HHS awards $126M for emergency relief services, with limited competition and a high per-unit cost

Contract Overview

Contract Amount: $126,121,929 ($126.1M)

Contractor: Rapid Deployment Inc

Awarding Agency: Department of Health and Human Services

Start Date: 2021-03-31

End Date: 2021-06-30

Contract Duration: 91 days

Daily Burn Rate: $1.4M/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: WRAP AROUND SERVICES

Place of Performance

Location: BOERNE, KENDALL County, TEXAS, 78006

State: Texas Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $126.1 million to RAPID DEPLOYMENT INC for work described as: WRAP AROUND SERVICES Key points: 1. The contract's value is substantial, reflecting significant demand for emergency relief services. 2. Limited competition raises concerns about potential overpayment and reduced value for taxpayer funds. 3. The short duration of the contract (91 days) suggests an urgent need or a bridging solution. 4. The firm fixed-price contract type offers cost certainty but may not incentivize efficiency. 5. The contractor, Rapid Deployment Inc., has secured a significant award, indicating potential past performance or market position. 6. The emergency nature of the services may justify the procurement approach, but requires careful scrutiny. 7. The contract's focus on emergency and relief services aligns with the agency's mission during crises.

Value Assessment

Rating: questionable

The contract value of $126.1 million for a 91-day period is exceptionally high, averaging over $1.38 million per day. Without specific details on the services rendered, it is difficult to benchmark against similar contracts. However, the lack of competition and the emergency nature of the award suggest that pricing may not have been optimized. The per-unit cost, if calculable based on specific deliverables, would likely be high given the overall contract value and short timeframe.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded using a 'NOT COMPETED' procedure, indicating a sole-source or limited competition scenario. This approach is typically used when only one source is capable of meeting the requirement, often in urgent situations or for specialized services. The lack of a competitive bidding process means that the government did not benefit from the price discovery and innovation that typically arises from multiple offers. This raises concerns about whether the best possible price and solution were obtained.

Taxpayer Impact: The absence of competition means taxpayers may have paid a premium for these services, as there was no market pressure to drive down costs. This procurement method limits the government's ability to ensure it received the most cost-effective solution available.

Public Impact

Beneficiaries include individuals and communities impacted by emergencies requiring relief services. Services delivered likely encompass critical support, logistics, and aid during crisis situations. The geographic impact is focused on Texas (ST: TX, SN: TEXAS), indicating a response to a specific regional need. Workforce implications could involve the mobilization of personnel by the contractor to support relief efforts.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may lead to inflated pricing and reduced value for money.
The high daily cost suggests potential inefficiencies or a premium for rapid deployment.
The short contract duration could indicate a temporary solution, potentially leading to follow-on contracts with similar issues.
Limited transparency due to sole-source award makes it difficult to assess the true cost-effectiveness.

Positive Signals

The award addresses critical emergency and relief needs, fulfilling a vital government function.
The firm fixed-price contract provides cost certainty for the government.
The contractor's ability to secure such a large award suggests they possess the capacity to deliver on urgent requirements.

Sector Analysis

The contract falls within the 'Emergency and Other Relief Services' category, a sector often characterized by urgent needs and rapid response requirements. This sector can see significant government spending during natural disasters or public health crises. Market size can fluctuate dramatically based on the frequency and severity of emergencies. Comparable spending benchmarks are difficult to establish due to the often unique and time-sensitive nature of these services, but large-scale relief efforts can easily reach tens or hundreds of millions of dollars.

Small Business Impact

There is no indication that this contract included small business set-asides (SB: false). The large contract value and the nature of emergency relief services often lend themselves to larger, established contractors. Subcontracting opportunities for small businesses are not specified but are possible, depending on the contractor's approach. The lack of set-asides means that the direct impact on the small business ecosystem for this specific award is likely minimal.

Oversight & Accountability

Oversight mechanisms for this contract would typically involve the contracting officer and the relevant program officials within the Administration for Children and Families (ACF). Given the 'NOT COMPETED' status, enhanced scrutiny from oversight bodies like the HHS Office of Inspector General (OIG) would be warranted to ensure the justification for the sole-source award was sound and that the pricing was fair and reasonable. Transparency is limited due to the procurement method, making public accountability more challenging.

Related Government Programs

Disaster Relief Funding
Emergency Management Services
Humanitarian Aid Contracts
Federal Emergency Management Agency (FEMA) Contracts
Public Health Emergency Response

Risk Flags

Sole-source award lacks competitive pricing.
High daily cost raises concerns about value for money.
Short contract duration may indicate a temporary or stop-gap solution.
Limited public information on contractor's specific experience in this domain.

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $126.1 million to RAPID DEPLOYMENT INC. WRAP AROUND SERVICES

Who is the contractor on this award?

The obligated recipient is RAPID DEPLOYMENT INC.

Which agency awarded this contract?

Awarding agency: Department of Health and Human Services (Administration for Children and Families).

What is the total obligated amount?

The obligated amount is $126.1 million.

What is the period of performance?

Start: 2021-03-31. End: 2021-06-30.

What specific emergency or relief services were provided under this contract?

The data indicates the contract was for 'Emergency and Other Relief Services' (ND: 624230) awarded to RAPID DEPLOYMENT INC. While the specific nature of the services is not detailed in the provided data, contracts in this category typically involve providing essential support during crises. This could include logistical support, shelter operations, distribution of supplies, temporary infrastructure, or personnel deployment to assist affected populations. Given the substantial value ($126.1M) and short duration (91 days), the services were likely intensive and required immediate mobilization and execution within Texas.

How does the per-day cost of this contract compare to similar emergency relief efforts?

The contract cost $126,121,929.11 over 91 days, resulting in an average daily expenditure of approximately $1,385,955. This is an exceptionally high daily rate. Benchmarking this against similar emergency relief contracts is challenging without more specific details on the services rendered and the context of the emergency. However, such a high daily cost suggests either a very large scale of operations, extremely specialized services, or potentially a premium paid due to the lack of competition and the urgency of the need. Standard operational costs for relief efforts are typically much lower on a per-day basis unless dealing with major disaster response.

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

The provided data explicitly states the contract was 'NOT COMPETED' (CT: NOT COMPETED), indicating a sole-source or limited competition award. The justification for such an award typically falls under specific exceptions to full and open competition, such as urgency, unique capabilities of a single source, or national security requirements. For a contract of this magnitude and nature, the agency (HHS/ACF) would need to have documented a compelling reason why only Rapid Deployment Inc. could fulfill the requirement within the necessary timeframe and scope, especially given the emergency context.

What is the track record of Rapid Deployment Inc. in providing emergency relief services?

The provided data indicates that Rapid Deployment Inc. (CO: RAPID DEPLOYMENT INC) was awarded this significant contract. However, the data does not include details about the company's past performance, previous contracts, or specific experience in emergency and relief services. To assess their track record, one would need to examine their contract history with the government, client testimonials, and any performance reviews or awards associated with previous engagements. Securing a $126M contract suggests they have the capacity, but not necessarily a proven history of excellence in this specific domain.

How does the contract duration of 91 days impact the overall value and effectiveness?

The contract duration of 91 days (dur: 91), approximately three months, is relatively short for a contract valued at over $126 million. This short timeframe suggests the services were needed urgently or were intended as a temporary measure. While a firm fixed-price contract provides cost certainty, the short duration combined with the high total value implies a very high operational tempo and cost per day. It raises questions about whether this was a stop-gap measure, potentially leading to follow-on contracts, or if the emergency itself was time-bound. The effectiveness would depend on whether the critical needs were met within this period.

What oversight is in place to ensure accountability for this sole-source emergency contract?

Oversight for this contract would primarily fall under the purview of the Department of Health and Human Services (HHS), specifically the Administration for Children and Families (ACF), and the contracting officer. Given the sole-source nature, the HHS Office of Inspector General (OIG) would likely have a heightened interest in reviewing the justification for the award and ensuring the funds were used appropriately and effectively. Accountability measures would include regular reporting requirements from the contractor, performance monitoring, and potentially audits. However, the lack of competition inherently reduces the transparency typically available through a competitive bidding process.

Industry Classification

NAICS: Health Care and Social Assistance › Community Food and Housing, and Emergency and Other Relief Services › Emergency and Other Relief Services

Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › PROFESSIONAL SERVICES

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 1521 AZALEA RD, MOBILE, AL, 36693

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

Financial Breakdown

Contract Ceiling: $126,121,929

Exercised Options: $126,121,929

Current Obligation: $126,121,929

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Timeline