DHS's $12.5M contract for security services in West Virginia awarded to Security Consultants Group Inc

Contract Overview

Contract Amount: $12,555,040 ($12.6M)

Contractor: Security Consultants Group Inc

Awarding Agency: Department of Homeland Security

Start Date: 2005-01-20

End Date: 2007-09-30

Contract Duration: 983 days

Daily Burn Rate: $12.8K/day

Competition Type: COMPETITIVE DELIVERY ORDER

Number of Offers Received: 6

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: PROFESSIONAL SECURITY SERVICES FOR THE STATE OF WEST VIRGINIA, EXCLUDING THE COUNTIES OF BERKELEY, JEFFERSON AND MORGAN.

Place of Performance

Location: OAK RIDGE, ANDERSON County, TENNESSEE, 37830

State: Tennessee Government Spending

Plain-Language Summary

Department of Homeland Security obligated $12.6 million to SECURITY CONSULTANTS GROUP INC for work described as: PROFESSIONAL SECURITY SERVICES FOR THE STATE OF WEST VIRGINIA, EXCLUDING THE COUNTIES OF BERKELEY, JEFFERSON AND MORGAN. Key points: 1. The contract value of $12.5 million over approximately 2.7 years suggests a moderate annual spend for security services. 2. The fixed-price contract type aims to control costs, but the final price is fixed regardless of actual costs incurred. 3. The award was made via a competitive delivery order, indicating some level of competition. 4. The services are specific to West Virginia, excluding certain counties, which may limit the scope and potential for broader application. 5. The contractor, Security Consultants Group Inc., has secured this contract, but their broader track record requires further investigation. 6. The contract's duration of nearly three years provides a stable period for service delivery but limits flexibility for adjustments.

Value Assessment

Rating: fair

The total contract value of $12.5 million over 983 days averages to approximately $12,772 per day. Without specific details on the scope of services (e.g., number of guards, hours, specific security measures), it is difficult to benchmark this against similar contracts. The fixed-price nature suggests an attempt to control costs, but the value-for-money assessment depends heavily on the quality and effectiveness of the services provided and the prevailing market rates for comparable security personnel and services in the specified region of West Virginia.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded as a 'COMPETITIVE DELIVERY ORDER,' which implies that it was competed under a broader indefinite-delivery/indefinite-quantity (IDIQ) contract or a similar framework that allowed for multiple bidders. The presence of 6 bidders suggests a reasonable level of competition for this specific delivery order. However, the extent of the initial competition for the parent contract, if applicable, is not detailed here. The competition level is generally positive for price discovery.

Taxpayer Impact: A competitive award process, even for a delivery order, generally benefits taxpayers by encouraging multiple firms to offer competitive pricing and services, potentially leading to a more cost-effective outcome.

Public Impact

The primary beneficiaries are U.S. Immigration and Customs Enforcement (ICE) and potentially other Department of Homeland Security (DHS) components requiring security services within the specified areas of West Virginia. The services delivered include security guards and patrol services, crucial for maintaining safety and security at federal facilities or designated areas. The geographic impact is limited to specific counties within the state of West Virginia, excluding Berkeley, Jefferson, and Morgan counties. The contract supports jobs for security personnel employed by Security Consultants Group Inc. within the service area.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

The fixed-price contract type means the government pays the agreed-upon price regardless of the contractor's actual costs, which could lead to overpayment if costs are lower than anticipated.
The exclusion of specific counties might indicate unique security needs or limitations in the service area that could affect overall security posture.
The duration of the contract (nearly 3 years) might not be optimal if security needs change rapidly or if better solutions become available.
Limited information is provided on the specific performance metrics and how they were evaluated to ensure value for money.
The contractor's specific track record and past performance on similar contracts are not detailed, posing a potential risk.
The contract does not appear to have small business set-aside provisions, which could limit opportunities for smaller firms.

Positive Signals

The contract was awarded through a competitive delivery order process, suggesting that multiple vendors were considered.
The fixed-price contract type helps in budget predictability for the agency.
The contract specifies security guards and patrol services, addressing a clear need for physical security.
The award to Security Consultants Group Inc. provides a dedicated provider for the specified duration.
The contract is for a defined period, allowing for reassessment of needs upon completion.

Sector Analysis

The market for professional security services is substantial and diverse, encompassing physical security, cybersecurity, and consulting. This contract falls within the physical security segment, specifically guard and patrol services. The federal government is a significant purchaser of such services across various agencies. Benchmarking this contract's value requires comparison with other federal or state contracts for similar guard services in the Appalachian region, considering factors like labor costs, threat levels, and required service hours. The annual spend of approximately $4.6 million is moderate within the broader federal security services landscape.

Small Business Impact

The data indicates that this contract was not set aside for small businesses (ss: false, sb: false). This means that the competition was likely open to businesses of all sizes. While this allows for a wider pool of potential contractors, it may limit direct opportunities for small businesses unless they are prime contractors on larger vehicles or are involved as subcontractors. Further analysis would be needed to determine if subcontracting opportunities were mandated or utilized by the prime contractor, Security Consultants Group Inc., to engage small businesses.

Oversight & Accountability

Oversight for this contract would primarily fall under the U.S. Immigration and Customs Enforcement (ICE) contracting officers and their representatives. Performance monitoring, quality assurance, and invoice verification are standard oversight mechanisms. The Department of Homeland Security's Office of Inspector General (OIG) would have jurisdiction to investigate potential fraud, waste, or abuse related to this contract. Transparency is facilitated through contract award databases, but detailed performance reports are typically internal.

Related Government Programs

Federal Protective Service contracts
Department of Homeland Security security contracts
State and Local Law Enforcement Support Contracts
General Services Administration (GSA) Schedule contracts for security services
Department of Justice security contracts

Risk Flags

Fixed-price contract risk
Limited geographic scope
Contractor performance history unknown
Potential for overpayment in fixed-price contracts
Lack of small business set-aside

Frequently Asked Questions

What is this federal contract paying for?

Department of Homeland Security awarded $12.6 million to SECURITY CONSULTANTS GROUP INC. PROFESSIONAL SECURITY SERVICES FOR THE STATE OF WEST VIRGINIA, EXCLUDING THE COUNTIES OF BERKELEY, JEFFERSON AND MORGAN.

Who is the contractor on this award?

The obligated recipient is SECURITY CONSULTANTS 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 $12.6 million.

What is the period of performance?

Start: 2005-01-20. End: 2007-09-30.

What is the specific track record of Security Consultants Group Inc. in performing similar federal contracts?

Information regarding the specific track record of Security Consultants Group Inc. on similar federal contracts is not detailed in the provided data. To assess their capabilities and past performance, one would need to consult federal procurement databases like SAM.gov or FPDS-NG for historical contract awards, performance evaluations (e.g., Contractor Performance Assessment Reporting System - CPARS), and any documented issues or successes. A thorough review would involve examining the size, scope, duration, and client satisfaction of their previous engagements, particularly those involving security guard and patrol services for government entities. Without this data, it is difficult to definitively gauge their reliability and expertise for this specific DHS requirement.

How does the average daily cost of this contract compare to market rates for security services in West Virginia?

The average daily cost for this contract is approximately $12,772 ($12,555,040.36 / 983 days). Benchmarking this against market rates requires detailed information on the specific services rendered (e.g., number of guards, hours, specialized skills, post orders) and prevailing wage rates for security personnel in the relevant West Virginia counties. General market data suggests that hourly rates for unarmed security guards can range from $20 to $50+, and for armed guards, potentially higher. If this contract involves a significant number of guards working multiple shifts, the daily cost could be reasonable. However, without a detailed service breakdown, a precise comparison to market rates is challenging. It is advisable to compare this rate against similar government contracts awarded in the region or consult industry cost guides.

What are the primary risks associated with a fixed-price contract for security services?

The primary risk associated with a fixed-price contract for security services is that the contractor may incur lower costs than anticipated and thus achieve a higher profit margin, potentially indicating that the government did not receive the best possible value. Conversely, if the contractor's costs are higher than expected due to unforeseen circumstances (e.g., increased labor costs, unexpected security incidents requiring more resources), they bear the loss, which could potentially impact service quality if the contractor seeks to cut corners. For the government, the risk lies in potentially overpaying if the fixed price was not adequately negotiated based on realistic cost estimates and market conditions. Effective oversight is crucial to ensure the contractor meets all performance requirements despite the fixed-price structure.

What is the potential impact of excluding specific counties (Berkeley, Jefferson, Morgan) on the overall security effectiveness for ICE operations in West Virginia?

The exclusion of Berkeley, Jefferson, and Morgan counties from the security services contract could indicate several possibilities regarding ICE operations in West Virginia. It might mean that these specific counties do not house critical ICE facilities or assets requiring contracted security, or that alternative security arrangements are already in place for these areas (e.g., in-house personnel, different contracts, or lower security needs). Alternatively, it could suggest a strategic decision to focus resources on higher-priority areas within the state. The impact on overall security effectiveness depends on the operational significance of the excluded counties to ICE's mission in West Virginia. If these areas are critical, the exclusion might create security gaps or necessitate additional, uncontracted security measures.

How does the number of bidders (6) influence the price discovery and potential value for money in this competitive delivery order?

Having six bidders for this competitive delivery order generally suggests a healthy level of competition, which is conducive to better price discovery. When multiple firms vie for a contract, they are incentivized to offer more competitive pricing and potentially more innovative solutions to win the award. This competitive pressure can help drive down costs and ensure that the government secures services at a price closer to the market equilibrium. A higher number of bidders typically reduces the risk of collusion and increases the likelihood that the government selects the offer that provides the best overall value, considering both price and technical factors. Conversely, if the competition were limited to only one or two bidders, there would be a higher risk of non-competitive pricing.

What are the implications of the contract type 'COMPETITIVE DELIVERY ORDER' for future contracting opportunities?

A 'Competitive Delivery Order' typically implies that this order was placed against a pre-existing Indefinite Delivery/Indefinite Quantity (IDIQ) contract or a similar multiple-award contract vehicle. This means that the initial competition likely occurred when the parent IDIQ contract was awarded, establishing a pool of pre-qualified vendors. For future contracting opportunities, this suggests that ICE or other agencies utilizing the same IDIQ vehicle may issue further delivery orders under that contract, potentially with similar competitive procedures or, depending on the IDIQ's terms, streamlined processes for smaller orders. It also indicates that Security Consultants Group Inc. is an established vendor within this framework, potentially positioning them favorably for future orders under the same contract.

Industry Classification

NAICS: Administrative and Support and Waste Management and Remediation Services › Investigation and Security Services › Security Guards and Patrol Services

Product/Service Code: UTILITIES AND HOUSEKEEPING › HOUSEKEEPING SERVICES

Competition & Pricing

Extent Competed: COMPETITIVE DELIVERY ORDER

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: HSCEGI04RF00001

Offers Received: 6

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: SRS Critical Infrastructure Security LLC (UEI: 355790924)

Address: 13655 DULLES TECHNOLOGY DR STE 100, HERNDON, VA, 20171

Business Categories: Category Business, Hispanic American Owned Business, Minority Owned Business, Not Designated a Small Business, Special Designations, Subchapter S Corporation, U.S.-Owned Business, Veteran Owned Business

Financial Breakdown

Contract Ceiling: $34,000,102

Exercised Options: $34,000,102

Current Obligation: $12,555,040

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Parent Contract

Parent Award PIID: GS07F0267L

IDV Type: FSS

Timeline