DHS's $63.5M Unscheduled Air Charter Contract Awarded to CSI Aviation, Inc. for Immigration Enforcement Support

Contract Overview

Contract Amount: $63,478,352 ($63.5M)

Contractor: CSI Aviation, Inc

Awarding Agency: Department of Homeland Security

Start Date: 2014-04-02

End Date: 2018-04-30

Contract Duration: 1,489 days

Daily Burn Rate: $42.6K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: UNSCHEDULED AIR CHARTER SERVICES ORIGINATING OUT OF SAN ANTONIO, TEXAS.IGF::OT::IGF

Place of Performance

Location: ALBUQUERQUE, BERNALILLO County, NEW MEXICO, 87107

State: New Mexico Government Spending

Plain-Language Summary

Department of Homeland Security obligated $63.5 million to CSI AVIATION, INC for work described as: UNSCHEDULED AIR CHARTER SERVICES ORIGINATING OUT OF SAN ANTONIO, TEXAS.IGF::OT::IGF Key points: 1. Contract awarded through full and open competition, suggesting a competitive bidding process. 2. The contract value of $63.5 million over approximately four years indicates significant spending on air charter services. 3. The fixed-price contract type aims to control costs, but potential for cost overruns exists if not managed effectively. 4. The services are critical for supporting U.S. Immigration and Customs Enforcement operations, highlighting a key government function. 5. The contract's duration of nearly four years suggests a sustained need for these specialized aviation services. 6. The absence of small business set-aside indicates that large businesses were likely the primary bidders and recipients.

Value Assessment

Rating: fair

The contract value of $63.5 million over nearly four years averages to approximately $16.7 million annually. Benchmarking this against similar unscheduled air charter services is challenging without more specific service details (e.g., aircraft type, flight hours, routes). However, the firm fixed-price structure provides some cost certainty. The number of bids received (2) is on the lower side for a full and open competition, which could suggest less aggressive pricing than a more robust bidding environment might yield. Further analysis would require comparing the per-flight hour costs or per-mile rates to industry standards for similar charter operations.

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. However, only two bids were received. While this indicates some level of competition, a lower number of bidders can sometimes lead to less competitive pricing compared to scenarios with numerous proposals. The agency's ability to secure favorable terms and pricing would depend on the specific capabilities and proposals submitted by these two entities.

Taxpayer Impact: A competitive process, even with two bidders, is generally beneficial for taxpayers as it encourages providers to offer their best pricing. However, the limited number of bids warrants scrutiny to ensure the price paid reflects fair market value and isn't inflated due to a lack of broader competition.

Public Impact

Benefits U.S. Immigration and Customs Enforcement (ICE) by providing essential transportation for operational needs. Facilitates the movement of personnel and potentially detainees, supporting the agency's mission. The services are critical for unscheduled or emergent travel requirements, ensuring operational flexibility. Geographic impact is likely nationwide, given the nature of ICE operations, with a specific origin point in San Antonio, Texas. Supports the aviation industry through contract revenue for the service provider.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Limited competition (2 bidders) may have reduced price negotiation leverage.
Firm Fixed Price contracts can lead to contractor windfalls if costs are lower than anticipated.
Reliance on a single contractor for a significant duration (nearly 4 years) poses a risk if performance issues arise.

Positive Signals

Full and open competition process allows for a wide range of potential providers.
Firm Fixed Price contract provides cost certainty for the government.
The contract duration suggests a stable and predictable need for these services.

Sector Analysis

The aviation services sector encompasses a wide range of activities, from commercial airlines to specialized charter operations. This contract falls within the niche of unscheduled air charter services, often utilized by government agencies for time-sensitive or mission-critical transportation needs where commercial options are insufficient. The market for government aviation contracts is competitive, with specialized firms vying for these opportunities. Spending on such services can fluctuate based on agency operational tempo and specific mission requirements.

Small Business Impact

The data indicates this contract was not set aside for small businesses (sb: false). The primary contractor, CSI Aviation, Inc., is likely a larger entity capable of fulfilling these extensive charter requirements. There is no explicit information on subcontracting plans for small businesses within this award. Without specific subcontracting goals or reporting, the direct impact on the small business ecosystem from this particular contract is likely minimal, though CSI Aviation may engage small businesses opportunistically.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of Homeland Security (DHS) and U.S. Immigration and Customs Enforcement (ICE) contracting officers and program managers. They are responsible for monitoring performance, ensuring compliance with contract terms, and approving payments. The contract type (firm fixed price) simplifies some aspects of financial oversight but requires vigilance regarding service delivery. Transparency is generally maintained through contract databases like FPDS, though specific operational details may be sensitive.

Related Government Programs

Department of Homeland Security Contracts
U.S. Immigration and Customs Enforcement Contracts
Air Charter Services
Travel Services
Unscheduled Transportation

Risk Flags

Limited Competition
Potential for High Contractor Profit
Reliance on Single Contractor

Frequently Asked Questions

What is this federal contract paying for?

Department of Homeland Security awarded $63.5 million to CSI AVIATION, INC. UNSCHEDULED AIR CHARTER SERVICES ORIGINATING OUT OF SAN ANTONIO, TEXAS.IGF::OT::IGF

Who is the contractor on this award?

The obligated recipient is CSI AVIATION, INC.

Which agency awarded this contract?

Awarding agency: Department of Homeland Security (U.S. Immigration and Customs Enforcement).

What is the total obligated amount?

The obligated amount is $63.5 million.

What is the period of performance?

Start: 2014-04-02. End: 2018-04-30.

What is the track record of CSI Aviation, Inc. in performing similar government contracts?

CSI Aviation, Inc. has a history of performing government contracts, particularly for aviation services. A review of federal procurement data would reveal the extent and nature of their past performance. Key indicators to examine include the types of services provided (e.g., charter, medevac, cargo), the agencies they have served (e.g., DOD, HHS, DHS), contract values, and any performance evaluations or disputes. A strong track record with similar agencies and service types would suggest a lower performance risk for this current contract. Conversely, past issues with delivery, safety, or billing could raise concerns about their ability to meet the requirements of this DHS contract effectively.

How does the pricing of this contract compare to similar unscheduled air charter services?

Directly comparing the pricing of this $63.5 million contract is difficult without granular data on the specific services rendered (e.g., aircraft types, flight hours, routes, passenger/cargo capacity). Unscheduled air charter rates vary significantly based on these factors. To benchmark effectively, one would need to obtain data on the per-hour or per-mile costs for comparable aircraft operated by similar providers serving government clients. The fact that only two bids were received in a full and open competition might suggest that the pricing, while fixed, may not be as aggressively competitive as it could be with more bidders. Further analysis would involve obtaining industry rate sheets or data from other government contracts for similar charter operations.

What are the primary risks associated with this contract for the government?

The primary risks associated with this contract include potential performance failures by the contractor, CSI Aviation, Inc., such as delays, cancellations, or safety incidents, which could disrupt critical ICE operations. Given the firm fixed-price nature, there's a risk of the contractor realizing excessive profits if their operational costs are significantly lower than anticipated, indicating potentially suboptimal price negotiation. Another risk is the contractor's financial stability or operational capacity over the nearly four-year period. Finally, the limited competition (two bidders) poses a risk that the government did not secure the most cost-effective solution available in the market.

How effective is the firm fixed-price contract type in managing costs for unscheduled air charter services?

The firm fixed-price (FFP) contract type is generally effective in providing cost certainty for the government, as the price is set and not subject to adjustment based on the contractor's actual costs. This shifts the risk of cost overruns to the contractor. For unscheduled air charter services, where operational needs can be unpredictable, FFP helps budget predictability. However, it requires careful initial price negotiation to ensure the fixed price is fair and reasonable. If the contractor significantly underestimates costs or faces unforeseen expenses, they bear the loss. Conversely, if the contractor efficiently manages operations, they may achieve higher profit margins, which could be seen as a missed opportunity for cost savings by the government if the initial price was too high.

What is the historical spending trend for unscheduled air charter services by DHS or ICE?

Analyzing historical spending trends for unscheduled air charter services by DHS and ICE would provide context for the $63.5 million award. This involves examining procurement data over several fiscal years to identify patterns in contract values, number of awards, and primary service providers. Significant increases or decreases in spending could indicate shifts in operational tempo, policy changes, or evolving needs for air transportation. Understanding this history helps assess whether the current contract represents a typical level of expenditure, an increase, or a decrease, and whether past spending has been associated with effective service delivery or cost concerns.

What are the implications of awarding this contract to CSI Aviation, Inc. given the limited number of bidders?

Awarding this contract to CSI Aviation, Inc. after receiving only two bids from a full and open competition suggests potential limitations in the market for these specific services or challenges in attracting a wider range of bidders. While CSI Aviation is now the awardee, the limited competition raises questions about whether the government secured the best possible price and terms. It could indicate that fewer companies possess the necessary certifications, fleet size, or operational capabilities to meet ICE's requirements, or that the solicitation's terms were not attractive enough to draw more interest. This situation warrants careful review of the solicitation process and the evaluation criteria used.

Industry Classification

NAICS: Administrative and Support and Waste Management and Remediation Services › Travel Arrangement and Reservation Services › All Other Travel Arrangement and Reservation Services

Product/Service Code: TRANSPORT, TRAVEL, RELOCATION › TRAVEL, LODGING, RECRUITMENT SVCS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: HSCECR-14-Q-00010

Offers Received: 2

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 3700 RIO GRANDE BLVD NW, ALBUQUERQUE, NM, 87107

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Service Disabled Veteran Owned Business, Small Business, Special Designations, U.S.-Owned Business, Veteran Owned Business

Financial Breakdown

Contract Ceiling: $96,584,161

Exercised Options: $72,212,666

Current Obligation: $63,478,352

Contract Characteristics

Commercial Item: COMMERCIAL ITEM

Parent Contract

Parent Award PIID: GS33F0025V

IDV Type: FSS

Timeline