DHS awards $18.9M contract for airport screening services, with Raytheon Company as the sole awardee

Contract Overview

Contract Amount: $18,982,350 ($19.0M)

Contractor: Raytheon Company

Awarding Agency: Department of Homeland Security

Start Date: 2007-05-24

End Date: 2014-12-31

Contract Duration: 2,778 days

Daily Burn Rate: $6.8K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 9

Pricing Type: COST PLUS AWARD FEE

Sector: Other

Official Description: SCREENING SERVICES AT KEY WEST INTERNATIONAL AIRPORT (EYW) AND THE FLORIDA KEYS MARATHON AIRPORT (MTH)

Place of Performance

Location: KEY WEST, MONROE County, FLORIDA, 33040

State: Florida Government Spending

Plain-Language Summary

Department of Homeland Security obligated $19.0 million to RAYTHEON COMPANY for work described as: SCREENING SERVICES AT KEY WEST INTERNATIONAL AIRPORT (EYW) AND THE FLORIDA KEYS MARATHON AIRPORT (MTH) Key points: 1. The contract value of $18.9 million over its duration suggests a significant investment in airport security. 2. The 'FULL AND OPEN COMPETITION' indicates a broad solicitation, but only one awardee was ultimately selected. 3. The contract type 'COST PLUS AWARD FEE' can incentivize performance but may lead to less predictable final costs. 4. The duration of the contract (2778 days) points to a long-term need for these screening services. 5. The North American Industry Classification System (NAICS) code 561612 categorizes this as Security Guards and Patrol Services. 6. The contract was awarded by the Department of Homeland Security, specifically the Transportation Security Administration (TSA).

Value Assessment

Rating: fair

Benchmarking the value of this contract is challenging without specific per-unit cost data for screening services. However, the total award of $18.9 million over approximately 7.6 years (2778 days) averages to roughly $2.48 million per year. This figure needs to be contextualized against the scale of operations at Key West International Airport (EYW) and Florida Keys Marathon Airport (MTH). The 'COST PLUS AWARD FEE' contract type introduces variability in the final cost, making direct price comparisons difficult. It suggests that the government is willing to pay for performance but also accepts some cost uncertainty.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under 'FULL AND OPEN COMPETITION,' suggesting that the solicitation was broadly advertised to all eligible offerors. However, the data indicates only one awardee, Raytheon Company. This could imply that while many may have bid, only one met the stringent requirements, or that the competition ultimately narrowed down to a single viable option. The presence of multiple bidders is not explicitly stated, but the 'full and open' designation implies an intention for broad market engagement.

Taxpayer Impact: A full and open competition, even with a single awardee, theoretically allows for market forces to influence pricing. Taxpayers benefit from the potential for competitive pricing, although the final cost is also influenced by the contract type.

Public Impact

The primary beneficiaries are travelers using Key West International Airport (EYW) and Florida Keys Marathon Airport (MTH), who receive enhanced security screening. The services delivered include security guard and patrol functions essential for airport operations and passenger safety. The geographic impact is concentrated in South Florida, specifically serving the airports in Key West and Marathon. The contract supports jobs within the security services sector, likely employing personnel for screening and related duties.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

The 'COST PLUS AWARD FEE' structure can lead to costs exceeding initial estimates if performance targets are aggressively pursued or if unforeseen expenses arise.
Limited transparency on the specific performance metrics and award fee structure makes it difficult to assess if the government received optimal value for the fees paid.
The long contract duration could potentially reduce flexibility to adopt newer, more efficient screening technologies if they emerge during the contract period.

Positive Signals

The 'FULL AND OPEN COMPETITION' indicates an effort to leverage the broader market for security services.
The contract's long duration suggests a stable and reliable provision of essential security services for the specified airports.
The award to Raytheon Company, a known entity in defense and security, may indicate a level of confidence in their capability to perform.

Sector Analysis

This contract falls within the broader security and protective services sector, specifically focusing on airport screening. The market for airport security services is substantial, driven by regulatory requirements and the need for passenger and baggage screening. Comparable spending benchmarks would typically involve analyzing other TSA contracts for similar services at airports of comparable size and traffic volume. Raytheon Company is a major player in defense and aerospace, with significant capabilities in security and technology solutions.

Small Business Impact

The data indicates that this contract was not set aside for small businesses (ss: false, sb: false). Therefore, there are no direct subcontracting implications for small businesses mandated by a set-aside. The primary contractor, Raytheon Company, is a large corporation, and any subcontracting opportunities would be at their discretion, not driven by a small business set-aside requirement.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of Homeland Security (DHS) and the Transportation Security Administration (TSA). As a 'COST PLUS AWARD FEE' contract, oversight would focus on monitoring contractor performance against established award criteria and ensuring that costs incurred are reasonable and allocable. Transparency is facilitated through contract award databases, but detailed performance metrics and fee structures may not be publicly disclosed. Inspector General jurisdiction would apply for investigations into fraud, waste, or abuse.

Related Government Programs

Transportation Security Administration (TSA) Airport Security Contracts
Department of Homeland Security (DHS) Security Services
Airport Screening and Security Services
Federal Aviation Administration (FAA) Airport Operations Support

Risk Flags

Cost Plus Award Fee contract type may lead to higher final costs than anticipated.
Limited public data on specific performance metrics makes value assessment challenging.
Long contract duration could impact adoption of newer technologies.

Frequently Asked Questions

What is this federal contract paying for?

Department of Homeland Security awarded $19.0 million to RAYTHEON COMPANY. SCREENING SERVICES AT KEY WEST INTERNATIONAL AIRPORT (EYW) AND THE FLORIDA KEYS MARATHON AIRPORT (MTH)

Who is the contractor on this award?

The obligated recipient is RAYTHEON COMPANY.

Which agency awarded this contract?

Awarding agency: Department of Homeland Security (Transportation Security Administration).

What is the total obligated amount?

The obligated amount is $19.0 million.

What is the period of performance?

Start: 2007-05-24. End: 2014-12-31.

What was the specific performance criteria used to determine award fees for Raytheon Company under this contract?

The specific performance criteria used to determine award fees for Raytheon Company are not detailed in the provided data. Contracts of the 'COST PLUS AWARD FEE' (CPAF) type typically establish a set of measurable performance objectives. These objectives can range from operational efficiency metrics (e.g., screening wait times, throughput), adherence to security protocols, equipment maintenance, personnel training, and customer satisfaction. The government's contracting officer would evaluate Raytheon's performance against these pre-defined criteria. Based on this evaluation, an award fee, which is a variable amount intended to incentivize superior performance, would be determined. Without access to the contract's Performance Work Statement (PWS) or the award fee plan, the exact metrics remain undisclosed.

How does the annual cost of this contract compare to similar airport screening contracts awarded by the TSA?

Direct comparison of the annual cost ($~2.48 million) to similar TSA contracts is difficult without more granular data on airport size, passenger volume, and specific service requirements. However, the TSA procures screening services across numerous airports, with costs varying significantly. Larger airports with higher passenger traffic typically incur higher screening costs due to the scale of operations and technology deployed. Contracts can also differ in scope, including the types of screening (e.g., passenger, baggage, cargo), the technology used, and the level of security personnel required. The 'COST PLUS AWARD FEE' nature of this contract also introduces variability, making simple annual cost comparisons less precise than fixed-price contracts.

What were the primary risks identified during the solicitation process for this airport screening contract?

The primary risks identified during the solicitation process for this airport screening contract likely centered around ensuring consistent and effective security screening operations at two distinct airports. Key risks could include the contractor's ability to recruit, train, and retain qualified security personnel, especially in potentially competitive labor markets. Operational risks might involve maintaining screening equipment, managing passenger flow efficiently, and adapting to evolving security threats and TSA directives. Furthermore, the 'COST PLUS AWARD FEE' structure itself presents a risk of cost overruns if not managed tightly, requiring robust government oversight to ensure value for money. Ensuring compliance with all federal security regulations and performance standards would also be a critical risk area.

What is Raytheon Company's track record in providing security guard and patrol services, particularly for government contracts?

Raytheon Company, now part of RTX Corporation, has an extensive track record in providing a wide array of services to the U.S. government, primarily in defense, aerospace, and intelligence sectors. While their core business is often associated with advanced technology and defense systems, they also possess capabilities in logistics, technical services, and security operations. Their experience in managing large, complex government contracts suggests a capacity for handling significant operational requirements like airport screening. Specific to security guard and patrol services, Raytheon has been involved in providing security for government facilities and critical infrastructure, leveraging their project management expertise and security clearances. Their performance on this specific TSA contract would be a key indicator of their capabilities in this niche.

How has federal spending on airport screening services evolved over the period of this contract (2007-2014)?

Federal spending on airport screening services, particularly managed by the TSA, has seen significant evolution, especially following the September 11, 2001 attacks. The period of this contract (2007-2014) falls within a phase of established security protocols post-9/11. Spending during this time was likely influenced by ongoing efforts to enhance security measures, deploy new screening technologies (like advanced imaging technology - AIT), and maintain a consistent workforce. While specific aggregate spending figures for airport screening services are not readily available in this data, it's understood that TSA's budget is substantial and allocated across various security functions, including personnel, technology, and infrastructure. Spending trends would reflect national security priorities, technological advancements, and operational needs at airports nationwide.

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: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 9

Pricing Type: COST PLUS AWARD FEE (R)

Evaluated Preference: NONE

Contractor Details

Address: 12160 SUNRISE VALLEY DR, RESTON, VA, 20191

Business Categories: Category Business, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $60,996,138

Exercised Options: $26,488,580

Current Obligation: $18,982,350

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Timeline