DHS awards $12.5M contract for Illinois security services, with Paragon Systems Inc. as the prime

Contract Overview

Contract Amount: $12,531,298 ($12.5M)

Contractor: Paragon Systems Inc

Awarding Agency: Department of Homeland Security

Start Date: 2025-01-01

End Date: 2025-06-30

Contract Duration: 180 days

Daily Burn Rate: $69.6K/day

Competition Type: FULL AND OPEN COMPETITION

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: ARMED PROTECTIVE SECURITY OFFICER (PSO) SERVICES THROUGHOUT THE STATE OF ILLINOIS

Place of Performance

Location: CHICAGO, COOK County, ILLINOIS, 60612

State: Illinois Government Spending

Plain-Language Summary

Department of Homeland Security obligated $12.5 million to PARAGON SYSTEMS INC for work described as: ARMED PROTECTIVE SECURITY OFFICER (PSO) SERVICES THROUGHOUT THE STATE OF ILLINOIS Key points: 1. The contract value of $12.5 million for a 6-month period suggests a significant operational footprint. 2. Full and open competition was utilized, indicating a broad market solicitation for these services. 3. The fixed-price contract type aims to control costs, but requires careful scope management. 4. The primary service category is Security Guards and Patrol Services, a critical function for agency operations. 5. The contract duration of 180 days is relatively short, potentially leading to frequent re-competition or extensions. 6. The award amount per day is approximately $69,618, providing a benchmark for daily operational costs.

Value Assessment

Rating: good

The contract value of $12.5 million for a 180-day period translates to a daily rate of approximately $69,618. This rate appears reasonable for comprehensive security services across a state, considering the need for personnel, equipment, and management. Benchmarking against similar large-scale security contracts would provide further insight, but the fixed-price nature suggests an expectation of cost control by the agency.

Cost Per Unit: Approximately $69,618 per day.

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, suggesting that multiple vendors were invited to bid. This approach typically fosters a competitive environment, potentially leading to better pricing and service offerings. The number of bidders is not specified, but the use of this procurement method implies a robust selection process.

Taxpayer Impact: Full and open competition generally benefits taxpayers by encouraging a wider range of offers, which can drive down costs and improve the quality of services received.

Public Impact

The Department of Homeland Security (DHS) will benefit from enhanced security operations throughout Illinois. The contract ensures the provision of armed protective security officer (PSO) services. Services will be delivered across the entire state of Illinois. The contract supports employment for security personnel within the state.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Short contract duration (180 days) may lead to increased administrative burden and potential disruption if not managed efficiently.
Reliance on a single prime contractor for statewide coverage could present logistical challenges in diverse geographic areas.
The fixed-price nature requires stringent performance monitoring to ensure service quality is maintained without scope creep.

Positive Signals

Full and open competition suggests a thorough vetting process and potential for competitive pricing.
The use of armed protective security officers indicates a commitment to high-level security standards.
The contract clearly defines the service area as the entire state of Illinois, ensuring comprehensive coverage.

Sector Analysis

The Security Guards and Patrol Services sector (NAICS 561612) is a critical component of the broader security industry, encompassing a wide range of protective services. Federal spending in this area is substantial, driven by the need to secure government facilities, personnel, and assets. This contract fits within the typical scope of federal security procurements, which often involve large geographic areas and significant personnel deployment. Comparable spending benchmarks would likely show similar daily rates for armed security services in major metropolitan or statewide contracts.

Small Business Impact

The data indicates that small business participation (sb) is marked as false, and there is no indication of a small business set-aside (ss). This suggests that the contract was not specifically targeted towards small businesses. While Paragon Systems Inc. may utilize small businesses for subcontracting, the primary award is to a large business. Further analysis of subcontracting plans would be needed to assess the direct impact on the small business ecosystem.

Oversight & Accountability

Oversight for this contract will likely fall under the Department of Homeland Security's procurement and operational units. The Office of Procurement Operations is involved in the award. Accountability measures will be tied to the performance standards outlined in the contract. Transparency is generally maintained through contract award databases, though specific performance metrics and oversight reports may not always be publicly accessible. 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
Statewide Security Guard Contracts
Armed Security Personnel Services
Government Facility Security

Risk Flags

Short Contract Duration
Potential for Contractor Instability
Need for Robust Oversight

Frequently Asked Questions

What is this federal contract paying for?

Department of Homeland Security awarded $12.5 million to PARAGON SYSTEMS INC. ARMED PROTECTIVE SECURITY OFFICER (PSO) SERVICES THROUGHOUT THE STATE OF ILLINOIS

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 $12.5 million.

What is the period of performance?

Start: 2025-01-01. End: 2025-06-30.

What is the historical spending pattern for security services by the Department of Homeland Security in Illinois?

Analyzing historical spending by DHS in Illinois for security services requires access to detailed federal procurement data over multiple fiscal years. Typically, agencies like DHS maintain ongoing contracts for security personnel to protect federal buildings and assets. The frequency and value of these contracts can fluctuate based on changing security needs, facility occupancy, and budget allocations. Without specific historical data for this exact service category and geographic region, it's difficult to provide precise figures. However, it is common for federal agencies to award multi-year contracts, often with options for extension, for essential services like security. The current $12.5 million award for a 6-month period suggests a significant, potentially recurring, need for these services in Illinois.

How does the daily rate of $69,618 for armed protective security officers compare to industry benchmarks for similar services in Illinois?

The daily rate of approximately $69,618 for armed protective security officers (PSOs) across Illinois is a substantial figure that needs to be contextualized. This rate encompasses not just the hourly wages of the officers but also includes overhead, management, training, equipment (such as vehicles, communication devices, and potentially firearms/ammunition), insurance, and profit for the contractor, Paragon Systems Inc. For statewide contracts involving a significant number of PSOs, this daily rate is likely competitive, reflecting the complexity of managing a dispersed workforce and ensuring 24/7 coverage. Benchmarking against other large-scale, statewide federal or state government contracts for armed security services in similar economic regions would be the most accurate comparison. Private sector rates for comparable high-level security services can vary widely, but this figure suggests a premium service level.

What are the potential risks associated with a short contract duration of 180 days for statewide security services?

A short contract duration of 180 days for statewide security services presents several potential risks. Firstly, it can lead to increased administrative burden and costs associated with frequent re-procurement processes, including solicitation, evaluation, and award. Secondly, it may create instability for the security personnel, potentially impacting morale and retention, as they face uncertainty about future employment. Thirdly, it could hinder the development of long-term relationships and specialized knowledge between the contractor and the agency, which can be beneficial for operational efficiency and security effectiveness. Finally, a short duration might discourage bidders from making significant investments in training or equipment tailored to the specific needs of the contract, potentially leading to less optimized service delivery.

What is the track record of Paragon Systems Inc. in delivering similar large-scale security contracts for federal agencies?

Paragon Systems Inc. has a significant track record in providing security services, including to federal agencies. They have been awarded numerous contracts for protective security officers (PSOs) and related security services across various government departments, including the General Services Administration (GSA) and the Department of Homeland Security (DHS). Their experience often involves large-scale operations covering multiple facilities or extensive geographic areas, similar to this Illinois contract. Reviews of their past performance, available through federal procurement databases like SAM.gov, generally indicate experience in managing such complex requirements. However, as with any large contractor, specific performance details, including any past issues or commendations, would require a deeper dive into contract performance reports and agency evaluations.

How does the fixed-price contract type influence the management of this security services contract?

A Firm Fixed Price (FFP) contract type, like the one used here, obligates the contractor (Paragon Systems Inc.) to perform the specified services at a predetermined price, regardless of the actual costs incurred. This structure places the primary cost risk on the contractor and provides the agency (DHS) with cost certainty. For the agency, the benefit is predictability in budgeting and protection against cost overruns. However, it necessitates meticulous scope definition and management. The agency must clearly articulate all requirements to prevent scope creep, which could lead to disputes or the contractor seeking additional compensation outside the contract terms. Effective oversight is crucial to ensure the contractor meets all performance standards within the agreed-upon price, without compromising the quality or scope of the essential security services.

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: $12,531,298

Exercised Options: $12,531,298

Current Obligation: $12,531,298

Actual Outlays: $12,532,291

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: 70RFP418DE5000001

IDV Type: IDC

Timeline