DHS awards $25.1M for protective security services in Manhattan, with Paragon Systems Inc. as prime

Contract Overview

Contract Amount: $25,181,649 ($25.2M)

Contractor: Paragon Systems Inc

Awarding Agency: Department of Homeland Security

Start Date: 2019-09-13

End Date: 2021-06-09

Contract Duration: 635 days

Daily Burn Rate: $39.7K/day

Competition Type: FULL AND OPEN COMPETITION

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: PROTECTIVE SECURITY OFFICER SERVICES - MANHATTAN

Place of Performance

Location: NEW YORK, NEW YORK County, NEW YORK, 10278

State: New York Government Spending

Plain-Language Summary

Department of Homeland Security obligated $25.2 million to PARAGON SYSTEMS INC for work described as: PROTECTIVE SECURITY OFFICER SERVICES - MANHATTAN Key points: 1. Contract value of $25.1M over approximately two years represents a significant investment in physical security. 2. The award was made under full and open competition, suggesting a competitive bidding process. 3. The fixed-price contract type aims to control costs by establishing a set price for services. 4. The services are categorized under 'Security Guards and Patrol Services,' a common requirement for federal facilities. 5. The contract duration of 635 days provides a stable security presence for the specified period. 6. The geographic focus on New York (Manhattan) indicates a localized but critical security need.

Value Assessment

Rating: good

The contract value of $25.1M for approximately two years of protective security services in Manhattan appears reasonable given the scope. Benchmarking against similar contracts for large-scale security services in major metropolitan areas would provide a more precise value-for-money assessment. The firm-fixed-price structure suggests an effort to manage costs effectively, though the ultimate value depends on the quality and efficiency of the services delivered by Paragon Systems Inc.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit bids. The number of bidders is not specified, but this procurement method generally fosters price discovery and encourages competitive pricing. The agency sought a broad range of potential contractors, which should have led to a more favorable price for the government.

Taxpayer Impact: Taxpayers benefit from a competitive process that aims to secure the best possible price for essential security services, reducing the risk of overpayment.

Public Impact

Federal facilities and personnel in Manhattan are protected by the services rendered under this contract. The contract ensures the continuous operation of critical security functions for the Department of Homeland Security. The geographic impact is concentrated in New York City, specifically Manhattan, addressing localized security concerns. The contract supports jobs within the security services sector, likely benefiting security guards and supervisory personnel.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for service quality variations between different security personnel.
Reliance on a single prime contractor for a critical security function.
Geographic concentration of services may limit broader economic impact.

Positive Signals

Awarded through full and open competition, suggesting a robust selection process.
Firm-fixed-price contract type provides cost certainty for the government.
Longer contract duration offers stability and continuity of essential security services.

Sector Analysis

The protective security services sector is a vital component of the federal procurement landscape, encompassing a wide range of services from guard patrols to advanced security systems. This contract falls within the broader 'Security Guards and Patrol Services' industry, which is characterized by numerous small and large businesses competing for government contracts. Federal spending in this area is consistently high due to the need to protect sensitive facilities and personnel across the nation. The market size for federal security services is substantial, with agencies like DHS being major consumers.

Small Business Impact

This contract does not appear to have a small business set-aside component, as indicated by 'sb': false. The prime contractor, Paragon Systems Inc., is a large business. There is no explicit information provided regarding subcontracting plans for small businesses. Therefore, the direct impact on the small business ecosystem through this specific award is likely minimal, though the prime contractor may engage small businesses in their supply chain.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and contract specialists within the Department of Homeland Security's Office of Procurement Operations. Performance monitoring, quality assurance checks, and adherence to contract terms are standard oversight mechanisms. Transparency is generally maintained through contract award databases, though specific performance metrics and detailed oversight reports may not always be publicly accessible. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse.

Related Government Programs

Federal Protective Service Contracts
Department of Homeland Security Security Services
Manhattan Federal Facility Security
Security Guard Services Contracts
Physical Security Services

Risk Flags

Potential for service quality issues if contractor performance is not rigorously monitored.
Geographic concentration of services may limit broader economic benefits.
Lack of explicit small business subcontracting goals could limit opportunities for smaller firms.

Frequently Asked Questions

What is this federal contract paying for?

Department of Homeland Security awarded $25.2 million to PARAGON SYSTEMS INC. PROTECTIVE SECURITY OFFICER SERVICES - MANHATTAN

Who is the contractor on this award?

The obligated recipient is PARAGON SYSTEMS INC.

Which agency awarded this contract?

Awarding agency: Department of Homeland Security (Office of Procurement Operations).

What is the total obligated amount?

The obligated amount is $25.2 million.

What is the period of performance?

Start: 2019-09-13. End: 2021-06-09.

What is the track record of Paragon Systems Inc. in performing similar federal security contracts?

Paragon Systems Inc. has a history of performing federal security contracts, including protective security officer services for various agencies. Their performance record can be assessed by reviewing past contract awards, performance evaluations (if publicly available), and any reported disputes or contract terminations. A detailed analysis would involve examining their success in meeting performance standards, delivery timelines, and budget constraints on previous similar engagements. Their experience with the Department of Homeland Security and other federal entities provides a basis for evaluating their capability to fulfill the requirements of this contract.

How does the awarded price compare to market rates for similar security services in Manhattan?

Benchmarking the $25.1M contract value against market rates for protective security services in Manhattan requires detailed analysis of prevailing wages, labor costs, and overhead specific to the region. Factors such as the number of personnel required, hours of service, security clearance levels, and specialized training influence per-hour or per-person costs. Without specific details on the service levels and personnel deployed, a precise comparison is challenging. However, given Manhattan's high cost of living and operating expenses, the contract value should reflect these regional economic factors. A thorough analysis would involve comparing the effective hourly rate or cost per security officer against industry benchmarks and rates paid by other large organizations in the area.

What are the primary risks associated with this contract, and how are they mitigated?

Key risks include potential disruptions to security services due to contractor performance issues, personnel turnover, or unforeseen security threats. Mitigation strategies typically involve robust performance monitoring by the contracting officer's representative (COR), clear performance standards in the contract, and contingency planning. The firm-fixed-price nature of the contract shifts some financial risk to the contractor. Additionally, the requirement for full and open competition aims to select a capable and reliable provider. The contract's duration provides some stability, but ongoing vigilance and proactive management are crucial for mitigating risks throughout its term.

How effective is the firm-fixed-price contract type in ensuring value for money for this security service?

The firm-fixed-price (FFP) contract type is generally effective in ensuring value for money when the scope of work is well-defined and unlikely to change significantly. It provides cost certainty for the government by establishing a ceiling price. For services like protective security, where the requirements are often standardized (e.g., hours of coverage, basic duties), FFP can incentivize the contractor to operate efficiently to maximize profit. However, if the scope is poorly defined or if unforeseen circumstances necessitate changes, FFP can lead to disputes or require costly contract modifications. In this case, assuming the security requirements are stable, FFP is a suitable mechanism for cost control.

What is the historical spending trend for protective security services by the Department of Homeland Security?

The Department of Homeland Security (DHS) consistently allocates significant funds towards protective security services due to its broad mandate to secure the nation. Historical spending data would likely show a steady or increasing trend, reflecting the ongoing need for physical security at federal facilities, border protection, and critical infrastructure. Factors such as evolving threat landscapes, expansion of federal operations, and policy changes can influence these spending patterns. Analyzing DHS's budget allocations and contract awards over several fiscal years would reveal the scale and evolution of its investment in security services.

What are the implications of awarding this contract through 'full and open competition' for taxpayer dollars?

Awarding this contract through 'full and open competition' is generally beneficial for taxpayer dollars. This procurement method allows any interested and qualified vendor to submit a bid, fostering a competitive environment. Increased competition typically drives down prices as contractors vie for the award. It also provides the agency with a wider pool of potential solutions and encourages innovation. For taxpayers, this means a higher likelihood that the government is receiving services at a fair and reasonable price, minimizing the risk of paying inflated costs that might occur under less competitive arrangements like sole-source contracts.

Industry Classification

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

Product/Service Code: UTILITIES AND HOUSEKEEPING › HOUSEKEEPING SERVICES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Securitas AB

Address: 13900 LINCOLN PARK DR STE 300, HERNDON, VA, 20171

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

Financial Breakdown

Contract Ceiling: $25,181,649

Exercised Options: $25,181,649

Current Obligation: $25,181,649

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: 70RFP118DE2000001

IDV Type: IDC

Timeline