to market rates for comparable facilities.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded under a 'NOT AVAILABLE FOR COMPETITION' (NAFC) justification, indicating that the solicitation was not broadly advertised or competed. This typically occurs when specific circumstances, such as urgency, unique capabilities, or existing infrastructure integration, are cited. The limited competition means that only one offeror, T&H SERVICES, LLC, was considered, preventing a broader market assessment and potentially limiting price discovery through competitive bidding.

Taxpayer Impact: Taxpayers may not benefit from the cost savings typically achieved through a competitive bidding process. The absence of multiple bids means the government could be paying a premium compared to what might have been negotiated in a more open market.

Public Impact

The primary beneficiaries are the Department of State personnel and operations, who rely on well-maintained facilities for their daily functions. Services delivered include essential operations and maintenance for selected State Department facilities, ensuring continuity of government operations. The geographic impact is concentrated at the specific State Department facilities managed under this contract, primarily located in Virginia. Workforce implications include the potential for job creation or retention within T&H SERVICES, LLC and its subcontractors to support facility management tasks.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition raises concerns about potential overpricing and reduced value for taxpayer dollars.
The long contract duration (7 years) could lock the government into a potentially suboptimal arrangement if market conditions or needs change.
Absence of specific performance metrics or quality indicators in the provided data makes it difficult to assess service quality risks.
The 'NOT AVAILABLE FOR COMPETITION' status requires thorough justification to ensure it was indeed the only viable option.

Positive Signals

The firm-fixed-price contract type provides cost certainty for the government, assuming the scope of work is well-defined.
The contract covers essential facility operations and maintenance, which is critical for the continuity of government services.
The long duration allows for stable planning and execution of facility management tasks, potentially leading to efficiencies.
T&H SERVICES, LLC's selection implies they met the government's requirements, though the specific criteria are not detailed.

Sector Analysis

The Facilities Support Services sector (NAICS 561210) encompasses a broad range of services related to the operation and maintenance of buildings and other physical structures. This includes activities like HVAC maintenance, janitorial services, groundskeeping, and security. Federal spending in this area is substantial, driven by the need to maintain a vast portfolio of government-owned and leased properties. Comparable spending benchmarks would typically involve analyzing the annual cost per square foot for facility management across different agency types and facility complexities. This contract fits within the broader trend of federal agencies outsourcing non-core functions to specialized service providers.

Small Business Impact

The provided data indicates that small business participation is not a primary focus for this contract, as the 'ss' (small business set-aside) field is false and the 'sb' (small business) field is also false. This suggests that the contract was not specifically set aside for small businesses, nor is there an explicit indication of significant subcontracting opportunities for small businesses within the scope of this award. Further investigation into the contractor's subcontracting plan would be necessary to determine the actual impact on the small business ecosystem.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of State's contracting officers and program managers. Accountability measures are typically embedded within the contract terms, including performance standards and reporting requirements. Transparency is facilitated through contract databases like FPDS, where basic award information is publicly available. However, the specific details of performance monitoring and any Inspector General (IG) involvement would depend on the contract's specific clauses and any identified issues during its performance period.

Related Government Programs

General Services Administration (GSA) Federal Buildings Fund
Department of Defense Facility Maintenance Contracts
Department of Homeland Security Facilities Operations
Public Buildings Service Contracts

Risk Flags

Limited competition justification requires scrutiny.
Potential for cost overruns due to lack of competitive pricing.
Long-term contract duration may reduce flexibility.
Performance monitoring details are not publicly available.

Frequently Asked Questions

What is this federal contract paying for?

Department of State awarded $76.0 million to T&H SERVICES, LLC. FACILITY MANAGEMENT SERVICES FOR SELECTED DEPARTMENT OF STATE FACILITIES (INCLUDES OPERATIONS AND MAINTENANCE AND REIMBURSABLES)

Who is the contractor on this award?

The obligated recipient is T&H SERVICES, LLC.

Which agency awarded this contract?

Awarding agency: Department of State (Department of State).

What is the total obligated amount?

The obligated amount is $76.0 million.

What is the period of performance?

Start: 2019-09-01. End: 2026-08-31.

What specific services are included under 'Operations and Maintenance and Reimbursables' for these State Department facilities?

The 'Operations and Maintenance' component typically covers routine and preventive maintenance for building systems such as HVAC, electrical, plumbing, and structural elements. It also includes janitorial services, landscaping, pest control, and waste management. 'Reimbursables' usually refer to costs incurred by the contractor that are passed through to the government, often for specialized repairs, emergency services, or materials not covered under the base contract's fixed price. Without the full contract details, the precise scope of these services and the mechanism for reimbursable costs remain unspecified, making a complete assessment of value challenging.

What was the justification for awarding this contract on a 'NOT AVAILABLE FOR COMPETITION' basis?

The 'NOT AVAILABLE FOR COMPETITION' (NAFC) status implies that the Department of State determined that full and open competition was not feasible or not in the government's best interest. Common justifications for NAFC awards include: urgency of need where only one source can meet the requirement, unique capabilities possessed by a single contractor, or situations where a previous contract was terminated and only one other source could perform. The specific rationale for this award would be documented in a Justification for Other Than Full and Open Competition (JOFOC) report, which is typically required by federal acquisition regulations. Without access to this document, the precise reasons remain speculative.

How does the annual value of this contract compare to similar facility management contracts for other federal agencies?

The approximate annual value of this contract is $10.8 million ($76M / 7 years). This figure falls within a moderate range for comprehensive facility management services. For instance, large federal agencies often award contracts for managing significant portions of their real estate portfolios that can range from tens to hundreds of millions of dollars annually. Smaller agencies or contracts covering fewer facilities might be in the low millions. To provide a precise comparison, one would need to analyze contracts with similar scopes (e.g., operations, maintenance, security, janitorial) and facility types (e.g., office buildings, specialized government installations) across agencies like GSA, DoD, or DHS, adjusting for geographic location and specific service requirements.

What are the potential risks associated with a sole-source award for facility management services?

The primary risk of a sole-source award for facility management is the potential for inflated costs due to the lack of competitive pressure. Without competing bids, the contractor may have less incentive to offer the most competitive pricing. Additionally, there's a risk that the government might not be accessing the most innovative or efficient service delivery methods available in the market. Long-term sole-source contracts can also lead to vendor lock-in, making it difficult and costly to switch providers if performance issues arise or if better market alternatives emerge. Ensuring robust contract oversight and performance management becomes even more critical in sole-source situations.

What is the track record of T&H SERVICES, LLC in performing similar federal contracts?

Information regarding T&H SERVICES, LLC's track record in performing similar federal contracts is not detailed in the provided data. A comprehensive assessment would require reviewing their past performance evaluations (e.g., Contractor Performance Assessment Reporting System - CPARS), the value and duration of previous awards, and the types of services rendered. Examining their history with the Department of State or other agencies for facility management or related services would provide insight into their reliability, quality of service, and ability to manage complex contracts. Without this historical data, it's difficult to gauge their proven capability beyond meeting the initial award criteria.

Are there any performance metrics or service level agreements (SLAs) defined in the contract to ensure quality?

The provided summary data does not include details on specific performance metrics or Service Level Agreements (SLAs) for this contract. Typically, facility management contracts include clauses that define key performance indicators (KPIs) related to response times for maintenance requests, uptime of critical systems (like HVAC), cleanliness standards, and safety compliance. These metrics are crucial for measuring the contractor's performance and ensuring the government receives the expected level of service. The absence of this information in the summary suggests that these details are likely found within the full contract document and are essential for effective oversight.

Industry Classification

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

Product/Service Code: MAINT, REPAIR, ALTER REAL PROPERTY › MAINT, ALTER, REPAIR BUILDINGS

Competition & Pricing

Extent Competed: NOT AVAILABLE FOR COMPETITION

Solicitation Procedures: ONLY ONE SOURCE

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 9097 GLACIER HIGHWAY, JUNEAU, AK, 99801

Business Categories: 8(a) Program Participant, Category Business, Corporate Entity Tax Exempt, Government, HUBZone Firm, Native American Tribal Government, Limited Liability Corporation, Minority Owned Business, Native American Owned Business, Self-Certified Small Disadvantaged Business, Small Business, Special Designations, Tribally Owned Firm, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $82,141,696

Exercised Options: $82,141,696

Current Obligation: $76,020,529

Actual Outlays: $19,984,694

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: 19AQMM19D0129

IDV Type: IDC

Timeline