State Department awards $14.2M for facilities support, raising questions about competition and value

Contract Overview

Contract Amount: $14,236,565 ($14.2M)

Contractor: HCI Management Services Company

Awarding Agency: Department of State

Start Date: 2019-09-30

End Date: 2025-03-31

Contract Duration: 2,009 days

Daily Burn Rate: $7.1K/day

Competition Type: NOT AVAILABLE FOR COMPETITION

Pricing Type: TIME AND MATERIALS

Sector: Other

Official Description: INCREMENTAL FUNDING FOR T/FO TASK ORDER

Place of Performance

Location: WINNEBAGO, THURSTON County, NEBRASKA, 68071

State: Nebraska Government Spending

Plain-Language Summary

Department of State obligated $14.2 million to HCI MANAGEMENT SERVICES COMPANY for work described as: INCREMENTAL FUNDING FOR T/FO TASK ORDER Key points: 1. Contract awarded on a non-competitive basis, limiting price discovery. 2. Significant duration of 20 months for task order. 3. Focus on facilities support services suggests a need for ongoing operational assistance. 4. Potential for cost overruns given the time and materials pricing structure. 5. Lack of small business participation noted. 6. Geographic focus on Nebraska for service delivery.

Value Assessment

Rating: questionable

The contract's value is difficult to benchmark due to its non-competitive nature and the absence of specific performance metrics. The time and materials pricing structure, while flexible, can lead to unpredictable costs and may not incentivize efficiency. Without comparable contracts or detailed cost breakdowns, assessing the true value for money is challenging. The incremental funding suggests a phased approach, but the total potential cost remains unclear.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded under a sole-source justification, meaning it was not competed. This limits the opportunity for multiple vendors to bid, potentially leading to higher prices than if a competitive process had been used. The lack of competition means the government did not benefit from the usual price discovery mechanisms inherent in open bidding.

Taxpayer Impact: Taxpayers may have paid a premium due to the absence of competitive pressure. The government missed an opportunity to secure potentially better pricing and service options through a competitive solicitation.

Public Impact

The Department of State benefits from ongoing facilities support services. Services are delivered in Nebraska, impacting the local economy and workforce. The contract ensures the operational continuity of facilities managed by the State Department. The specific end-users of these facilities are not detailed but likely include government personnel and operations.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Non-competitive award limits oversight and potential for cost savings.
Time and materials pricing structure poses a risk of cost escalation.
Lack of transparency in the sole-source justification.
Extended contract duration without clear performance benchmarks.
No indication of small business participation or subcontracting goals.

Positive Signals

Addresses a clear need for facilities support services.
Contract duration allows for stable service provision.
Specific geographic focus (Nebraska) may support local employment.

Sector Analysis

Facilities Support Services fall under the broader professional, scientific, and technical services sector. This sector is characterized by a wide range of service providers, from large corporations to specialized small businesses. Government spending in this area is consistent, supporting the maintenance and operation of federal infrastructure. Benchmarking is difficult without knowing the specific scope of services, but typical contracts range from routine maintenance to complex facility management.

Small Business Impact

This contract does not appear to include any small business set-aside provisions, nor is there any indication of subcontracting requirements for small businesses. This suggests that the primary contractor, HCI Management Services Company, is expected to perform the services directly or through its own resources. The lack of small business involvement means limited direct benefit to the small business ecosystem for this specific award.

Oversight & Accountability

Oversight mechanisms for this contract are not explicitly detailed in the provided data. Given the sole-source nature and time-and-materials pricing, robust oversight would be crucial to ensure cost control and performance. The Department of State's internal oversight processes and potentially the Inspector General's office would be responsible for monitoring this contract's execution and expenditures.

Related Government Programs

Facilities Operations and Maintenance
Government Support Services
Department of State Contracts
Non-Competitive Procurements

Risk Flags

Sole-source award
Time and Materials pricing
Lack of performance metrics
No small business participation

Frequently Asked Questions

What is this federal contract paying for?

Department of State awarded $14.2 million to HCI MANAGEMENT SERVICES COMPANY. INCREMENTAL FUNDING FOR T/FO TASK ORDER

Who is the contractor on this award?

The obligated recipient is HCI MANAGEMENT SERVICES COMPANY.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $14.2 million.

What is the period of performance?

Start: 2019-09-30. End: 2025-03-31.

What specific facilities support services are being provided under this contract?

The provided data indicates the contract is for 'Facilities Support Services' with the North American Industry Classification System (NAICS) code 561210. This typically encompasses a broad range of services including building operation and maintenance, cleaning, security, groundskeeping, and potentially specialized technical support for building systems. However, the exact scope of services for this specific task order is not detailed in the provided information. Further inquiry into the contract's statement of work would be necessary to understand the precise deliverables and their associated performance standards.

Why was this contract awarded on a sole-source basis instead of being competed?

The data explicitly states the contract type is 'NOT AVAILABLE FOR COMPETITION', implying a sole-source justification was used. Common reasons for sole-source awards include unique capabilities of a specific contractor, urgent and compelling needs where only one source can reasonably fulfill the requirement, or when a previous contract requires follow-on work that can only be efficiently performed by the incumbent. Without the specific justification document, the exact rationale remains unknown, but it signifies that the agency determined competition was not feasible or advantageous in this instance.

What is the historical spending pattern for facilities support services by the Department of State in Nebraska?

The provided data only details this specific $14.2 million task order awarded in 2019 with an end date of March 2025. It does not offer historical spending patterns for facilities support services by the Department of State, either generally or specifically within Nebraska. To analyze historical spending, one would need access to broader contract databases and historical procurement records for the agency, filtered by service type and geographic location. This would allow for trend analysis and comparison of current spending against past investments.

What are the potential risks associated with the 'Time and Materials' pricing structure for this contract?

The 'Time and Materials' (T&M) pricing structure carries inherent risks, primarily related to cost control and predictability. Unlike fixed-price contracts, T&M contracts reimburse the contractor for the actual cost of labor (at specified hourly rates) and materials, plus a fee or profit. This can lead to cost overruns if the project takes longer than anticipated or if material costs increase unexpectedly. It also places a greater burden on the government to closely monitor labor hours and material usage to ensure efficiency and prevent contractor overcharging. Without strong oversight, T&M contracts can become significantly more expensive than initially projected.

Are there any performance metrics or key performance indicators (KPIs) associated with this contract?

The provided data does not include specific performance metrics or Key Performance Indicators (KPIs) for this contract. While the contract is for facilities support services, the absence of defined KPIs makes it difficult to objectively assess the contractor's performance and the value delivered. Effective government contracts typically include measurable standards for service delivery, response times, quality, and customer satisfaction. The lack of such metrics in the summary data raises concerns about accountability and the ability to ensure the services meet the government's needs effectively.

Industry Classification

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

Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › MANAGEMENT SUPPORT SERVICES

Competition & Pricing

Extent Competed: NOT AVAILABLE FOR COMPETITION

Solicitation Procedures: ONLY ONE SOURCE

Pricing Type: TIME AND MATERIALS (Y)

Evaluated Preference: NONE

Contractor Details

Parent Company: Ho-Chunk, Inc.

Address: 1 MISSION DR, WINNEBAGO, NE, 68071

Business Categories: 8(a) Program Participant, Category Business, Corporate Entity Tax Exempt, HUBZone Firm, Minority Owned Business, Self-Certified Small Disadvantaged Business, Small Business, Special Designations, Tribally Owned Firm, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $14,236,565

Exercised Options: $14,236,565

Current Obligation: $14,236,565

Actual Outlays: $5,008,446

Contract Characteristics

Multi-Year Contract: Yes

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: 19AQMM19D0150

IDV Type: IDC

Timeline