Transportation awarded $19.5M for security services, with 3 bidders competing for the contract

Contract Overview

Contract Amount: $19,503,736 ($19.5M)

Contractor: Centerra Group, LLC

Awarding Agency: Department of Transportation

Start Date: 2010-03-03

End Date: 2015-09-30

Contract Duration: 2,037 days

Daily Burn Rate: $9.6K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 3

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: ARMED SECURITY GUARD SERVICES TAS::69 1301::TAS

Place of Performance

Location: PALM BEACH GARDENS, PALM BEACH County, FLORIDA, 33418, UNITED STATES OF AMERICA

State: Florida Government Spending

Plain-Language Summary

Department of Transportation obligated $19.5 million to CENTERRA GROUP, LLC for work described as: ARMED SECURITY GUARD SERVICES TAS::69 1301::TAS Key points: 1. The contract was awarded using full and open competition, suggesting a competitive pricing environment. 2. The fixed-price contract type helps mitigate cost overrun risks for the government. 3. The duration of the contract (over 5 years) indicates a long-term need for these services. 4. The services provided fall under security guards and patrol, a common government requirement. 5. The award was made to Centerra Group, LLC, a known entity in the security services sector.

Value Assessment

Rating: good

The contract's value of $19.5 million over approximately 5.5 years averages to about $3.5 million annually. Benchmarking this against similar federal contracts for security guard services requires detailed analysis of scope, location, and specific security requirements. However, the presence of multiple bidders in a full and open competition generally supports a fair market price. Without specific per-unit cost data or detailed service level agreements, a precise value-for-money assessment is challenging, but the competitive award process is a positive indicator.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, meaning all responsible sources were permitted to submit a bid. With three bidders participating, the competition level appears moderate. A higher number of bidders typically leads to more aggressive pricing and a wider range of solutions. However, three bidders still provide a basis for price discovery and indicate that the market has at least a few capable providers.

Taxpayer Impact: The full and open competition with three bidders suggests that taxpayers likely benefited from competitive pricing, avoiding potential overcharges associated with sole-source or limited competition awards.

Public Impact

The Federal Aviation Administration (FAA) benefits from enhanced security at its facilities. Services include security guards and patrol, ensuring the safety and integrity of government property. The contract's geographic impact is focused on Florida, where the services are presumably delivered. The contract supports jobs within the security services industry, contributing to the local workforce in Florida.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for vendor lock-in if follow-on contracts are not competitively bid.
Reliance on a single contractor for critical security functions could pose a risk if performance degrades.
The fixed-price nature might incentivize cost-cutting that could impact service quality if not closely monitored.

Positive Signals

Awarded through full and open competition, indicating a robust bidding process.
The firm fixed-price contract type provides cost certainty for the government.
The contract duration suggests a stable, long-term security solution.
The contractor, Centerra Group, LLC, is an established provider in the security sector.

Sector Analysis

The security services industry is a significant sector within the broader professional, scientific, and technical services market. Federal spending on security guards and patrol services is substantial, driven by the need to protect government assets and personnel across various agencies. This contract for armed security guard services fits within the established market for physical security solutions, where competition is often driven by price, experience, and security clearances. Comparable spending benchmarks would depend on the specific security level and geographic region, but federal contracts in this space typically range from hundreds of thousands to tens of millions of dollars annually.

Small Business Impact

This contract does not appear to have a small business set-aside component, as indicated by 'sb': false. Furthermore, the 'ss' (small business) flag is also false. This suggests that the contract was not specifically targeted towards small businesses, and there is no explicit indication of subcontracting goals for small businesses. The award to a larger entity like Centerra Group, LLC implies that small businesses may not have been primary participants in this specific procurement, though they could potentially be involved as subcontractors if the prime contractor has such requirements.

Oversight & Accountability

Oversight for this contract would typically fall under the Federal Aviation Administration (FAA), a division of the Department of Transportation. The contract's firm fixed-price nature implies that the government's primary oversight concern would be ensuring that the contractor meets the defined service requirements and performance standards. Accountability measures would be embedded in the contract's terms and conditions, including performance metrics and potential penalties for non-compliance. Transparency is generally maintained through contract award databases like FPDS-NG (now SAM.gov), where basic award details are publicly accessible. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

Federal Aviation Administration Security Contracts
Department of Transportation Security Services
Armed Security Guard Services Federal Contracts
Physical Security Services for Government Facilities

Risk Flags

Contract duration exceeds 5 years.
Potential for service quality degradation under fixed-price terms.
Moderate competition level (3 bidders).

Frequently Asked Questions

What is this federal contract paying for?

Department of Transportation awarded $19.5 million to CENTERRA GROUP, LLC. ARMED SECURITY GUARD SERVICES TAS::69 1301::TAS

Who is the contractor on this award?

The obligated recipient is CENTERRA GROUP, LLC.

Which agency awarded this contract?

Awarding agency: Department of Transportation (Federal Aviation Administration).

What is the total obligated amount?

The obligated amount is $19.5 million.

What is the period of performance?

Start: 2010-03-03. End: 2015-09-30.

What is the historical spending pattern for armed security guard services by the Federal Aviation Administration?

Analyzing the historical spending patterns for armed security guard services by the Federal Aviation Administration (FAA) reveals a consistent need for these protective measures. Prior to this $19.5 million contract awarded in 2010, the FAA likely engaged in similar procurements to secure its facilities and operations. Examining spending trends over the past decade or more would show fluctuations based on security threats, budget allocations, and strategic priorities. For instance, periods of heightened national security concerns might correlate with increased spending. Understanding these patterns helps in forecasting future needs and budgeting effectively. The average annual spending on such services can provide a benchmark against which current contract values can be assessed for reasonableness, assuming similar scope and service levels.

How does the number of bidders (3) compare to the average number of bidders for similar federal security contracts?

The number of bidders for federal security contracts can vary significantly based on the contract's size, scope, geographic location, and the specific services required. While three bidders were involved in this $19.5 million contract, the average number of bidders for similar federal security contracts can range from two to over ten. Contracts for basic guard services in high-demand areas might attract numerous bidders, whereas highly specialized or geographically isolated contracts might see fewer. A moderate number like three suggests that the competition was sufficient to establish a competitive price but perhaps not as robust as it could be. Agencies often aim for a higher number of bids to ensure maximum price competition and innovation, but logistical challenges or market concentration can limit the pool of qualified offerors.

What are the potential risks associated with a firm fixed-price contract for security services?

Firm fixed-price (FFP) contracts are generally favored for their cost certainty, but they do carry potential risks, especially for complex or service-oriented procurements like security. For the government, the primary risk is that the contractor might cut corners on service quality or personnel to maximize profit, particularly if the initial price was set too low or if unforeseen operational challenges arise. This could lead to a degradation of security effectiveness. Conversely, if the FFP price is set too high due to overly conservative contractor estimates, the government may overpay for the services. For the contractor, the risk lies in underestimating costs, leading to financial losses if they cannot renegotiate terms. Effective oversight and clear performance metrics are crucial to mitigate these risks in an FFP security contract.

What is Centerra Group, LLC's track record in providing federal security services?

Centerra Group, LLC has a significant track record in providing security and mission support services to various government agencies, including federal entities. They have been involved in large-scale contracts, often requiring extensive security clearances, personnel management, and operational expertise. Their experience spans correctional facilities, critical infrastructure protection, and base operations support. While specific performance details for every contract are not always publicly available, their continued success in winning competitive federal bids suggests a generally positive performance history and capability to meet government requirements. Prospective clients can often review past performance evaluations (if publicly released) or seek references to gauge their reliability and effectiveness in delivering security solutions.

How does the $19.5 million award compare to other federal contracts for security guards and patrol services?

The $19.5 million award for armed security guard services over approximately 5.5 years, awarded to Centerra Group, LLC by the Department of Transportation's Federal Aviation Administration, falls within a common range for significant federal security contracts. Federal spending on security guards and patrol services is substantial, with numerous contracts awarded annually across various agencies. Larger contracts can easily exceed tens of millions of dollars, particularly those covering extensive geographic areas, multiple facilities, or requiring high levels of security clearance and specialized personnel. Smaller contracts might be in the hundreds of thousands or low millions. This particular award appears to be a mid-to-large-sized contract, reflecting a substantial security requirement for the FAA, likely covering a significant number of posts or a lengthy period.

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: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 3

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: G4S Integrated Services Gmbh (UEI: 079659453)

Address: 7121 FAIRWAY DR STE 301, PALM BEACH GARDENS, FL, 33418

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

Financial Breakdown

Contract Ceiling: $73,018,864

Exercised Options: $19,503,736

Current Obligation: $19,503,736

Timeline