NIH awards $49.8M for security guard services to Paragon Systems Inc., highlighting a need for robust facility protection

Contract Overview

Contract Amount: $49,832,617 ($49.8M)

Contractor: Paragon Systems Inc

Awarding Agency: Department of Health and Human Services

Start Date: 2022-03-01

End Date: 2024-06-12

Contract Duration: 834 days

Daily Burn Rate: $59.8K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: SECURITY GUARD SERVICES FOR NIH FACILITIES

Place of Performance

Location: HERNDON, FAIRFAX County, VIRGINIA, 20171

State: Virginia Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $49.8 million to PARAGON SYSTEMS INC for work described as: SECURITY GUARD SERVICES FOR NIH FACILITIES Key points: 1. The contract value of $49.8 million over its period of performance suggests a significant investment in maintaining secure research and healthcare environments. 2. The award was made under full and open competition, indicating a broad market search and potential for competitive pricing. 3. The firm-fixed-price contract type shifts cost risk to the contractor, potentially leading to more predictable expenses for the government. 4. The primary service category, Security Guards and Patrol Services, is critical for safeguarding sensitive government assets and personnel. 5. The contract's duration of 834 days (approximately 2.3 years) provides a stable security presence but requires ongoing performance monitoring. 6. The contractor, Paragon Systems Inc., has been awarded this contract, suggesting a track record or competitive advantage in this service area.

Value Assessment

Rating: good

The contract value of approximately $49.8 million over roughly 2.3 years averages to about $21.6 million annually. Benchmarking this against similar large-scale security contracts for federal facilities suggests this is within a reasonable range, considering the scope and criticality of NIH facilities. The firm-fixed-price nature of the contract helps in budget predictability. However, a detailed cost breakdown and comparison to specific service level agreements would be needed for a more precise value assessment.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, meaning all responsible sources were permitted to submit offers. This typically involves a formal solicitation process, such as a Request for Proposal (RFP), where multiple companies can bid. The number of bidders is not specified, but full and open competition generally fosters a competitive environment, which can lead to better pricing and service quality as contractors vie for the award.

Taxpayer Impact: Taxpayers benefit from full and open competition through potentially lower prices due to contractor rivalry and a wider selection of qualified providers, ensuring the government secures services at a competitive market rate.

Public Impact

The primary beneficiaries are the National Institutes of Health (NIH) and its personnel, who receive enhanced security for their facilities and research. The services delivered include security guard and patrol functions, crucial for protecting sensitive research, equipment, and patient information. The geographic impact is concentrated around NIH facilities, primarily in Virginia, ensuring the security of these vital federal installations. The contract supports a workforce of security professionals, contributing to employment in the private security sector.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for over-reliance on a single contractor for critical security functions over an extended period.
Ensuring consistent service quality and adherence to security protocols across all shifts and locations requires diligent oversight.
The firm-fixed-price nature, while beneficial for budget certainty, could disincentivize contractors from exceeding basic service requirements without additional compensation.

Positive Signals

Awarded under full and open competition, suggesting a robust selection process and competitive pricing.
The firm-fixed-price contract type provides budget certainty for the government.
The contractor, Paragon Systems Inc., is likely experienced in providing security services to federal agencies.
The contract duration provides stability for NIH's security operations.

Sector Analysis

The security services industry is a significant sector within the broader professional, scientific, and technical services market. Federal contracts for security guards and patrol services are substantial, driven by the need to protect government assets, facilities, and personnel across various agencies. This contract with NIH fits within this landscape, representing a typical procurement for essential security operations. Comparable spending benchmarks would involve analyzing other large federal contracts for similar security services at research institutions or government complexes.

Small Business Impact

The data indicates that small business participation (ss: false, sb: false) was not a specific set-aside for this contract. This suggests that the primary competition was likely among larger, established security firms. There is no explicit information on subcontracting plans for small businesses, which could be a missed opportunity to engage the small business ecosystem. Future analysis could explore if subcontracting goals were established post-award or if the prime contractor has a history of utilizing small business subcontractors.

Oversight & Accountability

Oversight for this contract would typically fall under the purview of the contracting officer and the relevant program managers within the National Institutes of Health. Accountability measures are embedded in the firm-fixed-price contract terms, requiring the contractor to meet specific service level agreements. Transparency is generally maintained through contract award databases, though detailed performance reports may not always be publicly accessible. Inspector General jurisdiction would apply if any fraud, waste, or abuse is suspected.

Related Government Programs

Federal Protective Service Contracts
Department of Homeland Security Security Contracts
General Services Administration Schedules for Security Services
National Institutes of Health Facility Management Contracts

Risk Flags

Potential for personnel turnover impacting service continuity.
Need for rigorous quality assurance to ensure adherence to security protocols.
Firm-fixed-price contract may limit incentives for exceeding basic service levels.

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $49.8 million to PARAGON SYSTEMS INC. SECURITY GUARD SERVICES FOR NIH FACILITIES

Who is the contractor on this award?

The obligated recipient is PARAGON SYSTEMS INC.

Which agency awarded this contract?

Awarding agency: Department of Health and Human Services (National Institutes of Health).

What is the total obligated amount?

The obligated amount is $49.8 million.

What is the period of performance?

Start: 2022-03-01. End: 2024-06-12.

What is Paragon Systems Inc.'s track record with federal security contracts, particularly with agencies like NIH or similar research institutions?

Paragon Systems Inc. has a notable history of securing federal contracts for security guard services. While specific details on their performance with NIH are not provided in this data snippet, their presence as an awardee suggests they possess the necessary qualifications and experience. Federal procurement databases often show extensive award histories for companies like Paragon, indicating their capability to meet stringent government requirements. A deeper dive into past performance evaluations and contract modifications for their previous federal awards would offer a more comprehensive understanding of their reliability and effectiveness in similar roles. Their ability to win a contract of this magnitude under full and open competition implies a competitive standing among industry peers.

How does the annual cost of this contract compare to the average annual cost of security services for comparable federal research facilities?

The annual cost for this contract, approximately $21.6 million ($49.8M / 2.3 years), needs to be benchmarked against similar facilities. Federal research institutions like NIH often have unique security needs due to the sensitive nature of their work, including laboratories, high-value equipment, and intellectual property. Contracts for such facilities can be more expensive than standard office buildings. To provide a precise comparison, one would need data on the square footage, number of personnel, specific security threats, and the scope of services (e.g., access control, patrol, alarm monitoring) for other comparable federal research facilities. Without this granular data, it's challenging to definitively state if this contract represents superior or inferior value, though the amount suggests a comprehensive security posture.

What are the key performance indicators (KPIs) and service level agreements (SLAs) associated with this contract, and how is performance monitored?

The provided data does not detail the specific Key Performance Indicators (KPIs) or Service Level Agreements (SLAs) for this contract. However, for a security guard services contract of this nature, typical KPIs would likely include response times to incidents, adherence to post orders, guard presence and punctuality, incident reporting accuracy, and customer satisfaction. Performance monitoring is usually conducted by the Contracting Officer's Representative (COR) or a designated government official who reviews daily logs, conducts site inspections, and receives feedback from facility personnel. Contractual remedies, such as invoice withholding or termination for default, exist if the contractor fails to meet the agreed-upon performance standards.

What is the historical spending trend for security guard services at NIH over the past five years, and how does this award fit into that trend?

Analyzing historical spending trends for security guard services at NIH would require access to detailed federal procurement data beyond this single award. Generally, spending on essential services like security tends to be relatively stable, though it can fluctuate based on budget appropriations, changes in security requirements, or shifts in contracting strategies (e.g., moving from multiple small contracts to a larger consolidated one). This $49.8 million award over approximately 2.3 years represents a significant, ongoing investment. If NIH has historically awarded similar-sized contracts for security, this award aligns with established spending patterns. Conversely, if this represents a substantial increase or decrease, it might indicate a strategic shift in how NIH manages its security needs or a response to evolving threat landscapes.

Are there any specific risks identified in the contract documentation or performance history related to Paragon Systems Inc. or the nature of these security services?

The provided data does not include specific risk flags or details from contract documentation. However, general risks associated with large federal security contracts include potential lapses in security coverage due to personnel turnover, contractor failure to meet performance standards, or unforeseen security threats requiring enhanced measures. For Paragon Systems Inc., risks could be related to their financial stability, past performance issues on other contracts, or their ability to recruit and retain qualified personnel. A thorough risk assessment would involve reviewing past performance reports, financial health indicators, and any documented incidents or challenges encountered during the contract's execution.

Industry Classification

NAICS: Administrative and Support and Waste Management and Remediation Services › Investigation and Security Services › Security Guards and Patrol Services

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

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 1

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: $49,832,617

Exercised Options: $49,832,617

Current Obligation: $49,832,617

Actual Outlays: $49,832,617

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Parent Contract

Parent Award PIID: 47QSWA20D0010

IDV Type: FSS

Timeline