HHS's $97M Facilities Support Services contract to SOBRAN, INC. awarded in 2012, ending in 2018

Contract Overview

Contract Amount: $96,956,247 ($97.0M)

Contractor: Sobran, Inc.

Awarding Agency: Department of Health and Human Services

Start Date: 2012-03-06

End Date: 2018-10-31

Contract Duration: 2,430 days

Daily Burn Rate: $39.9K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 3

Pricing Type: COST PLUS AWARD FEE

Sector: Other

Official Description: IGF::OT::IGF

Place of Performance

Location: BETHESDA, MONTGOMERY County, MARYLAND, 20817

State: Maryland Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $97.0 million to SOBRAN, INC. for work described as: IGF::OT::IGF Key points: 1. The contract utilized a Cost Plus Award Fee (CPAF) structure, which incentivizes contractor performance through award fees tied to specific metrics. 2. With a duration of 2430 days (approximately 6.6 years), this represents a significant, long-term commitment for facilities support. 3. The contract was awarded under Full and Open Competition, suggesting a broad search for qualified bidders. 4. The base contract value was $39.9M, with the total award reaching $96.9M, indicating significant growth or scope expansion over its life. 5. Facilities Support Services (NAICS 561210) is a broad category encompassing a wide range of operational and maintenance activities for government facilities. 6. The contract's performance period spanned a significant portion of the 2010s, providing a consistent service stream during that decade.

Value Assessment

Rating: fair

Comparing this contract's total value of $96.9M over approximately 6.6 years to similar large-scale facilities support contracts requires detailed benchmarking. The Cost Plus Award Fee (CPAF) structure allows for performance-based adjustments, making direct price comparisons challenging without insight into the award fee payouts. The significant increase from the base value of $39.9M to the final award suggests either substantial scope changes or strong performance that earned significant award fees. Without specific performance metrics and award fee criteria, assessing the true value-for-money is difficult.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under 'Full and Open Competition,' indicating that all responsible sources were permitted to submit a bid. This typically suggests a robust bidding process designed to foster competition and achieve competitive pricing. The presence of 3 bidders (no=3) indicates a moderate level of competition for this significant facilities support requirement.

Taxpayer Impact: Full and open competition generally benefits taxpayers by encouraging multiple companies to offer their best pricing and services, leading to potentially lower costs and higher quality outcomes.

Public Impact

The National Institutes of Health (NIH) benefits from consistent and reliable facilities support services, enabling its research and operational functions. Services likely included maintenance, repair, operations, and potentially specialized support for laboratory and administrative facilities. The geographic impact is concentrated in Maryland (ST=MD, SN=MARYLAND), where NIH facilities are primarily located. The contract supported a workforce involved in various aspects of facility management and maintenance.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns given the CPAF structure and significant increase from base to final award value.
Lack of transparency regarding specific award fee criteria and payouts makes it difficult to assess performance incentives fully.
Long contract duration could lead to vendor complacency if not managed with rigorous oversight.

Positive Signals

Awarded under full and open competition, suggesting a competitive process.
CPAF structure incentivizes contractor performance through award fees.
Long-term contract provides stability for essential facilities services.

Sector Analysis

Facilities Support Services (NAICS 561210) is a substantial sector within the broader facilities management industry. This contract represents a significant government procurement within this sector, encompassing a wide array of services essential for the operation of large government installations like those managed by NIH. Comparable spending benchmarks would involve analyzing other large-scale government contracts for building operations, maintenance, and management across various agencies.

Small Business Impact

The data indicates this contract was not set aside for small businesses (ss=false, sb=false). Therefore, there are no direct subcontracting implications for small businesses stemming from a small business set-aside. However, the prime contractor, SOBRAN, INC., may have engaged small businesses as subcontractors, which is not detailed in the provided data.

Oversight & Accountability

The Cost Plus Award Fee (CPAF) structure implies performance monitoring and evaluation by the contracting agency to determine award fee amounts. Oversight mechanisms would typically involve contract officers, technical monitors, and potentially Inspector General reviews, especially given the contract's value and duration. Transparency regarding the specific performance metrics and award fee decisions would be key to assessing accountability.

Related Government Programs

Federal Buildings and Facilities Management
Government Operations and Support Services
NIH Facilities Operations
Department of Health and Human Services Contracts

Risk Flags

Significant increase from base to final award value requires justification.
CPAF structure necessitates robust performance monitoring.
Long contract duration may limit future flexibility.

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $97.0 million to SOBRAN, INC.. IGF::OT::IGF

Who is the contractor on this award?

The obligated recipient is SOBRAN, INC..

Which agency awarded this contract?

Awarding agency: Department of Health and Human Services (National Institutes of Health).

What is the total obligated amount?

The obligated amount is $97.0 million.

What is the period of performance?

Start: 2012-03-06. End: 2018-10-31.

What was the specific performance criteria used to determine award fees for SOBRAN, INC. under this contract?

The specific performance criteria for award fees are not detailed in the provided data. Typically, for Cost Plus Award Fee (CPAF) contracts, these criteria are outlined in the contract's Performance Work Statement (PWS) or Statement of Objectives (SOO). They often include metrics related to service availability, response times for maintenance requests, quality of work, safety compliance, and customer satisfaction. The contracting officer and technical representatives would evaluate the contractor's performance against these metrics throughout the contract period to determine the amount of award fee, if any, earned. Without access to the contract's detailed appendices or performance reports, the exact criteria remain unknown.

How does the total awarded amount of $96.9M compare to the initial base contract value of $39.9M in terms of percentage increase?

The total awarded amount of $96,956,246.88 represents a significant increase of approximately 143% over the initial base contract value of $39,900,000. This substantial rise from $39.9M to nearly $97M suggests that the contract either underwent significant scope changes, modifications, or that the contractor consistently achieved high performance ratings, leading to substantial award fee payouts over the contract's duration. Such a large delta warrants scrutiny to understand the drivers behind the increased expenditure, whether through approved contract modifications for expanded services or through performance-based incentives.

What is the typical market rate or average cost for similar facilities support services contracts of this magnitude?

Determining a precise 'market rate' for facilities support services is complex due to the wide variability in scope, geographic location, service mix, and contract type. However, contracts of this magnitude (approaching $100M over several years) for large federal installations typically involve comprehensive services including maintenance, repair, operations, custodial, security, and sometimes groundskeeping. Benchmarking would involve comparing the contract's cost per square foot or cost per facility user against similar large-scale government or private sector contracts. Given the CPAF structure and the significant increase from the base value, it suggests that pricing was likely negotiated with performance incentives, making direct comparisons to fixed-price contracts difficult. Further analysis would require detailed breakdowns of the services provided and their associated costs.

What risks are associated with a long-duration contract like this (over 6 years)?

Long-duration contracts, such as this 6.6-year facilities support agreement, carry several potential risks. One primary risk is 'vendor lock-in,' where the government becomes heavily reliant on a single provider, potentially reducing leverage for future negotiations or service improvements. There's also the risk of complacency; a contractor might reduce efforts to innovate or maintain peak performance once a long-term commitment is secured, especially if oversight is not rigorous. Furthermore, market conditions, technology, and government needs can change significantly over such a long period, potentially making the contracted services or pricing less optimal or even obsolete by the contract's end. Finally, long durations can tie up significant agency resources and budgets, potentially limiting flexibility for other priorities.

How does the number of bidders (3) impact the potential for competitive pricing in this 'Full and Open Competition' scenario?

Having three bidders in a 'Full and Open Competition' scenario generally indicates a moderate level of competition. While more bidders are typically preferred to drive prices down further, three offers suggest that the requirement was attractive enough to draw multiple capable companies. This number is often considered sufficient to provide a reasonable basis for price comparison and negotiation. However, the quality and capacity of the bidders are also crucial; if only a few companies possess the specific expertise or scale required for such a large facilities support contract, the competition might be less intense than if numerous smaller or more specialized firms could participate. The final price achieved would depend on the specific bidding strategies and the perceived value of the contract.

Industry Classification

NAICS: Administrative and Support and Waste Management and Remediation Services › Facilities Support Services › Facilities Support Services

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

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: NIHAO2011063

Offers Received: 3

Pricing Type: COST PLUS AWARD FEE (R)

Evaluated Preference: NONE

Contractor Details

Address: 4401 DAYTON-XENIA RD, DAYTON, OH, 45432

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

Financial Breakdown

Contract Ceiling: $151,216,140

Exercised Options: $96,956,247

Current Obligation: $96,956,247

Contract Characteristics

Multi-Year Contract: Yes

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline