Navy's $451M Food & Logistics Contract Awarded to Goodwill Raises Questions on Competition and Value

Contract Overview

Contract Amount: $451,393,355 ($451.4M)

Contractor: Goodwill Industries of Southeastern Wisconsin, Inc.

Awarding Agency: Department of Defense

Start Date: 2008-10-01

End Date: 2014-08-04

Contract Duration: 2,133 days

Daily Burn Rate: $211.6K/day

Competition Type: NOT AVAILABLE FOR COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: FOOD AND LOGISTICS SERVICES FOR NAVSTA GL

Place of Performance

Location: GREAT LAKES, LAKE County, ILLINOIS, 60088, UNITED STATES OF AMERICA

State: Illinois Government Spending

Plain-Language Summary

Department of Defense obligated $451.4 million to GOODWILL INDUSTRIES OF SOUTHEASTERN WISCONSIN, INC. for work described as: FOOD AND LOGISTICS SERVICES FOR NAVSTA GL Key points: 1. Significant contract value of $451M for food and logistics services. 2. Awarded to a single entity, raising concerns about competitive pricing. 3. Lack of competition may lead to inflated costs for taxpayers. 4. The sector is food service, with a specific NAICS code of 722310.

Value Assessment

Rating: questionable

The contract value is substantial at over $451 million. Without competitive bidding, it's difficult to assess if this price represents fair market value for food and logistics services. Benchmarking against similar contracts is challenging due to the lack of disclosed pricing details.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

The contract was not available for competition, indicating a limited or sole-source award. This significantly restricts price discovery and may prevent the government from securing the most cost-effective solution. The specific reasons for this limitation are not detailed.

Taxpayer Impact: The absence of competition likely results in higher costs for taxpayers, as there was no pressure to offer the lowest possible price.

Public Impact

Taxpayers may be overpaying for essential food and logistics services due to a lack of competitive bidding. The use of a single, non-profit provider raises questions about efficiency and cost-effectiveness compared to potentially more specialized commercial entities. Ensuring accountability and performance for such a large, long-term contract awarded without competition is crucial.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition
Potential for overpayment
Limited transparency on pricing justification

Positive Signals

Award to a non-profit organization
Long-term service provision

Sector Analysis

This contract falls within the Food Service Contractors sector (NAICS 722310). Spending in this area is essential for military readiness, but competitive procurement is typically expected to ensure value for money. Benchmarks for similar large-scale food service contracts are often driven by competition.

Small Business Impact

The data indicates this contract was not awarded to small businesses, as both 'ss' (small business set-aside) and 'sb' (small business participation) are false. This represents a missed opportunity for small business engagement in a significant federal spending area.

Oversight & Accountability

The limited competition aspect of this award warrants close oversight. Accountability for performance and cost management is critical, especially given the substantial dollar amount and duration of the contract. Further review of the justification for non-competitive award is recommended.

Related Government Programs

Food Service Contractors
Department of Defense Contracting
Department of the Navy Programs

Risk Flags

Lack of competitive bidding
Potential for inflated pricing
Limited transparency on justification for award
No small business participation indicated

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $451.4 million to GOODWILL INDUSTRIES OF SOUTHEASTERN WISCONSIN, INC.. FOOD AND LOGISTICS SERVICES FOR NAVSTA GL

Who is the contractor on this award?

The obligated recipient is GOODWILL INDUSTRIES OF SOUTHEASTERN WISCONSIN, INC..

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Navy).

What is the total obligated amount?

The obligated amount is $451.4 million.

What is the period of performance?

Start: 2008-10-01. End: 2014-08-04.

What was the specific justification for awarding this large food and logistics contract without competition, and how was the price determined to be fair and reasonable?

The justification for awarding the contract without competition is not provided in the data. Typically, such sole-source or limited-competition awards require a detailed justification, such as a unique capability or urgent need. Without this information, it's impossible to assess the rationale or the process used to determine the $451 million price as fair and reasonable, raising concerns about potential overpayment.

What are the potential risks associated with awarding a significant food and logistics contract to a single entity without competitive bidding?

The primary risk is the lack of price competition, which can lead to inflated costs for the government and taxpayers. Without competing offers, there's less incentive for the contractor to optimize efficiency or offer the lowest possible price. Additionally, reliance on a single provider can create risks related to service disruption if the contractor faces operational issues or fails to meet performance standards.

How does the lack of competition impact the overall effectiveness and value for money of this food and logistics service contract?

The lack of competition significantly undermines the effectiveness and value for money. Competitive processes drive innovation, efficiency, and lower prices. When a contract is awarded without competition, the government foregoes these benefits, potentially resulting in a less effective service at a higher cost than could have been achieved through a competitive solicitation.

Industry Classification

NAICS: Accommodation and Food Services › Special Food Services › Food Service Contractors

Product/Service Code: OPERATION OF GOVT OWNED FACILITY › OPERATE GOVT OWNED BUILDINGS

Competition & Pricing

Extent Competed: NOT AVAILABLE FOR COMPETITION

Solicitation Procedures: ONLY ONE SOURCE

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 6055 N 91ST ST, MILWAUKEE, WI, 53225

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

Financial Breakdown

Contract Ceiling: $490,299,846

Exercised Options: $487,050,658

Current Obligation: $451,393,355

Contract Characteristics

Cost or Pricing Data: NO

Timeline