USMS awards $345M detention contract to GEO Group, Inc. over 12 years, raising value-for-money questions

Contract Overview

Contract Amount: $344,977,670 ($345.0M)

Contractor: THE GEO Group, Inc.

Awarding Agency: Department of Justice

Start Date: 2006-01-06

End Date: 2017-12-15

Contract Duration: 4,361 days

Daily Burn Rate: $79.1K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: DETENTION SERVICES (SAN DIEGO, CA) - FUNDED BY THE USMS

Place of Performance

Location: SAN DIEGO, SAN DIEGO County, CALIFORNIA, 92101

State: California Government Spending

Plain-Language Summary

Department of Justice obligated $345.0 million to THE GEO GROUP, INC. for work described as: DETENTION SERVICES (SAN DIEGO, CA) - FUNDED BY THE USMS Key points: 1. The contract's long duration and significant value warrant scrutiny for potential cost efficiencies and market responsiveness. 2. GEO Group, Inc. has been the sole provider for this service in San Diego, raising concerns about sustained competition. 3. The firm fixed-price structure offers cost certainty but may limit flexibility in adapting to changing service needs. 4. Performance context is crucial; understanding service quality and adherence to standards over the contract's lifespan is key. 5. This contract represents a substantial portion of federal spending within the 'Other Justice, Public Order, and Safety Activities' NAICS code for the region.

Value Assessment

Rating: fair

The contract's total value of $345 million over nearly 12 years averages approximately $28.75 million annually. Benchmarking this against similar detention service contracts is challenging without specific per-bed or per-day cost data. However, the extended duration and sole-provider status for this specific location suggest a need to rigorously assess whether the pricing remained competitive throughout its term and if alternative, more cost-effective solutions were explored or available.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that multiple bidders were theoretically allowed to participate. However, the fact that GEO Group, Inc. has held this contract for such an extended period, potentially as the sole provider in this specific geographic area, raises questions about the actual level of sustained competition experienced during the award and renewal phases. Further investigation into the bidding process and the number of active participants in each competition cycle would be necessary to fully assess the competitive landscape.

Taxpayer Impact: While full and open competition was the stated method, the long-term sole-provider status suggests taxpayers may not have consistently benefited from the price reductions typically driven by robust, ongoing competition.

Public Impact

Immigrants and detainees requiring correctional and detention services in the San Diego area are directly impacted. The contract ensures the provision of essential detention facilities and services managed by the U.S. Marshals Service. Geographic impact is concentrated in San Diego, California, affecting local resources and potentially the local economy through employment. Workforce implications include employment opportunities for correctional officers, administrative staff, and support personnel employed by the contractor.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Extended contract duration may reduce opportunities for new market entrants and innovation.
Sole-provider status in a specific region can limit competitive pressure on pricing and service quality over time.
Lack of readily available per-unit cost data makes independent value assessment difficult.

Positive Signals

Awarded under full and open competition, theoretically allowing for broad market participation.
Firm fixed-price contract provides budget certainty for the U.S. Marshals Service.
Long-term contract can ensure stable service provision and operational continuity.

Sector Analysis

Detention services fall under the broader 'Correctional Facilities' or 'Public Safety and Justice Administration' sectors. The market for private correctional services is significant, with several large players competing for government contracts. This specific contract with the U.S. Marshals Service represents a substantial, long-term commitment for facility operation and management within this niche. Comparable spending benchmarks would typically involve analyzing per-diem rates and operational costs for similar facilities across different jurisdictions and contract types.

Small Business Impact

There is no indication that this contract included small business set-asides. Given the scale and nature of detention facility operations, it is unlikely that small businesses would be primary contractors. However, opportunities for subcontracting to small businesses for services such as food, laundry, or maintenance may exist, though the extent of this is not detailed in the provided data.

Oversight & Accountability

Oversight is primarily conducted by the U.S. Marshals Service, which is responsible for monitoring contractor performance, adherence to contract terms, and service quality. Accountability measures are embedded within the contract's performance standards and reporting requirements. Transparency is generally facilitated through contract award databases, but detailed operational performance metrics and cost breakdowns may not always be publicly accessible. Inspector General jurisdiction would typically fall under the Department of Justice.

Related Government Programs

Federal Bureau of Prisons Contracts
Immigration and Customs Enforcement Detention Contracts
State and Local Government Detention Agreements
Private Prison Industry Spending
USMS Facility Management Contracts

Risk Flags

Long-term sole-provider status raises competition concerns.
Lack of detailed performance metrics makes value assessment difficult.
Potential for cost overruns or service degradation over extended contract periods.
Limited transparency on specific per-unit costs.

Frequently Asked Questions

What is this federal contract paying for?

Department of Justice awarded $345.0 million to THE GEO GROUP, INC.. DETENTION SERVICES (SAN DIEGO, CA) - FUNDED BY THE USMS

Who is the contractor on this award?

The obligated recipient is THE GEO GROUP, INC..

Which agency awarded this contract?

Awarding agency: Department of Justice (U.S. Marshals Service).

What is the total obligated amount?

The obligated amount is $345.0 million.

What is the period of performance?

Start: 2006-01-06. End: 2017-12-15.

What was the historical spending trend for detention services in San Diego prior to this contract?

Historical spending data prior to this specific $345 million contract (2006-2017) is not directly provided. However, the U.S. Marshals Service (USMS) has a long-standing requirement for detention services across the nation. The initiation of this contract in 2006 suggests a continuation or expansion of existing needs. To understand the trend, one would need to examine previous USMS contracts for the San Diego region, potentially looking at earlier agreements with GEO Group or other providers, and analyze their annual expenditures. This would reveal whether spending was increasing, decreasing, or stable leading up to the 2006 award, and help contextualize the $345 million figure over its 12-year duration.

How does the per-day cost of this contract compare to national averages for similar USMS detention facilities?

The provided data does not include the specific per-day or per-bed cost for this contract, making a direct comparison to national averages impossible. The total award of $345,977,669.79 over a period of approximately 4361 days (from Jan 6, 2006, to Dec 15, 2017) yields an average daily cost of roughly $79,105. This is the total contract value divided by the duration. To derive a meaningful per-day cost per detainee, the average daily population housed under the contract would be required. Without this, benchmarking against national averages for USMS facilities, which can vary significantly based on location, security level, and services provided, cannot be accurately performed.

What is the track record of The GEO Group, Inc. in managing USMS contracts, specifically regarding performance and compliance?

The GEO Group, Inc. is a major private prison operator and has a significant history of managing contracts with various federal agencies, including the USMS. Their track record is extensive but also subject to scrutiny. Reports from government watchdogs, news investigations, and official audits have sometimes raised concerns about staffing levels, inmate safety, healthcare services, and operational management in facilities managed by GEO Group. Conversely, they also hold numerous contracts successfully. For this specific San Diego contract, assessing GEO Group's track record would require reviewing USMS performance evaluations, any issued cure notices or contract disputes, and potentially data on incidents or compliance issues reported during the 2006-2017 period.

Were there any significant changes in service requirements or scope during the contract's 12-year lifespan?

The provided data does not detail any modifications or changes to the service requirements or scope during the contract's lifespan from January 6, 2006, to December 15, 2017. A definitive contract, especially one of this duration, often includes provisions for adjustments. Significant changes could have impacted the total cost, performance metrics, or operational demands. To determine if such changes occurred, one would need to consult contract modification records, often available through federal procurement databases like FPDS or SAM.gov, which would document any amendments, task orders, or change orders issued throughout the contract period.

What is the rationale behind awarding such a long-term contract (12 years) for detention services?

Long-term contracts for detention services are often awarded to ensure stability, predictability, and continuity of operations for the contracting agency, in this case, the U.S. Marshals Service (USMS). For the USMS, securing a consistent provider for detention beds in a specific region like San Diego can be critical for managing their population and fulfilling judicial mandates. A long duration allows the contractor (The GEO Group, Inc.) to make significant capital investments in facilities and infrastructure, potentially leading to economies of scale. It also reduces the administrative burden and cost associated with frequent re-competition processes. However, such long terms can also reduce flexibility and potentially shield contractors from competitive pressures if not managed carefully.

Industry Classification

NAICS: Public Administration › Justice, Public Order, and Safety Activities › Other Justice, Public Order, and Safety Activities

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

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 1 PARK PL STE 700 621 NW 53RD ST, BOCA RATON, FL, 33487

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $344,977,670

Exercised Options: $344,977,670

Current Obligation: $344,977,670

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Timeline