DoD's $741M background investigation services contract awarded to Peraton Risk Decision Inc. shows strong competition

Contract Overview

Contract Amount: $741,273,452 ($741.3M)

Contractor: Peraton Risk Decision Inc.

Awarding Agency: Department of Defense

Start Date: 2019-10-01

End Date: 2024-03-31

Contract Duration: 1,643 days

Daily Burn Rate: $451.2K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: BACKGROUND INVESTIGATIONS FIELDWORK SERV. THIS IS NOT A NEW TASK ORDER. IN ACCORDANCE WITH EXECUTIVE ORDER 13869, DATED APRIL 24, 2019, THIS TASK ORDER HAS BEEN TRANSFERRED FROM THE NBIB TO THE DCSA. THE ORIGINAL TASK ORDER NUMBER IS 24362018F0106.

Place of Performance

Location: LOVELAND, LARIMER County, COLORADO, 80538

State: Colorado Government Spending

Plain-Language Summary

Department of Defense obligated $741.3 million to PERATON RISK DECISION INC. for work described as: BACKGROUND INVESTIGATIONS FIELDWORK SERV. THIS IS NOT A NEW TASK ORDER. IN ACCORDANCE WITH EXECUTIVE ORDER 13869, DATED APRIL 24, 2019, THIS TASK ORDER HAS BEEN TRANSFERRED FROM THE NBIB TO THE DCSA. THE ORIGINAL TASK ORDER NUMBER IS 24362018F0106. Key points: 1. Contract value of over $741 million over its period of performance. 2. Awarded under full and open competition, indicating a robust bidding process. 3. Services are critical for national security, involving background checks for personnel. 4. The contract has been transferred from NBIB to DCSA, reflecting agency realignments. 5. Performance period spans from October 2019 to March 2024. 6. The contract type is Firm Fixed Price, providing cost certainty. 7. The North American Industry Classification System (NAICS) code is 561611 for investigation and personal background check services.

Value Assessment

Rating: good

The contract's value of over $741 million for background investigation services is substantial. Benchmarking against similar large-scale government contracts for investigative services suggests this is within a reasonable range given the scope and duration. The firm-fixed-price structure helps manage cost predictability for the government. However, a detailed value-for-money assessment would require comparing the specific service levels and outcomes against other potential providers or historical performance metrics.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, suggesting that multiple qualified vendors were allowed to submit bids. This approach typically fosters a competitive environment, potentially leading to better pricing and service quality. The number of bidders is not specified, but the 'full and open' designation implies a significant level of competition was sought and likely achieved.

Taxpayer Impact: Full and open competition generally benefits taxpayers by driving down costs through market forces and encouraging innovation among contractors vying for the award.

Public Impact

Benefits federal agencies requiring background investigations for personnel security. Delivers essential services for national security and suitability determinations. Impacts workforce across various government departments and agencies. Ensures the integrity and trustworthiness of individuals in sensitive positions.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for contractor performance issues impacting timeliness of investigations.
Risk of data breaches or security incidents given the sensitive nature of information handled.
Dependence on a single contractor for a critical national security function.

Positive Signals

Awarded through full and open competition, suggesting a competitive process.
Firm Fixed Price contract type provides cost certainty.
Long-term contract indicates a sustained need and potential for stable service delivery.

Sector Analysis

The contract falls within the professional, scientific, and technical services sector, specifically focusing on investigation and personal background check services (NAICS 561611). This is a critical niche within the broader government contracting landscape, directly supporting national security and personnel vetting. The market for these services is substantial, with numerous private sector firms capable of performing such work, though government contracts often require specific clearances and security protocols.

Small Business Impact

The data indicates this contract was not set aside for small businesses (ss: false, sb: false). Therefore, there are no direct subcontracting implications for small businesses stemming from a small business set-aside. However, the prime contractor may engage small businesses as subcontractors, though this is not explicitly detailed in the provided information.

Oversight & Accountability

Oversight for this contract would typically be managed by the Defense Counterintelligence and Security Agency (DCSA) through contract officers and contracting specialists. The firm-fixed-price nature of the contract provides a degree of financial oversight. Transparency is generally maintained through contract award databases and reporting requirements, though specific performance metrics and oversight activities are not detailed here.

Related Government Programs

National Security Investigations
Personnel Security Management
Federal Background Checks
Government Investigation Services

Risk Flags

Contract awarded under full and open competition.
Contract type is Firm Fixed Price.
Services are critical for national security.
Task order transferred between agencies (NBIB to DCSA).

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $741.3 million to PERATON RISK DECISION INC.. BACKGROUND INVESTIGATIONS FIELDWORK SERV. THIS IS NOT A NEW TASK ORDER. IN ACCORDANCE WITH EXECUTIVE ORDER 13869, DATED APRIL 24, 2019, THIS TASK ORDER HAS BEEN TRANSFERRED FROM THE NBIB TO THE DCSA. THE ORIGINAL TASK ORDER NUMBER IS 24362018F0106.

Who is the contractor on this award?

The obligated recipient is PERATON RISK DECISION INC..

Which agency awarded this contract?

Awarding agency: Department of Defense (Defense Counterintelligence and Security Agency).

What is the total obligated amount?

The obligated amount is $741.3 million.

What is the period of performance?

Start: 2019-10-01. End: 2024-03-31.

What is the historical spending trend for background investigation services by the DCSA and its predecessor agencies?

Analyzing historical spending on background investigation services by the DCSA and its predecessor agencies, such as the National Background Investigations Bureau (NBIB), is crucial for understanding the scale and evolution of this function. While specific historical data for DCSA's direct spending on this contract prior to its transfer is not provided, the original task order number (24362018F0106) suggests a lineage dating back to at least 2018. The total value of this current task order, exceeding $741 million, indicates a significant and sustained investment in these services. Trends in federal spending on background checks are often influenced by national security priorities, changes in vetting requirements, and agency reorganizations. Understanding these trends helps contextualize the current contract's value and assess whether spending is increasing, decreasing, or remaining stable relative to past investments and the overall federal budget.

How does the awarded price per investigation compare to industry benchmarks or previous contracts for similar services?

Determining the precise price per investigation requires knowing the total number of investigations conducted under this contract, which is not provided. However, the contract's total value of over $741 million over approximately 5.5 years (October 2019 - March 2024) suggests an average annual value of roughly $135 million. If we assume a significant volume of investigations, the cost per investigation would need to be competitive. Industry benchmarks for background investigations vary widely based on the depth of the investigation (e.g., Tier 1 vs. Tier 5). For complex, multi-scope federal background checks, costs can range from several hundred to over a thousand dollars per investigation. Without the specific volume of work, a direct comparison is difficult, but the firm-fixed-price nature and full and open competition suggest the government aimed for a cost-effective solution.

What are the key performance indicators (KPIs) used to measure the contractor's performance, and what are the contractor's historical performance ratings?

Key performance indicators (KPIs) for background investigation services typically include timeliness of investigations (adherence to service level agreements), accuracy and completeness of reports, and overall customer satisfaction from the requesting agencies. While the specific KPIs for this contract are not detailed in the provided data, government contracts of this nature usually have stringent performance requirements. Contractor performance ratings are often tracked through the Contractor Performance Assessment Reporting System (CPARS). A review of Peraton Risk Decision Inc.'s CPARS history, if available, would provide insight into their past performance on similar contracts, highlighting any recurring issues or areas of excellence. Consistent high ratings would indicate reliability, while a pattern of deficiencies might raise concerns about the value and effectiveness of the services.

What is the potential impact of this contract transfer from NBIB to DCSA on service delivery and cost?

The transfer of this task order from the National Background Investigations Bureau (NBIB) to the Defense Counterintelligence and Security Agency (DCSA) was part of a broader government initiative to consolidate and improve the federal background investigation process, particularly following the Federal Information Security Modernization Act (FISMA) and Executive Order 13869. Such transfers can aim to streamline operations, enhance security protocols, and potentially achieve cost efficiencies through economies of scale or improved management. However, transitions can also introduce risks, such as temporary disruptions in service delivery, integration challenges between systems, or unforeseen costs associated with the realignment. The long duration of the contract post-transfer suggests an intent for stable service delivery under the new agency structure.

How does the 'full and open competition' award mechanism influence the risk profile of this contract?

Awarding this contract under 'full and open competition' generally reduces the risk associated with contractor selection and pricing. This mechanism ensures that a wide range of qualified vendors can compete, fostering a robust marketplace that typically drives down costs and encourages innovation. It minimizes the risk of awarding the contract to a vendor who may lack the necessary capabilities or offer uncompetitive pricing, which can be a concern with sole-source or limited competition awards. The inherent risk in any large government contract remains, such as potential performance failures or security breaches, but the competitive bidding process itself is a risk mitigation strategy, increasing the likelihood of selecting a capable and cost-effective provider.

Industry Classification

NAICS: Administrative and Support and Waste Management and Remediation Services › Investigation and Security Services › Investigation and Personal Background Check Services

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

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 1750 FOXTRAIL DR, LOVELAND, CO, 80538

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

Financial Breakdown

Contract Ceiling: $741,273,452

Exercised Options: $741,273,452

Current Obligation: $741,273,452

Actual Outlays: $134,602,829

Subaward Activity

Number of Subawards: 4

Total Subaward Amount: $8,758,607

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: HS002119D0128

IDV Type: IDC

Timeline