DHS awarded $48M for detention facility services, with a high per-unit cost for inmate support

Contract Overview

Contract Amount: $47,996,770 ($48.0M)

Contractor: THE GEO Group, Inc.

Awarding Agency: Department of Homeland Security

Start Date: 2009-10-24

End Date: 2010-10-23

Contract Duration: 364 days

Daily Burn Rate: $131.9K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: DETENTION, TRANSPORTATION AND FOOD SERVCIES FOR THE NORTHWEST CONTRACTOR DETENTION FACILITY, TACOMA, WASHINGTON.

Place of Performance

Location: TACOMA, PIERCE County, WASHINGTON, 98421

State: Washington Government Spending

Plain-Language Summary

Department of Homeland Security obligated $48.0 million to THE GEO GROUP, INC. for work described as: DETENTION, TRANSPORTATION AND FOOD SERVCIES FOR THE NORTHWEST CONTRACTOR DETENTION FACILITY, TACOMA, WASHINGTON. Key points: 1. The contract value of $47.99M for 364 days indicates a significant investment in detention operations. 2. The firm-fixed-price structure aims to control costs, but the per-unit cost warrants scrutiny. 3. Competition was full and open, suggesting a potentially competitive bidding process. 4. The contractor, The GEO Group, Inc., has a substantial presence in correctional and detention services. 5. The services provided are critical for immigration enforcement operations in the Northwest. 6. The contract duration of one year is typical for service-based agreements of this nature.

Value Assessment

Rating: fair

The contract's total value of approximately $48 million for a one-year period for detention, transportation, and food services is substantial. Benchmarking this against similar contracts for detention facilities is crucial. While the firm-fixed-price contract type aims for cost certainty, the per-unit cost analysis is essential to determine if the pricing is competitive and reflects value for money. Without direct comparable data on per-inmate costs for similar facilities in the region, a definitive value assessment is challenging, but the scale of the award suggests significant operational expenses.

Cost Per Unit: Per-unit cost is not directly calculable from the provided data without inmate population figures. However, the total award divided by the duration suggests a high daily operational cost per facility, which would translate to a significant per-inmate cost.

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 bids. This suggests a robust bidding environment, which typically leads to more competitive pricing and better value for the government. The fact that it was competed openly implies that multiple entities likely vied for this significant contract, potentially driving down costs compared to a sole-source or limited competition scenario.

Taxpayer Impact: Full and open competition generally benefits taxpayers by fostering a market where providers must offer competitive pricing to secure government contracts, potentially leading to cost savings.

Public Impact

Immigrants in detention facilities in the Northwest region of Washington state benefit from the services provided. The contract ensures the provision of essential services including detention, transportation, and food for detainees. The geographic impact is focused on Tacoma, Washington, serving U.S. Immigration and Customs Enforcement (ICE) operations in the Northwest. The contract supports jobs within the private corrections and facility management sector, specifically for The GEO Group, Inc.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for high per-inmate costs given the total contract value and duration.
Reliance on a single contractor for critical detention and support services.
The nature of detention services can involve complex operational and ethical considerations.
Geographic concentration of services in one facility may limit flexibility.
Contract performance monitoring is crucial to ensure service quality and compliance.

Positive Signals

Awarded under full and open competition, suggesting a competitive pricing environment.
Firm-fixed-price contract type provides cost certainty for the government.
The contractor, The GEO Group, Inc., is an established provider in this sector.
Services are essential for the functioning of immigration enforcement operations.
Clear contract duration and defined scope of services.

Sector Analysis

This contract falls within the Facilities Support Services sector, specifically catering to government detention facilities. The private detention services market is a significant segment of the broader correctional services industry. Companies like The GEO Group, Inc. operate in a space that is influenced by government policy, immigration trends, and public-private partnership models. Spending in this area is often driven by federal mandates and operational needs for housing and managing detainees, making it a consistent, albeit sometimes controversial, area of government expenditure.

Small Business Impact

The contract was awarded to The GEO Group, Inc. and does not indicate any specific small business set-aside provisions (ss: false, sb: false). This suggests that the primary award was not targeted towards small businesses. There is no information provided regarding subcontracting plans or opportunities for small businesses within this contract. Therefore, the direct impact on the small business ecosystem from this specific award appears limited, though larger prime contractors may engage small businesses for ancillary services.

Oversight & Accountability

Oversight for this contract would typically be managed by U.S. Immigration and Customs Enforcement (ICE), a component of the Department of Homeland Security. Accountability measures are inherent in the firm-fixed-price contract structure, which obligates the contractor to deliver specified services. Transparency is generally maintained through contract award databases and performance reports, though specific operational details may be sensitive. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse related to the contract.

Related Government Programs

Immigration and Customs Enforcement (ICE) Operations
Federal Detention Center Management
Private Correctional Facility Services
Transportation Services for Detainees
Food Services for Government Facilities

Risk Flags

Contractor Performance Risk
Service Quality and Compliance
Inmate Welfare and Safety
Reputational Risk
Cost Management

Frequently Asked Questions

What is this federal contract paying for?

Department of Homeland Security awarded $48.0 million to THE GEO GROUP, INC.. DETENTION, TRANSPORTATION AND FOOD SERVCIES FOR THE NORTHWEST CONTRACTOR DETENTION FACILITY, TACOMA, WASHINGTON.

Who is the contractor on this award?

The obligated recipient is THE GEO GROUP, 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 $48.0 million.

What is the period of performance?

Start: 2009-10-24. End: 2010-10-23.

What is the track record of The GEO Group, Inc. in managing federal detention facilities, and have there been any significant performance issues or controversies?

The GEO Group, Inc. is a major private operator of correctional and detention facilities in the United States and internationally. They have a long history of managing government contracts, including those with federal agencies like ICE and the Bureau of Prisons. While they are a significant player, like many large contractors in this sector, they have faced scrutiny and criticism regarding conditions in their facilities, labor practices, and instances of non-compliance with contract terms. Reports from government oversight bodies, news media, and advocacy groups have sometimes highlighted issues related to staffing, healthcare, safety, and security in facilities operated by The GEO Group. However, they also hold numerous contracts and are generally considered an experienced provider. A thorough review would involve examining specific performance evaluations and audit reports related to their federal contracts.

How does the per-unit cost of services for this contract compare to similar detention facilities managed by other contractors or government-run facilities?

Directly comparing the per-unit cost is challenging without specific data on the average daily population (ADP) for this facility during the contract period. The total award of $47,996,770.35 over 364 days implies a daily operational cost of approximately $131,859. If we assume an average daily population, we could derive a per-inmate per-day cost. However, such comparisons are complex due to variations in facility size, security levels, geographic location (affecting labor and supply costs), and the specific mix of services included (e.g., medical care, transportation frequency). Generally, private facilities can sometimes operate at a lower cost than government-run facilities due to labor flexibility and economies of scale, but this is not always the case, and quality of service can vary. Benchmarking would require access to detailed cost breakdowns and operational metrics from comparable facilities.

What are the primary risk indicators associated with this contract, considering its nature and the contractor involved?

Key risk indicators for this contract include operational risks related to maintaining safety, security, and humane conditions within the detention facility. There's a risk of contractor non-performance, leading to disruptions in detention services, which could impact ICE's operational capacity. Reputational risk is also significant, as controversies surrounding detention facility conditions can attract negative media attention and public scrutiny. Financial risks, though mitigated by the firm-fixed-price structure, could arise from unforeseen cost increases not covered by the contract or potential contractor financial instability. Compliance risks, including adherence to evolving legal and regulatory standards for detention, are also present. Finally, risks associated with inmate welfare, healthcare provision, and transportation safety are paramount.

What is the historical spending pattern for detention, transportation, and food services by ICE in the Northwest region, and how does this award fit within that trend?

Historical spending data for ICE detention services in the Northwest region would provide context for this $48 million award. ICE relies on a network of detention facilities, both government-owned and contracted, across the country. Spending patterns are influenced by immigration enforcement priorities, border apprehension numbers, and judicial processing backlogs. Awards like this one are typical for ICE's operational needs to manage detainees awaiting immigration proceedings or removal. Without specific historical data for the Northwest, it's difficult to definitively state if this award represents an increase or decrease in spending. However, the scale suggests a significant, ongoing requirement for detention capacity in that region. Trends in immigration policy and enforcement levels directly correlate with the demand for and cost of these services.

What are the implications of using a firm-fixed-price contract for detention services, particularly regarding cost control and service quality?

A firm-fixed-price (FFP) contract is generally preferred by the government when the scope of work is well-defined and risks can be reasonably assessed. For detention services, an FFP contract provides the government with cost certainty, as the contractor is obligated to perform the specified services for a set price, regardless of their actual costs. This shifts the risk of cost overruns to the contractor. However, this structure can sometimes incentivize contractors to cut corners on service quality or staffing to maximize profit margins, potentially impacting inmate welfare or operational standards. Effective government oversight and performance monitoring are therefore critical to ensure that the contractor meets all contractual requirements and maintains acceptable service levels while operating within the fixed price.

Industry Classification

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

Product/Service Code: UTILITIES AND HOUSEKEEPING › HOUSEKEEPING SERVICES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: HSCEDM-09-R-00003

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 1 PARK PL STE 700, BOCA RATON, FL, 23

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

Financial Breakdown

Contract Ceiling: $47,996,770

Exercised Options: $47,996,770

Current Obligation: $47,996,770

Parent Contract

Parent Award PIID: HSCEDM10D00001

IDV Type: IDC

Timeline