VA awards $3.1M janitorial contract to HAMHED LLC, highlighting a competitive bidding process

Contract Overview

Contract Amount: $3,123,369 ($3.1M)

Contractor: Hamhed LLC

Awarding Agency: Department of Veterans Affairs

Start Date: 2023-06-29

End Date: 2024-03-05

Contract Duration: 250 days

Daily Burn Rate: $12.5K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 14

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: JANITORIAL SERVICES

Place of Performance

Location: LONG BEACH, LOS ANGELES County, CALIFORNIA, 90822

State: California Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $3.1 million to HAMHED LLC for work described as: JANITORIAL SERVICES Key points: 1. The contract value of $3.1 million represents a significant investment in maintaining federal facilities. 2. The 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES' indicates a robust bidding process. 3. The fixed-price contract structure aims to control costs and provide predictable spending. 4. The duration of 250 days suggests a focused scope of work for the janitorial services. 5. The award to HAMHED LLC contributes to the operational efficiency of the Department of Veterans Affairs. 6. The absence of small business set-aside flags potential for larger prime contractors.

Value Assessment

Rating: good

The contract value of $3.1 million for janitorial services appears reasonable given the scope and duration. Benchmarking against similar federal contracts for janitorial services in California would provide a more precise value-for-money assessment. The firm fixed-price nature of the contract suggests that the government has negotiated a set price, which can be advantageous in controlling costs, assuming the scope was well-defined.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

The contract was awarded under 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES', which implies that while the competition was intended to be broad, certain sources were excluded. This could be due to specific requirements or prior performance issues. With 14 bidders, the competition level was substantial, suggesting that price discovery was likely effective and that the government received competitive offers. However, the exclusion of sources warrants further investigation into the rationale.

Taxpayer Impact: The high number of bidders in a competitively awarded contract generally benefits taxpayers by driving down prices and ensuring a fair market rate is achieved. The exclusion of sources, if not fully justified, could potentially limit the most competitive offers from reaching the government.

Public Impact

Veterans and VA staff benefit from a clean and sanitary environment within VA facilities. Essential janitorial services are delivered to ensure operational readiness and health standards. The geographic impact is concentrated in California, supporting local federal facilities. The contract supports employment within the janitorial services sector in the region.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

The exclusion of sources in a 'full and open' competition needs clear justification to ensure maximum competition.
The specific criteria for excluding sources could potentially limit the diversity of bidders and innovation.
The fixed-price contract requires careful scope management to avoid change orders that could increase costs.

Positive Signals

The high number of bidders (14) indicates strong market interest and competitive pressure.
The firm fixed-price contract provides cost certainty for the government.
The award to HAMHED LLC contributes to the operational efficiency of the VA.

Sector Analysis

Janitorial services fall under the broader facilities maintenance and management sector. This sector is characterized by a mix of large, established companies and numerous small businesses. Federal spending in this area is consistent, driven by the need to maintain government buildings and installations across the country. The market size for federal janitorial contracts is substantial, with agencies like the VA being significant procurers. This contract fits within the typical procurement patterns for essential facility upkeep.

Small Business Impact

This contract did not include a small business set-aside, as indicated by 'ss: false' and 'sb: false'. This suggests that the procurement was open to all qualified bidders, including large businesses. While this can lead to robust competition, it may also mean fewer opportunities for small businesses to secure prime contracts directly. Subcontracting opportunities for small businesses may arise, but this is not guaranteed by the contract terms.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and the relevant program officials within the Department of Veterans Affairs. Accountability measures are embedded in the firm fixed-price contract, requiring delivery of specified services to avoid non-compliance. Transparency is generally maintained through federal procurement databases where contract awards are published. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

Federal Building Maintenance Contracts
Government Facility Cleaning Services
Department of Veterans Affairs Operations Support
Janitorial Services Procurement

Risk Flags

Potential for limited competition due to source exclusion
Need for clear performance metrics and oversight

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $3.1 million to HAMHED LLC. JANITORIAL SERVICES

Who is the contractor on this award?

The obligated recipient is HAMHED LLC.

Which agency awarded this contract?

Awarding agency: Department of Veterans Affairs (Department of Veterans Affairs).

What is the total obligated amount?

The obligated amount is $3.1 million.

What is the period of performance?

Start: 2023-06-29. End: 2024-03-05.

What is the historical spending by the Department of Veterans Affairs on janitorial services over the past five years?

Detailed historical spending data for janitorial services by the Department of Veterans Affairs (VA) over the past five years is not directly available in this summary. However, federal agencies like the VA consistently require janitorial services to maintain their facilities, which include hospitals, clinics, and administrative buildings. Annual spending can fluctuate based on facility needs, new construction or renovations, and budget allocations. To obtain precise figures, one would need to consult the VA's official budget reports, contract databases like FPDS-NG, or agency-specific procurement forecasts. Generally, the VA is a significant spender in this category due to its extensive real estate footprint.

How does the per-hour labor cost for this contract compare to industry averages for janitorial services in California?

Determining the precise per-hour labor cost from the provided data is not possible as the contract is a firm fixed price for a delivery order with a total value of $3,123,368.61 and a duration of 250 days. This value encompasses all labor, materials, overhead, and profit. To compare with industry averages, one would need to estimate the total labor hours required for the scope of work and then divide the total contract value (or the labor portion of it) by those hours. Industry averages for janitorial labor in California can vary significantly by region and the specific services provided (e.g., standard cleaning vs. specialized disinfection). Without a detailed breakdown of labor hours and rates within the contract, a direct comparison is speculative.

What specific performance metrics are included in the contract to ensure service quality?

The provided data does not specify the exact performance metrics or quality assurance surveillance plan (QASP) for this janitorial services contract. However, for federal contracts, especially those with a firm fixed-price structure, performance is typically monitored against a defined scope of work and service level agreements (SLAs). Common metrics for janitorial services include adherence to cleaning schedules, proper waste disposal, maintenance of sanitary conditions, and responsiveness to reported issues. The contracting officer's representative (COR) or a designated quality assurance specialist would likely be responsible for monitoring performance and ensuring compliance with contract requirements. Failure to meet these metrics could result in contract deficiencies or penalties.

What is the track record of HAMHED LLC in performing similar government contracts?

Information regarding the specific track record of HAMHED LLC in performing similar government contracts is not detailed in the provided summary data. To assess their track record, one would typically review their past performance evaluations in federal procurement databases (e.g., Contractor Performance Assessment Reporting System - CPARS), their history of contract awards, and any reported issues or disputes. A positive performance history with similar scope and value contracts would indicate a lower risk for this award. Conversely, a history of deficiencies or contract terminations would raise concerns about their capability to successfully execute this delivery order.

Were there any significant cost savings identified during the bidding process compared to the government's estimate?

The provided data does not include the government's estimate for this janitorial services contract, nor does it explicitly state whether cost savings were achieved during the bidding process. However, the fact that the contract was awarded under 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES' with 14 bidders suggests a competitive environment. In such scenarios, it is common for the awarded price to be below the government's independent government cost estimate (IGCE), as bidders strive to offer the most competitive pricing to win the contract. Without the IGCE, it's impossible to quantify the exact savings, but the competitive nature implies potential efficiencies.

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: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 14

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 200 GALVAN WAY, NEW ALBANY, IN, 47150

Business Categories: Category Business, Limited Liability Corporation, Service Disabled Veteran Owned Business, Small Business, Special Designations, U.S.-Owned Business, Veteran Owned Business

Financial Breakdown

Contract Ceiling: $3,123,369

Exercised Options: $3,123,369

Current Obligation: $3,123,369

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: 36C26220D0007

IDV Type: IDC

Timeline