IRS awards $12.2M contract for custodial and pest control services at Memphis facility

Contract Overview

Contract Amount: $12,237,611 ($12.2M)

Contractor: Memphis Goodwill Industries Inc

Awarding Agency: Department of the Treasury

Start Date: 2024-01-01

End Date: 2026-12-31

Contract Duration: 1,095 days

Daily Burn Rate: $11.2K/day

Competition Type: NOT AVAILABLE FOR COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: CUSTODIAL AND PEST CONTROL SERVICES AT MEMPHIS INTERNAL REVENUE SERVICE/ ENTERPRISE COMPUTER CENTER CAMPUS (MIRSC) IN MEMPHIS, TENNESSEE

Place of Performance

Location: MEMPHIS, SHELBY County, TENNESSEE, 38118

State: Tennessee Government Spending

Plain-Language Summary

Department of the Treasury obligated $12.2 million to MEMPHIS GOODWILL INDUSTRIES INC for work described as: CUSTODIAL AND PEST CONTROL SERVICES AT MEMPHIS INTERNAL REVENUE SERVICE/ ENTERPRISE COMPUTER CENTER CAMPUS (MIRSC) IN MEMPHIS, TENNESSEE Key points: 1. The contract is for custodial and pest control services at the IRS/ECC campus in Memphis, TN. 2. The sole awardee is Memphis Goodwill Industries Inc. 3. The contract is a firm-fixed-price definitive contract with a duration of 1095 days. 4. The contract was not available for competition. 5. The estimated value is $12,237,610.59.

Value Assessment

Rating: fair

The contract value of $12.2M over three years for custodial and pest control services appears within a reasonable range for a facility of this size. However, without specific details on the scope of services and facility square footage, a precise benchmark is difficult.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

The contract was not available for competition, indicating a limited competition approach. This may limit price discovery and potentially lead to higher costs compared to a fully competitive process.

Taxpayer Impact: Taxpayer funds are being used for this contract. The lack of competition raises concerns about whether the best possible price was achieved.

Public Impact

Ensures a clean and safe working environment for IRS employees at the Memphis facility. Supports essential building maintenance and operational continuity. Provides services that contribute to the overall efficiency of IRS operations.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition
Potential for inflated pricing due to limited competition

Positive Signals

Essential service provision
Award to a known entity (Memphis Goodwill)

Sector Analysis

Custodial and pest control services fall under the broader facilities management sector. Spending in this sector is generally stable, driven by the need for basic building upkeep across government agencies. Benchmarks vary significantly based on facility size and specific service requirements.

Small Business Impact

The data does not indicate whether small businesses were involved as subcontractors. The primary awardee, Memphis Goodwill Industries Inc., is a non-profit organization, and its role in supporting employment for individuals with barriers to employment is a positive social impact.

Oversight & Accountability

The contract is managed by the Department of the Treasury, specifically the Internal Revenue Service. Standard contract oversight mechanisms should be in place to ensure performance and adherence to terms. The lack of competition warrants closer scrutiny.

Related Government Programs

Janitorial Services
Department of the Treasury Contracting
Internal Revenue Service Programs

Risk Flags

Limited competition may result in higher costs.
Lack of transparency in the justification for limited competition.
Potential for cost overruns if scope is not tightly managed.
Performance monitoring is crucial to ensure service quality.

Frequently Asked Questions

What is this federal contract paying for?

Department of the Treasury awarded $12.2 million to MEMPHIS GOODWILL INDUSTRIES INC. CUSTODIAL AND PEST CONTROL SERVICES AT MEMPHIS INTERNAL REVENUE SERVICE/ ENTERPRISE COMPUTER CENTER CAMPUS (MIRSC) IN MEMPHIS, TENNESSEE

Who is the contractor on this award?

The obligated recipient is MEMPHIS GOODWILL INDUSTRIES INC.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $12.2 million.

What is the period of performance?

Start: 2024-01-01. End: 2026-12-31.

What specific factors led to this contract being 'not available for competition', and were alternatives explored?

The determination of 'not available for competition' typically arises from specific circumstances such as urgent needs, unique capabilities, or sole-source provider situations. Further investigation into the justification provided by the IRS is necessary to understand the rationale and confirm that all reasonable efforts were made to ensure competition or justify its absence.

How does the per-square-foot cost of these services compare to similar government contracts for facilities of comparable size and type?

A detailed cost-per-square-foot analysis would require access to the contract's detailed scope of work, including the total square footage of the Memphis IRS/ECC campus. Benchmarking against similar government contracts for custodial and pest control services would then reveal if the $12.2M award represents a fair and reasonable price, especially given the limited competition.

What performance metrics are in place to ensure the effectiveness and quality of the custodial and pest control services provided?

Effective oversight requires clearly defined performance standards and metrics within the contract. The IRS should have established procedures for monitoring service quality, addressing deficiencies, and ensuring that the contractor, Memphis Goodwill Industries Inc., meets all contractual obligations for cleanliness, pest management, and overall facility upkeep.

Industry Classification

NAICS: Administrative and Support and Waste Management and Remediation Services › Services to Buildings and Dwellings › Janitorial Services

Product/Service Code: UTILITIES AND HOUSEKEEPING › HOUSEKEEPING SERVICES

Competition & Pricing

Extent Competed: NOT AVAILABLE FOR COMPETITION

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: 2043FY-23-R-00004

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 6895 STAGE RD, MEMPHIS, TN, 38133

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

Financial Breakdown

Contract Ceiling: $20,235,156

Exercised Options: $15,993,235

Current Obligation: $12,237,611

Actual Outlays: $8,398,489

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Timeline