HUD's $48M Michigan housing contract awarded to Michaelson Connor & Boul without competition

Contract Overview

Contract Amount: $48,024,009 ($48.0M)

Contractor: Michaelson Connor & Boul

Awarding Agency: Department of Housing and Urban Development

Start Date: 2009-09-01

End Date: 2010-09-30

Contract Duration: 394 days

Daily Burn Rate: $121.9K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: SF REO M&M CONTRACT - MICHIGAN (BRIDGE CONTRACT)

Place of Performance

Location: DETROIT, WAYNE County, MICHIGAN, 48201

State: Michigan Government Spending

Plain-Language Summary

Department of Housing and Urban Development obligated $48.0 million to MICHAELSON CONNOR & BOUL for work described as: SF REO M&M CONTRACT - MICHIGAN (BRIDGE CONTRACT) Key points: 1. The contract was awarded on a firm-fixed-price basis, indicating a defined cost for the services. 2. The duration of the contract was approximately 13 months, suggesting a short-term need. 3. The contract was not competed, raising questions about potential cost savings and market fairness. 4. The North American Industry Classification System (NAICS) code 531110 points to lessors of residential buildings and dwellings. 5. The award was made by the Department of Housing and Urban Development (HUD) to Michaelson Connor & Boul. 6. The contract was awarded in Michigan, with specific details on the state and county not provided.

Value Assessment

Rating: questionable

Without a competitive bidding process, it is difficult to benchmark the value for money. The firm-fixed-price contract type suggests a defined cost, but the absence of competition means there's no market validation of this price. Comparing this to similar contracts for residential property management or leasing services would be necessary to assess if the $48 million expenditure was reasonable for the services rendered over the 394-day period.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was explicitly marked as 'NOT COMPETED,' indicating a sole-source award. There is no information available on the number of bidders or the justification for bypassing the competitive process. Sole-source awards can sometimes be justified for specialized services or urgent needs, but they typically limit price discovery and may not yield the best value for taxpayers.

Taxpayer Impact: The lack of competition means taxpayers may have paid a premium compared to what could have been achieved through a bidding process. Without a competitive environment, there's less pressure on the contractor to offer the most cost-effective solution.

Public Impact

The primary beneficiaries of this contract are likely the residents of the housing properties managed under this agreement in Michigan. The services delivered involve the leasing and management of residential buildings. The geographic impact is limited to the state of Michigan. Workforce implications would involve the personnel employed by Michaelson Connor & Boul to manage these properties.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition raises concerns about potential overpricing and reduced value for taxpayer funds.
The short contract duration (394 days) might indicate a temporary need, but the large dollar amount warrants scrutiny.
Absence of detailed performance metrics or outcomes makes it hard to assess the effectiveness of the services provided.

Positive Signals

The contract was awarded on a firm-fixed-price basis, which can provide cost certainty for the government.
The contract was awarded to a single entity, Michaelson Connor & Boul, suggesting they were identified as capable of fulfilling the requirement.

Sector Analysis

This contract falls within the real estate and property management sector, specifically related to residential leasing. The NAICS code 531110, 'Lessors of Residential Buildings and Dwellings,' indicates the nature of the services. Benchmarking this spending would involve comparing it to other federal or state contracts for similar property management services, considering factors like the number of units managed, geographic location, and the scope of services (e.g., maintenance, tenant relations, rent collection).

Small Business Impact

There is no indication that this contract involved small business set-asides or subcontracting opportunities. The award was made directly to Michaelson Connor & Boul, and information regarding their utilization of small businesses is not provided. Further investigation would be needed to determine if any small business participation was mandated or occurred.

Oversight & Accountability

Oversight mechanisms for this contract would typically be managed by the Department of Housing and Urban Development (HUD). As a sole-source award, transparency might be limited unless specific justifications and reporting requirements were stipulated. Assessing accountability would involve reviewing performance reports, payment records, and any audits or reviews conducted by HUD's Office of Inspector General.

Related Government Programs

HUD Public Housing Programs
HUD Rental Assistance Programs
Federal Housing Administration (FHA) Programs

Risk Flags

Sole-source award without clear justification
Lack of competitive bidding may lead to suboptimal pricing
Limited transparency on specific services and performance metrics

Frequently Asked Questions

What is this federal contract paying for?

Department of Housing and Urban Development awarded $48.0 million to MICHAELSON CONNOR & BOUL. SF REO M&M CONTRACT - MICHIGAN (BRIDGE CONTRACT)

Who is the contractor on this award?

The obligated recipient is MICHAELSON CONNOR & BOUL.

Which agency awarded this contract?

Awarding agency: Department of Housing and Urban Development (Department of Housing and Urban Development).

What is the total obligated amount?

The obligated amount is $48.0 million.

What is the period of performance?

Start: 2009-09-01. End: 2010-09-30.

What specific services did Michaelson Connor & Boul provide under this contract?

The contract, identified by NAICS code 531110 ('Lessors of Residential Buildings and Dwellings'), indicates that Michaelson Connor & Boul was responsible for services related to the leasing and management of residential properties. This could encompass a range of activities such as tenant acquisition and screening, rent collection, property maintenance, lease enforcement, and ensuring compliance with housing regulations. However, the provided data does not detail the precise scope of services or the number of units managed. Further documentation from the Department of Housing and Urban Development (HUD) would be required to ascertain the full extent of their responsibilities and the specific deliverables expected under the $48 million contract.

Why was this contract awarded on a sole-source basis instead of being competed?

The provided data explicitly states the contract was 'NOT COMPETED,' classifying it as a sole-source award. The specific justification for this decision is not included in the abbreviated data. Typically, sole-source contracts are awarded when only one responsible source is available, or when a compelling justification exists, such as urgent and unanticipated needs, or when the service is highly specialized and only one contractor can provide it. Without the official justification documentation from HUD, it is impossible to determine the exact reasons. This lack of competition is a significant point of concern regarding potential value for money and adherence to procurement best practices.

How does the $48 million contract value compare to similar property management contracts?

Benchmarking the $48 million contract value is challenging without more specific details on the services rendered and the scale of operations. The contract duration was approximately 394 days (about 13 months). To compare, one would need to identify similar HUD or other federal/state agency contracts for residential property management in Michigan or comparable regions. Key metrics for comparison would include the number of units managed, the types of properties (e.g., single-family homes, multi-unit dwellings), the scope of services (full-service management vs. specific tasks), and the contract type (firm-fixed-price). A higher per-unit management cost or a significantly higher total cost for a similar duration and service scope would indicate potential overpricing.

What is the track record of Michaelson Connor & Boul with federal contracts?

The provided data indicates Michaelson Connor & Boul was awarded this $48 million contract by HUD. To assess their track record, a broader search of federal procurement databases (like SAM.gov or FPDS) would be necessary to identify all contracts awarded to this entity, their values, agencies involved, performance history, and any past performance issues or awards. Understanding their history with other federal agencies, particularly HUD, would provide context on their reliability, experience, and potentially their pricing strategies on government contracts.

What were the potential risks associated with this sole-source contract?

The primary risk associated with this sole-source contract is the potential for a lack of value for money. Without competition, the government may not have secured the most favorable pricing or the highest quality of service. There's also a risk of contractor complacency, as there is less incentive to innovate or improve efficiency when a competitor is not vying for the business. Furthermore, sole-source awards can sometimes indicate a lack of adequate planning or market research by the contracting agency. The absence of a competitive process limits transparency and makes it harder to ensure accountability for performance and cost.

What is the significance of the NAICS code 531110 for this contract?

The North American Industry Classification System (NAICS) code 531110, 'Lessors of Residential Buildings and Dwellings,' signifies that the core business activity related to this contract involves the leasing and management of residential properties. This code helps categorize the contract within the broader economy and allows for comparisons with other businesses and contracts in the same industry. For HUD, this indicates the contract was likely for managing a portfolio of residential units, potentially including tasks like finding tenants, collecting rent, maintaining the properties, and handling lease agreements. It places the contract within the real estate services sector.

Industry Classification

NAICS: Real Estate and Rental and Leasing › Lessors of Real Estate › Lessors of Residential Buildings and Dwellings

Product/Service Code: MAINT, REPAIR, ALTER REAL PROPERTY › MAINT, ALTER, REPAIR BUILDINGS

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 5312 BOLSA AVE STE 200, HUNTINGTON BEACH, CA, 47

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

Financial Breakdown

Contract Ceiling: $48,024,009

Exercised Options: $48,024,009

Current Obligation: $48,024,009

Contract Characteristics

Cost or Pricing Data: NO

Timeline