DHS awarded $17.2M for detention facilities, raising questions about value and competition for alien felon housing

Contract Overview

Contract Amount: $17,233,378 ($17.2M)

Contractor: THE GEO Group, Inc.

Awarding Agency: Department of Homeland Security

Start Date: 2008-09-17

End Date: 2010-05-31

Contract Duration: 621 days

Daily Burn Rate: $27.8K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: FUNDING AS PRESCRIBED ON TERMS OF CDF CONTRACT #HSCEOP-06-D-00010. EXISTING DETENTION SPACE IS NEEDED TO HOUSE KNOWN ALIEN FELONS FOR REMOVAL PROCEEDINGS.

Place of Performance

Location: AURORA, ADAMS County, COLORADO, 80010

State: Colorado Government Spending

Plain-Language Summary

Department of Homeland Security obligated $17.2 million to THE GEO GROUP, INC. for work described as: FUNDING AS PRESCRIBED ON TERMS OF CDF CONTRACT #HSCEOP-06-D-00010. EXISTING DETENTION SPACE IS NEEDED TO HOUSE KNOWN ALIEN FELONS FOR REMOVAL PROCEEDINGS. Key points: 1. The contract's value of $17.2 million for detention services warrants scrutiny against market rates and alternative solutions. 2. Full and open competition was utilized, but the limited number of bidders may have impacted price discovery. 3. The fixed-firm price structure offers cost certainty but may not fully capture potential efficiencies or cost savings. 4. The duration of the contract (621 days) suggests a need for ongoing, predictable service delivery. 5. The specific need for housing alien felons highlights a critical but potentially sensitive area of government operations. 6. The contractor, The GEO Group, Inc., has a significant presence in the private detention services market.

Value Assessment

Rating: fair

The award of $17.2 million for detention services requires careful benchmarking against similar contracts and market rates for correctional facilities. Without specific per-unit cost data or comparisons to publicly operated facilities, assessing the precise value-for-money is challenging. The firm-fixed-price nature provides cost predictability for the government, but it's essential to ensure the pricing reflects competitive market conditions and avoids excessive profit margins. Further analysis would involve comparing the per-bed cost and service level agreements to industry standards.

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. However, the data does not specify the number of bids received. A low number of responsive bids, even under full and open competition, could suggest limited market capacity or high barriers to entry, potentially impacting the government's ability to secure the most competitive pricing.

Taxpayer Impact: While full and open competition is generally favorable for taxpayers, the actual number of bidders is crucial. If only a few entities could realistically bid, the potential for cost savings may have been diminished.

Public Impact

The primary beneficiaries are U.S. Immigration and Customs Enforcement (ICE) and the Department of Homeland Security (DHS), receiving essential services for managing detainees. The services delivered include providing detention space for alien felons awaiting removal proceedings. The geographic impact is localized to Colorado, where the detention facility is located. Workforce implications include employment opportunities at the detention facility operated by The GEO Group, Inc.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for high per-diem costs if not benchmarked against public facilities or alternative solutions.
Reliance on private sector for detention services raises ethical and oversight concerns.
Limited transparency into operational details and staffing levels within the contracted facility.
Contract duration may not align with fluctuating detention needs, leading to potential inefficiencies.

Positive Signals

Firm-fixed-price contract provides budget certainty for the government.
Full and open competition, in principle, allows for a broad range of potential providers.
Contract addresses a critical government requirement for managing alien felons.
The GEO Group, Inc. is an established provider in the detention services industry.

Sector Analysis

The Facilities Support Services sector, particularly within government contracting, involves providing essential infrastructure and operational support. This contract falls under the broader category of correctional and detention services, a niche within the larger facilities management market. The market size for such services is significant, driven by government needs for housing and managing individuals in various legal statuses. Benchmarking this contract would involve comparing its per-diem rates and service scope to other federal, state, and local detention facilities, as well as private correctional operators.

Small Business Impact

The provided data indicates that small business participation was not a specific set-aside requirement for this contract (ss: false, sb: false). As a large contract likely awarded to a major provider, the primary impact on small businesses would be through subcontracting opportunities. However, without specific subcontracting plans or goals detailed in the award, it's difficult to assess the extent to which small businesses will benefit from this particular contract. The overall impact on the small business ecosystem depends on the prime contractor's subcontracting practices.

Oversight & Accountability

Oversight for this contract would primarily fall under the purview of U.S. Immigration and Customs Enforcement (ICE) within the Department of Homeland Security. Accountability measures would be defined by the contract's terms and conditions, including performance standards and reporting requirements. Transparency is often a concern with detention facilities; while the contract itself is a public record, the day-to-day operations and specific conditions within the facility may have limited public visibility. Inspector General jurisdiction would apply to investigations of fraud, waste, or abuse related to the contract.

Related Government Programs

Federal Bureau of Prisons Contracts
U.S. Marshals Service Detention Contracts
State and Local Government Detention Agreements
Immigration Detention Services
Correctional Facility Management

Risk Flags

Potential for high per-diem costs
Contractor performance history concerns
Oversight challenges in private detention facilities
Reputational risk associated with private detention

Frequently Asked Questions

What is this federal contract paying for?

Department of Homeland Security awarded $17.2 million to THE GEO GROUP, INC.. FUNDING AS PRESCRIBED ON TERMS OF CDF CONTRACT #HSCEOP-06-D-00010. EXISTING DETENTION SPACE IS NEEDED TO HOUSE KNOWN ALIEN FELONS FOR REMOVAL PROCEEDINGS.

Who is the contractor on this award?

The obligated recipient is THE GEO GROUP, INC..

Which agency awarded this contract?

Awarding agency: Department of Homeland Security (U.S. Immigration and Customs Enforcement).

What is the total obligated amount?

The obligated amount is $17.2 million.

What is the period of performance?

Start: 2008-09-17. End: 2010-05-31.

What is the historical spending pattern for similar detention services by ICE?

Analyzing historical spending by ICE on detention services reveals a significant and often increasing reliance on contracted facilities over the past two decades. This trend is driven by fluctuating immigration flows and policy changes. For instance, spending has seen substantial growth during periods of increased border apprehensions and expedited removal processes. Comparing the $17.2 million awarded for this specific contract to the agency's overall detention budget and the average cost per bed across various facilities provides crucial context. It's important to note that spending can vary widely based on contract type (e.g., per diem, fixed price), facility size, location, and the specific population being housed (e.g., families, single adults, criminal aliens). Examining multi-year spending trends allows for an assessment of whether this contract represents a typical investment or an outlier in terms of cost and scope.

How does the per-unit cost of this contract compare to industry benchmarks for detention facilities?

Determining the precise per-unit cost for this $17.2 million contract requires additional data, such as the total number of beds or the average daily population housed over the contract's duration. However, the contract's purpose – housing alien felons for removal proceedings – suggests a need for secure facilities. Industry benchmarks for detention services can vary significantly based on geographic location, security levels, and the services provided (e.g., medical care, food, transportation). Generally, per-diem rates for secure detention facilities can range from $100 to over $200 per person per day. If this contract supported a facility housing several hundred individuals for its 621-day duration, the implied per-diem rate would need to be compared against these benchmarks. A higher-than-average per-diem rate, even under a firm-fixed-price contract, could indicate potential issues with value for money or market competitiveness.

What is The GEO Group, Inc.'s track record with similar government contracts?

The GEO Group, Inc. is one of the largest private providers of correctional and detention management services in the United States, with a substantial portfolio of contracts with federal, state, and local government agencies. Their track record with the federal government, particularly with agencies like ICE and the Federal Bureau of Prisons, is extensive. This includes managing numerous detention centers and correctional facilities. Performance reviews and past performance evaluations for these contracts are critical indicators of their reliability, operational efficiency, and compliance with contractual obligations. While GEO Group has a long history of service, it has also faced scrutiny and criticism regarding facility conditions, staffing levels, and cost-effectiveness in some of its operations. Understanding their specific performance on comparable ICE contracts, including any past disputes, contract modifications, or successful outcomes, is essential for assessing the risk and value associated with this current award.

What are the primary risks associated with this contract for the government?

The primary risks associated with this contract include potential cost overruns if the firm-fixed-price does not adequately account for unforeseen operational challenges or changes in service requirements. There's also a risk related to the quality of services provided; inadequate facility management, staffing shortages, or failure to meet security standards could lead to operational disruptions, safety incidents, or reputational damage for the government. Over-reliance on a single contractor for critical detention services can also pose a risk if the contractor experiences financial difficulties or operational failures. Furthermore, public and political scrutiny regarding the use of private detention facilities, especially for housing individuals with criminal records, presents a significant reputational risk. Ensuring robust oversight and performance monitoring is crucial to mitigate these risks.

How does the contract's duration (621 days) align with the government's typical needs for alien felon detention?

The contract duration of 621 days (approximately 1.7 years) suggests a medium-term need for detention services. This duration implies that the Department of Homeland Security anticipates a consistent requirement for housing alien felons for removal proceedings over this period. It is neither a short-term emergency measure nor a long-term, indefinite commitment. This timeframe allows for operational stability and planning for the contractor while providing the government with a predictable service period. However, it also necessitates careful consideration of whether this duration accurately reflects projected immigration trends and removal processing times. If detention needs are expected to fluctuate significantly, a fixed duration might lead to either excess capacity or insufficient beds towards the end of the term, impacting overall cost-effectiveness.

Industry Classification

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

Product/Service Code: UTILITIES AND HOUSEKEEPING › HOUSEKEEPING SERVICES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 621 NW 53RD ST STE 700, BOCA RATON, FL, 33487

Business Categories: Category Business, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $17,233,378

Exercised Options: $17,233,378

Current Obligation: $17,233,378

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Parent Contract

Parent Award PIID: HSCEOP06D00010

IDV Type: IDC

Timeline