DOT awarded $47.8M for transportation equipment, with no competition, raising value concerns

Contract Overview

Contract Amount: $47,768,842 ($47.8M)

Contractor: Washington Metropolitan Area Transit Authority

Awarding Agency: Department of Transportation

Start Date: 2010-01-27

End Date: 2010-09-30

Contract Duration: 246 days

Daily Burn Rate: $194.2K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Transportation

Official Description: FARE MEDIA

Place of Performance

Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20590

State: District of Columbia Government Spending

Plain-Language Summary

Department of Transportation obligated $47.8 million to WASHINGTON METROPOLITAN AREA TRANSIT AUTHORITY for work described as: FARE MEDIA Key points: 1. The contract was awarded on a sole-source basis, limiting price discovery and potentially increasing costs. 2. The fixed-price contract type offers some cost certainty but doesn't mitigate the risk of overpayment due to lack of competition. 3. The duration of the contract (246 days) is relatively short, suggesting a focused need rather than a long-term strategic acquisition. 4. The specific product category, 'Transportation Equipment and Supplies (except Motor Vehicle) Merchant Wholesalers,' is broad and requires further detail to assess true value. 5. The award to a single entity without competition warrants scrutiny regarding the justification for sole-source procurement. 6. The contract's value is significant, making the absence of competitive bidding a notable point of interest for fiscal oversight.

Value Assessment

Rating: questionable

Without competitive bids, it is difficult to benchmark the pricing for this $47.8 million contract. The lack of competition suggests that the government may not have secured the best possible price for the transportation equipment and supplies. Comparing this award to similar sole-source procurements for comparable goods would be necessary to assess if the pricing is reasonable, but such data is not readily available in this context. The absence of a competitive process inherently raises questions about the overall value for money achieved.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning it was not competed. The justification for not conducting a full and open competition is not provided here. A sole-source award typically occurs when only one responsible source is available or capable of meeting the agency's needs. The lack of multiple bidders means there was no opportunity for price negotiation or comparison among different vendors, which can lead to higher costs for the government.

Taxpayer Impact: The absence of competition means taxpayers did not benefit from potential cost savings that could have resulted from a bidding process. This could translate to a less efficient use of public funds.

Public Impact

The primary beneficiary is the contractor, FARE MEDIA, which received a substantial award. The services delivered involve the provision of transportation equipment and supplies, crucial for the operational needs of the Department of Transportation. The geographic impact is centered in the District of Columbia, where the Washington Metropolitan Area Transit Authority is located. While not directly creating new jobs, the contract supports existing employment within the awarded company and potentially its supply chain.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition raises concerns about potential overpricing and reduced value for taxpayer money.
The sole-source nature of the award requires strong justification to ensure it was truly necessary and not a missed opportunity for savings.
The broad description of 'Transportation Equipment and Supplies' could mask inefficiencies if specific needs were not clearly defined and sourced competitively.
The short contract duration might indicate a reactive procurement rather than strategic planning, potentially leading to rushed decisions.
Without transparency into the sole-source justification, it's difficult to assess if all regulatory requirements were met.

Positive Signals

The contract was awarded to a single entity, potentially streamlining the acquisition process and delivery.
The firm fixed-price contract type provides cost certainty for the government, limiting the risk of cost overruns.
The award supports the operational needs of the Department of Transportation, ensuring the availability of necessary equipment and supplies.
The contract value is substantial, indicating a significant need being met by the award.

Sector Analysis

This contract falls within the broader sector of transportation equipment and supplies wholesale. The market for such goods can be diverse, ranging from specialized components to general operational equipment. Without specific details on the 'transportation equipment and supplies' procured, it's challenging to benchmark against industry standards or market size. However, government procurements in this category are common, supporting various agencies' logistical and operational requirements. The value of this single contract is significant, representing a notable portion of spending within its specific niche.

Small Business Impact

There is no indication that this contract involved small business set-asides or subcontracting opportunities. The award was made to a single entity, FARE MEDIA, and the information provided does not specify its size or whether it is a small business. Without further details on subcontracting plans, the impact on the small business ecosystem is unknown, but the lack of competition suggests limited opportunities for small businesses to participate in this specific award.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of Transportation's internal procurement review processes and potentially the Office of Inspector General if any irregularities were suspected. The 'NOT COMPETED' status suggests that a justification for sole-source procurement was likely required and reviewed internally. Transparency regarding this justification and the subsequent performance monitoring would be key to assessing accountability. Without access to the full contract file and justification documents, a comprehensive assessment of oversight effectiveness is limited.

Related Government Programs

Department of Transportation - General Operations
Transportation Equipment Procurement
Wholesale Trade - Transportation Equipment
Federal Supply Schedule (if applicable)
Sole-Source Contract Awards

Risk Flags

Sole-source award without clear justification
Potential for overpayment due to lack of competition
Lack of transparency regarding specific goods procured
Absence of small business participation opportunities

Frequently Asked Questions

What is this federal contract paying for?

Department of Transportation awarded $47.8 million to WASHINGTON METROPOLITAN AREA TRANSIT AUTHORITY. FARE MEDIA

Who is the contractor on this award?

The obligated recipient is WASHINGTON METROPOLITAN AREA TRANSIT AUTHORITY.

Which agency awarded this contract?

Awarding agency: Department of Transportation (Immediate Office of the Secretary of Transportation).

What is the total obligated amount?

The obligated amount is $47.8 million.

What is the period of performance?

Start: 2010-01-27. End: 2010-09-30.

What specific transportation equipment and supplies were procured under this contract?

The provided data indicates the contract was for 'Transportation Equipment and Supplies (except Motor Vehicle) Merchant Wholesalers' with a North American Industry Classification System (NAICS) code of 423860. However, the specific items procured are not detailed. This broad classification could encompass a wide range of goods, from specialized parts for transit systems to general maintenance supplies. Understanding the exact nature of these goods is crucial for assessing their necessity, potential for competitive sourcing, and value for money. Without this specificity, it is difficult to determine if the $47.8 million award was for essential items or if there was room for negotiation or alternative sourcing.

What was the justification for awarding this contract on a sole-source basis?

The contract was explicitly marked as 'NOT COMPETED,' indicating a sole-source award. Federal procurement regulations typically require agencies to justify sole-source awards, often citing reasons such as urgency, unique capabilities of a single provider, or lack of market availability. Without the specific justification document associated with this contract (e.g., a Justification and Approval - J&A), it is impossible to ascertain the rationale. This lack of transparency means it cannot be verified whether the sole-source award was appropriate and if opportunities for competition were genuinely exhausted. Such justifications are critical for ensuring fair and efficient use of taxpayer funds.

How does the $47.8 million contract value compare to similar procurements for transportation equipment and supplies?

Benchmarking the $47.8 million contract value is challenging without knowing the specific items procured and their quantities. However, as a sole-source award, there is an inherent risk that the price may not be as competitive as it would be in a fully competed scenario. To perform a meaningful comparison, one would need to identify similar contracts for the same or comparable goods, ideally those awarded through full and open competition. Analyzing the unit prices, total value, and contract duration of such comparable contracts would reveal whether FARE MEDIA's award represents a fair market price or potentially an inflated cost due to the lack of competition. Without this comparative data, the value proposition remains uncertain.

What is the track record of FARE MEDIA in fulfilling government contracts, particularly sole-source awards?

The provided data does not include information on FARE MEDIA's past performance or track record with government contracts. To assess this, a review of contract databases (like SAM.gov or FPDS) would be necessary to identify previous awards, their values, contract types, and performance ratings. Understanding their history, especially concerning sole-source awards, would shed light on their reliability, pricing practices, and ability to deliver on government requirements. A history of successful, competitively priced contract completions would lend more confidence to this award, whereas a pattern of issues or high costs in sole-source situations would raise red flags.

What are the potential risks associated with a sole-source award of this magnitude?

A sole-source award of $47.8 million carries several risks. Firstly, the primary risk is financial: the government may pay a higher price than necessary due to the absence of competitive pressure. Secondly, there's a risk of reduced innovation and service quality, as the contractor may face less incentive to improve offerings when competition is not a factor. Thirdly, it raises concerns about fairness and equal opportunity, potentially excluding other capable vendors. Finally, without a robust justification and oversight, there's a risk of impropriety or inefficient allocation of resources. The government must ensure that sole-source awards are truly justified and that the chosen contractor can meet all requirements effectively and at a reasonable cost.

How does this contract align with the Department of Transportation's strategic goals and spending priorities?

The alignment of this $47.8 million contract with the Department of Transportation's (DOT) strategic goals depends heavily on the specific nature of the 'transportation equipment and supplies' procured. If these goods are critical for maintaining or improving transportation infrastructure, enhancing safety, or supporting key DOT initiatives (e.g., modernization of transit systems, supply chain resilience), then the contract would align well. However, if the procured items are less critical or could have been sourced more cost-effectively through competition, the alignment might be weaker. The sole-source nature also raises questions about strategic sourcing versus opportunistic procurement. A thorough assessment would require understanding DOT's current priorities and how this specific acquisition contributes to them.

Industry Classification

NAICS: Wholesale Trade › Machinery, Equipment, and Supplies Merchant Wholesalers › Transportation Equipment and Supplies (except Motor Vehicle) Merchant Wholesalers

Product/Service Code: TRANSPORT, TRAVEL, RELOCATION › OTHER TRANSPORT, TRAVEL, RELOCAT SV

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 600 5TH ST NW ROOM 6 B15, WASHINGTON, DC, 20001

Business Categories: Category Business, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $47,768,842

Exercised Options: $47,768,842

Current Obligation: $47,768,842

Contract Characteristics

Commercial Item: COMMERCIAL ITEM

Parent Contract

Parent Award PIID: DTOS5906D00454

IDV Type: IDC

Timeline