Department of the Army's $83.7M Facilities Support Services contract awarded to PRIDE INDUSTRIES shows concerning value and limited competition

Contract Overview

Contract Amount: $83,737,472 ($83.7M)

Contractor: Pride Industries

Awarding Agency: Department of Defense

Start Date: 2013-02-21

End Date: 2020-02-28

Contract Duration: 2,563 days

Daily Burn Rate: $32.7K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: BASE OPERATIONS

Place of Performance

Location: FORT RUCKER, DALE County, ALABAMA, 36362

State: Alabama Government Spending

Plain-Language Summary

Department of Defense obligated $83.7 million to PRIDE INDUSTRIES for work described as: BASE OPERATIONS Key points: 1. The contract's value appears high relative to its duration and scope, suggesting potential overpayment. 2. Awarded on a sole-source basis, the lack of competition limits price discovery and potentially inflates costs. 3. The long duration of the contract (2563 days) raises concerns about adaptability to changing needs and market conditions. 4. While providing essential base operations, the performance context is limited by the absence of comparative data. 5. This contract falls within the Facilities Support Services sector, a common area for government outsourcing. 6. The firm fixed-price structure aims to control costs, but the lack of competition undermines this benefit.

Value Assessment

Rating: concerning

The total award amount of $83.7 million over approximately 7 years for facilities support services appears high, especially considering it was not competed. Without benchmark data or comparison to similar contracts, it's difficult to definitively assess value for money. However, the lack of competitive bidding strongly suggests that the pricing may not reflect the most economical market rates. The per-day cost, while calculable, doesn't provide sufficient context without understanding the specific services rendered and their quality.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning only one vendor, PRIDE INDUSTRIES, was solicited. This approach bypasses the competitive bidding process, which is typically used to ensure fair pricing and identify the best value. The absence of multiple bidders means there was no market pressure to drive down costs or encourage innovation. This raises questions about whether the government secured the most advantageous terms possible.

Taxpayer Impact: For taxpayers, a sole-source award means there is a higher risk of paying more than necessary for the services provided. The lack of competition prevents the government from leveraging market forces to achieve cost savings.

Public Impact

The primary beneficiaries are the Department of the Army personnel and operations at the facilities supported by these services. Services delivered include essential base operations, ensuring the functionality and upkeep of military installations. The geographic impact is concentrated in Alabama (AL), where the contract was performed. Workforce implications include the employment of personnel by PRIDE INDUSTRIES to perform these facilities support tasks.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition raises concerns about inflated pricing and suboptimal value for taxpayer dollars.
The extended contract duration may lead to vendor complacency and reduced responsiveness to evolving needs.
Sole-source awards can set a precedent for future non-competitive procurements, hindering market competition.
Absence of performance metrics or quality indicators makes it difficult to assess the effectiveness of services.
The large contract value without competitive justification warrants scrutiny regarding fiscal responsibility.

Positive Signals

PRIDE INDUSTRIES has a long-standing relationship with the government, indicating potential reliability.
The firm fixed-price contract type provides cost certainty for the government, assuming the price is fair.
The contract covers essential base operations, crucial for maintaining military readiness and functionality.
The contract was performed in Alabama, potentially supporting local employment and economic activity.

Sector Analysis

Facilities Support Services is a broad category encompassing a wide range of services necessary for the operation and maintenance of buildings and grounds. This sector is characterized by numerous providers, from large, diversified companies to smaller, specialized firms. Government spending in this area is substantial, as agencies often outsource these functions to focus on core missions. Benchmarks for such services vary widely based on scope, location, and service level agreements, but competitive bidding is generally expected to yield better pricing.

Small Business Impact

This contract does not appear to have included a small business set-aside component, as indicated by 'sb: false'. Furthermore, there is no explicit information regarding subcontracting plans with small businesses. This suggests that the primary contract was awarded to a large business, and opportunities for small businesses to participate in this specific procurement may have been limited, potentially impacting the small business ecosystem.

Oversight & Accountability

Oversight mechanisms for this contract would typically involve the contracting officer's representative (COR) at the Department of the Army, responsible for monitoring performance and ensuring compliance with contract terms. However, the sole-source nature and lack of explicit performance metrics in the provided data make a detailed assessment of accountability and transparency challenging. Inspector General jurisdiction would apply if fraud, waste, or abuse were suspected.

Related Government Programs

Base Operations Support
Facilities Maintenance Services
Logistics and Support Services
Government Contracting

Risk Flags

Sole-source award
Lack of competition
Potential for overpricing
Extended contract duration
Absence of performance metrics

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $83.7 million to PRIDE INDUSTRIES. BASE OPERATIONS

Who is the contractor on this award?

The obligated recipient is PRIDE INDUSTRIES.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $83.7 million.

What is the period of performance?

Start: 2013-02-21. End: 2020-02-28.

What specific facilities support services were included under this $83.7 million contract?

The provided data categorizes this contract under 'Facilities Support Services' (NAICS code 561210) and mentions 'BASE OPERATIONS'. However, the specific breakdown of services is not detailed. Typically, facilities support services can encompass a wide range of activities including, but not limited to, maintenance and repair of buildings and grounds, custodial services, pest control, refuse collection, security, transportation services, and laundry services. For this particular contract, the 'BASE OPERATIONS' designation suggests a comprehensive suite of services essential for the functioning of a military installation. Without a detailed statement of work (SOW) or contract line item numbers (CLINs), it is impossible to ascertain the exact scope and quantity of each service provided.

How does the $83.7 million award compare to similar facilities support contracts awarded by the Department of the Army or other agencies?

Direct comparison of the $83.7 million award is challenging without knowing the specific services, geographic location, and duration. However, facilities support services are a significant area of government spending. Large, comprehensive base operations contracts can indeed reach tens or even hundreds of millions of dollars over their lifespan. The key differentiator here is that this contract was awarded sole-source. Competitively procured contracts for similar scopes of work often yield prices that are benchmarked against market rates. The absence of competition for this $83.7 million award raises a red flag, suggesting that the price may not be as competitive as it could have been if multiple vendors had vied for the contract. Further analysis would require access to a database of competitively bid contracts for comparable services.

What are the potential risks associated with a sole-source award of this magnitude and duration?

A sole-source award of this magnitude ($83.7 million) and duration (over 7 years) carries several significant risks. Firstly, the lack of competition means the government likely paid a premium, as there was no market pressure to drive down prices. This represents a potential loss of taxpayer value. Secondly, the extended duration can lead to vendor complacency, where the contractor may become less motivated to innovate or provide exceptional service, knowing their position is secure. It also reduces the government's flexibility to adapt to changing needs or incorporate new technologies. Finally, sole-source awards can stifle competition in the long run by discouraging other capable firms from developing the expertise or relationships needed to compete for future contracts.

What does the 'PRIDE INDUSTRIES' track record suggest about their performance on this contract?

PRIDE INDUSTRIES is a well-established government contractor, often specializing in facilities management and support services. Their long tenure suggests a level of operational capability and experience in meeting government requirements. However, the provided data does not include specific performance ratings or past performance evaluations for this particular contract. While their longevity implies a degree of success, it does not inherently guarantee optimal value or efficiency, especially in the context of a sole-source award. A deeper dive into their performance history, including any documented issues or commendations on similar contracts, would be necessary for a comprehensive assessment.

How has federal spending on Facilities Support Services (NAICS 561210) trended over the past decade?

Federal spending on Facilities Support Services (NAICS 561210) has generally been substantial and has seen fluctuations over the past decade. Agencies across the government rely on these services to maintain their infrastructure. While specific year-over-year trends can vary based on budget allocations, agency priorities, and global events, the overall demand for these services remains consistent due to the government's vast real estate holdings. Factors like base realignments, new construction, and shifts towards outsourcing non-core functions can influence spending levels. The total federal obligation for this sector typically runs into the billions of dollars annually, reflecting its critical importance.

What is the significance of the contract type being 'FIRM FIXED PRICE' in this context?

The 'FIRM FIXED PRICE' (FFP) contract type is generally favored by the government as it shifts the risk of cost overruns to the contractor. Under an FFP contract, the price is set and not subject to adjustment unless the scope of work changes. This provides budget certainty for the government. However, the effectiveness of an FFP contract in ensuring value for money is significantly diminished when awarded on a sole-source basis. While the government knows the total price, the lack of competition means that this fixed price may be higher than it would have been in a competitive environment. Therefore, while FFP offers cost certainty, it does not guarantee cost efficiency in a non-competitive scenario.

Industry Classification

NAICS: Administrative and Support and Waste Management and Remediation Services › Facilities Support Services › Facilities Support Services

Product/Service Code: OPERATION OF GOVT OWNED FACILITY › OPERATE GOVT OWNED BUILDINGS

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: W9124G12R0003

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 10030 FOOTHILLS BLVD, ROSEVILLE, CA, 95747

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

Financial Breakdown

Contract Ceiling: $85,856,224

Exercised Options: $85,856,224

Current Obligation: $83,737,472

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Timeline