VA Awards $31M Contract to Federal Express for NGDS Shipping Services

Contract Overview

Contract Amount: $31,052,500 ($31.1M)

Contractor: Federal Express Corporation

Awarding Agency: Department of Veterans Affairs

Start Date: 2025-10-01

End Date: 2026-09-30

Contract Duration: 364 days

Daily Burn Rate: $85.3K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 4

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: FED EX NGDS SHIPPING

Place of Performance

Location: LEAVENWORTH, LEAVENWORTH County, KANSAS, 66048

State: Kansas Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $31.1 million to FEDERAL EXPRESS CORPORATION for work described as: FED EX NGDS SHIPPING Key points: 1. Significant contract value of $31.05 million over two years. 2. Federal Express Corporation is the sole awardee, raising questions about competition. 3. The contract falls under the 'Couriers and Express Delivery Services' sector. 4. Potential for cost savings or overspending given the fixed-price structure.

Value Assessment

Rating: fair

The contract's pricing is set at a firm fixed price. Without specific per-unit cost data or benchmarks for similar government express delivery services, it's difficult to definitively assess its value. However, the total award amount suggests a substantial commitment.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

The contract was awarded under 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES,' indicating a limited competition scenario. This method may restrict price discovery and potentially lead to higher costs compared to broader competitive solicitations.

Taxpayer Impact: Taxpayer funds are being utilized for express delivery services. The limited competition raises concerns about whether the most cost-effective solution was secured for the government.

Public Impact

Ensures timely delivery of critical supplies and documents for the Department of Veterans Affairs. Supports the operational needs of VA facilities across Kansas. Impacts the efficiency of VA's logistical network.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Limited competition may result in suboptimal pricing.
Lack of transparency in the award process.
Potential for price increases in future contract renewals.

Positive Signals

Ensures reliable delivery services for a critical government agency.
Fixed-price contract provides cost certainty for the duration.
Supports established vendor relationships.

Sector Analysis

This contract falls within the 'Couriers and Express Delivery Services' sector, which is essential for government operations. Benchmarks for similar large-scale delivery contracts are often influenced by volume, speed requirements, and geographic coverage.

Small Business Impact

The awardee, Federal Express Corporation, is a large corporation. There is no indication that small businesses were involved as subcontractors or partners in this specific contract, suggesting limited direct impact on the small business sector.

Oversight & Accountability

The Department of Veterans Affairs is responsible for oversight. The 'limited competition' aspect warrants scrutiny to ensure fair pricing and performance standards are met throughout the contract period.

Related Government Programs

Couriers and Express Delivery Services
Department of Veterans Affairs Contracting
Department of Veterans Affairs Programs

Risk Flags

Limited competition raises concerns about potential overpricing.
Lack of detailed service breakdown makes value assessment difficult.
Awardee is a large corporation, potentially excluding small business participation.
Contract duration of two years with options could lead to long-term reliance on a single provider.

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $31.1 million to FEDERAL EXPRESS CORPORATION. FED EX NGDS SHIPPING

Who is the contractor on this award?

The obligated recipient is FEDERAL EXPRESS CORPORATION.

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 $31.1 million.

What is the period of performance?

Start: 2025-10-01. End: 2026-09-30.

What is the specific breakdown of services included in this $31 million contract, and how does it compare to market rates for similar government express delivery needs?

The contract covers express delivery services under NAICS code 492110. A detailed breakdown of services is not provided in the summary data. To assess market rates, one would need to compare the contract's scope, service level agreements, and pricing against other government contracts for similar delivery volumes and geographic coverage, as well as private sector benchmarks.

Given the limited competition, what measures are in place to ensure the VA is receiving a fair price and that performance standards are rigorously monitored?

The contract utilizes a firm fixed-price structure, which provides some cost certainty. However, the VA should implement robust performance monitoring, including tracking delivery times, package integrity, and customer satisfaction. Regular price reasonableness checks against available market data and potentially conducting a cost analysis for future solicitations would be prudent.

How does this contract contribute to the overall efficiency and effectiveness of the VA's logistical operations, particularly in supporting healthcare delivery?

Reliable express delivery is crucial for the VA to ensure timely transport of medical supplies, pharmaceuticals, and patient records between facilities and to beneficiaries. This contract's effectiveness hinges on Federal Express's ability to meet stringent delivery timelines and maintain the integrity of sensitive shipments, directly impacting patient care and operational continuity.

Industry Classification

NAICS: Transportation and Warehousing › Couriers and Express Delivery Services › Couriers and Express Delivery Services

Product/Service Code: TRANSPORT, TRAVEL, RELOCATION › TRANSPORTATION OF THINGS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 4

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Fedex Corp

Address: 2003 CORPORATE PLZ, MEMPHIS, TN, 38132

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

Financial Breakdown

Contract Ceiling: $31,052,500

Exercised Options: $31,052,500

Current Obligation: $31,052,500

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: HTC71123DC023

IDV Type: IDC

Timeline