DOT's $27.3M MillerKnoll Furniture Contract Lacks Competition, Raises Value Concerns

Contract Overview

Contract Amount: $27,304,052 ($27.3M)

Contractor: Millerknoll Inc

Awarding Agency: Department of Transportation

Start Date: 2017-03-20

End Date: 2026-09-29

Contract Duration: 3,480 days

Daily Burn Rate: $7.8K/day

Competition Type: NOT COMPETED

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: NATIONAL FURNITURE PROCUREMENT - SYSTEMS AND MODULAR FURNITURE

Place of Performance

Location: ZEELAND, OTTAWA County, MICHIGAN, 49464

State: Michigan Government Spending

Plain-Language Summary

Department of Transportation obligated $27.3 million to MILLERKNOLL INC for work described as: NATIONAL FURNITURE PROCUREMENT - SYSTEMS AND MODULAR FURNITURE Key points: 1. High contract value ($27.3M) for furniture procurement. 2. Sole-source award to MillerKnoll Inc. limits competitive pricing. 3. Long contract duration (2017-2026) may not reflect current market value. 4. Facilities Support Services sector, with potential for significant taxpayer spending.

Value Assessment

Rating: questionable

The contract's value is substantial for furniture. Without competitive bidding, it's difficult to assess if the pricing reflects fair market value compared to similar government or commercial furniture contracts.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded sole-source, meaning it was not competed. This significantly limits price discovery and potentially leads to higher costs for taxpayers as there was no opportunity for vendors to bid against each other.

Taxpayer Impact: The lack of competition on a $27.3M contract likely results in higher costs for taxpayers than if it had been competitively procured.

Public Impact

Taxpayers may be overpaying for furniture due to the absence of competitive bidding. Federal agencies rely on furniture for operational effectiveness; this contract impacts FAA facilities. Long-term contracts without re-competition can lead to outdated equipment and higher lifecycle costs.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award
Lack of competition
Long contract duration

Positive Signals

Fulfills agency furniture needs

Sector Analysis

This contract falls under Facilities Support Services, specifically for systems and modular furniture. Benchmarks for furniture procurement vary widely, but large sole-source awards warrant scrutiny due to potential price inflation.

Small Business Impact

The data indicates this contract was not awarded to small businesses, and the sole-source nature further suggests limited opportunities for small business participation in this specific procurement.

Oversight & Accountability

The sole-source nature of this contract raises questions about the justification for not competing it. Further oversight is needed to ensure the government received the best value and that such awards are exceptions, not the norm.

Related Government Programs

Facilities Support Services
Department of Transportation Contracting
Federal Aviation Administration Programs

Risk Flags

Sole-source award lacks competition
Potential for overpayment
Long contract duration may not reflect current market value
Limited transparency on justification

Frequently Asked Questions

What is this federal contract paying for?

Department of Transportation awarded $27.3 million to MILLERKNOLL INC. NATIONAL FURNITURE PROCUREMENT - SYSTEMS AND MODULAR FURNITURE

Who is the contractor on this award?

The obligated recipient is MILLERKNOLL INC.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $27.3 million.

What is the period of performance?

Start: 2017-03-20. End: 2026-09-29.

What was the justification for awarding this large furniture contract sole-source to MillerKnoll Inc.?

The justification for a sole-source award typically involves specific circumstances, such as a unique capability possessed only by the contractor, urgent and compelling needs, or when only one responsible source is available. Without the specific justification documentation, it's impossible to definitively state why this $27.3M contract was not competed, but it warrants review to ensure it aligns with federal procurement regulations.

How does the pricing of this contract compare to market rates for similar modular furniture systems?

Direct comparison is challenging without access to the contract's specific line items and negotiated prices. However, sole-source contracts inherently lack the price discovery mechanism of competition. It is probable that the pricing is higher than what could have been achieved through a competitive bidding process, potentially leading to suboptimal value for the taxpayer.

What is the potential impact of this long-term, non-competed contract on the FAA's ability to acquire modern and cost-effective furniture solutions in the future?

A long-term, sole-source contract can stifle innovation and prevent agencies from benefiting from market advancements and competitive pricing. The FAA may be locked into potentially outdated or overpriced solutions, and future procurements could be influenced by the existing relationship, making it harder to achieve best value.

Industry Classification

NAICS: Administrative and Support and Waste Management and Remediation Services › Facilities Support Services › Facilities Support Services

Product/Service Code: FURNITURE

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Millerknoll, Inc.

Address: 855 E MAIN AVE, ZEELAND, MI, 49464

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Manufacturer of Goods, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $63,808,078

Exercised Options: $27,304,052

Current Obligation: $27,304,052

Actual Outlays: $7,559,420

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: DTFAWA16D00042

IDV Type: IDC

Timeline