DOT awards $3.77M mail and package delivery contract to ServiceSource Inc. for headquarters

Contract Overview

Contract Amount: $3,770,603 ($3.8M)

Contractor: Servicesource Inc

Awarding Agency: Department of Transportation

Start Date: 2024-07-01

End Date: 2026-02-28

Contract Duration: 607 days

Daily Burn Rate: $6.2K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: THE PURPOSE OF THIS CONTRACT AWARD IS TO CREATE A NEW CONTRACT FOR MAIL AND SMALL PACKAGE/PARCEL PICK-UP AND DELIVERY SERVICES FOR THE US DEPARTMENT OF TRANSPORTATION AND FAA HEADQUARTERS BUILDINGS

Place of Performance

Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20590

State: District of Columbia Government Spending

Plain-Language Summary

Department of Transportation obligated $3.8 million to SERVICESOURCE INC for work described as: THE PURPOSE OF THIS CONTRACT AWARD IS TO CREATE A NEW CONTRACT FOR MAIL AND SMALL PACKAGE/PARCEL PICK-UP AND DELIVERY SERVICES FOR THE US DEPARTMENT OF TRANSPORTATION AND FAA HEADQUARTERS BUILDINGS Key points: 1. Contract focuses on essential mail and package delivery services for DOT and FAA. 2. Sole-source award raises questions about potential for better pricing through competition. 3. Fixed-price contract type mitigates cost overrun risk for the government. 4. Short performance period (607 days) suggests a need for immediate service delivery. 5. ServiceSource Inc. is the sole awardee, indicating a specific capability or relationship. 6. Geographic focus is limited to Washington D.C. headquarters buildings.

Value Assessment

Rating: fair

The contract value of $3.77 million for mail and small package delivery services over approximately two years appears reasonable for a sole-source award to a single entity. However, without competitive bidding, it is difficult to benchmark against market rates or assess if the government secured the best possible value. The fixed-price nature of the contract provides cost certainty, but the absence of competition prevents a direct comparison of pricing efficiency.

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 among multiple vendors. This approach is typically used when only one vendor can provide the required service, or for urgent needs. The lack of competition means that the government did not benefit from the price discovery and potential cost savings that typically arise from a competitive bidding process.

Taxpayer Impact: Taxpayers may not have received the most cost-effective solution due to the absence of competitive pressure on pricing.

Public Impact

Employees at the Department of Transportation and FAA headquarters in Washington D.C. will benefit from reliable mail and package delivery services. The contract ensures the efficient flow of official correspondence, supplies, and other critical items to and from the headquarters. The primary geographic impact is localized to the DOT and FAA headquarters buildings within the District of Columbia. The contract supports the operational needs of federal employees working at these key transportation agencies.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits opportunities for other vendors and potentially higher competition.
Lack of competition makes it difficult to assess if the pricing is optimal.
Short contract duration might indicate a temporary solution or a need for re-evaluation soon.

Positive Signals

Fixed-price contract provides cost certainty and limits the government's exposure to cost increases.
Award to a single entity suggests a focused and potentially specialized service provider.
Contract ensures essential mail and package services are maintained for critical agencies.

Sector Analysis

The postal and courier services sector is a mature industry with established players. Federal spending in this area typically supports the operational needs of government agencies for mail, package delivery, and logistics. While large contracts exist for broader logistics and transportation management, this award focuses on a specific, localized need for mail and small package handling within agency headquarters. Benchmarking would typically involve comparing rates for similar services provided to other large organizations or government entities.

Small Business Impact

This contract was not set aside for small businesses, nor does it appear to have specific subcontracting requirements for small businesses mentioned in the provided data. The award to ServiceSource Inc. suggests that the primary contractor is likely a larger entity, and the focus is on direct service delivery rather than fostering small business participation through this specific award.

Oversight & Accountability

As a definitive contract, it is subject to standard federal procurement oversight. The Department of Transportation's contracting officers are responsible for monitoring performance and ensuring compliance. While specific oversight mechanisms beyond standard contract management are not detailed, the fixed-price nature provides a degree of financial control. Transparency would be enhanced through a competitive process, which was not utilized here.

Related Government Programs

Federal Express (FedEx) contracts
United Parcel Service (UPS) contracts
US Postal Service (USPS) agreements
Logistics and supply chain management services

Risk Flags

Sole-source award may indicate lack of market research or limited vendor pool.
Absence of competition prevents verification of best value pricing.
Contract duration is relatively short, requiring timely re-procurement.

Frequently Asked Questions

What is this federal contract paying for?

Department of Transportation awarded $3.8 million to SERVICESOURCE INC. THE PURPOSE OF THIS CONTRACT AWARD IS TO CREATE A NEW CONTRACT FOR MAIL AND SMALL PACKAGE/PARCEL PICK-UP AND DELIVERY SERVICES FOR THE US DEPARTMENT OF TRANSPORTATION AND FAA HEADQUARTERS BUILDINGS

Who is the contractor on this award?

The obligated recipient is SERVICESOURCE INC.

Which agency awarded this contract?

Awarding agency: Department of Transportation (Immediate Office of the Secretary of Transportation).

What is the total obligated amount?

The obligated amount is $3.8 million.

What is the period of performance?

Start: 2024-07-01. End: 2026-02-28.

What is the track record of ServiceSource Inc. in providing mail and package delivery services to federal agencies?

The provided data indicates ServiceSource Inc. as the awardee for this specific contract. However, it does not offer details on their past performance or track record in delivering mail and package services to federal agencies. Further investigation into contract databases and performance reports would be necessary to assess their history, reliability, and client satisfaction with similar services. Understanding their experience with government contracts, particularly those involving logistics and delivery, is crucial for evaluating the risk associated with this award.

How does the pricing of this contract compare to similar mail and package delivery services for federal agencies?

Direct comparison of pricing is challenging due to the sole-source nature of this award. Typically, competitive bidding allows for price discovery and benchmarking against multiple offers. Without this, it's difficult to ascertain if $3.77 million over approximately 20 months represents optimal value. To assess value, one would need to compare the per-unit costs (e.g., per package, per pound) or overall service costs against contracts awarded competitively for similar services to other federal agencies or large organizations in the Washington D.C. area. The fixed-price contract offers cost certainty but doesn't inherently guarantee the lowest possible price.

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

The primary risk associated with a sole-source award for essential mail and package services is the potential for inflated pricing due to the lack of competitive pressure. Without competing bids, the government may overpay for the services rendered. Additionally, there's a risk of vendor lock-in, where the agency becomes dependent on a single provider, potentially limiting flexibility and future cost-saving opportunities. While this contract is for a defined period, the absence of competition hinders the government's ability to explore alternative, potentially more cost-effective solutions or providers in the market.

How effective is the fixed-price contract type in managing costs for this mail delivery service?

The Firm Fixed Price (FFP) contract type is generally effective in managing costs for services like mail and package delivery, as it shifts the risk of cost overruns to the contractor. The government knows the total cost upfront, which aids in budget planning and predictability. For ServiceSource Inc., this means they must absorb any unexpected increases in operational costs (e.g., fuel, labor) to remain profitable. This contract type is suitable when the scope of work is well-defined and risks are manageable, providing cost certainty for the Department of Transportation.

What is the historical spending pattern for mail and package delivery services at the Department of Transportation headquarters?

The provided data does not include historical spending patterns for mail and package delivery services at the Department of Transportation headquarters. To analyze this, one would need to access historical contract databases and search for previous awards related to postal services, courier services, or mail management for DOT and FAA headquarters. Understanding past expenditures, contract durations, and awardees would provide context for the current $3.77 million award, helping to determine if spending has increased, decreased, or remained consistent over time.

What are the implications of the short contract duration (607 days) for service continuity and future procurement?

The relatively short contract duration of 607 days (approximately 20 months) suggests that this award may be intended to fulfill an immediate need or serve as a bridge to a future, potentially larger or differently structured, contract. For service continuity, it implies that the Department of Transportation will need to initiate a new procurement process well in advance of the February 28, 2026, expiration date to ensure uninterrupted service. This short timeframe also limits the contractor's long-term investment incentive and may necessitate more frequent contract renewals or re-competitions.

Industry Classification

NAICS: Transportation and Warehousing › Postal Service › Postal Service

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

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: 693JK424R500003

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 10467 WHITE GRANITE DR, OAKTON, VA, 22124

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: $42,729,243

Exercised Options: $12,979,901

Current Obligation: $3,770,603

Actual Outlays: $3,377,252

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline