DHS awards $6.5M for armed protective security services in Ohio, with Paragon Systems Inc. as the contractor

Contract Overview

Contract Amount: $6,522,241 ($6.5M)

Contractor: Paragon Systems Inc

Awarding Agency: Department of Homeland Security

Start Date: 2023-10-01

End Date: 2024-09-06

Contract Duration: 341 days

Daily Burn Rate: $19.1K/day

Competition Type: FULL AND OPEN COMPETITION

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: ARMED PROTECTIVE SECURITY OFFICER (PSO) SERVICES THROUGHOUT OHIO

Place of Performance

Location: CLEVELAND, CUYAHOGA County, OHIO, 44119

State: Ohio Government Spending

Plain-Language Summary

Department of Homeland Security obligated $6.5 million to PARAGON SYSTEMS INC for work described as: ARMED PROTECTIVE SECURITY OFFICER (PSO) SERVICES THROUGHOUT OHIO Key points: 1. Contract value represents a significant investment in physical security for federal facilities in Ohio. 2. The contract was awarded through full and open competition, suggesting a competitive bidding process. 3. The duration of the contract is approximately one year, indicating a need for ongoing security services. 4. The service category is security guards and patrol services, a critical component of facility protection. 5. The fixed-price contract type aims to provide cost certainty for the government. 6. The contractor, Paragon Systems Inc., has a track record in providing security services.

Value Assessment

Rating: good

The contract value of $6.52 million for approximately one year of armed protective security services appears reasonable given the scope. Benchmarking against similar contracts for security services across federal agencies would provide a more precise value-for-money assessment. However, the fixed-price nature of the contract helps manage cost risks for the government. The specific services required, such as armed personnel, inherently carry higher costs than unarmed services.

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 method generally fosters a competitive environment, which can lead to better pricing and service offerings for the government. The agency likely sought to maximize competition to ensure the best value.

Taxpayer Impact: Full and open competition is beneficial for taxpayers as it increases the likelihood of obtaining competitive pricing and high-quality services, thereby optimizing the use of public funds.

Public Impact

Federal facilities and personnel within Ohio are the primary beneficiaries, receiving enhanced security. The contract ensures the provision of armed protective security officers, a critical service for high-risk environments. The geographic impact is concentrated within Ohio, where the security services will be deployed. The contract supports jobs for armed security professionals in the region.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if scope creep occurs, though mitigated by fixed-price contract.
Reliance on a single contractor for critical security functions requires robust performance monitoring.
Ensuring consistent quality and adherence to strict protocols across all deployed officers.

Positive Signals

Awarded through full and open competition, suggesting a competitive process that should yield good value.
Fixed-price contract type provides cost predictability for the agency.
The contractor, Paragon Systems Inc., is likely experienced in providing similar security services.

Sector Analysis

The security services sector is a significant part of the federal contracting landscape, with agencies consistently requiring protective services to safeguard personnel and assets. This contract falls within the broader security and investigation services industry, specifically focusing on physical security. Comparable spending benchmarks for similar security contracts can vary widely based on geographic location, threat levels, and the specific requirements for armed personnel.

Small Business Impact

The data indicates that this contract was not specifically set aside for small businesses, nor does it explicitly mention subcontracting requirements for small businesses. Therefore, the direct impact on the small business ecosystem is likely minimal unless the prime contractor voluntarily engages small businesses for subcontracting opportunities. Further analysis would be needed to determine if small businesses are participating in the supply chain.

Oversight & Accountability

Oversight for this contract would typically be managed by the Department of Homeland Security's contracting officers and program managers. Accountability measures are embedded within the contract terms, including performance standards and payment schedules tied to service delivery. Transparency is generally maintained through contract databases, though specific operational details of security deployment are often sensitive. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Federal Protective Service Contracts
Department of Homeland Security Security Services
Security Guard Services
Armed Security Personnel Contracts

Risk Flags

Contract Duration
Security Service Reliance
Performance Monitoring Needs

Frequently Asked Questions

What is this federal contract paying for?

Department of Homeland Security awarded $6.5 million to PARAGON SYSTEMS INC. ARMED PROTECTIVE SECURITY OFFICER (PSO) SERVICES THROUGHOUT OHIO

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 $6.5 million.

What is the period of performance?

Start: 2023-10-01. End: 2024-09-06.

What is the historical spending by the Department of Homeland Security on security guard services in Ohio?

Analyzing historical spending by the Department of Homeland Security (DHS) on security guard services specifically within Ohio requires access to detailed federal procurement data. While this specific contract is for $6.52 million, understanding the broader trend involves examining previous awards for similar services in the state. Factors such as changes in threat assessments, facility expansions, or shifts in security strategies can influence spending patterns. Without a comprehensive historical dataset for DHS security contracts in Ohio, it is difficult to provide a precise figure. However, federal agencies consistently allocate significant resources to security, and spending can fluctuate year-over-year based on evolving needs and budget allocations. This contract represents a current allocation for essential protective services.

How does the per-hour cost of these security services compare to industry benchmarks?

Determining the precise per-hour cost for these security services requires breaking down the total contract value by the estimated hours of service provided. The contract is for $6,522,241 with a duration of 341 days. Assuming a standard 24/7 operation for security posts, this would translate to approximately 8,184 hours per post per year. If we assume a certain number of posts, we can estimate an hourly rate. However, the number of posts and the specific qualifications (e.g., armed, specialized training) are not detailed here. Generally, armed security personnel command higher hourly rates than unarmed guards due to increased training, licensing, and risk. Industry benchmarks for armed security can range significantly, often from $40 to $70+ per hour, depending on location, complexity of duties, and contractor overhead. A detailed analysis would require knowing the exact number of posts and hours worked to calculate an effective hourly rate and compare it against these benchmarks.

What is Paragon Systems Inc.'s track record with federal security contracts?

Paragon Systems Inc. has a substantial track record of securing and performing federal contracts, particularly in the realm of protective security services. They have been a frequent awardee of contracts from various federal agencies, including the Department of Defense, Department of Homeland Security, and others requiring security personnel. Their experience often encompasses providing armed and unarmed guards, access control, and other security-related functions across numerous government facilities. Reviews of their contract history indicate a pattern of receiving significant contract awards, suggesting a level of performance and capability that meets federal requirements. However, as with any large contractor, a thorough review would also examine past performance evaluations, any disputes, or contract terminations to fully assess their reliability and effectiveness.

What are the specific risks associated with relying on a single contractor for armed security services?

Relying on a single contractor for armed security services presents several risks. Firstly, there's a risk of service disruption if the contractor faces financial difficulties, labor disputes, or fails to maintain adequate staffing levels. Secondly, a lack of competition can potentially lead to complacency in service quality or price increases over time, although this contract is fixed-price. Thirdly, the government's leverage in addressing performance issues might be reduced compared to a situation with multiple competing providers. To mitigate these risks, robust contract management, clear performance metrics, regular oversight, and contingency planning are essential. The government must ensure strong communication channels and have mechanisms in place to address deficiencies promptly and effectively, including the possibility of terminating the contract if necessary and transitioning to another provider.

How does the National Industry Classification System (NAICS) code 561612 inform the scope of this contract?

The NAICS code 561612, 'Security Guards and Patrol Services,' precisely defines the primary nature of the services being procured under this contract. This classification indicates that the contract is for establishments primarily engaged in providing guard and patrol services, which may include the use of specialized equipment such as electronic monitoring systems. It covers services like protecting people and property from hazards such as theft, vandalism, and unauthorized access. For this specific contract with DHS, the NAICS code confirms that the core requirement is for personnel to act as armed protective security officers, performing duties related to surveillance, access control, and response to security incidents within federal facilities in Ohio. This code helps ensure that the procurement aligns with standard industry definitions and facilitates comparisons with other similar government 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: $6,522,241

Exercised Options: $6,522,241

Current Obligation: $6,522,241

Actual Outlays: $6,525,497

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: 70RFP419DE5000002

IDV Type: IDC

Timeline