FEMA awarded $20.9M for mobile homes, with a significant portion allocated to a single Indiana manufacturer

Contract Overview

Contract Amount: $20,886,239 ($20.9M)

Contractor: TL Industries, Inc.

Awarding Agency: Department of Homeland Security

Start Date: 2008-11-19

End Date: 2008-12-31

Contract Duration: 42 days

Daily Burn Rate: $497.3K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: MANUFACTOR AND DELIVER MOBIL HOMES

Place of Performance

Location: ELKHART, ELKHART County, INDIANA, 46514

State: Indiana Government Spending

Plain-Language Summary

Department of Homeland Security obligated $20.9 million to TL INDUSTRIES, INC. for work described as: MANUFACTOR AND DELIVER MOBIL HOMES Key points: 1. The contract's value, while substantial, requires scrutiny against the number of units and delivery timeline. 2. Competition dynamics appear limited, with the award going to a single, established Indiana-based firm. 3. Risk indicators include the tight delivery window and the potential for supply chain disruptions for specialized housing. 4. Performance context is critical, as the success of this contract hinges on timely delivery and quality of the manufactured homes. 5. Sector positioning places this within the broader emergency response and disaster relief procurement landscape. 6. The fixed-price nature of the contract shifts cost overrun risk to the contractor, but may have influenced initial pricing.

Value Assessment

Rating: fair

The contract awarded $20.9 million for manufactured homes. Benchmarking this requires understanding the specific unit size, features, and delivery locations. Without more granular data on the number of units and their specifications, a direct value-for-money assessment is challenging. However, the average price per unit appears to be approximately $65,000 based on the total award and the number of units (321,991). This figure needs to be compared against market rates for similar emergency housing solutions, considering factors like transport and setup.

Cost Per Unit: Approximately $65,000 per unit, requiring market comparison for emergency-grade manufactured housing.

Competition Analysis

Competition Level: limited

The contract was awarded under 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES,' which suggests an initial broad solicitation followed by a more restricted process. The specific reasons for excluding other sources are not detailed here. The fact that the award went to a single contractor, TL INDUSTRIES, INC., indicates that either only one bidder met the stringent requirements or the competition was narrowed significantly. This limited competition could potentially lead to less favorable pricing for the government.

Taxpayer Impact: Limited competition may result in higher prices for taxpayers compared to a scenario with multiple competitive bids. The government may not have achieved the best possible price due to fewer viable options.

Public Impact

Disaster-affected populations in areas designated by FEMA will benefit from the provision of temporary housing. The contract delivers manufactured homes, a critical component of emergency response and recovery efforts. The geographic impact is likely concentrated in disaster zones requiring immediate housing solutions. Workforce implications may include temporary employment at the manufacturing facility in Indiana and potentially in logistics and deployment.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for delays in delivery given the short contract duration (approx. 1 month).
Quality control of manufactured homes is crucial to ensure habitability and safety.
Logistical challenges in transporting and deploying a large number of mobile homes.
Dependence on a single manufacturer could create supply chain vulnerabilities if unforeseen issues arise.

Positive Signals

The contract specifies a firm fixed price, providing cost certainty for FEMA.
The award to an established manufacturer suggests a degree of reliability in production capabilities.
The contract aims to address an urgent need for housing in disaster situations.

Sector Analysis

This contract falls within the broader construction and manufacturing sector, specifically focusing on prefabricated and modular housing. The market for manufactured homes is diverse, ranging from individual sales to large-scale government contracts for disaster relief or military housing. FEMA's procurement of mobile homes is a critical, albeit episodic, component of its disaster response strategy, often requiring rapid deployment and adherence to specific standards. Comparable spending benchmarks would involve other large-scale housing procurements for emergency or transitional purposes.

Small Business Impact

The contract does not indicate any specific small business set-aside provisions (sb=false). There is no explicit mention of subcontracting goals for small businesses. Therefore, the direct impact on the small business ecosystem is likely minimal unless TL INDUSTRIES, INC. voluntarily engages small businesses in its supply chain or subcontracting efforts.

Oversight & Accountability

Oversight for this contract would primarily fall under the Federal Emergency Management Agency (FEMA), a component of the Department of Homeland Security. Accountability measures would include adherence to the contract's delivery schedule, quality specifications, and pricing. Transparency is generally facilitated through federal procurement databases like FPDS. Inspector General jurisdiction would lie with the Department of Homeland Security's Office of Inspector General, which investigates fraud, waste, and abuse in federal programs.

Related Government Programs

Disaster Housing Assistance Program
Temporary Housing Program
Emergency Management and Response Contracts
Manufactured Housing Procurement

Risk Flags

Significant increase from base contract value to award value.
Limited competition indicated by single award.
Short contract duration poses delivery risks.
Potential ambiguity in unit count and per-unit cost calculation.

Frequently Asked Questions

What is this federal contract paying for?

Department of Homeland Security awarded $20.9 million to TL INDUSTRIES, INC.. MANUFACTOR AND DELIVER MOBIL HOMES

Who is the contractor on this award?

The obligated recipient is TL INDUSTRIES, INC..

Which agency awarded this contract?

Awarding agency: Department of Homeland Security (Federal Emergency Management Agency).

What is the total obligated amount?

The obligated amount is $20.9 million.

What is the period of performance?

Start: 2008-11-19. End: 2008-12-31.

What was the specific justification for the 'exclusion of sources' in this full and open competition?

The contract type 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES' (FPDS code CT) indicates that while the procurement was initially intended to be open, certain sources were subsequently excluded. The specific justification for this exclusion is not provided in the summary data. Typically, such exclusions might occur if only a limited number of vendors possess the necessary specialized capabilities, security clearances, or if the solicitation process led to the disqualification of all but one or a few bidders based on technical proposals or past performance. Without further documentation, the precise reason remains speculative, but it suggests a narrowing of the competitive field after an initial open phase.

How does the per-unit cost of these manufactured homes compare to typical market rates for similar emergency housing?

The approximate per-unit cost derived from this contract is around $65,000 ($20.9M / 321,991 units). This figure needs careful contextualization. The number of units (321,991) seems exceptionally high for a single contract award of this value, suggesting a potential data anomaly or a misunderstanding of the 'NA' field (which is '321991' - possibly a product code or classification, not the number of units). If we assume 'NO' (number of offers) is 1, and 'BR' (base contract value) is $4,972,910, and 'AW' (award value) is $20,886,238.90, the unit count is still unclear. If we assume the 'NA' field is indeed the number of units, the per-unit cost is extremely low for a manufactured home. However, if 'NA' is a classification code, and the number of units is not explicitly stated but implied to be much smaller, the cost per unit could be significantly higher. For emergency housing, market rates can vary widely based on size, features, transport, and setup. A typical manufactured home can range from $50,000 to over $150,000. Without clarity on the number of units, a precise comparison is impossible, but the stated $65,000 figure (if accurate for the number of units) would be on the lower end for a fully equipped, delivered mobile home.

What are the primary risks associated with this contract, given its short duration and the nature of the product?

The primary risks associated with this contract revolve around timely delivery and quality assurance. The contract duration is extremely short (November 19, 2008, to December 31, 2008), leaving little room for manufacturing delays, transportation issues, or unforeseen logistical challenges. Given that these are manufactured homes intended for emergency use, ensuring they meet habitability and safety standards is paramount. A risk also exists in the potential for supply chain disruptions affecting TL INDUSTRIES, INC., especially if they rely on specialized components or materials. Furthermore, the concentration of the award to a single entity could pose a risk if that entity faces production issues, potentially jeopardizing FEMA's ability to meet immediate housing needs post-disaster.

What does the 'st': 'IN' and 'sn': 'INDIANA' signify in relation to the contractor and the contract?

The 'st': 'IN' and 'sn': 'INDIANA' fields indicate the state and state name where the contractor, TL INDUSTRIES, INC., is located or primarily operates. This suggests that the manufacturing of the mobile homes likely took place in Indiana. For a contract involving the delivery of physical goods like manufactured homes, the contractor's location is relevant for logistical planning, transportation costs, and potentially for understanding regional economic impacts. It also provides context for the contractor's operational base and potential capacity.

How does the award value compare to the base contract value, and what does this difference imply?

The award value (AW) is $20,886,238.90, while the base contract value (BR) is $4,972,910. This significant difference, nearly a four-fold increase from the base to the award value, implies that the contract was substantially modified or exercised options beyond its initial scope. Such increases can occur due to evolving needs, unforeseen circumstances requiring more units or services, or the exercise of contract options. It raises questions about the initial contract planning and whether the base value accurately reflected the anticipated total requirement. While contract modifications are common, a near quadrupling of the value warrants scrutiny to ensure the changes were justified, competitively priced (if applicable), and aligned with the government's best interests.

What is the significance of 'pt': 'FIRM FIXED PRICE' for this contract?

The contract type 'FIRM FIXED PRICE' (FFP) means that the price is set and not subject to adjustment based on the contractor's cost experience. For FEMA, this offers significant cost certainty, as the total expenditure is known upfront, barring any contract modifications. The risk of cost overruns is borne entirely by the contractor, TL INDUSTRIES, INC. This contract type is generally preferred by the government when the scope of work is well-defined and the risks are manageable. However, contractors often build in a contingency premium into FFP bids to account for potential risks, which could mean the initial price might be higher than if it were a cost-reimbursable contract, but it protects the government from unexpected cost increases.

Industry Classification

NAICS: Manufacturing › Other Wood Product Manufacturing › Manufactured Home (Mobile Home) Manufacturing

Product/Service Code: ARCHITECT/ENGINEER SERVICES › ARCH-ENG SVCS - CONSTRUCTION

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: HSFEHQ-08-R-0068

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 25876 MINER RD, ELKHART, IN, 02

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Labor Surplus Area Firm, Manufacturer of Goods, Small Business, Special Designations, Subchapter S Corporation

Financial Breakdown

Contract Ceiling: $38,270,750

Exercised Options: $38,270,750

Current Obligation: $20,886,239

Parent Contract

Parent Award PIID: HSFEHQ08D1145

IDV Type: IDC

Timeline