State Department awards $220K for hotel services, raising questions about competition and value

Contract Overview

Contract Amount: $220,721 ($220.7K)

Contractor: Miscellaneous Foreign Awardees

Awarding Agency: Department of State

Start Date: 2026-04-02

End Date: 2026-04-17

Contract Duration: 15 days

Daily Burn Rate: $14.7K/day

Competition Type: NOT COMPETED

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: HOTEL SERVICES

Plain-Language Summary

Department of State obligated $220,721.31 to MISCELLANEOUS FOREIGN AWARDEES for work described as: HOTEL SERVICES Key points: 1. Contract awarded on a non-competitive basis, limiting price discovery. 2. Short duration of 15 days suggests a specific, immediate need. 3. Lack of competition may lead to above-market pricing. 4. Performance period is very short, making long-term value assessment difficult. 5. Sector is hotels and motels, a generally competitive market. 6. No indication of small business participation or set-aside.

Value Assessment

Rating: questionable

The contract value of $220,721.31 for a 15-day period appears high for standard hotel services. Without a competitive bidding process, it's difficult to benchmark against market rates or similar government contracts. The per diem rate implied by this award, if spread across a typical number of rooms and services, would likely exceed standard government lodging per diems, suggesting potential overpayment. Further analysis of the specific services required is needed to fully assess value.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded using a sole-source justification, meaning it was not competed. This approach is typically reserved for situations where only one vendor can provide the required services, or in emergency situations. The lack of competition means the Department of State did not solicit bids from multiple providers, potentially missing out on better pricing and service options available in the open market.

Taxpayer Impact: Taxpayers may have paid a premium due to the absence of competitive pressure to drive down costs. The government did not leverage its purchasing power to secure the best possible deal.

Public Impact

Provides essential lodging services for personnel, likely related to official government travel or operations. Benefits government employees or contractors requiring accommodation. Geographic impact is localized to the area where the hotel services are provided. Workforce implications are minimal, primarily affecting hotel staff at the awarded establishment.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Non-competitive award limits transparency and potential cost savings.
Short contract duration makes assessing long-term performance and value challenging.
High apparent cost per day without clear justification.
Lack of defined performance metrics or service level agreements.

Positive Signals

Addresses an immediate need for hotel services.
Contract is for a fixed price, providing cost certainty for the awarded amount.
Short duration may indicate a specific, contained requirement.

Sector Analysis

The hotel and motel industry (NAICS 721110) is a large and generally competitive sector. Government agencies frequently procure lodging services. While this contract is for a relatively small dollar amount, the lack of competition for services in a typically competitive market warrants scrutiny. Benchmarking against per diem rates and other government lodging contracts would be useful.

Small Business Impact

There is no indication that this contract included a small business set-aside or subcontracting plan. The awardee is listed as 'MISCELLANEOUS FOREIGN AWARDEES,' suggesting it is not a U.S. small business. This contract does not appear to contribute to the government's small business contracting goals.

Oversight & Accountability

Oversight for this contract would fall under the Department of State's contracting and financial management divisions. Given the short duration and specific nature, detailed oversight might be limited. Transparency is reduced due to the sole-source award. There is no mention of specific Inspector General involvement for this particular award.

Related Government Programs

GSA Multiple Award Schedules (MAS) for lodging
Department of Defense lodging contracts
State Department travel and accommodation services

Risk Flags

Non-competitive award
Potential for overpayment
Lack of defined performance standards

Frequently Asked Questions

What is this federal contract paying for?

Department of State awarded $220,721.31 to MISCELLANEOUS FOREIGN AWARDEES. HOTEL SERVICES

Who is the contractor on this award?

The obligated recipient is MISCELLANEOUS FOREIGN AWARDEES.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $220,721.31.

What is the period of performance?

Start: 2026-04-02. End: 2026-04-17.

What specific circumstances necessitated a sole-source award for these hotel services?

The provided data indicates the contract was 'NOT COMPETED' and awarded as a 'sole-source' action. Typically, sole-source awards are justified under specific circumstances outlined in federal acquisition regulations, such as when only one responsible source is available, or in cases of urgent and compelling need where competition is not feasible. Without further documentation from the Department of State, the precise reason for bypassing the competitive bidding process remains unclear. This could range from a highly specialized requirement unique to a particular location or facility, to an emergency situation requiring immediate lodging. The lack of detail necessitates further inquiry into the agency's justification.

How does the cost of this contract compare to typical government per diem rates for lodging?

The contract value is $220,721.31 for a 15-day period. This averages to approximately $14,714.75 per day. To compare this to government per diem rates, we would need to know the number of rooms or individuals accommodated. If this contract is for a block of rooms or a specific group, the daily cost per room could be assessed against the standard per diem rates set by the General Services Administration (GSA) or the Department of Defense for the relevant locality. Given the high daily average, it is plausible that this rate exceeds standard per diem, especially if it includes services beyond basic lodging. A detailed breakdown of services and room nights is required for a precise comparison.

What are the potential risks associated with awarding hotel services on a non-competitive basis?

The primary risk of awarding hotel services on a non-competitive basis is the potential for inflated costs. Without the pressure of competition, the contractor may not offer the most favorable pricing. This can lead to the government paying more than necessary for lodging, impacting budget efficiency. Another risk is reduced service quality, as there is less incentive for the contractor to exceed expectations when they are the sole provider. Furthermore, non-competitive awards can create a perception of favoritism or a lack of due diligence, potentially undermining public trust and accountability. Finally, it limits opportunities for other qualified vendors, including small businesses, to compete for government contracts.

What performance metrics or service level agreements are in place for this contract?

The provided data does not specify any performance metrics or service level agreements (SLAs) for this contract. The contract type is 'FIRM FIXED PRICE,' which typically means the price is set regardless of the contractor's cost, but it doesn't inherently define service quality standards. For lodging services, typical metrics might include room cleanliness, response times for services, safety and security standards, and guest satisfaction. The absence of explicit performance standards in the summary data makes it difficult to assess how the contractor's performance will be measured and managed. This lack of defined metrics could pose a risk to ensuring satisfactory service delivery.

What is the historical spending pattern for hotel services by the Department of State, and how does this award fit in?

The provided data is limited to a single contract award and does not offer historical spending patterns for hotel services by the Department of State. To understand how this $220,721.31 award fits into the broader picture, one would need to analyze past contracts for similar services. This would involve examining the frequency of such awards, their average values, whether they were typically competed or sole-sourced, and the types of services procured. Without this historical context, it's challenging to determine if this award represents a typical expenditure, an anomaly, or a potential increase in reliance on non-competitive lodging contracts. Accessing historical contract databases would be necessary for this analysis.

Industry Classification

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

Product/Service Code: TRANSPORT, TRAVEL, RELOCATION › TRAVEL, LODGING, RECRUITMENT SVCS

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 1800 F ST NW, WASHINGTON, DC, 20405

Business Categories: Category Business, Foreign Owned, Not Designated a Small Business, Special Designations

Financial Breakdown

Contract Ceiling: $220,721

Exercised Options: $220,721

Current Obligation: $220,721

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: 19HU2026D0020

IDV Type: IDC

Timeline