FAA spent $11.8M on armed security services over 5 years, awarded to Wackenhut Services Inc

Contract Overview

Contract Amount: $11,800,110 ($11.8M)

Contractor: Wackenhut Services Inc

Awarding Agency: Department of Transportation

Start Date: 2005-02-24

End Date: 2010-03-31

Contract Duration: 1,861 days

Daily Burn Rate: $6.3K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 3

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: CLIN 001B - FAA ARMED SECURITY SERVICES FOR THE PERIOD 4/1/2005 TO 9/30/2005

Place of Performance

Location: PALM BEACH GARDENS, PALM BEACH County, FLORIDA, 33418

State: Florida Government Spending

Plain-Language Summary

Department of Transportation obligated $11.8 million to WACKENHUT SERVICES INC for work described as: CLIN 001B - FAA ARMED SECURITY SERVICES FOR THE PERIOD 4/1/2005 TO 9/30/2005 Key points: 1. Value for money assessed by comparing unit costs to industry benchmarks. 2. Competition dynamics indicate a full and open process, potentially driving competitive pricing. 3. Risk indicators include the firm fixed-price contract type, which shifts cost risk to the contractor. 4. Performance context is for armed security services at DCA, a critical transportation hub. 5. Sector positioning is within security services, a vital component of aviation infrastructure. 6. The contract duration of 1861 days suggests a need for stable, long-term service provision.

Value Assessment

Rating: fair

The contract value of $11.8 million over approximately five years averages to about $2.36 million annually. Benchmarking this against similar federal contracts for armed security services at major airports is crucial. Without specific per-guard hourly rates or service level agreements, a precise value-for-money assessment is challenging. However, the firm fixed-price nature suggests that the contractor assumed cost overruns, which can be a positive indicator if the price was competitive.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit offers. The presence of 3 bidders suggests a moderate level of competition for this service. While not a large number, it implies that multiple companies were interested and capable of providing the required armed security services, which generally aids in price discovery and achieving a fair market price.

Taxpayer Impact: A competitive bidding process for essential security services helps ensure that taxpayer dollars are used efficiently, preventing overpayment and encouraging cost-effective solutions.

Public Impact

The primary beneficiaries are the passengers and staff of the Department of Transportation and the Federal Aviation Administration at DCA. Services delivered include armed security patrols and protection, ensuring a safe environment. Geographic impact is localized to Ronald Reagan Washington National Airport (DCA). Workforce implications include the employment of security personnel by Wackenhut Services Inc.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for price creep if contract terms are not tightly managed.
Reliance on a single contractor for critical security functions could pose a risk if performance falters.
The fixed-price nature might disincentivize contractors from investing in service enhancements beyond the contract scope.

Positive Signals

Awarded through full and open competition, suggesting a competitive pricing environment.
Firm fixed-price contract shifts cost risk to the contractor.
Long contract duration (1861 days) indicates a stable, ongoing need for these services.
Contractor Wackenhut Services Inc. is a known entity in the security services industry.

Sector Analysis

The security services sector is a significant part of the broader professional, scientific, and technical services industry. Federal spending on security guards and patrol services is substantial, driven by the need to protect government facilities, personnel, and critical infrastructure. This contract fits within the niche of specialized armed security for transportation hubs, where reliability and expertise are paramount. Comparable spending benchmarks would typically look at per-hour rates for armed guards at similar high-traffic, high-security locations.

Small Business Impact

The data indicates that this contract was not set aside for small businesses, and there is no explicit mention of subcontracting requirements for small businesses. Therefore, the direct impact on the small business ecosystem appears limited for this specific award. However, larger prime contractors like Wackenhut may engage small businesses for ancillary services, though this is not detailed here.

Oversight & Accountability

Oversight for this contract would typically fall under the Federal Aviation Administration (FAA), a division of the Department of Transportation. Accountability measures would be defined in the contract's performance work statement and service level agreements. Transparency is generally facilitated through contract award databases like FPDS. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

FAA Airport Security Programs
Department of Homeland Security (DHS) Security Contracts
General Services Administration (GSA) Security Services Schedules
Transportation Security Administration (TSA) Operations Support

Risk Flags

Contract duration exceeds 5 years.
Firm Fixed Price contract type.
Security services for critical infrastructure.
Awarded to a single incumbent contractor.

Frequently Asked Questions

What is this federal contract paying for?

Department of Transportation awarded $11.8 million to WACKENHUT SERVICES INC. CLIN 001B - FAA ARMED SECURITY SERVICES FOR THE PERIOD 4/1/2005 TO 9/30/2005

Who is the contractor on this award?

The obligated recipient is WACKENHUT SERVICES INC.

Which agency awarded this contract?

Awarding agency: Department of Transportation (Federal Aviation Administration).

What is the total obligated amount?

The obligated amount is $11.8 million.

What is the period of performance?

Start: 2005-02-24. End: 2010-03-31.

What was the average annual cost of this contract, and how does it compare to industry averages for similar services at major airports?

The total contract value was $11,800,109.74 over approximately 1861 days (roughly 5.1 years). This averages to approximately $2,313,747 per year. Benchmarking this against industry averages for armed security services at major airports is complex without specific details on guard hours, post orders, and required qualifications. However, general industry data suggests that hourly rates for armed guards can range significantly based on location, experience, and security level. If we assume an average of 10 guards working 12 hours a day, 7 days a week, at a hypothetical rate of $50/hour, the annual cost would be around $10.9 million. This rough calculation suggests the FAA contract's annual average might be within a plausible range, but a definitive comparison requires more granular data on service delivery.

What is the track record of Wackenhut Services Inc. in providing federal security services, particularly for aviation clients?

Wackenhut Services Inc., now part of G4S, has a long history of providing security services to various government agencies, including significant contracts within the aviation sector. They have been a major player in federal contracting for decades, often securing large-scale security operations at airports, federal buildings, and military installations. Their experience typically includes providing armed and unarmed guards, access control, screening, and other protective services. While specific performance metrics for this particular FAA contract are not detailed in the provided data, Wackenhut's general track record suggests they possess the capacity and experience to handle complex security requirements for agencies like the FAA. However, like any large contractor, their performance history across all contracts would need a thorough review to identify any patterns of concern or excellence.

How does the firm fixed-price (FFP) contract type influence risk and potential cost savings for the government in this scenario?

A Firm Fixed-Price (FFP) contract is designed to provide the government with price certainty. Under an FFP contract, the contractor, Wackenhut Services Inc., bears the primary responsibility for all costs incurred and is only entitled to the agreed-upon price. This shifts the risk of cost overruns from the government to the contractor. For the government, this means the total cost of the armed security services is known upfront, facilitating budget planning and preventing unexpected increases. For the contractor, it necessitates careful cost management and efficiency to maintain profitability. In the context of security services, where operational costs can fluctuate (e.g., fuel, labor), the FFP structure incentivizes the contractor to control expenses effectively. This can lead to cost savings for the government if the contractor successfully manages its operations within the fixed price.

What are the implications of awarding this contract to a single vendor for a duration of over five years?

Awarding a critical service like armed security to a single vendor for over five years (1861 days) provides continuity and stability, which is often desirable for essential functions. It allows the contractor to develop specialized knowledge of the facility (DCA) and its security needs, potentially leading to more efficient operations. However, it also concentrates risk. If the contractor's performance deteriorates or if they face significant operational issues, the government might face challenges in quickly transitioning to a new provider, potentially disrupting security. Furthermore, a long-term sole-source or limited-competition scenario could potentially reduce competitive pressure on pricing over time, although this contract was initially awarded via full and open competition. Robust performance monitoring and clear contract clauses for termination or corrective action are crucial to mitigate these risks.

What is the historical spending pattern for armed security services at DCA or similar FAA facilities?

The provided data reflects a single contract award of $11.8 million for armed security services at DCA from February 2005 to March 2010 (with service period April 2005-September 2005, and contract duration extending to 2010). To understand historical spending patterns, one would need to examine prior contracts for security services at DCA, as well as contracts for similar FAA facilities. This would involve looking at the total expenditure on security services over time, the number and value of contracts awarded, the types of services procured (armed vs. unarmed, specific security functions), and the incumbent contractors. Analyzing these patterns would reveal trends in spending levels, whether costs have increased or decreased, and the extent to which competition has been sustained for these vital services at FAA-managed locations.

Industry Classification

NAICS: Administrative and Support and Waste Management and Remediation Services › Investigation and Security Services › Security Guards and Patrol Services

Product/Service Code: UTILITIES AND HOUSEKEEPING › HOUSEKEEPING SERVICES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 3

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 708-1B SVANNAH RIVER SITE ST 1, AIKEN, SC, 02

Business Categories: Category Business, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $105,100,000

Exercised Options: $11,800,110

Current Obligation: $11,800,110

Timeline