HUD awards $2.7M contract for accounting services to ELITEBCO LLC, a sole-source procurement

Contract Overview

Contract Amount: $2,700,000 ($2.7M)

Contractor: Elitebco LLC

Awarding Agency: Department of Housing and Urban Development

Start Date: 2023-09-30

End Date: 2026-09-29

Contract Duration: 1,095 days

Daily Burn Rate: $2.5K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: OMB CIRCULAR A-123 SUPPORT SERVICES

Place of Performance

Location: SAN JUAN, SAN JUAN County, PUERTO RICO, 00909

Plain-Language Summary

Department of Housing and Urban Development obligated $2.7 million to ELITEBCO LLC for work described as: OMB CIRCULAR A-123 SUPPORT SERVICES Key points: 1. Contract awarded on a sole-source basis, limiting potential cost savings from competition. 2. The contract duration of three years (1095 days) suggests a need for sustained support. 3. Firm Fixed Price contract type aims to control costs, but sole-source nature may inflate the base price. 4. The NAICS code 541211 indicates a focus on accounting, auditing, and bookkeeping services. 5. No small business set-aside was utilized, potentially impacting small business participation. 6. The contract's value is relatively modest within the broader federal contracting landscape.

Value Assessment

Rating: fair

The contract value of $2.7 million over three years for accounting services appears within a reasonable range for federal support. However, without a competitive bidding process, it is difficult to benchmark the pricing against market rates or identify potential cost savings. The firm fixed-price structure provides cost certainty for the government, but the absence of competition raises questions about whether the most advantageous price was secured. Further analysis would require comparing ELITEBCO LLC's proposed rates to similar sole-source contracts for comparable services.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was not competed, indicating a sole-source award. The specific justification for this approach is not provided in the data, but it typically arises when only one vendor can meet the requirement due to unique capabilities, urgent needs, or a lack of market research. The absence of competition means that the government did not benefit from multiple offers, which could have driven down prices and spurred innovation. This limits the ability to assess price discovery and the potential for a more cost-effective outcome.

Taxpayer Impact: For taxpayers, a sole-source award means there is a higher risk of paying a premium for services due to the lack of competitive pressure. This can lead to less efficient use of public funds compared to a competed contract.

Public Impact

The Department of Housing and Urban Development (HUD) will benefit from specialized accounting services. These services are crucial for maintaining financial integrity and compliance within the agency. The contract supports the agency's core mission by ensuring accurate financial record-keeping. The primary beneficiaries are HUD's internal finance and accounting departments, ensuring operational continuity.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may lead to higher costs for taxpayers.
Sole-source awards can reduce transparency and accountability in procurement.
Potential for vendor lock-in if ELITEBCO LLC's services become indispensable.

Positive Signals

Firm Fixed Price contract provides cost certainty.
Contract duration suggests a stable, ongoing need for these services.
Focus on accounting services (NAICS 541211) indicates specialized expertise is being procured.

Sector Analysis

The federal government procures a vast array of professional services, including accounting and auditing, under NAICS code 541211. This sector is characterized by a mix of large, established firms and smaller specialized companies. Federal spending in this area is driven by the need for financial oversight, compliance, and auditing across all agencies. While many accounting contracts are competed, sole-source awards are sometimes utilized for specific, urgent, or highly specialized requirements. The $2.7 million value for this three-year contract is moderate within the context of federal professional services spending.

Small Business Impact

This contract was not awarded as a small business set-aside, nor does it indicate any specific subcontracting requirements for small businesses. The data suggests that ELITEBCO LLC is the primary awardee, and there is no explicit information on how small businesses will be involved in fulfilling this contract. This could mean limited opportunities for small businesses to participate in this specific procurement, potentially impacting the small business ecosystem if similar contracts are also awarded without set-asides.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of Housing and Urban Development's contracting officers and program managers. Accountability measures are inherent in the Firm Fixed Price contract type, which obligates the contractor to deliver specific services for an agreed-upon price. Transparency is limited due to the sole-source nature of the award, as the justification and evaluation process are not publicly detailed. The Inspector General for HUD would have jurisdiction to investigate any potential fraud, waste, or abuse related to this contract.

Related Government Programs

OMB Circular A-123 Support Services
Federal Accounting and Auditing Services
HUD Financial Management Support
Professional Services Contracts

Risk Flags

Sole-source award lacks competitive justification.
Potential for inflated pricing due to lack of competition.
Limited transparency in the procurement process.

Frequently Asked Questions

What is this federal contract paying for?

Department of Housing and Urban Development awarded $2.7 million to ELITEBCO LLC. OMB CIRCULAR A-123 SUPPORT SERVICES

Who is the contractor on this award?

The obligated recipient is ELITEBCO LLC.

Which agency awarded this contract?

Awarding agency: Department of Housing and Urban Development (Department of Housing and Urban Development).

What is the total obligated amount?

The obligated amount is $2.7 million.

What is the period of performance?

Start: 2023-09-30. End: 2026-09-29.

What is the track record of ELITEBCO LLC with federal contracts?

The provided data does not include specific details on ELITEBCO LLC's past performance or track record with federal contracts. To assess their reliability and past success, a review of their contract history, including any past performance evaluations, awards, or disputes, would be necessary. This information is typically available through federal procurement databases like SAM.gov or through agency-specific performance records. Without this data, it's challenging to evaluate their suitability beyond the stated need for accounting services.

How does the $2.7 million contract value compare to similar federal accounting service contracts?

Benchmarking the $2.7 million contract value requires comparing it to similar federal accounting service contracts awarded over the same period, considering factors like contract duration, scope of work, and agency. Given this is a sole-source award, direct price comparisons are difficult. However, if similar services were procured competitively, one could analyze the average price per year or per service unit. For a three-year contract, $2.7 million equates to $900,000 annually. This figure needs to be contextualized against the specific accounting needs of HUD and the complexity of the services required. A deeper analysis would involve querying federal procurement data for contracts under NAICS code 541211 with comparable durations and values.

What are the primary risks associated with this sole-source contract?

The primary risks associated with this sole-source contract stem from the lack of competition. This includes the risk of paying a higher price than could be achieved through a competitive process, potentially leading to inefficient use of taxpayer funds. There's also a risk of reduced innovation, as the contractor may have less incentive to offer cost-saving solutions or improved service delivery without competitive pressure. Furthermore, sole-source awards can sometimes indicate a lack of market research or planning, potentially leading to a suboptimal choice of vendor or contract terms. Ensuring robust oversight and performance management becomes critical to mitigate these risks.

How effective is the Firm Fixed Price (FFP) contract type in managing costs for this service?

The Firm Fixed Price (FFP) contract type is generally effective in managing costs for services where the scope of work is well-defined and unlikely to change significantly. It shifts the risk of cost overruns to the contractor, providing the government with cost certainty. For accounting services, where tasks are often predictable, FFP can be a suitable choice. However, the effectiveness is somewhat diminished in a sole-source context. While the price is fixed, the absence of competition means the 'fixed' price might be higher than it would be in a competitive scenario. The government must still ensure the contractor delivers the required quality and scope within the fixed price.

What is the historical spending pattern for OMB Circular A-123 support services at HUD?

The provided data snippet focuses on a single contract and does not offer historical spending patterns for OMB Circular A-123 support services at HUD. To determine historical spending, one would need to analyze procurement data for this specific service category over several fiscal years. This would involve identifying all contracts related to OMB Circular A-123 support, their values, durations, and award types (competed vs. sole-source). Such an analysis would reveal trends in spending, identify key contractors, and highlight any shifts towards or away from competitive procurement for these services.

Are there any specific performance metrics or deliverables outlined for this contract?

The provided data does not detail specific performance metrics or deliverables for this contract. While the contract is for 'OMB CIRCULAR A-123 SUPPORT SERVICES' and has a Firm Fixed Price structure, the exact requirements, key performance indicators (KPIs), and deliverables are not specified. Typically, a contract of this nature would include clauses outlining expected service levels, reporting requirements, and quality standards. These would be detailed in the contract's statement of work (SOW) or performance work statement (PWS), which are not included in the provided data. Effective contract management would necessitate clear metrics to ensure ELITEBCO LLC meets its obligations.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Accounting, Tax Preparation, Bookkeeping, and Payroll Services › Offices of Certified Public Accountants

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

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: 86615723R00008

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 1666 AVE PONCE DE LEON, SAN JUAN, PR, 00909

Business Categories: 8(a) Program Participant, Category Business, Corporate Entity Not Tax Exempt, Hispanic American Owned Business, HUBZone Firm, Limited Liability Corporation, Minority Owned Business, Self-Certified Small Disadvantaged Business, Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $4,500,000

Exercised Options: $2,700,000

Current Obligation: $2,700,000

Actual Outlays: $1,831,500

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Timeline