Justice Department's FBI spent over $24M on food services, raising questions about value and competition

Contract Overview

Contract Amount: $24,238,247 ($24.2M)

Contractor: Servicesource Inc

Awarding Agency: Department of Justice

Start Date: 2013-10-01

End Date: 2018-09-30

Contract Duration: 1,825 days

Daily Burn Rate: $13.3K/day

Competition Type: NOT AVAILABLE FOR COMPETITION

Pricing Type: FIXED PRICE WITH ECONOMIC PRICE ADJUSTMENT

Sector: Other

Official Description: IGF::OT::IGF FUNDING FOR FULL FOOD SERVICE CONTRACT.

Place of Performance

Location: QUANTICO, STAFFORD County, VIRGINIA, 22135

State: Virginia Government Spending

Plain-Language Summary

Department of Justice obligated $24.2 million to SERVICESOURCE INC for work described as: IGF::OT::IGF FUNDING FOR FULL FOOD SERVICE CONTRACT. Key points: 1. The contract awarded to Servicesource Inc. for food services represents a significant investment in supporting federal personnel. 2. Analysis of this contract is crucial to understand if the pricing reflects fair market value for the services rendered. 3. The procurement method, noted as 'not available for competition,' warrants scrutiny regarding potential limitations on competitive pricing. 4. Performance context is essential to evaluate if the quality and scope of food services met the FBI's operational needs. 5. This contract falls within the broader category of facility support services, a common area of federal expenditure. 6. The duration of the contract (5 years) suggests a long-term commitment that should be aligned with sustained operational requirements.

Value Assessment

Rating: fair

The total award amount of $24.2 million over five years for food services to the FBI is substantial. Benchmarking this against similar contracts for cafeteria and catering services within federal agencies or large private sector organizations is necessary to determine value for money. Without specific details on the scope of services (e.g., number of meals, types of facilities supported), a precise per-unit cost comparison is difficult. However, the overall expenditure suggests a need to ensure efficient resource allocation and cost control.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

The contract was awarded under a 'not available for competition' status, indicating a sole-source procurement. This means that only one vendor, Servicesource Inc., was considered for this contract. While sole-source awards can be justified under specific circumstances (e.g., unique capabilities, urgent needs), they typically limit price discovery and may result in higher costs compared to a fully competed contract. The absence of multiple bidders means there was no direct price competition to drive down costs.

Taxpayer Impact: For taxpayers, a sole-source award means there was no opportunity to benefit from competitive bidding, which could have potentially led to lower prices or better service terms. This lack of competition reduces the government's leverage in negotiating favorable terms and prices.

Public Impact

Federal employees at the FBI facility in Virginia benefit from the provision of food services, enhancing on-site convenience and potentially morale. The services delivered include the operation of cafeterias, grill buffets, and buffets, providing daily meal options. The geographic impact is concentrated at the FBI facility in Virginia, supporting its personnel. Workforce implications are primarily related to the contractor's employees providing the food services, rather than direct federal employment.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may lead to inflated prices and reduced service innovation.
Sole-source awards can be a red flag for potential inefficiencies or lack of market research.
The significant dollar amount warrants close monitoring for cost-effectiveness over the contract's life.
Absence of performance metrics in the provided data makes it difficult to assess service quality objectively.

Positive Signals

The contract ensures essential food services are available to FBI personnel, supporting operational readiness.
A single, established provider can offer consistency in service delivery.
The fixed-price structure with economic price adjustment can provide some cost predictability.

Sector Analysis

The food service industry within the federal sector is a significant market, encompassing a wide range of services from cafeteria operations to large-scale catering. This contract for the FBI falls under the broader category of facility support services. Comparable spending benchmarks for similar food service contracts within government agencies can range widely based on the size of the facility, the number of personnel served, and the specific services offered. The $24.2 million figure over five years suggests a substantial operation, likely serving a large population within the FBI.

Small Business Impact

The provided data indicates that small business participation (sb) was false, and there is no information regarding small business set-asides. This suggests that the contract was not specifically targeted towards small businesses, nor does it appear to have included subcontracting requirements for small businesses. Consequently, the direct impact on the small business ecosystem for this particular contract is likely minimal, with the primary award going to a larger entity.

Oversight & Accountability

Oversight for this contract would typically fall under the purview of the contracting officer and the relevant program managers within the FBI. Accountability measures would be defined in the contract's terms and conditions, including performance standards and remedies for non-compliance. Transparency is often limited in sole-source procurements, but contract award details are usually made public. Inspector General jurisdiction may apply if any allegations of fraud, waste, or abuse arise.

Related Government Programs

Federal Food Service Contracts
FBI Support Services
Department of Justice Procurement
Facility Management Contracts
Government Cafeteria Operations

Risk Flags

Lack of Competition
Potential for Overpricing
Limited Transparency
Long-Term Commitment without Performance Benchmarks

Frequently Asked Questions

What is this federal contract paying for?

Department of Justice awarded $24.2 million to SERVICESOURCE INC. IGF::OT::IGF FUNDING FOR FULL FOOD SERVICE CONTRACT.

Who is the contractor on this award?

The obligated recipient is SERVICESOURCE INC.

Which agency awarded this contract?

Awarding agency: Department of Justice (Federal Bureau of Investigation).

What is the total obligated amount?

The obligated amount is $24.2 million.

What is the period of performance?

Start: 2013-10-01. End: 2018-09-30.

What specific services were included in the $24.2 million food service contract for the FBI?

The provided data indicates the contract was for 'FULL FOOD SERVICE CONTRACT' and specifically mentions 'Cafeterias, Grill Buffets, and Buffets.' This suggests the scope included the operation and management of dining facilities, providing daily meal services, and potentially catering for events within the FBI premises. The exact number of meals served, operating hours, and specific menu offerings would be detailed in the contract's statement of work, which is not available in the provided summary data. Understanding these specifics is crucial for a comprehensive value assessment.

How does the $24.2 million expenditure compare to similar food service contracts at other federal agencies?

Direct comparison of the $24.2 million expenditure requires access to detailed data on similar contracts, including the number of personnel served, geographic location, and the specific services provided. However, for context, large federal facilities often spend millions annually on food services. For example, a large military base or a major agency headquarters might have contracts in a similar range. The key is to benchmark against contracts serving a comparable number of individuals and offering a similar breadth of services. Without such granular data, it's difficult to definitively state if this contract represents high or low spending relative to peers.

What are the risks associated with a sole-source award for essential services like food?

Sole-source awards, like the one for this FBI food service contract ('NOT AVAILABLE FOR COMPETITION'), carry inherent risks. The primary risk is the lack of competitive pressure, which can lead to inflated pricing and reduced incentives for the contractor to innovate or improve service quality. Without competing vendors, the government loses the opportunity to secure the best possible value through price negotiation and service enhancements. There's also a risk that the justification for a sole-source award might be weak, potentially masking inefficiencies or a lack of proactive market research by the agency. This can result in taxpayers paying more than necessary for the services received.

What does the contract type 'FIXED PRICE WITH ECONOMIC PRICE ADJUSTMENT' imply for cost control?

A 'FIXED PRICE WITH ECONOMIC PRICE ADJUSTMENT' (FP-EPA) contract type aims to balance cost certainty for the government with protection for the contractor against significant fluctuations in input costs, such as labor or raw materials. The 'fixed price' component provides a baseline cost, while the 'economic price adjustment' clause allows for modifications to the price based on predefined economic indices. This can help ensure service continuity by mitigating risks for the contractor, but it also means the final cost could be higher than the initial fixed price if economic conditions change unfavorably. Effective oversight is needed to ensure that price adjustments are justified and do not lead to excessive costs.

What is the significance of the contract duration of 1825 days (5 years)?

A contract duration of 1825 days, equivalent to five years, indicates a long-term commitment by the FBI to Servicesource Inc. for food services. Such durations are often chosen for services that require significant setup, specialized knowledge, or where stability is paramount. For the government, a longer duration can provide service continuity and potentially allow the contractor to invest in infrastructure or personnel, possibly leading to efficiencies. However, it also locks the government into a single provider for an extended period, reducing flexibility to adapt to changing needs or market conditions. It necessitates careful initial evaluation and ongoing performance monitoring to ensure continued value.

Were there any small business subcontracting requirements associated with this contract?

Based on the provided data, the 'sb' (small business) indicator is 'false,' and there is no mention of small business subcontracting requirements. This suggests that the contract was not structured to include specific goals or mandates for the prime contractor, Servicesource Inc., to subcontract portions of the work to small businesses. Consequently, this contract likely did not contribute to the government's small business utilization goals through subcontracting, and the primary economic benefit would flow to the large prime contractor.

Industry Classification

NAICS: Accommodation and Food Services › Limited-Service Eating Places › Cafeterias, Grill Buffets, and Buffets

Product/Service Code: UTILITIES AND HOUSEKEEPING › HOUSEKEEPING SERVICES

Competition & Pricing

Extent Competed: NOT AVAILABLE FOR COMPETITION

Solicitation Procedures: ONLY ONE SOURCE

Pricing Type: FIXED PRICE WITH ECONOMIC PRICE ADJUSTMENT (K)

Evaluated Preference: NONE

Contractor Details

Address: 6295 EDSALL RD STE 175, ALEXANDRIA, VA, 22312

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: $24,238,247

Exercised Options: $24,238,247

Current Obligation: $24,238,247

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: DJFBI12142

IDV Type: IDC

Timeline