Homeland Security contract for security services awarded to G4S Secure Solutions for over $48.5 million

Contract Overview

Contract Amount: $48,528,337 ($48.5M)

Contractor: G4S Secure Solutions (USA) Inc.

Awarding Agency: Department of Homeland Security

Start Date: 2007-09-13

End Date: 2008-08-29

Contract Duration: 351 days

Daily Burn Rate: $138.3K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 1

Pricing Type: TIME AND MATERIALS

Sector: Other

Official Description: TRANSPORTATION SERVICES (SOUTHWEST BORDER)

Place of Performance

Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20229

State: District of Columbia Government Spending

Plain-Language Summary

Department of Homeland Security obligated $48.5 million to G4S SECURE SOLUTIONS (USA) INC. for work described as: TRANSPORTATION SERVICES (SOUTHWEST BORDER) Key points: 1. Contract awarded for security guard services, a critical function for border security operations. 2. The contract was awarded using full and open competition, suggesting a robust bidding process. 3. The duration of the contract was approximately one year, indicating a need for immediate service. 4. The contract type is Time and Materials, which can pose cost control challenges if not managed closely. 5. The base award amount was over $138,000, with the total award reaching over $48.5 million. 6. The North American Industry Classification System (NAICS) code 561612 points to security guard services.

Value Assessment

Rating: fair

The total award of over $48.5 million for approximately one year of security services appears high, especially considering the base award was significantly lower. Time and Materials contracts inherently carry a higher risk of cost overruns if not meticulously managed and monitored. Benchmarking this specific contract against similar large-scale security service contracts for border operations would be necessary for a definitive value assessment. However, the substantial difference between the base and total award warrants scrutiny regarding the scope and execution of the services provided.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

The contract was awarded under 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES.' This indicates that while the competition was intended to be open, certain sources were excluded, potentially limiting the breadth of competition. The specific reasons for excluding other sources are not detailed, which raises questions about the extent of true market engagement. A limited competition may not always yield the most competitive pricing.

Taxpayer Impact: Taxpayers may have paid more than necessary due to the exclusion of potential bidders, limiting the government's ability to secure the lowest possible price.

Public Impact

The primary beneficiaries are U.S. Customs and Border Protection, receiving essential security services for border operations. The services delivered include security guards and patrol services, crucial for maintaining order and safety at the border. The geographic impact is focused on the Southwest Border region, a critical area for national security and immigration. Workforce implications include the employment of security personnel by the contractor, G4S Secure Solutions.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

The Time and Materials contract type increases the risk of cost escalation without strict oversight.
The significant difference between the base award and the total award suggests potential scope creep or unforeseen costs.
The 'exclusion of sources' in the competition method warrants further investigation into why other qualified bidders were not considered.

Positive Signals

The contract was awarded through a competitive process, indicating an effort to obtain services from qualified providers.
G4S Secure Solutions is a large, established security services provider, suggesting experience in handling such contracts.

Sector Analysis

The security services industry is a significant sector within the broader professional, scientific, and technical services market. This contract falls under security guards and patrol services, a segment that supports government agencies in maintaining physical security and operational integrity. The market for government security contracts is substantial, with agencies like Homeland Security being major clients. Comparable spending benchmarks would involve analyzing other large-scale security contracts awarded by federal agencies for similar operational needs.

Small Business Impact

The contract was awarded to G4S Secure Solutions (USA) Inc., a large corporation, and there is no indication of small business set-asides or subcontracting requirements in the provided data. This suggests that the primary contract was not specifically aimed at benefiting small businesses, and the bulk of the work likely went to the prime contractor or its larger subcontractors.

Oversight & Accountability

Oversight for this contract would typically fall under the U.S. Customs and Border Protection (CBP) contracting officers and program managers. The Time and Materials nature of the contract necessitates rigorous monitoring of labor hours, material costs, and adherence to the Statement of Work to ensure accountability and prevent cost overruns. Transparency would be enhanced through regular reporting requirements from the contractor and potential audits by the Department of Homeland Security's Office of Inspector General.

Related Government Programs

Border Security Operations
Physical Security Services
Federal Law Enforcement Support
Department of Homeland Security Contracts
Security Guard Services

Risk Flags

High Cost Variance
Limited Competition Justification
Time and Materials Contract Risk

Frequently Asked Questions

What is this federal contract paying for?

Department of Homeland Security awarded $48.5 million to G4S SECURE SOLUTIONS (USA) INC.. TRANSPORTATION SERVICES (SOUTHWEST BORDER)

Who is the contractor on this award?

The obligated recipient is G4S SECURE SOLUTIONS (USA) INC..

Which agency awarded this contract?

Awarding agency: Department of Homeland Security (U.S. Customs and Border Protection).

What is the total obligated amount?

The obligated amount is $48.5 million.

What is the period of performance?

Start: 2007-09-13. End: 2008-08-29.

What was the specific justification for excluding certain sources in the 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES' award?

The provided data does not specify the exact reasons for excluding certain sources. Typically, such exclusions might occur due to national security concerns, specific technical requirements that only a limited number of vendors could meet, or prior performance issues with certain contractors. Without further documentation, it is difficult to ascertain the precise rationale. However, this method of competition inherently limits the pool of potential bidders, which can impact price discovery and potentially lead to higher costs for the government compared to a truly open competition where all qualified vendors are encouraged to participate.

How does the total award of over $48.5 million compare to the initial base award of $138,257 for this contract?

The disparity between the base award of $138,257 and the total award of $48,528,337.07 is substantial, representing an increase of over 350 times the initial amount. This significant difference suggests that the contract likely involved extensive use of contract modifications, task orders, or the full utilization of contract options to cover a much larger scope of work or a longer period than initially anticipated by the base award. Time and Materials contracts are particularly susceptible to such growth if not tightly controlled, as they allow for costs to accrue based on labor hours and materials used. This warrants a detailed review of the contract's performance history and any modifications issued.

What are the potential risks associated with a Time and Materials (T&M) contract for security services at the Southwest Border?

Time and Materials contracts carry inherent risks, especially for large-scale, long-duration services like border security. The primary risk is cost escalation, as the contractor is reimbursed for direct labor hours at specified rates and for the actual cost of materials plus a percentage for overhead and profit. Without stringent oversight, monitoring of labor hours, and verification of material costs, the total expenditure can significantly exceed initial estimates. For border security, this could mean increased costs due to unforeseen operational demands, extended hours, or the need for specialized equipment. Effective management requires robust tracking mechanisms, clear performance metrics, and proactive identification of potential cost drivers.

What is the typical performance period for a contract of this nature and value?

The provided data indicates a contract duration of 351 days, which is approximately 11.5 months, aligning with a roughly one-year performance period. For a contract valued at over $48.5 million, this duration is relatively short, especially considering the critical nature of border security. Typically, large service contracts may have longer base periods with options for extension. The short duration here, coupled with the significant total award, suggests that the contract might have been awarded to meet an immediate, substantial need, or it could represent a single year of a larger, multi-year requirement that was potentially re-competed or modified extensively.

How does the NAICS code 561612 (Security Guards and Patrol Services) typically align with the spending patterns of U.S. Customs and Border Protection?

The NAICS code 561612, 'Security Guards and Patrol Services,' directly aligns with the operational needs of U.S. Customs and Border Protection (CBP). CBP is responsible for protecting the nation's borders against terrorism, smuggling, and illegal immigration, which necessitates extensive physical security and surveillance. Security guards are crucial for monitoring entry points, patrolling sensitive areas, and providing a visible deterrent. Therefore, significant spending under this NAICS code by CBP is expected and reflects the agency's core mission requirements for maintaining border integrity and security.

Industry Classification

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

Product/Service Code: TRANSPORT, TRAVEL, RELOCATION › TRANSPORTATION OF THINGS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 1

Pricing Type: TIME AND MATERIALS (Y)

Evaluated Preference: NONE

Contractor Details

Parent Company: G4S PLC (UEI: 737341631)

Address: 4200 WACKENHUT DR STE 100, PALM BEACH GARDENS, FL, 21

Business Categories: Category Business, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $48,528,337

Exercised Options: $48,528,337

Current Obligation: $48,528,337

Parent Contract

Parent Award PIID: HSBP1006A01327

IDV Type: BPA

Timeline