Department of State awards $25.8M contract to NVE, INC for security guard services

Contract Overview

Contract Amount: $25,809,110 ($25.8M)

Contractor: NVE, Inc

Awarding Agency: Department of State

Start Date: 2022-07-15

End Date: 2030-11-30

Contract Duration: 3,060 days

Daily Burn Rate: $8.4K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: TIME AND MATERIALS

Sector: Other

Official Description: ---------- COMMENTS: ADMINISTRATIVELY APPROVED BY AL LOPEZ APPROVAL FLOW EDIT: POLLY ELIZABETH FASSNACHT ADDED BY JEFFREY NAVARRO ON FRI JUN 03 14:46:17 EDT 2022 REASON ADDED: SELECTED APPROVER APPROVAL FLOW EDIT: DREAMA J GRIFFITH ADDED BY JEFFR

Plain-Language Summary

Department of State obligated $25.8 million to NVE, INC for work described as: ---------- COMMENTS: ADMINISTRATIVELY APPROVED BY AL LOPEZ APPROVAL FLOW EDIT: POLLY ELIZABETH FASSNACHT ADDED BY JEFFREY NAVARRO ON FRI JUN 03 14:46:17 EDT 2022 REASON ADDED: SELECTED APPROVER APPROVAL FLOW EDIT: DREAMA J GRIFFITH ADDED BY JEFFR Key points: 1. Contract awarded via full and open competition, suggesting a competitive bidding process. 2. The contract type is Time and Materials, which can pose cost control risks if not managed closely. 3. NVE, INC is the sole awardee, indicating a single entity will perform the services. 4. The contract duration is substantial, spanning over 8 years, requiring long-term performance monitoring. 5. The North American Industry Classification System (NAICS) code 561612 points to specialized security services. 6. The contract is a Delivery Order, implying it's part of a larger indefinite-delivery/indefinite-quantity (IDIQ) vehicle or a similar framework.

Value Assessment

Rating: fair

The total contract value is $25.8 million over approximately 8 years. Without specific performance metrics or detailed cost breakdowns, it is difficult to definitively assess value for money. The Time and Materials pricing structure necessitates careful oversight to prevent cost overruns. Benchmarking against similar security guard contracts would require more granular data on service levels, geographic coverage, and specific security requirements.

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. The number of bidders is not specified, but this method generally promotes price discovery and allows the government to select the best value offer. The open competition suggests a healthy market for these services.

Taxpayer Impact: Taxpayers benefit from a competitive process that aims to secure services at a reasonable price. Full and open competition increases the likelihood of receiving multiple bids, driving down costs and ensuring a fair market price.

Public Impact

The Department of State will receive security guard and patrol services, enhancing the safety and security of its facilities and personnel. The contract's duration suggests a long-term commitment to maintaining a consistent level of security. The geographic impact is likely concentrated around the facilities managed by the Department of State, both domestically and potentially internationally. The contract may support a workforce of security personnel, contributing to employment in the security services sector.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Time and Materials pricing can lead to uncontrolled cost escalation if not diligently managed and monitored.
The long contract duration (over 8 years) increases the risk of performance degradation or outdated service provision if not actively managed.
Lack of specific performance metrics in the provided data makes it challenging to assess the contractor's performance objectively.
The contract is a Delivery Order, which might indicate it's part of a larger, potentially less scrutinized, contracting vehicle.

Positive Signals

Awarded through full and open competition, suggesting a robust bidding process and potential for competitive pricing.
The contract is with NVE, INC, a known entity in the government contracting space, implying some level of established capability.
The Department of State, a major federal agency, is the contracting entity, suggesting adherence to established procurement standards.

Sector Analysis

The security guard and patrol services sector is a significant component of the broader professional, scientific, and technical services industry. This contract falls under NAICS code 561612. The market is characterized by numerous providers ranging from small, specialized firms to large, diversified security companies. Federal spending in this area is driven by the need to protect government assets, personnel, and facilities. Comparable spending benchmarks would depend on the specific security requirements, locations, and service levels, but federal contracts for security services often represent substantial investments.

Small Business Impact

The provided data indicates that small business participation (sb) is false, and there is no indication of a small business set-aside (ss). This suggests the contract was not specifically targeted towards small businesses. While NVE, INC may utilize small businesses for subcontracting, there is no explicit requirement or information provided to assess its impact on the small business ecosystem. The absence of set-aside provisions means larger, established firms likely competed for and were awarded this contract.

Oversight & Accountability

Oversight for this contract would primarily reside with the Department of State's contracting officers and program managers. They are responsible for monitoring performance, ensuring compliance with contract terms, and managing payments. The Time and Materials nature of the contract necessitates particularly close financial oversight to control costs. Transparency is generally facilitated through contract award databases, but detailed performance reports and specific oversight mechanisms are not publicly detailed in this summary.

Related Government Programs

General Services Administration (GSA) Schedules for Security Services
Department of Homeland Security (DHS) Security Contracts
Federal Protective Service Contracts
Department of Defense (DoD) Security Services

Risk Flags

Time and Materials pricing structure requires close monitoring to control costs.
Long contract duration increases risk of performance degradation or outdated services.
Lack of specific performance metrics makes objective assessment difficult.
Delivery Order implies potential linkage to a broader contracting vehicle.

Frequently Asked Questions

What is this federal contract paying for?

Department of State awarded $25.8 million to NVE, INC. ---------- COMMENTS: ADMINISTRATIVELY APPROVED BY AL LOPEZ APPROVAL FLOW EDIT: POLLY ELIZABETH FASSNACHT ADDED BY JEFFREY NAVARRO ON FRI JUN 03 14:46:17 EDT 2022 REASON ADDED: SELECTED APPROVER APPROVAL FLOW EDIT: DREAMA J GRIFFITH ADDED BY JEFFR

Who is the contractor on this award?

The obligated recipient is NVE, INC.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $25.8 million.

What is the period of performance?

Start: 2022-07-15. End: 2030-11-30.

What is the historical spending pattern for security guard services by the Department of State?

Analyzing historical spending patterns for security guard services by the Department of State requires access to detailed federal procurement data over multiple fiscal years. Typically, such analysis would involve identifying all contracts awarded under relevant NAICS codes (like 561612) or service descriptions related to security guards and patrols. Trends might reveal an increase or decrease in spending, shifts in awarded contractors, or changes in contract types (e.g., from fixed-price to time-and-materials). Understanding these patterns helps contextualize the current $25.8 million award, indicating whether it represents a typical investment, an expansion, or a reduction in security service procurement for the agency. Without specific historical data, it's difficult to provide precise figures, but agencies like the State Department consistently require significant security services due to their global operations and sensitive facilities.

How does the per-unit cost of this contract compare to similar security guard contracts?

Determining a precise per-unit cost comparison for this contract is challenging without more granular data. The contract is awarded on a Time and Materials (T&M) basis, meaning costs are based on direct labor hours at specified rates and the cost of materials. To benchmark effectively, one would need to know the specific labor categories (e.g., guard levels, supervisors), their hourly rates, the estimated hours, and the types/costs of materials used. Furthermore, comparisons would need to account for geographic location (which significantly impacts labor costs), the specific security requirements (e.g., armed vs. unarmed, level of surveillance), and the contract duration. Generally, T&M contracts require diligent oversight to ensure rates are competitive and hours are reasonable for the services rendered. A comparison would ideally involve looking at other T&M contracts for similar security services awarded by the Department of State or other federal agencies in comparable locations.

What is NVE, INC's track record with federal security contracts?

NVE, INC has a history of performing federal contracts, including those related to security services. To assess their track record specifically for security guard and patrol services, a review of their past performance evaluations (e.g., Contractor Performance Assessment Reporting System - CPARS) and contract history would be necessary. This would reveal their performance quality, timeliness, cost control, and overall customer satisfaction on previous government engagements. While the award of this $25.8 million contract by the Department of State suggests they met the agency's requirements and were deemed a responsible contractor, a deeper dive into their specific experience with similar scope, scale, and security requirements would provide a more comprehensive understanding of their capabilities and potential risks.

What are the potential risks associated with a Time and Materials (T&M) contract for security services?

Time and Materials (T&M) contracts, like the one awarded to NVE, INC for security services, carry inherent risks primarily related to cost control. Unlike fixed-price contracts, T&M agreements reimburse the contractor for direct labor hours and material costs incurred, plus a fixed fee or percentage for profit and overhead. This structure can incentivize longer performance periods or higher labor rates if not rigorously monitored. For security services, risks include inflated labor hours, unnecessary material purchases, and potentially higher-than-expected costs if demand fluctuates unpredictably or if the scope of work is not clearly defined. Effective oversight by the Department of State, including detailed tracking of hours, verification of materials, and comparison against established labor rate benchmarks, is crucial to mitigate these risks and ensure the government receives good value.

How does the duration of this contract (over 8 years) impact its overall value and risk?

The extended duration of this contract, spanning over 8 years (from July 2022 to November 2030), presents both opportunities and risks. On the positive side, it offers stability and continuity of essential security services for the Department of State, potentially reducing administrative burden and transition costs associated with frequent re-competitions. It also allows the contractor, NVE, INC, to invest in personnel and resources. However, a long duration increases the risk of performance degradation over time, potential for outdated security protocols if not updated, and exposure to market price fluctuations. It also ties the government to a specific contractor and pricing structure for an extended period, potentially limiting its ability to capitalize on future cost-saving opportunities or technological advancements unless the contract includes appropriate review or adjustment clauses.

Industry Classification

NAICS: Administrative and Support and Waste Management and Remediation Services › Investigation and Security Services › Security Guards and Patrol Services

Product/Service Code: ARCHITECT/ENGINEER SERVICES › ARCH-ENG SVCS - GENERAL

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: 12700 SUNRISE VALLEY DR STE 450, RESTON, VA, 20191

Business Categories: Asian Pacific American Owned Business, Category Business, Corporate Entity Not Tax Exempt, Minority Owned Business, Not Designated a Small Business, Self-Certified Small Disadvantaged Business, Small Business, Special Designations, Subchapter S Corporation, U.S.-Owned Business, Woman Owned Business, Women Owned Small Business

Financial Breakdown

Contract Ceiling: $25,809,110

Exercised Options: $25,809,110

Current Obligation: $25,809,110

Actual Outlays: $49,741

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: 19AQMM20D0082

IDV Type: IDC

Timeline