HHS awards $200.8M for emergency intake site wrap-around services to DRC Emergency Services, LLC

Contract Overview

Contract Amount: $200,865,673 ($200.9M)

Contractor: DRC Emergency Services, LLC

Awarding Agency: Department of Health and Human Services

Start Date: 2021-04-19

End Date: 2021-08-02

Contract Duration: 105 days

Daily Burn Rate: $1.9M/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: WRAP AROUND SERVICES FOR ORR EMERGENCY INTAKE SITES FOR UC OPERATIONS

Place of Performance

Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20201

State: District of Columbia Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $200.9 million to DRC EMERGENCY SERVICES, LLC for work described as: WRAP AROUND SERVICES FOR ORR EMERGENCY INTAKE SITES FOR UC OPERATIONS Key points: 1. Contract awarded on a sole-source basis, raising questions about potential cost savings through competition. 2. The contract duration of 105 days suggests a focus on immediate, short-term needs. 3. Services provided are critical for supporting unaccompanied children's operations. 4. The awardee, DRC Emergency Services, LLC, is the sole entity for these specific services. 5. The contract's value is substantial, indicating significant resource allocation to this area. 6. Performance is tied to emergency relief services, highlighting a response to urgent situations.

Value Assessment

Rating: questionable

The contract value of $200.8 million for a 105-day period is substantial. Without competitive bidding, it is difficult to benchmark the value for money. The pricing structure is firm fixed price, which typically shifts risk to the contractor but requires careful negotiation to ensure fair pricing. Given the emergency nature and sole-source award, a thorough review of the contractor's proposed costs against industry standards for similar rapid-deployment services would be necessary to fully assess value.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning it was not competed among multiple vendors. This approach is typically used when only one vendor can provide the required services, often due to specialized capabilities or urgent, unforeseen circumstances. The lack of competition means there was no opportunity for price discovery through bidding, potentially leading to higher costs for the government compared to a fully competed contract.

Taxpayer Impact: The absence of competition means taxpayers did not benefit from potential cost reductions that could arise from multiple vendors vying for the contract. This could translate to a less efficient use of public funds.

Public Impact

Unaccompanied children in the care of the Administration for Children and Families (ACF) benefit from the provision of essential wrap-around services. Services include support for emergency intake sites, ensuring basic needs and operational continuity. The geographic impact is focused on the District of Columbia, where the intake sites are located. The contract supports the federal government's response to humanitarian needs related to child welfare.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits price competition and potential taxpayer savings.
Short contract duration (105 days) may indicate a reactive rather than strategic approach to service provision.
Lack of public details on the specific services and performance metrics makes independent assessment challenging.

Positive Signals

Addresses critical needs for unaccompanied children, aligning with humanitarian goals.
Firm fixed-price contract shifts some financial risk to the contractor.
Awarded to a single entity, potentially streamlining management for a focused emergency response.

Sector Analysis

This contract falls within the Emergency and Other Relief Services sector, a niche area focused on rapid response to crises. The market for such services is often characterized by urgent needs and specialized providers capable of immediate deployment. While specific market size data for 'wrap-around services for emergency intake sites' is not readily available, the overall federal spending on emergency response and humanitarian aid is significant, particularly in recent years. This contract represents a direct allocation of resources to manage a specific aspect of the unaccompanied children crisis.

Small Business Impact

This contract does not appear to have a small business set-aside. Given the sole-source nature and the specialized services required, it is unlikely that subcontracting opportunities for small businesses were a primary consideration in the award. Further analysis would be needed to determine if any small business participation was mandated or voluntarily included by the prime contractor.

Oversight & Accountability

Oversight for this contract would primarily fall under the Administration for Children and Families (ACF) within HHS. As a definitive contract, it is subject to standard federal procurement regulations and oversight mechanisms. Transparency regarding the specific performance metrics and outcomes is limited due to the nature of the award and the focus on emergency operations. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

ORR Emergency Intake Sites
Services for Unaccompanied Children
Emergency Relief Services
Department of Health and Human Services Contracts
Administration for Children and Families Programs

Risk Flags

Sole-source award
High contract value for short duration
Emergency services context

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $200.9 million to DRC EMERGENCY SERVICES, LLC. WRAP AROUND SERVICES FOR ORR EMERGENCY INTAKE SITES FOR UC OPERATIONS

Who is the contractor on this award?

The obligated recipient is DRC EMERGENCY SERVICES, LLC.

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 $200.9 million.

What is the period of performance?

Start: 2021-04-19. End: 2021-08-02.

What specific wrap-around services are included under this contract?

The contract, "WRAP AROUND SERVICES FOR ORR EMERGENCY INTAKE SITES FOR UC OPERATIONS," awarded to DRC Emergency Services, LLC, is intended to provide comprehensive support services at emergency intake sites for unaccompanied children (UC). While the specific details of 'wrap-around services' are not fully elaborated in the provided data, these typically encompass a range of non-medical support functions essential for the care and well-being of children during their temporary stay at intake facilities. This can include services such as case management, educational support, recreational activities, translation services, transportation, and general facility support (e.g., cleaning, security, food services). The objective is to ensure that children receive adequate care and are processed efficiently while awaiting placement with sponsors or further transfer within the shelter system. The firm fixed-price nature of the contract suggests a defined scope of services for a set price.

Why was this contract awarded on a sole-source basis?

The provided data indicates this contract was awarded on a 'NOT COMPETED' basis, which typically signifies a sole-source or limited-source justification. For emergency services, particularly those responding to a surge in unaccompanied children, agencies may invoke emergency acquisition authorities to expedite the procurement process. This could be due to the urgent need for immediate services, the lack of readily available contractors with the specific capabilities and capacity to respond rapidly, or the unique nature of the operational requirements at the time of the award. Without a detailed justification document (e.g., a Justification and Approval for Other Than Full and Open Competition), the precise reasons remain speculative, but emergency circumstances and specialized provider requirements are common drivers for sole-source awards in such situations.

How does the contract value of $200.8 million compare to similar emergency relief services?

The contract value of $200.8 million for a 105-day period is substantial, averaging approximately $1.9 million per day. Benchmarking this against 'similar' contracts is challenging without more specific data on the scope and duration of services. However, contracts for large-scale emergency response, particularly those involving humanitarian aid or disaster relief, can reach these figures, especially when rapid deployment and extensive support are required. The Administration for Children and Families (ACF) has historically managed significant funding for services related to unaccompanied children. The firm fixed-price structure suggests a defined budget for the period, but the lack of competition makes it difficult to assess if this represents optimal value compared to what might have been achieved through a competitive process. Further analysis would require comparing the per-diem cost or cost per child served against other ACF or FEMA emergency shelter support contracts.

What are the potential risks associated with a sole-source award of this magnitude?

A primary risk associated with a sole-source award of this magnitude is the potential for inflated costs due to the absence of competitive pressure. Without multiple bidders vying for the contract, the government may not achieve the most favorable pricing. Another risk is reduced innovation, as the contractor may have less incentive to develop novel or more efficient service delivery methods. Furthermore, sole-source awards can raise concerns about fairness and equal opportunity for other qualified vendors. In this specific case, the emergency nature of the services might mitigate some risks by prioritizing speed and availability, but it necessitates robust oversight to ensure the contractor delivers effectively and efficiently within the agreed-upon terms and price.

What is the track record of DRC Emergency Services, LLC in providing similar services?

Information regarding the specific track record of DRC Emergency Services, LLC in providing 'wrap-around services for ORR emergency intake sites for UC operations' is not detailed in the provided data. However, the company's name suggests a focus on emergency services. To assess their track record, one would typically look at past performance evaluations on federal contracts, their experience with similar populations (e.g., vulnerable children), their capacity to scale operations rapidly, and their financial stability. Given the sole-source nature of this award, it is possible that DRC Emergency Services, LLC was identified as the only or most capable provider at the time of the award, implying a pre-existing relationship or demonstrated capability relevant to the urgent needs of the Administration for Children and Families (ACF).

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: SOCIAL SERVICES › SOCIAL 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: 6702 BROADWAY ST, GALVESTON, TX, 77554

Business Categories: Category Business, Limited Liability Corporation, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $205,625,354

Exercised Options: $200,865,673

Current Obligation: $200,865,673

Actual Outlays: $7,254,001

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NOT OBTAINED - WAIVED

Timeline