DOJ's $108.5M Federal Express Contract: A Decade of Delivery Services

Contract Overview

Contract Amount: $108,532,150 ($108.5M)

Contractor: Federal Express Corporation

Awarding Agency: Department of Justice

Start Date: 2009-03-31

End Date: 2016-02-29

Contract Duration: 2,526 days

Daily Burn Rate: $43.0K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 3

Pricing Type: TIME AND MATERIALS

Sector: Other

Official Description: GLOBAL - COURIERS AND EXPRESS DELIVERY SERVICES

Place of Performance

Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20530

State: District of Columbia Government Spending

Plain-Language Summary

Department of Justice obligated $108.5 million to FEDERAL EXPRESS CORPORATION for work described as: GLOBAL - COURIERS AND EXPRESS DELIVERY SERVICES Key points: 1. Significant spending on essential courier services by the Department of Justice. 2. Federal Express Corporation holds the primary contract, indicating potential market concentration. 3. The contract duration and value suggest a substantial, long-term reliance on these services. 4. Analysis needed to assess if the Time and Materials pricing model optimized value.

Value Assessment

Rating: fair

The contract's Time and Materials pricing structure, while flexible, can lead to cost overruns if not closely managed. Benchmarking against similar government courier contracts is difficult without detailed task orders, but the total value suggests a significant investment.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, suggesting a competitive bidding process. However, the long duration and single awardee (Federal Express) warrant scrutiny to ensure ongoing price competitiveness and prevent potential vendor lock-in.

Taxpayer Impact: Taxpayers funded over $108 million for essential delivery services, with the effectiveness of the pricing model impacting the overall value for money.

Public Impact

Ensures timely delivery of sensitive legal documents and evidence for the Department of Justice. Supports nationwide and potentially international operations of various DOJ divisions. Facilitates critical communication and logistics for law enforcement and judicial processes. Potential for cost savings through optimized routing and delivery methods.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost creep with Time and Materials pricing.
Lack of transparency on specific service utilization and cost breakdown.
Long contract duration may limit opportunities for newer, potentially more cost-effective providers.

Positive Signals

Ensures reliable and widespread delivery capabilities.
Awarded through full and open competition.
Supports critical government functions.

Sector Analysis

The courier and express delivery services sector is vital for government operations, enabling the movement of documents, packages, and goods. Spending benchmarks vary widely based on agency needs, but this contract represents a substantial investment within this sector for the DOJ.

Small Business Impact

The data indicates this contract was awarded to Federal Express Corporation, a large business. There is no indication of small business participation or subcontracting within this specific contract award.

Oversight & Accountability

The Department of Justice is responsible for oversight. Given the contract's duration and value, regular performance reviews and audits would be crucial to ensure efficiency, cost control, and adherence to service level agreements.

Related Government Programs

Couriers and Express Delivery Services
Department of Justice Contracting
Offices, Boards and Divisions Programs

Risk Flags

Potential for cost overruns due to Time and Materials pricing.
Long contract duration may limit competitive opportunities.
Lack of small business participation.
Limited transparency on specific service costs and performance metrics.
Market concentration with a single provider.

Frequently Asked Questions

What is this federal contract paying for?

Department of Justice awarded $108.5 million to FEDERAL EXPRESS CORPORATION. GLOBAL - COURIERS AND EXPRESS DELIVERY SERVICES

Who is the contractor on this award?

The obligated recipient is FEDERAL EXPRESS CORPORATION.

Which agency awarded this contract?

Awarding agency: Department of Justice (Offices, Boards and Divisions).

What is the total obligated amount?

The obligated amount is $108.5 million.

What is the period of performance?

Start: 2009-03-31. End: 2016-02-29.

Was the Time and Materials pricing model effectively managed to ensure cost efficiency for the government, or did it lead to inflated costs compared to fixed-price alternatives?

The Time and Materials (T&M) pricing model offers flexibility but carries inherent risks of cost escalation if not rigorously monitored. Without detailed breakdowns of labor hours and material costs, it's challenging to definitively assess cost efficiency. Agencies must implement strict oversight, including detailed reporting requirements and regular audits, to mitigate T&M risks and ensure fair pricing comparable to fixed-price contracts for similar services.

What specific risks were identified during the full and open competition process, and how were they mitigated to ensure the best value for taxpayers?

During a full and open competition, risks typically revolve around ensuring adequate vendor qualification, fair evaluation criteria, and preventing bid protests. For this contract, potential risks might include ensuring Federal Express could meet the DOJ's diverse and demanding delivery needs nationwide, and that the proposed pricing was competitive. Mitigation likely involved clear performance standards, robust evaluation metrics, and potentially negotiating specific service level agreements to guarantee quality and cost-effectiveness.

How effectively did this contract support the Department of Justice's mission-critical operations, and could alternative delivery solutions have provided similar or better outcomes?

This contract likely provided essential, reliable delivery services crucial for the DOJ's operations, ensuring timely movement of legal documents and evidence. However, the long duration and single award raise questions about whether exploring alternative solutions, such as multi-award contracts or incorporating newer logistics technologies, could have yielded greater efficiency or cost savings over time.

Industry Classification

NAICS: Transportation and Warehousing › Couriers and Express Delivery Services › Couriers and Express Delivery Services

Product/Service Code: TRANSPORT, TRAVEL, RELOCATION › MOTOR POOL OR PACKING/CRATING

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 3

Pricing Type: TIME AND MATERIALS (Y)

Evaluated Preference: NONE

Contractor Details

Parent Company: Fedex Corp (UEI: 003141970)

Address: 2005 CORPORATE PLAZA, MEMPHIS, TN, 38132

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

Financial Breakdown

Contract Ceiling: $185,754,811

Exercised Options: $184,962,034

Current Obligation: $108,532,150

Contract Characteristics

Commercial Item: COMMERCIAL ITEM

Timeline