State Department's $237M security contract awarded competitively, raising questions about value and domestic contractor utilization

Contract Overview

Contract Amount: $237,200,142 ($237.2M)

Contractor: Domestic Awardees (undisclosed)

Awarding Agency: Department of State

Start Date: 2006-02-08

End Date: 2011-08-07

Contract Duration: 2,006 days

Daily Burn Rate: $118.2K/day

Competition Type: COMPETITIVE DELIVERY ORDER

Number of Offers Received: 3

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: OVERSEAS CONTRACT

Plain-Language Summary

Department of State obligated $237.2 million to DOMESTIC AWARDEES (UNDISCLOSED) for work described as: OVERSEAS CONTRACT Key points: 1. Contract awarded through a competitive delivery order, indicating some level of market engagement. 2. The significant value of the contract suggests a critical need for security services. 3. Lack of disclosed domestic awardees warrants further investigation into contractor origins and potential economic impact. 4. The firm-fixed-price contract type aims to control costs, but performance monitoring is key. 5. Long duration of the contract (over 5 years) necessitates ongoing performance evaluation. 6. The security guard and patrol services sector is highly competitive, making price benchmarking crucial.

Value Assessment

Rating: fair

Benchmarking the value of this contract is challenging without specific performance metrics or comparable domestic contract data. The $237 million total value over five years averages approximately $47.4 million annually. While the firm-fixed-price structure provides cost certainty, the absence of disclosed domestic awardees raises concerns about whether the most cost-effective solutions were secured. Further analysis would require comparing unit costs for security personnel and services against industry standards and other government contracts for similar geographic regions and service levels.

Cost Per Unit: N/A

Competition Analysis

Competition Level: unknown

This contract was awarded as a competitive delivery order, suggesting that multiple vendors were considered. However, the specific number of bidders and the details of the competition are not fully disclosed in the provided data. A competitive delivery order typically implies a pre-existing contract vehicle or a streamlined process for awarding task orders. The level of competition is crucial for ensuring fair pricing and access to a broad range of capabilities.

Taxpayer Impact: The competitive nature of the award is positive for taxpayers, as it should theoretically drive down prices and encourage efficient service delivery. However, the lack of transparency regarding the number of bidders and the specific awardees limits the ability to fully assess the extent of price discovery achieved.

Public Impact

Provides essential security services for U.S. interests abroad, safeguarding personnel and facilities. Benefits U.S. diplomatic missions and personnel operating in potentially high-risk environments. The contract supports the Department of State's foreign policy and diplomatic operations. Geographic impact is global, covering overseas locations where U.S. diplomatic presence is maintained. Workforce implications include the potential employment of security personnel, though the origin of these workers is not specified.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of disclosed domestic awardees raises concerns about economic benefits flowing to U.S. businesses.
Limited transparency on the competitive process hinders a full assessment of value for money.
The long contract duration could lead to complacency if not rigorously overseen.
Potential for reliance on non-domestic labor pools, impacting U.S. job creation.

Positive Signals

Awarded through a competitive process, indicating some level of market vetting.
Firm-fixed-price contract type helps manage cost uncertainty for the government.
The contract addresses a critical need for security in overseas operations.
Long-term nature allows for stable security provision.

Sector Analysis

The security guard and patrol services industry is a significant component of the broader security and defense sector. This contract falls under North American Industry Classification System (NAICS) code 561612. The global demand for private security services, particularly for government facilities and personnel in high-risk areas, is substantial. This contract represents a notable portion of federal spending within this specific service category, highlighting the government's reliance on external providers for critical security functions abroad.

Small Business Impact

The provided data does not indicate whether this contract included small business set-asides or subcontracting goals. The lack of disclosed domestic awardees makes it difficult to assess the impact on the small business ecosystem. Typically, large contracts like this offer opportunities for small businesses to participate as subcontractors, but without specific information, this remains speculative. Further investigation would be needed to determine if small businesses were involved in delivering these security services.

Oversight & Accountability

Oversight for this contract would primarily reside with the Department of State's contracting officers and program managers. Accountability measures would be embedded in the contract terms, including performance standards and reporting requirements. Transparency is limited by the undisclosed nature of the awardees and the specific competitive process. Inspector General jurisdiction would apply to investigations of fraud, waste, or abuse related to the contract.

Related Government Programs

Department of State Security Contracts
Overseas Security Services
Federal Law Enforcement Support Contracts
Global Security Services
Private Security Firm Contracts

Risk Flags

Lack of transparency in awardees
Potential for non-domestic labor utilization
Limited detail on competitive process
Long contract duration requires sustained oversight

Frequently Asked Questions

What is this federal contract paying for?

Department of State awarded $237.2 million to DOMESTIC AWARDEES (UNDISCLOSED). OVERSEAS CONTRACT

Who is the contractor on this award?

The obligated recipient is DOMESTIC AWARDEES (UNDISCLOSED).

Which agency awarded this contract?

Awarding agency: Department of State (Department of State).

What is the total obligated amount?

The obligated amount is $237.2 million.

What is the period of performance?

Start: 2006-02-08. End: 2011-08-07.

What specific security services were provided under this contract, and were there any performance issues reported?

The contract, identified by NAICS code 561612, covers 'Security Guards and Patrol Services.' These services typically include providing trained personnel to guard government facilities, monitor security systems, patrol premises, control access, and respond to security incidents. While the provided data does not detail specific performance issues, the long duration and significant value suggest a continuous need for these services. Government contracts of this nature usually include performance metrics and reporting requirements. Any significant performance failures would typically be documented in contract performance evaluations or through formal dispute resolution processes, which are not detailed in the summary data.

How does the average annual cost of this contract compare to similar security contracts awarded by the Department of State or other agencies?

The average annual cost of this contract is approximately $47.4 million ($237.2 million / 5 years). Benchmarking this against similar contracts is challenging without access to a comprehensive database of federal security contracts with detailed service scopes and geographic locations. However, the scale of this contract suggests it is a significant award, likely covering extensive security requirements in a high-risk or strategically important region. To perform a robust comparison, one would need to analyze contracts for security guard and patrol services of similar duration, scope (e.g., number of personnel, hours of coverage), and operating environment (e.g., embassy security, base security). The lack of disclosed domestic awardees also complicates direct comparison with contracts known to utilize U.S.-based firms.

What are the potential risks associated with awarding a large security contract to undisclosed domestic awardees?

Awarding a large security contract to undisclosed domestic awardees presents several potential risks. Firstly, it limits transparency, making it difficult for the public and oversight bodies to assess the contractor's suitability, track record, and potential conflicts of interest. Secondly, it raises concerns about whether the competition truly yielded the best value for taxpayers if the identities and capabilities of all bidders are not scrutinized. Thirdly, it can obscure the economic impact, as it becomes unclear whether the contract is creating jobs and opportunities for U.S. workers and businesses. Finally, without clear identification, it can be harder to hold contractors accountable for performance or compliance issues, especially if they operate through complex corporate structures.

Given the firm-fixed-price contract type, what mechanisms are in place to ensure the quality and effectiveness of the security services provided?

A firm-fixed-price (FFP) contract type obligates the contractor to perform the work for a predetermined price, regardless of the contractor's actual costs. While FFP is advantageous for cost control, it places a greater emphasis on the government's ability to clearly define requirements and monitor performance. For this contract, quality and effectiveness are likely ensured through several mechanisms: detailed performance work statements (PWS) outlining specific service standards, key performance indicators (KPIs) that must be met, regular performance reviews by government representatives, and potential penalties or incentives tied to performance outcomes. The Department of State would have contracting officers' representatives (CORs) responsible for overseeing the contractor's day-to-day performance and ensuring compliance with the PWS.

How has federal spending on security guard and patrol services evolved over time, and where does this contract fit within that trend?

Federal spending on security guard and patrol services has generally trended upwards over the past two decades, driven by increased security needs post-9/11, ongoing global security challenges, and the expansion of U.S. government operations abroad. This contract, valued at $237.2 million over approximately five years (2006-2011), represents a substantial single award within this category during that period. Its duration and value indicate a significant commitment to securing specific overseas assets or operations. While this specific contract reflects spending patterns from the mid-2000s to early 2010s, it is part of a larger, sustained federal investment in private security services, which continues to be a major expenditure area for agencies like the Department of State, Department of Defense, and others operating in complex environments.

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: COMPETITIVE DELIVERY ORDER

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 3

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 1800 F ST NW, WASHINGTON, DC, 20405

Business Categories: Category Business, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $237,200,142

Exercised Options: $237,200,142

Current Obligation: $237,200,142

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Parent Contract

Parent Award PIID: SAQMPD05D1098

IDV Type: IDC

Timeline