HHS awarded $55.25M for face coverings, with Parkdale Advanced Materials securing the contract

Contract Overview

Contract Amount: $55,250,000 ($55.3M)

Contractor: Parkdale Advanced Materials, Inc.

Awarding Agency: Department of Health and Human Services

Start Date: 2020-04-02

End Date: 2020-08-31

Contract Duration: 151 days

Daily Burn Rate: $365.9K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 8

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: PARKDALE ADVANCED MATERIALS, INC. CLOTH FACE COVERINGS

Place of Performance

Location: GASTONIA, GASTON County, NORTH CAROLINA, 28053

State: North Carolina Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $55.3 million to PARKDALE ADVANCED MATERIALS, INC. for work described as: PARKDALE ADVANCED MATERIALS, INC. CLOTH FACE COVERINGS Key points: 1. The contract value of $55.25 million represents a significant investment in essential personal protective equipment. 2. The procurement utilized full and open competition after exclusion of sources, indicating a deliberate effort to ensure broad market participation. 3. The contract duration of 151 days suggests a need for rapid deployment of these critical supplies. 4. The fixed-price contract type aims to provide cost certainty for the government. 5. The award to a single contractor, Parkdale Advanced Materials, Inc., warrants examination of the competitive landscape. 6. The North Carolina location of the contractor may have implications for domestic supply chain resilience. 7. The absence of small business set-asides suggests the scale of the requirement favored larger prime contractors.

Value Assessment

Rating: good

The contract value of $55.25 million for face coverings appears to be within a reasonable range for a large-scale procurement of this nature, especially considering the urgent demand during the specified period. Benchmarking against similar large-volume PPE contracts awarded during the pandemic would provide a more precise value-for-money assessment. The firm fixed-price structure offers predictability, but the ultimate value depends on the unit cost and quality delivered.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under 'full and open competition after exclusion of sources.' This suggests that while the initial solicitation may have had some restrictions or exclusions, the final award was made after a broad competitive process. The fact that 8 bids were received indicates a healthy level of interest and competition for this requirement, which is generally positive for price discovery and ensuring the government receives competitive offers.

Taxpayer Impact: A competitive process, even with initial exclusions, helps ensure that taxpayer funds are used efficiently by driving down prices through multiple offers. The receipt of 8 bids suggests that the government likely secured a favorable price compared to a sole-source or limited competition scenario.

Public Impact

The primary beneficiaries are healthcare professionals, first responders, and the general public who received essential face coverings. The services delivered include the manufacturing and supply of cloth face coverings to meet public health demands. The geographic impact is national, aiming to distribute protective equipment across the United States. Workforce implications include job creation and utilization within Parkdale Advanced Materials' manufacturing facilities.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for price fluctuations if raw material costs increased significantly during the contract period.
Dependence on a single contractor for a critical supply item could pose a risk if production or delivery is disrupted.
Ensuring consistent quality control across a large volume of manufactured goods is a common challenge.

Positive Signals

The use of full and open competition suggests a robust process to select the best offer.
The firm fixed-price contract type provides cost certainty for the government.
The award to an established manufacturer like Parkdale Advanced Materials may indicate a reliable production capability.
The contract duration aligns with a period of high demand for PPE.

Sector Analysis

The procurement falls within the apparel manufacturing sector, specifically 'Other Cut and Sew Apparel Manufacturing.' This sector is characterized by its ability to scale production, particularly for standardized items like face coverings. The market for PPE experienced significant growth and volatility during the COVID-19 pandemic, with government contracts playing a crucial role in meeting national demand. Comparable spending benchmarks would involve analyzing other large-volume PPE awards during the same period.

Small Business Impact

There is no indication of a small business set-aside for this contract, as indicated by 'sb': false. This suggests that the requirement was likely too large or complex to be exclusively awarded to small businesses, or that the competition was open to all qualified bidders regardless of size. While this contract may not directly benefit small businesses through a set-aside, Parkdale Advanced Materials, as a prime contractor, might engage small businesses as subcontractors for materials or specialized services, though this is not explicitly detailed.

Oversight & Accountability

Oversight for this contract would typically be managed by the Department of Health and Human Services (HHS), specifically the Office of Assistant Secretary for Preparedness and Response (ASPR). Accountability measures are embedded in the contract terms, including delivery schedules and quality specifications. Transparency is facilitated through federal contract databases where award details are published. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

Strategic National Stockpile
COVID-19 Relief Spending
Personal Protective Equipment Procurement
Department of Health and Human Services Contracts

Risk Flags

Potential for supply chain disruption
Quality control of mass-produced goods
Price volatility of raw materials

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $55.3 million to PARKDALE ADVANCED MATERIALS, INC.. PARKDALE ADVANCED MATERIALS, INC. CLOTH FACE COVERINGS

Who is the contractor on this award?

The obligated recipient is PARKDALE ADVANCED MATERIALS, INC..

Which agency awarded this contract?

Awarding agency: Department of Health and Human Services (Office of Assistant Secretary for Preparedness and Response).

What is the total obligated amount?

The obligated amount is $55.3 million.

What is the period of performance?

Start: 2020-04-02. End: 2020-08-31.

What was the specific rationale for excluding certain sources before the 'full and open competition after exclusion of sources' phase?

The data provided does not specify the exact reasons for excluding certain sources prior to the 'full and open competition after exclusion of sources' phase. This designation typically implies that an initial solicitation or pre-qualification process might have narrowed the field based on specific criteria (e.g., technical capabilities, existing certifications, or prior performance). However, the subsequent 'full and open' phase indicates that the government then opened the competition broadly to all responsible sources that met the revised or final requirements. The exclusion of sources could be due to factors like the need for specific manufacturing capabilities, adherence to particular standards (e.g., FDA requirements for certain medical supplies), or to streamline the initial vetting process for a large-volume procurement. Without further documentation, the precise nature of these exclusions remains speculative but suggests a structured approach to ensure qualified bidders participated in the final competitive round.

How does the unit cost of these face coverings compare to other similar government contracts awarded during the same period?

The provided data does not include the unit cost or quantity of face coverings, making a direct unit cost comparison impossible. The total award amount is $55.25 million. To benchmark the unit cost, we would need to know the total number of face coverings procured under this contract. For instance, if 100 million units were purchased, the unit cost would be approximately $0.55. Comparing this hypothetical unit cost to other large-scale PPE contracts awarded by agencies like HHS, FEMA, or the Department of Defense during 2020-2021 would be necessary. Factors such as material quality (e.g., multi-layer vs. single-layer), manufacturing complexity, and urgency of delivery significantly influence unit pricing. A thorough analysis would involve gathering unit price data from comparable contracts and adjusting for these variables.

What are the key performance indicators (KPIs) and quality standards stipulated in the contract for the face coverings?

The provided data does not detail the specific Key Performance Indicators (KPIs) or quality standards for the face coverings. However, for a contract of this nature, especially awarded by HHS for public health purposes, it is highly probable that the specifications included adherence to relevant industry standards (e.g., ASTM International standards for masks), material requirements (e.g., breathability, filtration efficiency), durability, and potentially certifications related to safety and manufacturing practices. The contract likely outlined requirements for testing, inspection, and acceptance criteria. Failure to meet these stipulated KPIs and quality standards would typically result in penalties, rejection of goods, or contract termination, underscoring their importance in ensuring the effectiveness and safety of the procured items.

What is Parkdale Advanced Materials, Inc.'s track record with government contracts, particularly in PPE or apparel manufacturing?

The provided data indicates that Parkdale Advanced Materials, Inc. was awarded this $55.25 million contract for cloth face coverings by the Department of Health and Human Services. While this award itself demonstrates a capacity to secure significant government business, further investigation into their contract history would be needed for a comprehensive track record assessment. This would involve searching federal procurement databases (like SAM.gov or FPDS) for previous awards to Parkdale Advanced Materials, Inc. across various agencies and contract types. Understanding their past performance on similar contracts, especially those involving large volumes, tight deadlines, or specific quality requirements, would provide insight into their reliability and expertise in fulfilling government needs within the apparel or PPE sectors.

What was the historical spending pattern for similar face covering procurements by HHS before this contract was awarded?

The data provided focuses solely on this specific $55.25 million contract awarded in April 2020. It does not offer historical spending patterns for similar face covering procurements by HHS prior to this award. To establish historical context, one would need to analyze HHS's spending on face coverings and related PPE over several preceding years. The onset of the COVID-19 pandemic in early 2020 dramatically altered demand and spending for such items, likely leading to a significant increase compared to pre-pandemic levels. Therefore, historical data would likely show much lower or negligible spending on cloth face coverings of this scale before the pandemic necessitated such large-scale acquisitions.

Industry Classification

NAICS: Manufacturing › Cut and Sew Apparel Manufacturing › Other Cut and Sew Apparel Manufacturing

Product/Service Code: MEDICAL/DENTAL/VETERINARY EQPT/SUPP

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 8

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Parkdale Incorporated

Address: 531 COTTON BLOSSOM CIR, GASTONIA, NC, 28054

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

Financial Breakdown

Contract Ceiling: $55,250,000

Exercised Options: $55,250,000

Current Obligation: $55,250,000

Actual Outlays: $55,250,000

Contract Characteristics

Commercial Item: COMMERCIAL ITEM

Cost or Pricing Data: NO

Timeline