Transportation Dept. awards $26M contract for business association services, raising questions on competition and value

Contract Overview

Contract Amount: $26,005 ($26.0K)

Contractor: American Bureau of Shipping

Awarding Agency: Department of Transportation

Start Date: 2023-01-15

End Date: 2023-12-31

Contract Duration: 350 days

Daily Burn Rate: $74/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: TSFS FY23 ABS SERVICES

Place of Performance

Location: PINEY POINT, SAINT MARYS County, MARYLAND, 20674

State: Maryland Government Spending

Plain-Language Summary

Department of Transportation obligated $26,005.03 to AMERICAN BUREAU OF SHIPPING for work described as: TSFS FY23 ABS SERVICES Key points: 1. Contract awarded on a non-competitive basis, limiting price discovery and potentially increasing costs. 2. The firm fixed-price contract type offers some cost certainty but doesn't mitigate the lack of competition. 3. Limited competition raises concerns about whether the government secured the best possible value for taxpayer funds. 4. The contract duration of 350 days suggests a need for ongoing services, but the procurement method is unclear. 5. Analysis of the contractor's past performance and pricing benchmarks is crucial for assessing value. 6. The specific services provided under 'Business Associations' need further clarification to understand the contract's impact.

Value Assessment

Rating: questionable

Without a competitive bidding process, it is difficult to benchmark the value for money. The $26 million award for business association services lacks clear comparable contracts in the provided data to assess pricing against market rates. The firm fixed-price nature provides some cost control, but the absence of competition means the government may not have achieved the most advantageous pricing. Further analysis would require understanding the specific deliverables and comparing them to industry standards or similar government contracts.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning it was not competed. This limits the number of potential bidders to one, which can lead to higher prices and reduced innovation. The lack of competition means the Maritime Administration did not explore the market to find the most cost-effective solution or the best-qualified vendor through a transparent process.

Taxpayer Impact: Sole-source awards mean taxpayers may be paying a premium, as there was no opportunity for multiple vendors to bid and drive down costs through competition.

Public Impact

The primary beneficiaries are likely the recipients of the business association services funded by this contract. Services delivered are related to business associations, though specific details are not provided. The geographic impact is centered in Maryland, where the contractor is located. Workforce implications are not detailed but would involve personnel at the contractor's firm.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition for a significant award raises concerns about potential overpayment.
The 'Business Associations' category is broad and may obscure the true nature and necessity of the services.
Absence of details on performance metrics makes it hard to assess effectiveness.
The sole-source nature prevents an evaluation of alternative service providers.
No indication of small business participation or subcontracting opportunities.

Positive Signals

The contract is firm fixed-price, offering some cost predictability.
The contractor is based in Maryland, potentially supporting local economic activity.
The award is for FY23, indicating a current need for these services.

Sector Analysis

The contract falls under business support services, a broad category within the professional services sector. The market for such services can vary widely depending on specialization. Without specific details on the 'business associations' services, it's challenging to benchmark against industry standards or comparable government spending. However, large sole-source contracts in professional services often warrant scrutiny to ensure fair pricing and necessity.

Small Business Impact

The provided data indicates that this contract was not set aside for small businesses (ss: false) and there is no information on subcontracting (sb: false). This suggests that small businesses were not specifically targeted for this award, and their potential involvement through subcontracting is not evident from the data. Further investigation would be needed to determine if any outreach was made to small businesses or if they were excluded from consideration.

Oversight & Accountability

Oversight mechanisms for this contract are not detailed in the provided data. As a sole-source award, it may have undergone specific justification and approval processes within the Department of Transportation. Transparency is limited due to the non-competitive nature. Accountability would typically be managed through contract performance monitoring by the contracting officer, but specific details on reporting or audits are absent.

Related Government Programs

Federal Procurement Data System (FPDS)
General Services Administration (GSA) Schedules
Department of Transportation Agency-Specific Contracts
Professional Services Acquisition

Risk Flags

Sole-source award raises concerns about value for money.
Lack of competition limits price discovery and potential for better deals.
Broad service category ('Business Associations') lacks specificity, hindering performance assessment.
No clear indication of performance metrics or oversight details.
Potential for overpayment due to non-competitive nature.

Frequently Asked Questions

What is this federal contract paying for?

Department of Transportation awarded $26,005.03 to AMERICAN BUREAU OF SHIPPING. TSFS FY23 ABS SERVICES

Who is the contractor on this award?

The obligated recipient is AMERICAN BUREAU OF SHIPPING.

Which agency awarded this contract?

Awarding agency: Department of Transportation (Maritime Administration).

What is the total obligated amount?

The obligated amount is $26,005.03.

What is the period of performance?

Start: 2023-01-15. End: 2023-12-31.

What specific services are included under 'Business Associations' for this $26 million contract?

The provided data categorizes this award under NAICS code 813910 (Business Associations), indicating the general nature of the services. However, the specific deliverables, scope of work, and intended outcomes are not detailed. These services could range from industry advocacy, research, policy development, event organization, to member support for various business groups. Without a detailed statement of work, it is impossible to ascertain the precise nature of the services rendered and their direct impact or necessity for the Maritime Administration's mission.

What was the justification for awarding this contract on a sole-source basis?

The data explicitly states 'CT: NOT COMPETED', indicating a sole-source or non-competitive award. Federal procurement regulations require a justification for sole-source awards, typically citing reasons such as only one responsible source being available, or an urgent and compelling need that cannot be met through competition. The specific justification document (e.g., a Justification and Approval - J&A) for this $26 million contract would need to be obtained from the Department of Transportation to understand the rationale behind bypassing the competitive bidding process. This is crucial for assessing the legitimacy of the award.

How does the $26 million cost compare to similar business association services procured by the government?

Benchmarking this $26 million contract is challenging without more specific details on the services provided and the contractor's performance. The NAICS code 813910 covers a wide array of business association activities. To perform a meaningful comparison, one would need to identify contracts with similar scopes of work, durations, and service levels, ideally procured through competitive means. Analyzing historical spending patterns within the Maritime Administration or across other federal agencies for comparable services, and examining the pricing structures of awarded contracts, would be necessary to determine if this award represents fair market value.

What is the track record of AMERICAN BUREAU OF SHIPPING in providing business association services to the federal government?

The provided data identifies AMERICAN BUREAU OF SHIPPING (AMERICAN BUREAU OF SHIPPING) as the contractor. While the data confirms they received this $26 million award, it does not detail their past performance specifically in 'Business Associations' services for the federal government. A comprehensive assessment would require reviewing their contract history, performance evaluations (e.g., Contractor Performance Assessment Reporting System - CPARS), and any documented successes or failures on previous government contracts. Understanding their experience and past performance is critical for evaluating the risk associated with this sole-source award.

What are the potential risks associated with awarding a large contract like this without competition?

The primary risks of awarding a $26 million contract on a sole-source basis are increased costs due to the lack of competitive pressure, potential for substandard performance if the contractor is not adequately incentivized, and a lack of transparency in the procurement process. Taxpayers may overpay for services that could have been procured more affordably through competition. Furthermore, it limits the government's ability to explore innovative solutions or leverage the expertise of a wider range of potential vendors. The absence of competition can also reduce accountability, as the contractor may feel less pressure to perform exceptionally.

What is the historical spending trend for business association services by the Maritime Administration?

The provided data snippet focuses on a single FY23 contract award. To analyze historical spending trends for business association services by the Maritime Administration, one would need access to historical procurement data, ideally spanning several fiscal years. This would involve querying databases like FPDS to identify all contracts awarded under relevant NAICS codes (e.g., 813910) or service descriptions by the Maritime Administration. Analyzing this data would reveal patterns in spending levels, types of services procured, and the procurement methods used (competitive vs. sole-source) over time.

Industry Classification

NAICS: Other Services (except Public Administration) › Business, Professional, Labor, Political, and Similar Organizations › Business Associations

Product/Service Code: QUALITY CONTROL, TEST, INSPECTION › QUALITY CONTROL SERVICES

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: 6933A223Q000002

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 1701 CITY PLAZA DR, SPRING, TX, 77389

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

Financial Breakdown

Contract Ceiling: $26,005

Exercised Options: $26,005

Current Obligation: $26,005

Actual Outlays: $26,005

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Timeline