DOJ's $89M Contract for Secure Correctional Facility Operations in Texas Raises Questions on Value and Competition

Contract Overview

Contract Amount: $89,134,672 ($89.1M)

Contractor: County of Reeves

Awarding Agency: Department of Justice

Start Date: 2019-07-01

End Date: 2022-05-30

Contract Duration: 1,064 days

Daily Burn Rate: $83.8K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 11

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: OPERATION OF A CONTRACTOR OWNED/CONTRACTOR LEASED, CONTRACTOR OPERATED SECURE CORRECTIONAL FACILITY.

Place of Performance

Location: PECOS, REEVES County, TEXAS, 79772

State: Texas Government Spending

Plain-Language Summary

Department of Justice obligated $89.1 million to COUNTY OF REEVES for work described as: OPERATION OF A CONTRACTOR OWNED/CONTRACTOR LEASED, CONTRACTOR OPERATED SECURE CORRECTIONAL FACILITY. Key points: 1. The contract awarded to County of Reeves for correctional facility operations represents a significant expenditure. 2. While labeled 'Full and Open Competition', the nature of correctional facility management may limit true market participation. 3. The firm fixed-price contract type aims to control costs, but oversight is crucial for ensuring value. 4. The sector involves essential public services with inherent risks related to safety and security.

Value Assessment

Rating: fair

The contract value of $89.1 million over approximately 3 years suggests a substantial cost for facility operation. Benchmarking against similar correctional facility contracts would be necessary to definitively assess value for money.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under 'Full and Open Competition'. However, the specialized nature of operating a secure correctional facility might inherently restrict the number of truly capable bidders, potentially impacting price discovery.

Taxpayer Impact: Taxpayer funds are being used to operate a correctional facility, a core government function. Ensuring cost-effectiveness and efficient service delivery is paramount for responsible use of these funds.

Public Impact

Ensures the operation of secure correctional facilities, contributing to public safety and the justice system. Provides essential services for inmate management, including housing, security, and support. Supports local economies through job creation and resource utilization within the contracted region.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for limited true competition despite 'full and open' designation.
Risk of cost overruns if operational complexities are underestimated.
Ensuring consistent quality of care and security standards.

Positive Signals

Firm fixed-price contract helps control costs.
Contract duration provides stability for operations.
Located in Texas, potentially serving a specific regional need.

Sector Analysis

This contract falls under Facilities Support Services, specifically the operation of secure correctional facilities. Spending in this sector is driven by government needs for detention and rehabilitation services, with costs influenced by security requirements, staffing, and location.

Small Business Impact

The data does not indicate any specific provisions or participation by small businesses in this contract. The nature of operating a secure correctional facility often requires large-scale infrastructure and specialized expertise, which may favor larger, established entities.

Oversight & Accountability

The Bureau of Prisons is responsible for overseeing this contract. Robust oversight mechanisms are essential to ensure compliance with security protocols, inmate welfare standards, and financial accountability throughout the contract's lifecycle.

Related Government Programs

Facilities Support Services
Department of Justice Contracting
Federal Prison System / Bureau of Prisons Programs

Risk Flags

Potential for limited effective competition.
Ensuring consistent security and operational standards.
Risk of cost escalation if not managed tightly.
Dependence on contractor performance for public safety.

Frequently Asked Questions

What is this federal contract paying for?

Department of Justice awarded $89.1 million to COUNTY OF REEVES. OPERATION OF A CONTRACTOR OWNED/CONTRACTOR LEASED, CONTRACTOR OPERATED SECURE CORRECTIONAL FACILITY.

Who is the contractor on this award?

The obligated recipient is COUNTY OF REEVES.

Which agency awarded this contract?

Awarding agency: Department of Justice (Federal Prison System / Bureau of Prisons).

What is the total obligated amount?

The obligated amount is $89.1 million.

What is the period of performance?

Start: 2019-07-01. End: 2022-05-30.

What specific metrics are used to evaluate the operational effectiveness and cost-efficiency of this correctional facility contract?

Effectiveness is typically evaluated through metrics such as inmate security incident rates, recidivism rates, compliance with health and safety regulations, staff-to-inmate ratios, and successful completion of audits. Cost-efficiency would be assessed by comparing actual expenditures against the fixed-price contract, monitoring for any deviations, and analyzing the cost per inmate day against industry benchmarks.

How does the 'Full and Open Competition' process ensure genuine market competition for specialized correctional facility operations?

While 'Full and Open Competition' theoretically allows all responsible sources to submit offers, the specialized nature of operating secure correctional facilities may present high barriers to entry. These can include significant capital investment, extensive experience requirements, and stringent security clearances. The agency must ensure outreach efforts effectively reach all potential qualified bidders and that evaluation criteria do not unduly favor incumbents or specific types of providers.

What is the long-term taxpayer impact of relying on contractor-operated correctional facilities versus government-run facilities?

The long-term taxpayer impact involves a trade-off between potential cost savings through private sector efficiency and the risk of profit-driven decisions compromising service quality or leading to hidden costs. While contracts can offer flexibility and potentially lower upfront capital costs, ongoing management fees, profit margins, and the need for rigorous oversight can offset savings. Government-run facilities may have higher initial capital costs but offer direct control over operations and standards.

Industry Classification

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

Product/Service Code: SOCIAL SERVICES › SOCIAL SERVICES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: RFP-PCC-0026

Offers Received: 11

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 100 E 4TH ST FIRST FL STE 207, PECOS, TX, 79772

Business Categories: Category Business, Government, U.S. Local Government, U.S. National Government, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $273,453,231

Exercised Options: $273,453,231

Current Obligation: $89,134,672

Actual Outlays: $15,907,255

Contract Characteristics

Multi-Year Contract: Yes

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline