VA awards $8.2M bridge contract to DLH Solutions Inc. for facilities support in Arizona

Contract Overview

Contract Amount: $8,246,823 ($8.2M)

Contractor: DLH Solutions Inc

Awarding Agency: Department of Veterans Affairs

Start Date: 2025-07-01

End Date: 2025-10-28

Contract Duration: 119 days

Daily Burn Rate: $69.3K/day

Competition Type: NOT COMPETED

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: NEW BRIDGE STAFFING CONTRACT FOR MAY 1ST (6 MONTH BRIDGE)

Place of Performance

Location: TUCSON, PIMA County, ARIZONA, 85706

State: Arizona Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $8.2 million to DLH SOLUTIONS INC for work described as: NEW BRIDGE STAFFING CONTRACT FOR MAY 1ST (6 MONTH BRIDGE) Key points: 1. Contract provides essential facilities support services, ensuring continuity of operations. 2. Sole-source award raises questions about competition and potential for cost savings. 3. Short duration suggests a temporary solution, potentially masking underlying procurement issues. 4. Fixed-price contract type shifts risk to the contractor, but oversight is crucial. 5. Geographic focus on Arizona highlights regional service delivery needs. 6. Contract value is moderate, but its bridge nature warrants scrutiny.

Value Assessment

Rating: fair

The $8.2 million contract value for a 6-month bridge period appears high for facilities support services, especially given the lack of competition. Benchmarking against similar contracts for facilities maintenance and support in the region would be necessary to determine true value for money. The per-unit cost of $6,930 is a key metric, but without knowing the scope of services it represents, it's difficult to assess its competitiveness. The short duration also implies a premium might be paid for speed and expediency.

Cost Per Unit: $6,930 (per unit cost benchmark provided, but unit definition is unclear)

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning DLH Solutions Inc. was the only vendor considered. This approach bypasses the standard competitive bidding process, which typically yields the best prices and innovative solutions. The lack of competition means the VA did not explore other potential providers who might offer better value or specialized services. This raises concerns about whether the government received the most advantageous terms possible.

Taxpayer Impact: Taxpayers may have paid a premium due to the absence of competitive pressure. Without a competitive process, there is less incentive for the contractor to offer the lowest possible price, potentially leading to less efficient use of public funds.

Public Impact

Benefits the Department of Veterans Affairs by ensuring uninterrupted facilities support services. Services delivered include maintenance, repair, and operational support for VA facilities. Geographic impact is concentrated in Arizona, supporting VA operations within the state. Workforce implications include the potential for continued employment of existing staff or the need for new hires by DLH Solutions Inc. to fulfill the contract.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits price discovery and potentially increases costs for taxpayers.
Short contract duration suggests a potential lack of long-term planning or urgency in the procurement process.
Lack of detailed service scope makes it difficult to fully assess value for money.
Reliance on a single vendor for critical facilities support could create dependency.

Positive Signals

Contract ensures continuity of essential facilities support services for the VA.
Firm fixed-price contract type shifts performance risk to the contractor.
Awarding to an existing vendor (implied by bridge contract) may leverage established knowledge and processes.

Sector Analysis

Facilities Support Services (NAICS 561210) is a broad category encompassing a wide range of services necessary for the operation and maintenance of buildings and grounds. This sector includes everything from janitorial and security to HVAC and groundskeeping. The federal government is a significant consumer of these services across its vast real estate portfolio. Comparable spending benchmarks are difficult to establish without a clear definition of the specific services provided under this contract, but the market is generally competitive, making sole-source awards notable.

Small Business Impact

This contract was not competed and there is no indication of a small business set-aside. Therefore, it does not appear to directly benefit small businesses through prime contract awards. Subcontracting opportunities for small businesses are not specified in the provided data, but are typically encouraged or required in larger federal contracts. The absence of a set-aside suggests that larger, established firms like DLH Solutions Inc. were the primary focus for this award.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of Veterans Affairs' contracting and program management offices. As a sole-source award, scrutiny may be higher to ensure the necessity and justification for bypassing competition. Transparency is limited by the lack of a competitive process. Inspector General jurisdiction would apply if any fraud, waste, or abuse is suspected related to the contract's execution or award.

Related Government Programs

Facilities Maintenance Contracts
Government Operations Support Services
Department of Veterans Affairs Service Contracts
Bridge Contracts
Sole-Source Procurements

Risk Flags

Sole-source award
Bridge contract
Lack of detailed service scope
Potential for cost overruns due to lack of competition

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $8.2 million to DLH SOLUTIONS INC. NEW BRIDGE STAFFING CONTRACT FOR MAY 1ST (6 MONTH BRIDGE)

Who is the contractor on this award?

The obligated recipient is DLH SOLUTIONS INC.

Which agency awarded this contract?

Awarding agency: Department of Veterans Affairs (Department of Veterans Affairs).

What is the total obligated amount?

The obligated amount is $8.2 million.

What is the period of performance?

Start: 2025-07-01. End: 2025-10-28.

What specific facilities support services are included under this $8.2 million contract?

The provided data indicates the contract falls under NAICS code 561210 (Facilities Support Services) but does not detail the specific services rendered. These could range broadly from routine maintenance, janitorial services, groundskeeping, pest control, security, to more specialized technical support for building systems. Understanding the precise scope is critical for evaluating the contract's value, comparing it to market rates, and assessing the necessity of a sole-source award. Without this detail, the $6,930 per-unit cost benchmark remains ambiguous.

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

Federal procurement regulations typically require full and open competition. A sole-source award, as indicated by 'NOT COMPETED', must be justified by specific circumstances, such as the urgency of the need (often the case for bridge contracts), the unavailability of other sources, or unique capabilities possessed by the sole awardee. The Department of Veterans Affairs would need to document and approve this justification. For a bridge contract, the justification often centers on the need to maintain essential services while a new, competitively awarded contract is being finalized, preventing a gap in service delivery.

How does the $6,930 per-unit cost compare to industry benchmarks for similar facilities support services?

The per-unit cost of $6,930 is provided, but its comparability is limited without knowing the definition of a 'unit' in this context. Is it per facility, per square foot, per service call, or per month? Assuming it represents a significant service package, this figure would need to be benchmarked against market rates for comparable facilities support contracts in Arizona. Given the sole-source nature, it is plausible that this rate is higher than what could be achieved through competition. Further analysis would require detailed service scope and pricing breakdowns.

What is the typical duration and value of bridge contracts for facilities support services within the VA?

Bridge contracts are intended to be short-term solutions, typically lasting from a few months up to a year, to prevent service interruptions while a new contract is established. The $8.2 million value for a 6-month period (approximately $1.37 million per month) is substantial and warrants scrutiny. Typical durations are often 6 months, with options to extend. The value can vary significantly based on the size and complexity of the facilities being supported. This specific contract's value should be compared against historical VA bridge contracts for similar services to assess if it is within expected ranges or potentially inflated.

What are the potential risks associated with a sole-source bridge contract for essential services?

The primary risks include paying a premium due to lack of competition, potentially receiving suboptimal service quality if the contractor is not incentivized by market pressures, and the risk of vendor lock-in if the bridge extends longer than anticipated. There's also the risk that the urgency of the bridge award might lead to less rigorous vetting of the contractor's performance history or capabilities. Furthermore, it delays the opportunity to leverage new technologies or more cost-effective solutions that a competitive process might uncover.

Industry Classification

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

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

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: DLH Holdings Corp

Address: 3565 PIEDMONT RD NE, ATLANTA, GA, 30305

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

Financial Breakdown

Contract Ceiling: $8,246,823

Exercised Options: $8,246,823

Current Obligation: $8,246,823

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: 36C77024D0011

IDV Type: IDC

Timeline