FBI spends $21,243 on a 3-day hotel stay, raising questions about value and competition

Contract Overview

Contract Amount: $21,243 ($21.2K)

Contractor: XLD Group, LLC

Awarding Agency: Department of Justice

Start Date: 2026-04-20

End Date: 2026-04-23

Contract Duration: 3 days

Daily Burn Rate: $7.1K/day

Competition Type: NOT COMPETED UNDER SAP

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: HOTEL STAY

Place of Performance

Location: TORRANCE, LOS ANGELES County, CALIFORNIA, 90503

State: California Government Spending

Plain-Language Summary

Department of Justice obligated $21,243.49 to XLD GROUP, LLC for work described as: HOTEL STAY Key points: 1. The contract value appears high for a short duration, suggesting potential overspending. 2. Limited competition for this service could lead to inflated pricing. 3. The short performance period may indicate an urgent need, but also limits opportunities for competitive bidding. 4. This purchase order falls within the hospitality sector, a common area for government travel needs. 5. The firm fixed-price contract type offers cost certainty but may not reflect market fluctuations. 6. The absence of small business set-aside flags suggests larger entities or direct sourcing.

Value Assessment

Rating: questionable

The cost of $7,081 per day for a hotel stay is significantly above typical per diem rates for federal employees, even in high-cost areas. While specific location details are not provided, this rate suggests a premium accommodation or potential overpayment. Benchmarking against similar short-term lodging contracts for government agencies would be necessary to definitively assess value, but initial indicators point to a lack of cost-effectiveness.

Cost Per Unit: Approximately $7,081 per day, which is substantially higher than standard federal per diem rates.

Competition Analysis

Competition Level: sole-source

This contract was not competed under the Simplified Acquisition Procedures (SAP), indicating it was likely procured through a sole-source or limited competition method. The "NOT COMPETED UNDER SAP" designation suggests that standard competitive processes were bypassed. Without further details on the justification for this approach, it is difficult to assess the extent of competition and its impact on price discovery. The single awardee, XLD GROUP, LLC, received the entire value of the contract.

Taxpayer Impact: The lack of open competition means taxpayers may have paid a premium, as the government did not benefit from a competitive bidding process that typically drives down prices.

Public Impact

Federal Bureau of Investigation (FBI) personnel are the direct beneficiaries of this lodging service. The service provided is temporary accommodation for a short duration. The geographic impact is localized to the area where the hotel stay occurred, likely within California. There are no direct workforce implications as this is a service contract for lodging.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

High per-day cost compared to federal per diem rates.
Lack of competitive bidding process raises concerns about price justification.
Short duration may not have allowed for thorough market research or competitive sourcing.

Positive Signals

Firm fixed-price contract provides cost certainty for the government.
Award to a specific LLC indicates a direct business relationship.
Contract is for a defined, short period, limiting long-term financial exposure.

Sector Analysis

The hospitality sector, specifically hotels and motels, is a critical support service for government operations, particularly for travel and temporary assignments. The North American Industry Classification System (NAICS) code 721110 categorizes this segment. Government spending in this area is substantial, often managed through negotiated rates, government travel cards, or specific contracts like this purchase order. Benchmarking against industry standards and government travel policies is essential for evaluating cost-effectiveness.

Small Business Impact

The contract details do not indicate any small business set-aside provisions. The award was made to XLD GROUP, LLC, and there is no information regarding subcontracting opportunities for small businesses. This suggests that the procurement was not specifically designed to benefit the small business ecosystem, and larger entities or direct sourcing were prioritized.

Oversight & Accountability

As a purchase order, oversight would typically be managed by the contracting officer and the FBI's procurement department. Transparency is limited due to the lack of competitive bidding details. Inspector General jurisdiction would apply if fraud, waste, or abuse were suspected, but the current data does not provide enough information to trigger such an investigation. Accountability rests with the agency's procurement officials to ensure the necessity and reasonableness of the expense.

Related Government Programs

Government Travel Services
Lodging Contracts
Federal Per Diem Rates
Department of Justice Procurement

Risk Flags

High Cost Per Diem
Lack of Competition
Potential for Overpayment
Limited Transparency

Frequently Asked Questions

What is this federal contract paying for?

Department of Justice awarded $21,243.49 to XLD GROUP, LLC. HOTEL STAY

Who is the contractor on this award?

The obligated recipient is XLD GROUP, LLC.

Which agency awarded this contract?

Awarding agency: Department of Justice (Federal Bureau of Investigation).

What is the total obligated amount?

The obligated amount is $21,243.49.

What is the period of performance?

Start: 2026-04-20. End: 2026-04-23.

What is the specific justification for the high per-day cost of the hotel stay?

The provided data does not include the specific justification for the high per-day cost of $7,081. Typically, such high rates might be attributed to a critical, urgent need in a high-cost-of-living area, a requirement for specialized facilities or services within the hotel, or a lack of available lodging options due to a major event. However, without explicit documentation from the FBI detailing the necessity and market analysis supporting this rate, it remains a significant point of concern regarding value for money. Standard federal per diem rates are considerably lower, suggesting this expenditure deviates substantially from typical cost controls for government travel.

How does XLD GROUP, LLC's pricing compare to other hotel providers for similar government contracts?

Direct comparison of XLD GROUP, LLC's pricing to other hotel providers for similar government contracts is challenging with the current data. The contract was not competed, meaning there was no direct price comparison through a bidding process. To assess this, one would need to research other federal contracts awarded for hotel accommodations in similar locations and for similar durations, looking at the per-day rates. Additionally, reviewing the General Services Administration (GSA) schedules for lodging or state/local government contracts could provide benchmarks. The absence of competition makes it difficult to determine if XLD GROUP, LLC offered a competitive price or if the government accepted a non-competitive rate.

What are the potential risks associated with a sole-source procurement for hotel services?

The primary risk associated with a sole-source procurement for hotel services is the potential for inflated pricing due to the lack of competition. When a single vendor is selected without exploring other options, there is less incentive for that vendor to offer the most competitive rate. This can lead to the government paying more than necessary. Other risks include a potential lack of service quality if the vendor knows there are no alternatives, and reduced transparency in the procurement process. Furthermore, it raises questions about whether the government adequately fulfilled its responsibility to seek out the best value for taxpayer dollars.

What is the typical duration and cost for FBI hotel stays, and how does this contract compare?

The provided data indicates this FBI hotel stay is for a short duration of 3 days. The total cost is $21,243.49, averaging $7,081 per day. Without historical data on typical FBI hotel stays, it's difficult to provide a precise comparison. However, the per-day average is exceptionally high compared to standard federal per diem rates, which generally range from $100-$300 per day depending on the location. This suggests that either the circumstances of this particular stay were highly unusual (e.g., extreme emergency, unique location with no other options, specific high-security requirements) or the cost is not aligned with standard government travel expenses. Further investigation into the context of this stay is warranted.

Are there any performance metrics or service level agreements associated with this purchase order?

The provided data for this purchase order does not specify any performance metrics or service level agreements (SLAs). Purchase orders, especially for short-duration services like hotel stays, often rely on the general terms and conditions of the vendor and the expectation of satisfactory service. However, for significant expenditures, formal SLAs outlining expectations for room quality, amenities, check-in/check-out procedures, and responsiveness to issues would typically be included, especially if negotiated. The absence of explicit metrics makes it harder to formally evaluate the quality of service received against the high cost incurred.

Industry Classification

NAICS: Accommodation and Food Services › Traveler Accommodation › Hotels (except Casino Hotels) and Motels

Product/Service Code: LEASE/RENT FACILITIES › LEASE/RENTAL OF BUILDINGS

Competition & Pricing

Extent Competed: NOT COMPETED UNDER SAP

Solicitation Procedures: SIMPLIFIED ACQUISITION

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 3635 FASHION WAY, TORRANCE, CA, 90503

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

Financial Breakdown

Contract Ceiling: $21,243

Exercised Options: $21,243

Current Obligation: $21,243

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Timeline