DHS awards $22.5M contract for dormitory management in New Mexico, raising value-for-money questions

Contract Overview

Contract Amount: $22,553,564 ($22.6M)

Contractor: Adelante Development Center Inc

Awarding Agency: Department of Homeland Security

Start Date: 2023-10-01

End Date: 2031-09-30

Contract Duration: 2,921 days

Daily Burn Rate: $7.7K/day

Competition Type: NOT AVAILABLE FOR COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: DORMITORY MANAGEMENT SERVICES, ARTESIA, NEW MEXICO

Place of Performance

Location: ARTESIA, EDDY County, NEW MEXICO, 88210

State: New Mexico Government Spending

Plain-Language Summary

Department of Homeland Security obligated $22.6 million to ADELANTE DEVELOPMENT CENTER INC for work described as: DORMITORY MANAGEMENT SERVICES, ARTESIA, NEW MEXICO Key points: 1. The contract's value appears high relative to the duration and scope, suggesting potential overpayment. 2. Limited competition for this essential service raises concerns about price discovery and taxpayer value. 3. The firm-fixed-price structure may not adequately account for fluctuating operational costs. 4. Performance context is limited due to the lack of detailed metrics in the provided data. 5. This contract positions DHS to manage essential facilities operations in a critical training environment. 6. The absence of small business participation warrants further investigation into subcontracting opportunities.

Value Assessment

Rating: questionable

The contract value of $22.5 million over approximately 8 years (2921 days) for dormitory management services in Artesia, New Mexico, warrants scrutiny. Without specific performance metrics or comparable contract data, it is difficult to definitively benchmark value. However, the average annual cost approaches $2.8 million. This figure seems substantial for dormitory management, especially considering the fixed-price nature, which typically implies predictable service levels. Further analysis would require understanding the scope of services, number of personnel managed, and specific facility requirements to assess if this represents a fair market price or if efficiencies could be achieved.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded under a sole-source justification, meaning it was not openly competed. While sole-source awards can be necessary in specific circumstances, they inherently limit the potential for competitive bidding, which is a primary driver of cost savings for the government. The lack of competition means that taxpayers do not benefit from the price reductions that often arise when multiple companies vie for a contract. The rationale for this sole-source award is not provided, making it difficult to assess its necessity and potential impact on pricing.

Taxpayer Impact: The absence of competition means taxpayers may be paying a premium for these dormitory management services, as there was no market pressure to drive down costs through bidding.

Public Impact

Federal law enforcement trainees and personnel at the Artesia facility benefit from managed dormitory services. The contract ensures the provision of essential dormitory upkeep and management, contributing to a functional training environment. Services are geographically concentrated in Artesia, New Mexico, supporting the Federal Law Enforcement Training Center's operations. The contract likely supports local employment through the contractor's operational needs, though specific workforce numbers are not detailed.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits competitive pricing and potential taxpayer savings.
High contract value relative to duration raises questions about cost-effectiveness.
Lack of performance metrics makes value assessment challenging.
No indication of small business participation or subcontracting goals.

Positive Signals

Ensures essential dormitory services for a critical federal training facility.
Firm-fixed-price contract provides cost certainty for the government.
Long-term contract (approx. 8 years) offers stability for service provision.

Sector Analysis

Dormitory management services fall under the broader facilities management and support services sector. This sector is characterized by a mix of large, diversified service providers and smaller, specialized firms. Government contracts for such services are common across various agencies, supporting everything from administrative buildings to specialized operational facilities like training centers. Benchmarking this contract's value would require comparing it to similar dormitory or facility management contracts awarded by federal agencies, considering factors like location, size of facility, and scope of services provided. The total federal spending on facilities management is substantial, with this contract representing a small portion of that overall expenditure.

Small Business Impact

The data indicates that this contract was not awarded to a small business (ss: false) and does not appear to have specific small business set-aside provisions (sb: false). This suggests that opportunities for small businesses to participate, either as prime contractors or subcontractors, may be limited. Further investigation into the contractor's subcontracting plan would be necessary to determine if small businesses are being engaged to fulfill any part of this requirement. The lack of explicit small business focus could mean missed opportunities to support the small business ecosystem and leverage their agility.

Oversight & Accountability

Oversight for this contract would primarily reside with the contracting agency, the Department of Homeland Security (DHS), specifically the Federal Law Enforcement Training Center (FLETC). As a definitive contract, it is subject to standard federal procurement regulations and oversight. Transparency regarding the sole-source justification and performance metrics would be key indicators of effective oversight. While not explicitly stated, Inspector General (IG) offices within DHS or the Government Accountability Office (GAO) could potentially review this contract for compliance and value if concerns arise. The firm-fixed-price nature simplifies some aspects of financial oversight but requires robust performance monitoring.

Related Government Programs

Federal Law Enforcement Training Center Operations
Dormitory and Housing Management Services
Facilities Support Services
Department of Homeland Security Procurement

Risk Flags

Sole-source award lacks competitive justification.
Potential for overpayment due to lack of price competition.
Absence of performance metrics hinders value assessment.
No clear small business participation outlined.

Frequently Asked Questions

What is this federal contract paying for?

Department of Homeland Security awarded $22.6 million to ADELANTE DEVELOPMENT CENTER INC. DORMITORY MANAGEMENT SERVICES, ARTESIA, NEW MEXICO

Who is the contractor on this award?

The obligated recipient is ADELANTE DEVELOPMENT CENTER INC.

Which agency awarded this contract?

Awarding agency: Department of Homeland Security (Federal Law Enforcement Training Center).

What is the total obligated amount?

The obligated amount is $22.6 million.

What is the period of performance?

Start: 2023-10-01. End: 2031-09-30.

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

The provided data indicates the contract was awarded as 'NOT AVAILABLE FOR COMPETITION,' which typically signifies a sole-source or limited-source justification. Common reasons for sole-source awards include unique capabilities of a single provider, urgent and compelling needs where competition is impractical, or when only one responsible source is available. Without further documentation from the Department of Homeland Security (DHS), the precise justification remains unknown. However, such awards bypass the competitive bidding process, which is designed to ensure the government receives the best value through market forces. Understanding the specific rationale is crucial for assessing whether this deviation from full and open competition was warranted and if it resulted in a fair price for taxpayers.

How does the cost per day or per resident compare to similar dormitory management contracts?

Calculating a precise cost per day or per resident is challenging without knowing the number of dormitory beds or residents managed under this $22.5 million contract. The contract duration is approximately 2921 days (about 8 years). If we assume an average daily cost, it would be roughly $7,715 ($22,553,563.75 / 2921 days). To benchmark this, we would need data on comparable contracts for dormitory management at federal facilities, factoring in location, size, and the specific services included (e.g., cleaning, maintenance, security, utilities management). Given the sole-source nature and lack of detailed scope, it is difficult to ascertain if this daily rate is competitive or represents good value for money without further comparative analysis.

What are the key performance indicators (KPIs) and service level agreements (SLAs) associated with this contract?

The provided data does not include specific Key Performance Indicators (KPIs) or Service Level Agreements (SLAs) for this dormitory management contract. These metrics are crucial for objectively measuring the contractor's performance and ensuring the government receives the agreed-upon quality and scope of services. Typically, KPIs for such contracts might include response times for maintenance requests, cleanliness standards, resident satisfaction rates, and adherence to safety protocols. Without defined SLAs and KPIs, it is difficult for the Federal Law Enforcement Training Center (FLETC) to hold Adelante Development Center Inc. accountable for performance and to verify that the $22.5 million investment is yielding the expected outcomes. This lack of transparency in performance standards is a significant gap in assessing the contract's overall effectiveness.

What is the track record of Adelante Development Center Inc. in managing federal contracts, particularly for facilities management?

Information regarding Adelante Development Center Inc.'s specific track record with federal contracts, especially in facilities management, is not detailed in the provided data. A comprehensive assessment would require reviewing their past performance on similar government contracts, including client satisfaction, adherence to schedules and budgets, and any history of disputes or corrective actions. Understanding their experience is vital, particularly given this is a sole-source award. A strong, proven track record could help justify the non-competitive award, while a history of issues might raise concerns about the value and reliability of the services provided. Further due diligence would involve searching federal contract databases and performance reports.

What is the potential impact of this contract on the local economy in Artesia, New Mexico?

This $22.5 million contract for dormitory management services is likely to have a positive impact on the local economy in Artesia, New Mexico. Adelante Development Center Inc., as the contractor, will need to procure local goods and services and employ local personnel to fulfill the contract requirements. This can lead to job creation, increased local spending, and business opportunities for small and medium-sized enterprises in the region that may serve as suppliers or subcontractors. The duration of the contract (approximately 8 years) suggests a sustained economic contribution. However, the extent of this impact depends on the contractor's commitment to local sourcing and hiring practices.

Are there any provisions for contract termination or modification if performance is unsatisfactory or needs change?

As a definitive contract awarded by the Department of Homeland Security, this agreement is expected to include standard clauses for termination and modification. Federal Acquisition Regulation (FAR) Part 49 outlines procedures for contract termination for default or convenience, allowing the government to terminate the contract if the contractor fails to perform or if the government's needs change. Similarly, contract modifications (changes to scope, price, or schedule) are typically handled through formal amendment processes, often requiring mutual agreement or specific contractual rights. While the data doesn't specify these clauses, they are standard components of federal contracts and would be essential for managing risk and ensuring flexibility for the government.

Industry Classification

NAICS: Administrative and Support and Waste Management and Remediation Services › Services to Buildings and Dwellings › Janitorial Services

Product/Service Code: UTILITIES AND HOUSEKEEPING › HOUSEKEEPING SERVICES

Competition & Pricing

Extent Competed: NOT AVAILABLE FOR COMPETITION

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: 70LART23RPFB00004

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 3900 OSUNA RD NE, ALBUQUERQUE, NM, 87109

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

Financial Breakdown

Contract Ceiling: $46,472,618

Exercised Options: $22,553,564

Current Obligation: $22,553,564

Actual Outlays: $11,117,559

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: YES

Timeline