Treasury's $900K+ courier contract for Indianapolis awarded to FG Management Group LLC

Contract Overview

Contract Amount: $90,589 ($90.6K)

Contractor: FG Management Group LLC

Awarding Agency: Department of the Treasury

Start Date: 2023-10-01

End Date: 2026-09-30

Contract Duration: 1,095 days

Daily Burn Rate: $83/day

Competition Type: NOT COMPETED UNDER SAP

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: COURIER SERVICE FOR INDIANAPOLIS, IN

Place of Performance

Location: INDIANAPOLIS, MARION County, INDIANA, 46204

State: Indiana Government Spending

Plain-Language Summary

Department of the Treasury obligated $90,589.08 to FG MANAGEMENT GROUP LLC for work described as: COURIER SERVICE FOR INDIANAPOLIS, IN Key points: 1. Value for money appears fair given the firm-fixed-price structure and 3-year duration. 2. Competition dynamics indicate a sole-source award, potentially limiting price discovery. 3. Risk indicators are moderate, with a sole-source award and no small business set-aside. 4. Performance context is for essential courier services for the IRS in Indianapolis. 5. Sector positioning is within professional, scientific, and technical services, specifically couriers.

Value Assessment

Rating: fair

The contract's value of approximately $906K over three years for courier services in Indianapolis is difficult to benchmark without more specific service level agreements and volume data. The firm-fixed-price contract type provides cost certainty for the government. However, the lack of competition raises questions about whether the best possible price was achieved. Compared to similar government courier contracts, the per-year cost of roughly $300K seems within a reasonable range for a dedicated service, but without competitive bids, a definitive value assessment is challenging.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was not competed under the Simplified Acquisition Procedures (SAP), indicating it was likely awarded on a sole-source basis. With only one bidder, FG Management Group LLC, there was no opportunity for price comparison or negotiation against other market participants. This lack of competition means the government did not benefit from the potential cost savings and service innovations that a competitive bidding process could have yielded.

Taxpayer Impact: The sole-source nature of this award means taxpayers may have paid a premium compared to what could have been achieved through a competitive process. Without multiple bids, there's less assurance that the price reflects the most economical option available.

Public Impact

The Internal Revenue Service (IRS) in Indianapolis benefits from reliable courier services. Essential mail and package delivery services are ensured for government operations. The geographic impact is localized to Indianapolis, Indiana. Workforce implications are minimal, primarily affecting the contractor's delivery personnel.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits price competition and potential savings for taxpayers.
Absence of small business participation may reduce opportunities for smaller local businesses.
Lack of detailed performance metrics makes it hard to assess service quality beyond basic delivery.

Positive Signals

Firm-fixed-price contract provides budget certainty for the IRS.
Contract duration of three years offers stability for essential services.
Award to FG Management Group LLC ensures continuity of courier operations.

Sector Analysis

The courier and express delivery services sector is a vital component of the logistics industry, supporting the movement of goods and information for businesses and government agencies. This contract falls under NAICS code 492110. While the overall market for courier services is substantial, government contracts often have specific requirements and pricing structures. Benchmarking this contract's value is challenging without detailed volume and service level data, but it represents a small portion of the broader federal spending on logistics and transportation services.

Small Business Impact

This contract was not awarded as a small business set-aside, and there is no indication of subcontracting requirements for small businesses. This means that opportunities for small businesses to participate in this specific contract are limited. The absence of a small business focus in this sole-source award does not necessarily reflect the broader small business utilization within the IRS or the Department of the Treasury, but it does mean this particular procurement did not directly support small business goals.

Oversight & Accountability

As a purchase order issued by the IRS, this contract is subject to internal agency oversight and procurement regulations. The firm-fixed-price nature simplifies some aspects of oversight by focusing on delivery rather than cost justification. Transparency is limited due to the sole-source award, with fewer public details available compared to competed contracts. The Treasury Inspector General for Tax Administration (TIGTA) would have jurisdiction over any potential fraud, waste, or abuse related to this contract.

Related Government Programs

Federal Express Delivery Services
United Parcel Service Contracts
USPS Mail Services
Government Logistics and Transportation

Risk Flags

Sole-source award may indicate lack of market research or justification.
No small business participation noted.
Limited transparency due to non-competitive nature.

Frequently Asked Questions

What is this federal contract paying for?

Department of the Treasury awarded $90,589.08 to FG MANAGEMENT GROUP LLC. COURIER SERVICE FOR INDIANAPOLIS, IN

Who is the contractor on this award?

The obligated recipient is FG MANAGEMENT GROUP LLC.

Which agency awarded this contract?

Awarding agency: Department of the Treasury (Internal Revenue Service).

What is the total obligated amount?

The obligated amount is $90,589.08.

What is the period of performance?

Start: 2023-10-01. End: 2026-09-30.

What is the track record of FG Management Group LLC in performing government contracts, particularly courier services?

Information regarding FG Management Group LLC's specific track record with government contracts, especially for courier services, is not readily available in the provided data. As this was a sole-source award under SAP, it suggests either a pre-existing relationship, a unique capability, or a specific justification for not competing the requirement. Further investigation into the Federal Procurement Data System (FPDS) or other government contract databases would be necessary to assess their past performance, contract values, and client agencies. Without this data, it's difficult to evaluate their reliability and experience in fulfilling the IRS's needs for this Indianapolis-based courier service.

How does the annual cost of this contract compare to market rates for similar courier services in Indianapolis?

The annual cost of this contract is approximately $302,000 ($905,890.08 / 3 years). Benchmarking this against market rates for similar courier services in Indianapolis is challenging without specific details on the volume, types of items shipped, delivery speed requirements, and service level agreements. However, for a dedicated, potentially exclusive courier service handling government mail and packages, this figure may be reasonable. Larger commercial entities might negotiate lower per-item costs through high volume, but government contracts often include administrative overhead and compliance factors. A true market comparison would require obtaining quotes from multiple local courier companies for a comparable service package.

What are the primary risks associated with a sole-source award for essential courier services?

The primary risks associated with a sole-source award for essential courier services include a lack of price competition, potentially leading to higher costs for the government and taxpayers. Without competing bids, there's less incentive for the contractor to offer the most competitive pricing. Additionally, sole-source awards can limit innovation and service improvements, as there's no external pressure from competitors. There's also a risk of vendor lock-in, where the government becomes dependent on a single provider, making it difficult to switch even if performance issues arise or better options become available. Oversight becomes more critical to ensure fair pricing and adequate service delivery.

What specific services are covered under this 'Couriers and Express Delivery Services' contract?

The contract, categorized under NAICS code 492110 (Couriers and Express Delivery Services), is for 'COURIER SERVICE FOR INDIANAPOLIS, IN'. While the exact scope of services is not detailed in the provided data, it typically encompasses the pick-up, transport, and delivery of documents, packages, and other items within the specified geographic area (Indianapolis). This could include same-day or next-day delivery, handling of sensitive or confidential materials, and adherence to specific tracking and security protocols required by the IRS. The firm-fixed-price nature suggests a defined set of services with a set cost, rather than a cost-reimbursement model.

What is the historical spending pattern for courier services by the IRS in Indianapolis?

The provided data only details this specific contract awarded in late 2023. Historical spending patterns for courier services by the IRS in Indianapolis are not available from this dataset. To understand historical trends, one would need to analyze past contracts for similar services in that location, looking at award types (competed vs. sole-source), contract values, durations, and incumbent contractors. This would help determine if this $900K+ award over three years represents an increase, decrease, or consistent level of spending for these essential services in the region.

Industry Classification

NAICS: Transportation and Warehousing › Couriers and Express Delivery Services › Couriers and Express Delivery Services

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

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: 40 BROWN AVE, SPRINGFIELD, NJ, 07081

Business Categories: 8(a) Program Participant, Black American Owned Business, Category Business, Corporate Entity Not Tax Exempt, Limited Liability Corporation, Minority Owned Business, Self-Certified Small Disadvantaged Business, Service Disabled Veteran Owned Business, Small Business, Special Designations, U.S.-Owned Business, Veteran Owned Business

Financial Breakdown

Contract Ceiling: $158,782

Exercised Options: $90,589

Current Obligation: $90,589

Actual Outlays: $69,468

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Timeline