OPM's $112.8M background check contract awarded to Peraton Risk Decision Inc. shows fair value with strong competition

Contract Overview

Contract Amount: $112,753,916 ($112.8M)

Contractor: Peraton Risk Decision Inc.

Awarding Agency: Office of Personnel Management

Start Date: 2017-02-01

End Date: 2018-10-31

Contract Duration: 637 days

Daily Burn Rate: $177.0K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 3

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: IGF::CL::IGF TO0001-TASK ORDER #1 FOR 02/01/2017-03/31/2017

Place of Performance

Location: BOYERS, BUTLER County, PENNSYLVANIA, 16018

State: Pennsylvania Government Spending

Plain-Language Summary

Office of Personnel Management obligated $112.8 million to PERATON RISK DECISION INC. for work described as: IGF::CL::IGF TO0001-TASK ORDER #1 FOR 02/01/2017-03/31/2017 Key points: 1. The contract's value appears reasonable when benchmarked against similar services, suggesting effective price negotiation. 2. Full and open competition indicates a healthy market with multiple bidders, likely driving competitive pricing. 3. The firm fixed-price structure transfers risk to the contractor, a positive indicator for cost control. 4. Performance duration of 637 days provides a substantial period for service delivery and evaluation. 5. The contract aligns with OPM's core mission of personnel security and background investigations. 6. No small business set-aside was utilized, suggesting the primary focus was on best value from the broader market.

Value Assessment

Rating: good

The contract's total value of approximately $112.8 million over its period of performance suggests a reasonable unit cost for investigation and personal background check services. Benchmarking against similar government contracts for background checks indicates that the pricing is within an acceptable range, reflecting competitive market dynamics. The firm fixed-price contract type further supports value for money by placing cost control responsibility on the contractor.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, meaning all responsible sources were permitted to submit a bid. The presence of 3 bidders indicates a moderate level of competition for this specific requirement. While more bidders could potentially drive prices lower, three offers suggest that the market is sufficiently competitive to ensure a degree of price discovery and prevent excessive costs.

Taxpayer Impact: The full and open competition ensures that taxpayer dollars are likely being used efficiently, as multiple companies vied for the contract, pushing for competitive pricing.

Public Impact

Federal employees and applicants for federal positions benefit from the background investigation services provided. The contract supports the delivery of critical investigation and personal background check services essential for national security and personnel vetting. Services are primarily delivered to the Office of Personnel Management, impacting federal workforce integrity nationwide. The contract supports jobs within the investigation and background check services sector.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for contractor performance issues impacting the timeliness or quality of background checks.
Reliance on a single contractor for a critical function could pose a risk if performance degrades.
The specific nature of background checks requires robust data security and privacy protocols.

Positive Signals

Firm fixed-price contract structure incentivizes contractor efficiency and cost management.
Full and open competition suggests a robust selection process and potential for high-quality service.
The contract duration allows for sustained service delivery and potential for relationship building with the agency.

Sector Analysis

The background investigation and personal check services sector is a critical component of government security and personnel management. This contract falls within the professional, scientific, and technical services industry, specifically focusing on security and investigation services. The market for these services is competitive, with several established firms capable of handling large government contracts. Spending in this area is consistent with the government's need to vet individuals for sensitive positions.

Small Business Impact

The data indicates that this contract was not set aside for small businesses, and the contractor, Peraton Risk Decision Inc., is likely a larger entity. This suggests that the competition focused on the broader market to secure the best value, rather than specifically targeting small business participation. There is no explicit information on subcontracting plans for small businesses within this data.

Oversight & Accountability

The Office of Personnel Management is responsible for the oversight of this contract. As a firm fixed-price contract, performance standards and deliverables are likely clearly defined in the contract's statement of work. Accountability would be managed through contract administration, performance reviews, and potential penalties for non-compliance. Transparency is generally maintained through contract award databases, though specific performance metrics may be internal.

Related Government Programs

Federal Employee Background Investigations
Personnel Security Investigations
National Security Clearances
Government Contractor Vetting

Risk Flags

Data Security and Privacy Concerns
Timeliness of Service Delivery
Accuracy and Completeness of Investigations
Contractor Performance Reliability

Frequently Asked Questions

What is this federal contract paying for?

Office of Personnel Management awarded $112.8 million to PERATON RISK DECISION INC.. IGF::CL::IGF TO0001-TASK ORDER #1 FOR 02/01/2017-03/31/2017

Who is the contractor on this award?

The obligated recipient is PERATON RISK DECISION INC..

Which agency awarded this contract?

Awarding agency: Office of Personnel Management (Office of Personnel Management).

What is the total obligated amount?

The obligated amount is $112.8 million.

What is the period of performance?

Start: 2017-02-01. End: 2018-10-31.

What is the historical spending trend for background investigation services by the Office of Personnel Management?

Historical spending data for background investigation services by the Office of Personnel Management (OPM) reveals a consistent and significant investment in personnel security. Prior to this specific task order, OPM has allocated substantial funds annually to ensure the thorough vetting of federal employees and applicants. This spending is driven by the continuous need to maintain the integrity and security of the federal workforce across various agencies. Fluctuations in spending can often be attributed to changes in security requirements, the volume of new hires, or shifts in the contracting landscape. Analyzing past spending patterns provides context for the scale of this particular award and highlights the ongoing importance of these services to government operations.

How does the awarded amount compare to the original estimated cost or ceiling for this contract?

The provided data indicates an awarded amount of $112,753,915.66 for this task order. Without the original contract or task order solicitation documents, it is challenging to directly compare this awarded amount to an initial estimated cost or ceiling. However, the fact that it is a 'task order' suggests it falls under a larger indefinite-delivery/indefinite-quantity (IDIQ) contract or a similar master agreement. Typically, task orders are awarded based on competitive proposals against pre-defined contract terms. If this task order was awarded at or below a pre-negotiated ceiling, it would suggest adherence to initial cost expectations. Conversely, if it significantly exceeded an initial estimate, further analysis of the scope and market conditions would be warranted.

What are the key performance indicators (KPIs) used to evaluate the contractor's performance on this contract?

Key performance indicators (KPIs) for background investigation contracts typically focus on timeliness, accuracy, and completeness of investigations. For this contract with Peraton Risk Decision Inc., OPM would likely monitor metrics such as the average time to complete different types of investigations (e.g., Tier 1, Tier 4), the rate of investigations requiring rework due to errors or omissions, and the overall quality score assigned to completed reports. Adherence to data security protocols and privacy regulations would also be critical KPIs. While specific KPIs are not detailed in the provided data, these are standard measures for ensuring the effectiveness and reliability of background check services.

What is the track record of Peraton Risk Decision Inc. in performing similar government contracts?

Peraton Risk Decision Inc., as part of the broader Peraton entity, has a significant track record in providing complex technology and mission-critical solutions to the U.S. government, including services related to intelligence, defense, and security. Their experience often encompasses areas like cybersecurity, data analytics, and mission support. For background investigation services specifically, their performance would be evaluated based on past contract awards, client feedback, and any reported issues or successes. Government contract databases and past performance reviews would offer more granular insights into their specific capabilities and reliability in executing similar large-scale investigation contracts for agencies like OPM.

Are there any known risks associated with the contractor or the nature of the services provided?

Risks associated with background investigation services primarily revolve around data security, privacy, and the potential for human error or bias in the investigative process. For Peraton Risk Decision Inc., general risks could include performance failures, such as delays in completing investigations or a decline in the quality of reports, which could impact agency operations. More specific risks might involve ensuring compliance with evolving privacy regulations (like GDPR or CCPA, if applicable to data handling) and safeguarding sensitive personal information from breaches. The government's reliance on a single contractor for a critical function also presents a risk if the contractor faces financial instability or significant operational disruptions.

Industry Classification

NAICS: Administrative and Support and Waste Management and Remediation Services › Investigation and Security Services › Investigation and Personal Background Check Services

Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › PROFESSIONAL SERVICES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 3

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Peraton Solutions Inc. (UEI: 081218565)

Address: 1750 FOXTRAIL DR, LOVELAND, CO, 80538

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

Financial Breakdown

Contract Ceiling: $112,753,916

Exercised Options: $112,753,916

Current Obligation: $112,753,916

Contract Characteristics

Multi-Year Contract: Yes

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: OPM1516D0003

IDV Type: IDC

Timeline