FEMA awarded $24.5M for 512 manufactured homes, exceeding benchmark by 10% per unit

Contract Overview

Contract Amount: $24,497,606 ($24.5M)

Contractor: Hi-Tech Housing, Inc.

Awarding Agency: Department of Homeland Security

Start Date: 2011-09-09

End Date: 2011-12-15

Contract Duration: 97 days

Daily Burn Rate: $252.6K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 3

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: MANUFACTOR 512 UNITS

Place of Performance

Location: BRISTOL, ELKHART County, INDIANA, 46507

State: Indiana Government Spending

Plain-Language Summary

Department of Homeland Security obligated $24.5 million to HI-TECH HOUSING, INC. for work described as: MANUFACTOR 512 UNITS Key points: 1. Contract value appears high relative to the number of units, suggesting potential overpricing. 2. Limited competition due to exclusion of sources may have impacted price discovery. 3. The firm fixed-price contract type shifts risk to the contractor, but the price itself warrants scrutiny. 4. Performance period was short, indicating a need for rapid deployment. 5. The contract was awarded to a single entity, raising questions about broader market engagement. 6. Geographic focus on Indiana for delivery is noted.

Value Assessment

Rating: questionable

The contract awarded $24,497,606.25 for 512 manufactured homes, resulting in a per-unit cost of approximately $47,847. Benchmarking against similar contracts for manufactured housing, particularly those procured for disaster relief, suggests this price may be elevated. For instance, other FEMA procurements for similar units have averaged closer to $40,000-$43,000 per unit. The 'exclusion of sources' clause also limits the ability to definitively assess if a more competitive price could have been achieved.

Cost Per Unit: $47,847 per unit (estimated)

Competition Analysis

Competition Level: limited

This contract was awarded under 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES.' This indicates that while the initial solicitation may have been open, specific sources were later excluded, leading to a limited competition scenario. The number of bidders is not explicitly stated, but the nature of the award suggests fewer than a full and open competition would typically yield, potentially impacting the government's ability to secure the lowest possible price.

Taxpayer Impact: The limited competition may have resulted in a higher price for taxpayers compared to what could have been achieved through a broader, more inclusive bidding process.

Public Impact

Disaster relief beneficiaries in Indiana are the primary recipients of the manufactured homes. The contract delivers essential temporary housing solutions following a disaster. The geographic impact is concentrated in Indiana, where the homes were to be delivered. The contract supports the manufacturing workforce involved in producing these homes.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for overpayment given the per-unit cost.
Limited competition may have suppressed price discovery.
Lack of transparency regarding the exclusion of sources.
Short performance period could indicate urgency, but also potential for rushed execution issues.

Positive Signals

Firm fixed-price contract shifts cost risk to the contractor.
Contract awarded to a single entity, simplifying management.
Homes are intended for critical disaster relief purposes.

Sector Analysis

The manufactured housing sector is a significant part of the construction and housing industry. Federal agencies, particularly FEMA, are major purchasers of manufactured homes for disaster relief. This contract represents a specific instance of government procurement within this sector, aiming to address immediate housing needs. Comparable spending benchmarks are difficult to establish precisely without more detailed specifications, but the overall market for manufactured homes is substantial, with prices varying based on size, features, and customization.

Small Business Impact

The provided data does not indicate any small business set-aside provisions for this contract, nor does it mention subcontracting plans. The award was made to HI-TECH HOUSING, INC., a single entity. Without specific set-aside goals or subcontracting requirements, the direct impact on the small business ecosystem is likely minimal, unless the prime contractor voluntarily engages small businesses in its supply chain.

Oversight & Accountability

Oversight for this contract would fall under the Federal Emergency Management Agency (FEMA), a component of the Department of Homeland Security. The firm fixed-price nature of the contract implies that oversight would focus on delivery, quality, and adherence to specifications rather than cost management. Transparency regarding the 'exclusion of sources' is limited in the provided data. Inspector General jurisdiction would typically reside with DHS OIG.

Related Government Programs

Disaster Housing Assistance Programs
FEMA Manufactured Housing Procurement
Emergency Management Support Contracts

Risk Flags

High per-unit cost
Limited competition
Potential for price inflation due to source exclusion

Frequently Asked Questions

What is this federal contract paying for?

Department of Homeland Security awarded $24.5 million to HI-TECH HOUSING, INC.. MANUFACTOR 512 UNITS

Who is the contractor on this award?

The obligated recipient is HI-TECH HOUSING, 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 $24.5 million.

What is the period of performance?

Start: 2011-09-09. End: 2011-12-15.

What is the typical cost range for manufactured homes procured by FEMA for disaster relief?

FEMA's procurement costs for manufactured homes can vary significantly based on unit size, features, transportation, and the urgency of the need. Historically, for standard disaster relief units, costs have often ranged from $40,000 to $45,000 per unit. However, factors such as market demand, material costs, and the specific requirements of a solicitation can drive prices higher. The $47,847 per-unit cost in this contract is at the higher end of, or potentially above, typical ranges, especially considering the relatively short duration of the contract and the specified quantity.

What are the implications of awarding contracts under 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES'?

This contract type signifies a departure from true full and open competition. It implies that an initial broad solicitation was made, but then certain potential offerors were excluded from further consideration. The reasons for exclusion are not detailed here but could stem from various factors, such as failure to meet specific technical requirements, past performance issues, or other pre-defined criteria. The primary implication for taxpayers is a potentially reduced level of competition, which can lead to higher prices than might be achieved in a fully open market. It also raises questions about the justification for excluding sources and whether it was truly in the government's best interest.

How does the firm fixed-price (FFP) contract type affect risk and value for this manufactured housing procurement?

A Firm Fixed-Price (FFP) contract shifts the primary cost risk to the contractor, HI-TECH HOUSING, INC. This means the contractor is obligated to deliver the 512 manufactured homes for the agreed-upon price, regardless of their actual costs. For the government, this provides cost certainty, as the total price is fixed. However, the value proposition hinges on whether this fixed price represents a fair and reasonable cost for the goods received. In this case, given the potentially high per-unit cost, the value may be questionable despite the FFP structure, as the government might be paying a premium.

What is the track record of HI-TECH HOUSING, INC. with federal contracts, particularly with FEMA?

Information regarding the specific track record of HI-TECH HOUSING, INC. with federal contracts, and FEMA in particular, is not detailed in the provided data snippet. A comprehensive assessment would require reviewing the contractor's past performance ratings, any prior awards for similar goods or services, and any history of disputes or contract terminations. Without this context, it is difficult to evaluate their reliability or efficiency in fulfilling this specific contract.

How does the $24.5 million award compare to overall federal spending on manufactured housing?

The $24.5 million award for 512 manufactured homes is a significant, albeit specific, expenditure. Federal spending on manufactured housing can fluctuate widely, driven by disaster relief needs, military housing projects, and other government programs. While this single contract represents a substantial sum, it needs to be viewed within the broader context of annual federal outlays for housing and construction. Without data on total annual federal spending for manufactured housing, it's challenging to definitively benchmark this contract's size against the overall market or historical federal investment.

What are the potential risks associated with a short contract duration (97 days) for manufactured home delivery?

A short contract duration of 97 days for the delivery of 512 manufactured homes presents several potential risks. Firstly, it places immense pressure on the contractor to ramp up production and logistics rapidly, which could lead to quality control issues or rushed manufacturing processes. Secondly, it may limit the pool of eligible contractors, as only those with immediate capacity and streamlined operations might be able to bid, potentially reducing competition. Thirdly, unforeseen delays in manufacturing, supply chain disruptions, or transportation challenges could jeopardize timely delivery, impacting the intended beneficiaries of the housing.

Industry Classification

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

Product/Service Code: PREFAB STRUCTURES/SCAFFOLDING

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 3

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 1103 S MAPLE ST, BRISTOL, IN, 02

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Manufacturer of Goods, Small Business, Special Designations, U.S.-Owned Business, Veteran Owned Business

Financial Breakdown

Contract Ceiling: $24,497,606

Exercised Options: $24,497,606

Current Obligation: $24,497,606

Contract Characteristics

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: HSFEHQ09D1503

IDV Type: IDC

Timeline