Air Force custodial services contract awarded to Diversified Services Group for over $2.95M, spanning 5 years

Contract Overview

Contract Amount: $2,953,106 ($3.0M)

Contractor: Diversified Services Group, Inc.

Awarding Agency: Department of Defense

Start Date: 2021-04-01

End Date: 2026-03-31

Contract Duration: 1,825 days

Daily Burn Rate: $1.6K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 9

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: NMUSAF CUSTODIAL

Place of Performance

Location: DAYTON, MONTGOMERY County, OHIO, 45433

State: Ohio Government Spending

Plain-Language Summary

Department of Defense obligated $3.0 million to DIVERSIFIED SERVICES GROUP, INC. for work described as: NMUSAF CUSTODIAL Key points: 1. The contract's firm-fixed-price structure aims to control costs, but requires careful monitoring of service delivery. 2. With 9 bidders, the competition level suggests a reasonably competitive market for janitorial services. 3. The duration of 5 years presents a long-term commitment, necessitating ongoing performance evaluation. 4. The contract's value is moderate within the broader context of federal facilities maintenance. 5. Geographic concentration in Ohio may limit broader market testing for similar services. 6. The exclusion of sources in the competition type warrants further investigation into its necessity and impact.

Value Assessment

Rating: good

The contract value of approximately $2.95 million over five years for custodial services appears reasonable given the scope. Benchmarking against similar janitorial contracts across federal agencies for comparable facility sizes and service levels would provide a more precise value-for-money assessment. The firm-fixed-price nature of the contract helps in predictable budgeting, but the agency must ensure that the contractor meets all performance standards to avoid paying for substandard services.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

This contract was awarded under 'Full and Open Competition After Exclusion of Sources,' indicating that while the initial solicitation was broad, certain sources were excluded from the final competition. With 9 bidders participating, the competition level was substantial, suggesting that multiple firms were interested and capable of performing the required services. The exclusion of specific sources, however, may have limited the overall competitive landscape and potentially impacted price discovery.

Taxpayer Impact: The exclusion of sources, even with 9 bidders, could mean taxpayers did not benefit from the lowest possible price that might have been achieved with unrestricted competition. Further justification for the exclusion is needed to ensure full value for taxpayer funds.

Public Impact

The primary beneficiaries are the personnel and operations at the Department of the Air Force facilities in Ohio, who will receive enhanced cleanliness and sanitation. The contract ensures the delivery of essential janitorial and custodial services, maintaining a safe and healthy working environment. The geographic impact is concentrated within Ohio, where the contracted services will be performed. The contract supports jobs within the custodial services industry, contributing to the local workforce in Ohio.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

The 'Exclusion of Sources' clause in the competition type requires scrutiny to ensure it was justified and did not unduly restrict competition.
The long contract duration of five years necessitates robust performance monitoring to ensure continued value and service quality.
Lack of specific performance metrics or KPIs in the provided data makes it difficult to assess service effectiveness beyond general custodial duties.

Positive Signals

The firm-fixed-price contract type provides cost certainty for the government.
A relatively high number of bidders (9) indicates a healthy interest and potential for competitive pricing.
The contract is being performed in Ohio, potentially supporting local businesses and employment.

Sector Analysis

The custodial services sector is a significant component of the broader facilities management industry, characterized by a mix of large corporations and numerous small businesses. Federal contracts for these services are common across various agencies, supporting the maintenance of government buildings and installations. Spending in this sector is generally stable, driven by the ongoing need for operational upkeep. Comparable spending benchmarks would typically be assessed based on square footage, service frequency, and specific requirements like specialized cleaning or waste management.

Small Business Impact

The provided data indicates that this contract was not set aside for small businesses, nor does it explicitly mention subcontracting requirements for small businesses. This suggests that the primary award went to a larger entity, and opportunities for small business participation may be limited unless Diversified Services Group voluntarily engages them for subcontracting. Further analysis of the contract's subcontracting plan would be necessary to determine the actual impact on the small business ecosystem.

Oversight & Accountability

Oversight for this contract would typically fall under the purview of the Department of the Air Force contracting officer and program managers. Performance standards and quality assurance surveillance plans (QASPs) are crucial for ensuring accountability. Transparency is generally maintained through contract award databases like FPDS. Inspector General jurisdiction would apply if any fraud, waste, or abuse is suspected.

Related Government Programs

Federal Building Maintenance Contracts
Department of Defense Facilities Management
Janitorial Services for Government Facilities
Commercial Cleaning Services Contracts

Risk Flags

Competition Exclusion Justification
Long-Term Contract Performance Monitoring
Service Quality Assurance

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $3.0 million to DIVERSIFIED SERVICES GROUP, INC.. NMUSAF CUSTODIAL

Who is the contractor on this award?

The obligated recipient is DIVERSIFIED SERVICES GROUP, INC..

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Air Force).

What is the total obligated amount?

The obligated amount is $3.0 million.

What is the period of performance?

Start: 2021-04-01. End: 2026-03-31.

What is the track record of Diversified Services Group, Inc. with federal contracts, particularly for custodial services?

A review of federal procurement data would be necessary to fully assess Diversified Services Group, Inc.'s track record. This would involve examining past contract awards, performance evaluations (if publicly available), and any history of contract disputes or terminations. Understanding their experience with similar-sized contracts and government agencies, especially the Department of Defense, would provide insight into their capacity and reliability. Without specific performance data for this contractor, it's difficult to definitively assess their past performance beyond the fact they were awarded this current contract.

How does the awarded price compare to market rates for similar custodial services in Ohio?

To compare the awarded price to market rates, one would need to gather data on commercial custodial service contracts in Ohio for facilities of comparable size and service scope. This would involve researching pricing structures from private sector cleaning companies and potentially other federal or state contracts in the region. Factors such as the frequency of cleaning, types of services (e.g., deep cleaning, waste removal, disinfection), and specific facility needs (e.g., high-traffic areas, specialized equipment) would need to be standardized for a fair comparison. The firm-fixed-price nature suggests the contractor has factored in these costs.

What are the specific risks associated with a five-year firm-fixed-price contract for custodial services?

The primary risks with a five-year firm-fixed-price custodial services contract include potential service degradation over time if performance is not rigorously monitored, and the contractor potentially facing unforeseen cost increases (e.g., labor, supplies) that could impact their profitability or willingness to maintain high standards. For the government, the risk is paying for services that do not meet expectations. Conversely, if market costs decrease significantly, the government might be locked into a higher price. Effective risk mitigation involves robust performance metrics, regular quality checks, and clear communication channels.

What is the estimated impact of this contract on the local Ohio economy and workforce?

This contract is expected to have a positive impact on the local Ohio economy by creating or sustaining jobs in the custodial services sector. Diversified Services Group, Inc. will likely hire personnel in Ohio to perform the contracted duties, contributing to local employment and wages. The spending on supplies and potentially other local services by the contractor further stimulates economic activity. The exact scale of this impact depends on the number of employees hired and the extent of local procurement by the contractor.

What does the 'Full and Open Competition After Exclusion of Sources' designation imply for the fairness and competitiveness of the award?

This designation implies that the initial solicitation was intended to be open to all responsible sources, but specific sources were subsequently excluded from the final competition phase. The reasons for exclusion could range from non-compliance with initial requirements to strategic decisions based on past performance or specific capabilities. While 9 bidders participated, indicating a degree of competition, the exclusion of certain entities raises questions about whether the most competitive pricing and optimal solution were achieved. A thorough justification for the exclusion is critical to ensure the process was fair and served the government's best interests.

Are there any specific performance standards or key performance indicators (KPIs) associated with this contract?

The provided data does not specify the performance standards or Key Performance Indicators (KPIs) for this contract. Typically, custodial service contracts include detailed requirements regarding cleanliness levels, response times for issues, waste management protocols, and staff conduct. These are usually outlined in the Performance Work Statement (PWS). Without access to the PWS, it's impossible to detail the specific metrics used to evaluate Diversified Services Group's performance and ensure the quality of services delivered.

Industry Classification

NAICS: Administrative and Support and Waste Management and Remediation Services › Services to Buildings and Dwellings › Janitorial Services

Product/Service Code: UTILITIES AND HOUSEKEEPING › HOUSEKEEPING SERVICES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: FA860120R0014

Offers Received: 9

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 12410 MILESTONE CENTER DR STE 600, GERMANTOWN, MD, 20876

Business Categories: Black American Owned Business, Category Business, Corporate Entity Not Tax Exempt, Economically Disadvantaged Women Owned Small Business, Minority Owned Business, Self-Certified Small Disadvantaged Business, Small Business, Special Designations, U.S.-Owned Business, Woman Owned Business, Women Owned Small Business

Financial Breakdown

Contract Ceiling: $2,953,106

Exercised Options: $2,953,106

Current Obligation: $2,953,106

Actual Outlays: $187,946

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Timeline