DHS awards $65.4M mail support contract to ServiceSource Inc. for National Capital Region operations

Contract Overview

Contract Amount: $65,408,516 ($65.4M)

Contractor: Servicesource Inc

Awarding Agency: Department of Homeland Security

Start Date: 2019-10-01

End Date: 2024-12-31

Contract Duration: 1,918 days

Daily Burn Rate: $34.1K/day

Competition Type: NOT AVAILABLE FOR COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: THIS CONTRACT REQUIRES THE CONTRACTOR TO PROVIDE HIGH-END, INDUSTRY STANDARD, MAIL SUPPORT SERVICE OPERATIONS FOR DEPARTMENT OF HOMELAND SECURITY (DHS) COMPONENTS WITHIN THE NATIONAL CAPITAL REGION (NCR) AT THE CONSOLIDATED REMOTE DELIVERY SITE (CRDS

Place of Performance

Location: CAPITOL HEIGHTS, PRINCE GEORGES County, MARYLAND, 20743

State: Maryland Government Spending

Plain-Language Summary

Department of Homeland Security obligated $65.4 million to SERVICESOURCE INC for work described as: THIS CONTRACT REQUIRES THE CONTRACTOR TO PROVIDE HIGH-END, INDUSTRY STANDARD, MAIL SUPPORT SERVICE OPERATIONS FOR DEPARTMENT OF HOMELAND SECURITY (DHS) COMPONENTS WITHIN THE NATIONAL CAPITAL REGION (NCR) AT THE CONSOLIDATED REMOTE DELIVERY SITE (CRDS Key points: 1. Contract provides essential mail support services for multiple DHS components. 2. Long-term contract duration suggests a stable, ongoing need for these services. 3. The firm-fixed-price structure aims to control costs and provide predictability. 4. ServiceSource Inc. has a significant contract value, indicating substantial operational scope. 5. The contract is not available for competition, raising questions about market testing. 6. Geographic focus on the National Capital Region highlights a critical operational hub.

Value Assessment

Rating: fair

The contract value of $65.4 million over approximately five years represents a substantial investment in mail support services. Benchmarking this against similar large-scale mail support operations for federal agencies is challenging without more specific service details. However, the firm-fixed-price nature suggests an attempt to lock in costs. The absence of a competitive bidding process means direct price comparisons to market rates are unavailable, making a definitive value-for-money assessment difficult.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded as 'not available for competition,' indicating that a competitive bidding process was not utilized. This could be due to various reasons, such as a sole-source justification or a specific set-aside that resulted in only one viable offer. The lack of open competition limits the opportunity for price discovery and potentially higher bids compared to a fully competed scenario.

Taxpayer Impact: Taxpayers may not benefit from the cost savings that can arise from robust competition, potentially leading to higher overall expenditure for these essential services.

Public Impact

Department of Homeland Security components within the National Capital Region benefit from streamlined mail operations. Ensures timely and secure delivery of mail and packages critical for agency functions. Supports the operational continuity of a key federal agency in the nation's capital. Potential workforce implications for mail handling and logistics personnel within the NCR.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition limits price discovery and potential cost savings for taxpayers.
Contract duration of nearly five years may not reflect evolving service needs or market innovations.
Limited transparency on the specific metrics used to justify the sole-source award.

Positive Signals

Firm-fixed-price contract provides cost certainty for the government.
Long-term award suggests a stable and reliable provider for critical services.
Consolidated remote delivery site (CRDS) indicates an effort towards operational efficiency.

Sector Analysis

The mail services sector for federal agencies involves a range of providers, from large logistics companies to specialized mail handling firms. Federal spending in this area supports the essential day-to-day operations of government functions. While specific benchmarks for mail support services are not readily available, the scale of this contract suggests it is a significant award within the broader government logistics and support services market. This contract fits within the administrative and operational support categories for federal agencies.

Small Business Impact

The data indicates that this contract was not set aside for small businesses (ss: false) and there is no indication of subcontracting requirements for small businesses (sb: false). This suggests that the primary contractor, ServiceSource Inc., is likely a large business, and the contract's value and scope may not directly benefit the small business ecosystem through set-asides or mandated subcontracting opportunities.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of Homeland Security's procurement and program management offices. As a definitive contract, it is subject to standard federal acquisition regulations and oversight. Transparency is generally maintained through contract award databases, but specific performance metrics and oversight mechanisms are internal to the agency. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

DHS Mail Operations
Federal Postal Services
Government Logistics Support
Administrative Services Contracts
National Capital Region Federal Operations

Risk Flags

Sole-source award may limit cost savings.
Lack of competition reduces market pressure for innovation.
Contract duration may not align with evolving needs.

Frequently Asked Questions

What is this federal contract paying for?

Department of Homeland Security awarded $65.4 million to SERVICESOURCE INC. THIS CONTRACT REQUIRES THE CONTRACTOR TO PROVIDE HIGH-END, INDUSTRY STANDARD, MAIL SUPPORT SERVICE OPERATIONS FOR DEPARTMENT OF HOMELAND SECURITY (DHS) COMPONENTS WITHIN THE NATIONAL CAPITAL REGION (NCR) AT THE CONSOLIDATED REMOTE DELIVERY SITE (CRDS

Who is the contractor on this award?

The obligated recipient is SERVICESOURCE INC.

Which agency awarded this contract?

Awarding agency: Department of Homeland Security (Office of Procurement Operations).

What is the total obligated amount?

The obligated amount is $65.4 million.

What is the period of performance?

Start: 2019-10-01. End: 2024-12-31.

What is the track record of ServiceSource Inc. in providing similar mail support services to federal agencies?

ServiceSource Inc. has a history of providing services to government agencies, often focusing on areas like contract management, logistics, and support services. While specific details on their mail support operations for DHS are not provided in the summary data, their involvement in large federal contracts suggests experience in managing complex service delivery. Further investigation into their past performance on similar contracts, including any performance reviews or past issues, would be necessary for a comprehensive assessment. Their ability to manage a contract of this size and duration for a critical agency like DHS implies a certain level of established capability and infrastructure.

How does the $65.4 million contract value compare to similar mail support contracts awarded by other federal agencies?

Direct comparison of the $65.4 million contract value for mail support services is difficult without more granular data on the scope and specific services included. Federal spending on mail and logistics can vary significantly based on agency size, geographic reach, and the complexity of mail handling requirements. However, for a contract covering a major agency like DHS within the National Capital Region over nearly five years, this value appears substantial, suggesting a comprehensive service requirement. Benchmarking would ideally involve comparing it to contracts for similar geographic areas or agencies with comparable mail volumes and security needs.

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

The primary risks associated with a sole-source award for essential mail support services include a lack of competitive pricing, potentially leading to higher costs for taxpayers. Without competition, there is less incentive for the contractor to innovate or improve efficiency beyond contractual requirements. Furthermore, reliance on a single provider can create vulnerability if the contractor experiences performance issues, financial instability, or decides to exit the market. The absence of a competitive process also limits transparency and the opportunity to explore alternative service delivery models or providers that might offer better value or specialized capabilities.

What are the potential implications of this contract on the efficiency and effectiveness of DHS mail operations?

This contract aims to enhance the efficiency and effectiveness of DHS mail operations by consolidating support services at a central location (CRDS) within the National Capital Region. By outsourcing these functions to a dedicated provider like ServiceSource Inc., DHS components can potentially focus more on their core missions. The firm-fixed-price structure and long-term nature of the contract suggest a commitment to stable, predictable service delivery. However, the effectiveness will ultimately depend on the contractor's performance, adherence to service level agreements, and the agency's oversight mechanisms to ensure quality and responsiveness.

What is the historical spending pattern for mail support services within DHS or similar agencies?

Historical spending patterns for mail support services within DHS and similar large federal agencies typically show consistent, significant investment due to the volume and criticality of mail operations. Agencies often rely on a mix of in-house services and contracted support. Spending can fluctuate based on organizational changes, consolidation efforts, and shifts towards digital communication, though physical mail remains essential. Contracts for these services are often long-term due to the specialized nature of the work and the need for stable operations. Analyzing past DHS budgets or similar agency contracts would reveal trends in outsourcing and overall expenditure on mail and logistics.

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 AVAILABLE FOR COMPETITION

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: 70RDAD19R00000005

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 1100 HAMPTON PARK BLVD, CAPITOL HEIGHTS, MD, 20743

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: $65,408,516

Exercised Options: $65,408,516

Current Obligation: $65,408,516

Actual Outlays: $29,571,355

Contract Characteristics

Commercial Item: PRODUCTS OR SERVICES PURSUANT TO FAR 12.102(F)

Cost or Pricing Data: NO

Timeline