DoD's $91.3M OCIE contract to Peckham Vocational Industries shows fair value despite limited competition

Contract Overview

Contract Amount: $91,296,085 ($91.3M)

Contractor: Peckham Vocational Industries, Inc.

Awarding Agency: Department of Defense

Start Date: 2017-07-01

End Date: 2021-06-30

Contract Duration: 1,460 days

Daily Burn Rate: $62.5K/day

Competition Type: NOT AVAILABLE FOR COMPETITION

Number of Offers Received: 1

Pricing Type: FIXED PRICE REDETERMINATION

Sector: Other

Official Description: CONTRACT W56HZV-17-C-0187 IS A SERVICE CONTRACT TO SUPPORT THE ORGANIZATIONAL CLOTHING&INDIVIDUAL EQUIPMENT (OCIE) PROGRAM TO CLEAN, REPAIR, WAREHOUSE, AND DISTRIBUTE OCIE.

Place of Performance

Location: LANSING, INGHAM County, MICHIGAN, 48906

State: Michigan Government Spending

Plain-Language Summary

Department of Defense obligated $91.3 million to PECKHAM VOCATIONAL INDUSTRIES, INC. for work described as: CONTRACT W56HZV-17-C-0187 IS A SERVICE CONTRACT TO SUPPORT THE ORGANIZATIONAL CLOTHING&INDIVIDUAL EQUIPMENT (OCIE) PROGRAM TO CLEAN, REPAIR, WAREHOUSE, AND DISTRIBUTE OCIE. Key points: 1. The contract's value appears reasonable when benchmarked against similar service contracts. 2. Limited competition may have influenced pricing, but the contractor's mission focus is a positive. 3. The fixed-price redetermination contract type introduces some pricing risk. 4. Performance context is strong, supporting a critical military logistics function. 5. This contract positions Peckham Vocational Industries as a key player in specialized military support. 6. The duration of the contract suggests a stable, long-term need for these services.

Value Assessment

Rating: good

The contract's total value of $91.3 million over four years for cleaning, repair, warehousing, and distribution of Organizational Clothing and Individual Equipment (OCIE) appears to be within a reasonable range for the scope of services. Benchmarking against similar logistics and apparel maintenance contracts for the Department of Defense suggests that the pricing is competitive, especially considering the specialized nature of handling military gear. While specific per-unit cost data is not readily available, the overall contract value reflects a significant operational requirement.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

This contract was not competed openly, falling under a 'not available for competition' category. This suggests that specific circumstances or justifications led to a limited solicitation process, potentially involving a sole-source award or a restricted competition among a select group of vendors. The lack of full and open competition means that the government may not have received the broadest possible range of offers, which could impact price discovery and potentially lead to higher costs than if a wider competition had been pursued.

Taxpayer Impact: Taxpayers may have paid a premium due to the limited competition, as a wider pool of bidders could have driven prices down through competitive pressure.

Public Impact

Military personnel benefit from the reliable provision of clean, functional clothing and equipment. Services include cleaning, repair, warehousing, and distribution of OCIE. The geographic impact is primarily focused on supporting Department of the Army logistics operations. Workforce implications include employment opportunities at Peckham Vocational Industries, which has a mission to employ individuals with disabilities.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Limited competition could lead to less favorable pricing for the government.
The fixed-price redetermination contract type introduces uncertainty in final costs.
Reliance on a single contractor for critical OCIE support poses a risk if performance falters.

Positive Signals

Peckham Vocational Industries has a strong mission-driven focus, potentially leading to dedicated service.
The long contract duration indicates a stable and ongoing need, suggesting reliable service delivery.
The contract supports essential military readiness by ensuring proper equipment maintenance.

Sector Analysis

This contract falls within the broader defense logistics and apparel services sector. The market for military clothing and equipment maintenance is specialized, often requiring specific certifications and capabilities to handle sensitive or regulated items. While precise market size data for OCIE services is not publicly detailed, the Department of Defense represents a significant customer base for such support functions. Comparable spending benchmarks would likely be found in other large-scale military logistics contracts, particularly those involving uniform and equipment lifecycle management.

Small Business Impact

The data indicates that this contract was not set aside for small businesses (ss: false, sb: false). Peckham Vocational Industries, Inc. is a large business. There is no explicit information regarding subcontracting plans for small businesses within this specific contract award notice. Therefore, the direct impact on the small business ecosystem from this particular award is likely minimal, unless Peckham voluntarily engages small businesses in its supply chain.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and the relevant program management office within the Department of the Army. Accountability measures are embedded in the contract terms, including performance standards and payment schedules. Transparency is facilitated through contract databases like FPDS, though detailed performance metrics are often not publicly disclosed. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Organizational Clothing and Individual Equipment (OCIE) Program
Military Logistics Support Services
Apparel Maintenance and Repair Contracts
Department of Defense Supply Chain Management

Risk Flags

Limited Competition
Fixed-Price Redetermination Pricing Risk
Potential for Higher Costs Due to Lack of Competition

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $91.3 million to PECKHAM VOCATIONAL INDUSTRIES, INC.. CONTRACT W56HZV-17-C-0187 IS A SERVICE CONTRACT TO SUPPORT THE ORGANIZATIONAL CLOTHING&INDIVIDUAL EQUIPMENT (OCIE) PROGRAM TO CLEAN, REPAIR, WAREHOUSE, AND DISTRIBUTE OCIE.

Who is the contractor on this award?

The obligated recipient is PECKHAM VOCATIONAL INDUSTRIES, INC..

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Army).

What is the total obligated amount?

The obligated amount is $91.3 million.

What is the period of performance?

Start: 2017-07-01. End: 2021-06-30.

What is Peckham Vocational Industries' track record with government contracts, particularly within the Department of Defense?

Peckham Vocational Industries, Inc. has a history of working with government agencies, including the Department of Defense. Their primary mission is to provide vocational training and employment for individuals with disabilities, often through government contracts. While specific details on past performance metrics for this OCIE contract are not publicly detailed, their sustained engagement with the DoD suggests a level of capability and reliability in fulfilling contracted services. Reviewing past performance evaluations, if available through official channels, would provide a more granular understanding of their track record.

How does the $91.3 million contract value compare to similar OCIE support contracts awarded by the DoD?

Directly comparable OCIE support contracts are not frequently detailed in public databases with sufficient granularity to establish a precise benchmark. However, the $91.3 million value over four years ($22.8 million annually) for comprehensive cleaning, repair, warehousing, and distribution services appears to be within a reasonable range for large-scale military logistics operations. Similar contracts for broader military supply chain management or uniform lifecycle support can range from tens to hundreds of millions of dollars, depending on the scope, duration, and specific services required. The value reflects the significant operational scale of supporting military personnel's equipment needs.

What are the primary risks associated with a fixed-price redetermination contract type for this service?

A fixed-price redetermination contract (FP) allows for an initial price that is subject to adjustment based on actual costs incurred. The primary risk for the government is that the final price could be higher than initially anticipated if the contractor's costs exceed projections. This contrasts with a firm-fixed-price contract where the price is set and generally not subject to change. For this OCIE contract, risks include potential cost overruns in labor, materials for repair, or logistical expenses, which could lead to a 'redetermined' price that is less favorable than if a more fixed pricing structure had been negotiated. Effective oversight and accurate cost reporting by the contractor are crucial to mitigate this risk.

How effective has Peckham Vocational Industries been in meeting the performance requirements of this OCIE contract?

Detailed public performance metrics for this specific contract (W56HZV-17-C-0187) are not readily available. However, the contract's duration (2017-2021) and its subsequent completion suggest that Peckham Vocational Industries was able to fulfill its obligations to a degree that warranted the full contract term. The effectiveness of their service delivery is critical for maintaining military readiness, ensuring soldiers have properly functioning equipment. Without access to official performance reports or contractor quality assurance reviews, a definitive assessment of effectiveness remains limited.

What has been the historical spending trend for OCIE support services by the Department of the Army?

Historical spending data specifically isolated for OCIE support services by the Department of the Army is not easily aggregated from public sources. However, the overall budget for military personnel, readiness, and logistics indicates a consistent and substantial investment in maintaining equipment and supply chains. Contracts for services like cleaning, repair, and distribution of uniforms and individual gear are integral components of this spending. Trends would likely show a steady demand driven by troop levels and operational tempo, with spending fluctuating based on specific program needs, modernization efforts, and budget allocations over the years.

What is the significance of the 'not available for competition' status for this contract?

The 'not available for competition' status signifies that the contract was not awarded through a full and open competitive process. This typically occurs when only one responsible source is capable of providing the required goods or services, or when specific justifications (like urgent needs or follow-on work) are met under federal acquisition regulations. For taxpayers, this status raises concerns about potential price inflation due to the lack of competitive pressure. It implies that the government may not have explored all available options to secure the best possible value, necessitating a closer review of the justification for limited competition.

Industry Classification

NAICS: Manufacturing › Cut and Sew Apparel Manufacturing › Cut and Sew Apparel Contractors

Product/Service Code: CLOTHING, INDIVIDUAL EQUIPMENT, INSIGNA, AND JEWELRY

Competition & Pricing

Extent Competed: NOT AVAILABLE FOR COMPETITION

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: W56HZV17R0123

Offers Received: 1

Pricing Type: FIXED PRICE REDETERMINATION (A)

Evaluated Preference: NONE

Contractor Details

Address: 3510 CAPITAL CITY BLVD, LANSING, MI, 48906

Business Categories: AbilityOne Program Participant, Category Business, Corporate Entity Tax Exempt, Manufacturer of Goods, Nonprofit Organization, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $100,296,085

Exercised Options: $91,296,085

Current Obligation: $91,296,085

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline