Department of Defense awards $39.5M custodial services contract to DIDLAKE INC, raising questions about competition and value

Contract Overview

Contract Amount: $39,477,477 ($39.5M)

Contractor: Didlake Inc

Awarding Agency: Department of Defense

Start Date: 2015-06-01

End Date: 2020-05-31

Contract Duration: 1,826 days

Daily Burn Rate: $21.6K/day

Competition Type: NOT AVAILABLE FOR COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: IGF::OT::IGF CUSTODIAL SERVICES

Place of Performance

Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20301

State: District of Columbia Government Spending

Plain-Language Summary

Department of Defense obligated $39.5 million to DIDLAKE INC for work described as: IGF::OT::IGF CUSTODIAL SERVICES Key points: 1. Contract awarded on a non-competitive basis, limiting price discovery and potentially increasing costs. 2. The contract duration of 5 years (1826 days) suggests a long-term need for custodial services. 3. Fixed-price contract type aims to control costs, but the lack of competition hinders benchmarking. 4. The service area is limited to the District of Columbia, indicating a localized service requirement. 5. No small business set-aside was utilized, suggesting potential missed opportunities for small business participation. 6. The contract value of $39.5M warrants scrutiny for cost-effectiveness given the non-competitive award.

Value Assessment

Rating: questionable

Benchmarking the value of this custodial services contract is challenging due to the lack of publicly available comparable contract data and the non-competitive award. The fixed-price nature of the contract provides some cost control, but without competitive bids, it's difficult to ascertain if the $39.5 million represents a fair market price. The per-unit cost is not readily calculable from the provided data, making direct comparison to industry standards or similar government contracts difficult. Further analysis would be needed to determine if the pricing is aligned with industry benchmarks for janitorial services of this scale.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a 'NOT AVAILABLE FOR COMPETITION' basis, indicating that a full and open competition was not conducted. This typically occurs when only one source is capable of meeting the agency's needs, or in specific circumstances like urgent requirements or follow-on work to a previous sole-source award. The lack of competition means that multiple bidders were not evaluated, which can limit price discovery and potentially lead to higher costs for the government compared to a competitive process. The specific justification for the sole-source award is not provided.

Taxpayer Impact: Taxpayers may be paying a premium for these services due to the absence of competitive bidding, which typically drives down prices. The lack of competition also reduces transparency in the procurement process.

Public Impact

The primary beneficiaries are the facilities and personnel within the Washington Headquarters Services, which receive essential custodial support. The services delivered include janitorial and general cleaning to maintain a safe and sanitary working environment. The geographic impact is confined to the District of Columbia, specifically the areas managed by Washington Headquarters Services. The contract supports a workforce employed by DIDLAKE INC, contributing to employment in the janitorial services sector.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Non-competitive award raises concerns about potential overpayment and lack of market-driven pricing.
Limited transparency into the selection process due to sole-source justification.
Absence of small business participation could be a missed opportunity for economic inclusion.
Long contract duration without competitive re-evaluation could lead to complacency or price creep.

Positive Signals

Fixed-price contract type offers some cost predictability.
Contract is for essential services, ensuring operational continuity.
Service area is clearly defined, limiting scope creep.

Sector Analysis

The janitorial services industry is a significant component of the broader facilities management sector. This contract falls under the North American Industry Classification System (NAICS) code 561720 (Janitorial Services). The federal government is a major consumer of such services across various agencies and installations. While specific market size data for federal custodial contracts isn't provided, the overall facilities management market is substantial. This contract represents a significant portion of spending within this niche for the Washington Headquarters Services, highlighting the government's reliance on private sector providers for maintaining its physical infrastructure.

Small Business Impact

The provided data indicates that this contract was not awarded as a small business set-aside, nor does it appear to have specific subcontracting requirements for small businesses mentioned. This suggests that opportunities for small businesses to participate in this particular contract may have been limited or non-existent. Without a set-aside, larger businesses are typically eligible to bid, and in this sole-source scenario, the primary contractor, DIDLAKE INC, was selected without explicit provisions for small business engagement. This could represent a missed opportunity to foster small business growth within the federal contracting ecosystem for custodial services.

Oversight & Accountability

Oversight for this contract would primarily fall under the purview of the Washington Headquarters Services contracting officers and program managers. As a definitive contract, it is subject to standard federal procurement regulations and oversight. The Inspector General for the Department of Defense may also conduct audits or investigations into contract performance and financial management if concerns arise. Transparency is limited by the non-competitive nature of the award, but contract performance metrics and payment data would typically be tracked internally.

Related Government Programs

Federal Buildings and Facilities Maintenance
Government Janitorial Services
Washington Headquarters Services Contracts
Department of Defense Support Services

Risk Flags

Non-competitive award
Lack of transparency in pricing
Potential for cost overruns due to lack of competition

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $39.5 million to DIDLAKE INC. IGF::OT::IGF CUSTODIAL SERVICES

Who is the contractor on this award?

The obligated recipient is DIDLAKE INC.

Which agency awarded this contract?

Awarding agency: Department of Defense (Washington Headquarters Services).

What is the total obligated amount?

The obligated amount is $39.5 million.

What is the period of performance?

Start: 2015-06-01. End: 2020-05-31.

What is the track record of DIDLAKE INC in performing federal custodial contracts?

Information regarding DIDLAKE INC's specific track record with federal custodial contracts is not detailed in the provided data. However, the award of this $39.5 million contract suggests a level of capability deemed sufficient by the Washington Headquarters Services. To fully assess their track record, one would need to examine past performance reviews, any documented issues on previous contracts, and their history with other government agencies. Without this additional context, it's difficult to definitively gauge their reliability and performance quality beyond the fact that they were awarded this significant sole-source contract.

How does the value of this contract compare to similar federal custodial service contracts?

Direct comparison of this $39.5 million contract to similar federal custodial service contracts is difficult without access to a comprehensive database of recent awards, especially considering the non-competitive nature of this specific contract. Generally, the cost of custodial services can vary significantly based on location, scope of services (e.g., specialized cleaning, waste management), square footage, and security requirements. A sole-source award, by its nature, bypasses the competitive process that usually helps establish a market-based price. Therefore, without comparable competitive bids or detailed service scope comparisons, it's challenging to ascertain if $39.5 million represents a fair market value or an inflated price.

What are the primary risks associated with a sole-source award for custodial services?

The primary risks associated with a sole-source award for custodial services include a lack of price competition, which can lead to higher costs for the government and taxpayers. There's also a reduced incentive for the contractor to innovate or improve efficiency once the contract is secured, as there's no competitive pressure. Furthermore, the absence of multiple bidders limits the agency's ability to assess the full range of available solutions and potentially find a more cost-effective or higher-quality provider. Transparency in the procurement process is also diminished, making it harder to justify the expenditure to oversight bodies and the public.

How effective is the fixed-price contract type in managing costs for custodial services?

The fixed-price contract type is generally effective in managing costs for predictable services like custodial work because it shifts the risk of cost overruns to the contractor. The government agrees to pay a set price, regardless of the contractor's actual costs. This provides budget certainty. However, the effectiveness is somewhat diminished in a sole-source scenario. While the price is fixed, the initial determination of that price might be higher due to the lack of competition. For custodial services, where labor and supply costs are the main drivers, a fixed price can work well if the scope is clearly defined and the initial price is competitive, which is the challenge with non-competitive awards.

What is the historical spending pattern for custodial services at Washington Headquarters Services?

The provided data only includes details for this specific $39.5 million contract awarded to DIDLAKE INC, spanning from June 1, 2015, to May 31, 2020. It does not offer historical spending patterns for custodial services at Washington Headquarters Services (WHS) prior to or beyond this period. To understand historical spending, one would need to access procurement databases and analyze contract awards for WHS over several fiscal years, looking at the number of contracts, their values, the contractors involved, and the competition levels. This single contract does not provide sufficient data to establish a trend or pattern.

Are there specific performance metrics or KPIs tied to this contract?

The provided data does not explicitly list specific performance metrics or Key Performance Indicators (KPIs) associated with this contract. However, for a definitive contract of this nature, it is standard practice for government contracts to include performance standards and quality assurance surveillance plans (QASPs). These would outline the expected level of service, cleanliness standards, response times, and the methods for monitoring and evaluating the contractor's performance. Failure to meet these standards could result in contractually defined remedies, such as price adjustments or termination. The absence of explicit mention in the summary data does not necessarily mean they are absent from the full contract.

Industry Classification

NAICS: Administrative and Support and Waste Management and Remediation Services › Services to Buildings and Dwellings › Janitorial Services

Product/Service Code: UTILITIES AND HOUSEKEEPING › HOUSEKEEPING SERVICES

Competition & Pricing

Extent Competed: NOT AVAILABLE FOR COMPETITION

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: HQ003414R0140

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 8641 BREEDEN AVE STE 101, MANASSAS, VA, 20110

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

Financial Breakdown

Contract Ceiling: $39,492,692

Exercised Options: $39,477,477

Current Obligation: $39,477,477

Contract Characteristics

Commercial Item: COMMERCIAL ITEM

Cost or Pricing Data: NO

Timeline