Treasury's $940K Mailroom Services Contract Awarded to Strativia LLC Amidst Limited Competition

Contract Overview

Contract Amount: $939,886 ($939.9K)

Contractor: Strativia LLC

Awarding Agency: Department of the Treasury

Start Date: 2023-04-01

End Date: 2027-03-31

Contract Duration: 1,460 days

Daily Burn Rate: $644/day

Competition Type: NOT AVAILABLE FOR COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: MAILROOM SUPPORT SERVICES

Place of Performance

Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20011

State: District of Columbia Government Spending

Plain-Language Summary

Department of the Treasury obligated $939,885.51 to STRATIVIA LLC for work described as: MAILROOM SUPPORT SERVICES Key points: 1. Contract awarded on a firm-fixed-price basis, providing cost certainty for the government. 2. The contract duration of 1460 days (4 years) suggests a need for stable, long-term mailroom support. 3. Awarded to a single vendor, raising questions about the extent of competition and potential price optimization. 4. The service category (Business Support Services) is broad, requiring a clear understanding of specific deliverables. 5. Geographic location in Washington D.C. may indicate a focus on supporting federal agencies in the capital. 6. The absence of small business set-aside flags suggests this contract did not prioritize small business participation.

Value Assessment

Rating: fair

Benchmarking the value of this contract is challenging without detailed service scope and performance metrics. The firm-fixed-price structure offers some cost control. However, the lack of competitive bidding limits the ability to assess if the pricing reflects market rates or if a more advantageous price could have been secured through a broader competition. Further analysis would require comparing the specific services provided against similar contracts for mailroom support in the federal sector.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded under a 'NOT AVAILABLE FOR COMPETITION' justification, indicating that a full and open competition was not pursued. This typically occurs when only one responsible source is available or when an urgent need cannot be met by other means. The limited competition means there was no direct price comparison against other potential vendors, potentially impacting the government's ability to achieve the best possible price.

Taxpayer Impact: Sole-source awards can lead to higher costs for taxpayers as the government may not benefit from the price reductions typically driven by competitive bidding processes.

Public Impact

Federal agencies in Washington D.C. will benefit from continued mailroom support services. Ensures the efficient processing and handling of mail, crucial for government operations. Supports the administrative functions of the Bureau of the Fiscal Service within the Department of the Treasury. The contract may indirectly support local employment through the vendor's operations in the D.C. area.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Limited competition raises concerns about potential overpayment and lack of innovation.
Lack of transparency in the sole-source justification requires scrutiny to ensure necessity.
The broad service category could lead to scope creep or under-delivery if not precisely managed.

Positive Signals

Firm-fixed-price contract provides budget certainty.
Long-term contract (4 years) ensures continuity of essential mailroom services.
Award to an established entity (Strativia LLC) may imply prior successful performance, though not explicitly stated.

Sector Analysis

The Business Support Services sector encompasses a wide range of administrative and operational functions for organizations. Within the federal government, these services are critical for maintaining day-to-day operations, including mail management, document handling, and administrative assistance. Spending in this category can vary significantly based on agency size and specific needs. Comparable spending benchmarks are difficult to establish without a precise definition of the mailroom services required, but typically, such contracts aim for efficiency and reliability in handling large volumes of correspondence.

Small Business Impact

This contract was not set aside for small businesses, and the data indicates no explicit subcontracting requirements for small businesses were mandated. This means that opportunities for small businesses to participate in this specific contract are limited. The absence of a small business focus in this award does not necessarily reflect the overall small business utilization by the agency but is specific to this procurement.

Oversight & Accountability

Oversight for this contract would primarily fall under the Bureau of the Fiscal Service and the Department of the Treasury's contracting officers and program managers. They are responsible for monitoring performance, ensuring compliance with contract terms, and approving payments. Transparency is facilitated through contract databases like FPDS, but the specific justifications for sole-source awards require careful review by oversight bodies to ensure they are valid and in the government's best interest. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

Federal Mail Management Services
Administrative Support Contracts
Business Operations Support
Department of the Treasury Procurement

Risk Flags

Limited Competition
Sole-Source Justification Required Scrutiny
Potential for Non-Competitive Pricing
Lack of Small Business Participation

Frequently Asked Questions

What is this federal contract paying for?

Department of the Treasury awarded $939,885.51 to STRATIVIA LLC. MAILROOM SUPPORT SERVICES

Who is the contractor on this award?

The obligated recipient is STRATIVIA LLC.

Which agency awarded this contract?

Awarding agency: Department of the Treasury (Bureau of the Fiscal Service).

What is the total obligated amount?

The obligated amount is $939,885.51.

What is the period of performance?

Start: 2023-04-01. End: 2027-03-31.

What specific services are included under 'MAILROOM SUPPORT SERVICES' for this contract?

The provided data abbreviates the service as 'MAILROOM SUPPORT SERVICES' and categorizes it under 'All Other Business Support Services' (NAICS 561499). While the specific deliverables are not detailed in the summary data, typical mailroom support services can include receiving, sorting, distributing incoming mail, preparing outgoing mail, managing mail logs, operating mailroom equipment (like postage meters and mail sorters), and potentially courier services. For this contract, the Bureau of the Fiscal Service likely requires comprehensive mail handling to support its operations. A detailed statement of work (SOW) within the contract documents would specify the exact scope, including volume expectations, service level agreements (SLAs), and any specialized handling requirements for sensitive documents.

What is the justification for awarding this contract on a sole-source basis?

The data indicates the contract was awarded under 'NOT AVAILABLE FOR COMPETITION,' which is a category often used for sole-source justifications. Common reasons for sole-source awards include that only one responsible source is capable of providing the required service, there is an urgent and compelling need that cannot be satisfied through competition, or the procurement is for a brand name item or service. Without the specific justification document, it's impossible to know the exact reason. However, for a service like mailroom support, it might be argued that a specific incumbent vendor possesses unique knowledge, infrastructure, or security clearances essential for continuity, or that transitioning to a new vendor would be prohibitively disruptive or costly.

How does the firm-fixed-price (FFP) contract type benefit the government in this scenario?

A Firm-Fixed-Price (FFP) contract type is generally advantageous for the government when the scope of work is well-defined and the risks of cost overruns are manageable. For mailroom support services, an FFP contract provides budget certainty, as the contractor assumes the risk of cost increases. This means the government knows the exact price it will pay for the services over the contract's duration, simplifying financial planning and reducing the likelihood of unexpected cost escalations. This structure incentivizes the contractor to manage its own costs efficiently to maintain profitability.

What is the typical annual spending for mailroom support services in the federal government?

Annual spending on mailroom support services across the federal government can vary widely depending on the agency's size, mission, and geographic distribution. While specific aggregate data for 'mailroom support services' as a distinct category is not readily available, it falls under broader 'Business Support Services' or 'Administrative Services' categories. Agencies with large physical footprints or significant mail processing needs, such as the Department of Defense, Postal Service (though often handled internally or via specific contracts), or large civilian agencies like Treasury or HHS, can spend millions annually on such services, either through dedicated contracts or as part of larger facilities management agreements. This particular contract, at approximately $235,000 per year ($940K / 4 years), appears to be a moderate-sized award for a specific function within one bureau.

What are the potential risks associated with a sole-source award for mailroom support?

The primary risk associated with a sole-source award for mailroom support is the potential for inflated pricing due to the lack of competitive pressure. Without competing bids, the contractor may not feel compelled to offer the most cost-effective solution. Additionally, there's a risk of complacency or reduced service quality over time, as the vendor faces no direct threat of losing the contract to a competitor. This can also stifle innovation, as the government may not benefit from new technologies or more efficient processes that other vendors might offer. Ensuring the sole-source justification is robust and that performance is rigorously monitored becomes critical to mitigate these risks.

Industry Classification

NAICS: Administrative and Support and Waste Management and Remediation Services › Business Support Services › All Other Business Support Services

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

Competition & Pricing

Extent Competed: NOT AVAILABLE FOR COMPETITION

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: RFP-AFRW-RS-23-0007

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 1401 MERCANTILE LANE, LARGO, MD, 20774

Business Categories: 8(a) Program Participant, Black American Owned Business, Category Business, DoT Certified Disadvantaged Business Enterprise, Limited Liability Corporation, Minority Owned Business, Partnership or Limited Liability Partnership, Self-Certified Small Disadvantaged Business, Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $1,185,975

Exercised Options: $939,886

Current Obligation: $939,886

Actual Outlays: $633,670

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Timeline