HHS awards $51.8M contract for security services to Whitestone Group, Inc. over 4 years

Contract Overview

Contract Amount: $51,818,964 ($51.8M)

Contractor: THE Whitestone Group, Inc.

Awarding Agency: Department of Health and Human Services

Start Date: 2022-07-01

End Date: 2026-12-12

Contract Duration: 1,625 days

Daily Burn Rate: $31.9K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 4

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: PROTECTION AND SECURITY GUARD SERVICES (HUBERT H. HUMPHREY BUILDING AND PARKLAWN COMPLEX)

Place of Performance

Location: ROCKVILLE, MONTGOMERY County, MARYLAND, 20857

State: Maryland Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $51.8 million to THE WHITESTONE GROUP, INC. for work described as: PROTECTION AND SECURITY GUARD SERVICES (HUBERT H. HUMPHREY BUILDING AND PARKLAWN COMPLEX) Key points: 1. Contract value appears reasonable for the duration and scope of services. 2. Full and open competition was utilized, suggesting a competitive bidding process. 3. Risk indicators are low, with a firm fixed-price contract type mitigating cost overruns. 4. Services are essential for maintaining security at key federal facilities. 5. The contract aligns with the government's need for reliable security personnel. 6. Performance context is critical for ensuring continuous protection of federal assets.

Value Assessment

Rating: good

The contract value of approximately $51.8 million over 4 years for security services at the Hubert H. Humphrey Building and Parklawn Complex appears to be within a reasonable range for such a large-scale federal contract. Benchmarking against similar contracts for comprehensive security guard and patrol services at federal facilities of comparable size and complexity would provide further insight. The firm fixed-price contract type suggests that pricing was established upfront, which can be advantageous for budget predictability, assuming the initial pricing was competitive.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit bids. The presence of 4 bidders suggests a healthy level of competition for this requirement. A competitive process like this generally leads to better price discovery and potentially more favorable terms for the government, as contractors vie to win the award.

Taxpayer Impact: The full and open competition ensures that taxpayer dollars are likely being used efficiently by driving down costs through a competitive bidding environment.

Public Impact

Federal employees and visitors to the Hubert H. Humphrey Building and Parklawn Complex benefit from enhanced security. The contract ensures the continuous provision of security guard and patrol services. Geographic impact is concentrated in Maryland, where the facilities are located. The contract supports jobs within the private security sector.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for complacency if performance is not rigorously monitored.
Dependence on a single contractor for critical security functions.
Need for clear escalation procedures for security incidents.

Positive Signals

Firm fixed-price contract limits cost escalation risks.
Full and open competition suggests a robust selection process.
Long-term contract provides stability for security operations.

Sector Analysis

The security guard and patrol services sector is a significant component of the broader facilities management and security industry. Federal agencies are major consumers of these services, requiring robust and reliable protection for their personnel and assets. This contract falls within the NAICS code 561612, which covers establishments primarily engaged in providing security guards and patrol services. Spending in this sector is driven by the need for physical security, access control, and emergency response at government facilities nationwide.

Small Business Impact

This contract was awarded under full and open competition and does not indicate any specific small business set-aside. The presence of 4 bidders suggests that larger, established security firms likely participated. There is no explicit information provided regarding subcontracting plans for small businesses, which could be an area for further inquiry to ensure opportunities for smaller entities within the security ecosystem.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of Health and Human Services' Office of the Assistant Secretary for Administration, which awarded the contract. Accountability measures are inherent in the firm fixed-price contract type, which obligates the contractor to deliver services at the agreed-upon price. Transparency is generally maintained through contract award databases and reporting requirements, though specific performance monitoring details are not publicly detailed.

Related Government Programs

General Services Administration (GSA) Federal Protective Service contracts
Department of Homeland Security (DHS) security contracts
Department of Defense (DoD) security services

Risk Flags

Potential for performance degradation over contract duration.
Reliance on a single vendor for critical security functions.
Need for robust ongoing performance monitoring.

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $51.8 million to THE WHITESTONE GROUP, INC.. PROTECTION AND SECURITY GUARD SERVICES (HUBERT H. HUMPHREY BUILDING AND PARKLAWN COMPLEX)

Who is the contractor on this award?

The obligated recipient is THE WHITESTONE GROUP, INC..

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $51.8 million.

What is the period of performance?

Start: 2022-07-01. End: 2026-12-12.

What is the track record of The Whitestone Group, Inc. in performing similar federal security contracts?

Information regarding The Whitestone Group, Inc.'s specific track record on federal contracts, particularly those of similar size and scope to this $51.8 million award, would typically be available through federal procurement databases like SAM.gov or FPDS. A review of past performance evaluations, any documented disputes, or contract terminations would provide insight into their reliability and capability. Assessing their history with firm fixed-price contracts and their ability to meet security requirements consistently is crucial for understanding their suitability for this role. Without direct access to their detailed performance history, it's difficult to definitively assess their track record, but the award itself suggests they met the government's pre-qualification criteria.

How does the awarded price compare to market rates for similar security services in the Maryland region?

To benchmark the value, one would compare the per-hour or per-guard cost implied by this contract against prevailing market rates for security personnel in the Maryland area. Factors such as the level of security clearance required, the specific duties (e.g., armed vs. unarmed guards, surveillance monitoring), and the 24/7 operational needs of the Hubert H. Humphrey Building and Parklawn Complex would influence these rates. Given the firm fixed-price nature, the government has locked in a price, but understanding if this price reflects competitive market conditions requires detailed analysis of labor costs, overhead, and profit margins typical for security firms in that region. The presence of 4 bidders suggests the price was likely competitive within the market.

What are the primary risks associated with this contract and how are they being mitigated?

The primary risks for a contract of this nature include potential lapses in security coverage, contractor performance issues (e.g., inadequate training, unreliability), and unforeseen security incidents. Mitigation strategies are embedded in the contract structure and oversight. The firm fixed-price (FFP) nature of the contract mitigates financial risk for the government by capping costs. The requirement for full and open competition helps ensure a capable contractor is selected. Ongoing oversight by HHS, including performance monitoring and adherence to service level agreements, is critical. Clear reporting mechanisms for incidents and defined penalties for non-performance also serve as risk mitigation tools.

How effective is the current security service provision in meeting the needs of the Hubert H. Humphrey Building and Parklawn Complex?

Assessing the effectiveness of the current security service provision requires evaluating key performance indicators (KPIs) outlined in the contract. These might include response times to incidents, adherence to access control protocols, patrol effectiveness, and overall security posture. Feedback from building occupants, incident reports, and audits conducted by HHS would provide direct measures of effectiveness. Given this is a new award, the effectiveness will be determined over the contract's performance period. The previous contract's performance and any lessons learned would also inform the assessment of the new award's potential effectiveness.

What has been the historical spending trend for security services at these specific HHS facilities?

To understand the historical spending trend, one would need to examine previous contracts awarded for security services at the Hubert H. Humphrey Building and Parklawn Complex. This would involve looking at contract values, durations, and any modifications or task orders issued over the past several years. Comparing the current $51.8 million award against this historical data would reveal whether spending has increased, decreased, or remained relatively stable. Factors such as changes in security requirements, facility expansions, or shifts in contracting strategies could explain any observed trends in spending.

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: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 4

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 6422 E MAIN ST STE 101, REYNOLDSBURG, OH, 43068

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Self-Certified Small Disadvantaged Business, Service Disabled Veteran Owned Business, Small Business, Special Designations, U.S.-Owned Business, Veteran Owned Business

Financial Breakdown

Contract Ceiling: $57,818,964

Exercised Options: $51,818,964

Current Obligation: $51,818,964

Actual Outlays: $40,454,843

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Parent Contract

Parent Award PIID: GS07F9142S

IDV Type: FSS

Timeline