DoD's $747M Food Service Contract with Goodwill Faces Scrutiny Over Competition and Value
Contract Overview
Contract Amount: $747,466,563 ($747.5M)
Contractor: Goodwill Industries of Southeastern Wisconsin, Inc.
Awarding Agency: Department of Defense
Start Date: 2018-10-01
End Date: 2026-09-30
Contract Duration: 2,921 days
Daily Burn Rate: $255.9K/day
Competition Type: NOT AVAILABLE FOR COMPETITION
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: Other
Official Description: IGF::OT::IGF FOOD SERVICE LABOR
Place of Performance
Location: GREAT LAKES, LAKE County, ILLINOIS, 60088
State: Illinois Government Spending
Plain-Language Summary
Department of Defense obligated $747.5 million to GOODWILL INDUSTRIES OF SOUTHEASTERN WISCONSIN, INC. for work described as: IGF::OT::IGF FOOD SERVICE LABOR Key points: 1. Significant contract value of $747M over 8 years. 2. Sole-source award raises questions about competition and potential price inflation. 3. Lack of competition may limit opportunities for other service providers. 4. Sector context: Food service contracts are common but require careful oversight.
Value Assessment
Rating: questionable
The contract's large value and lack of competitive bidding make a direct pricing assessment difficult. Without comparable contracts, it's hard to determine if the $747M represents fair market value.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
The contract was awarded on a sole-source basis, indicating a lack of competition. This method bypasses the standard competitive bidding process, potentially impacting price discovery and leading to higher costs for the government.
Taxpayer Impact: The absence of competition could result in taxpayers paying more than necessary for food services.
Public Impact
Taxpayers may be overpaying due to the sole-source nature of the contract. Limited transparency into the pricing structure raises concerns about efficiency. The long duration of the contract (8 years) means potential overspending could accumulate significantly.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Lack of competition
- Long contract duration
- High contract value
Positive Signals
- Supports a non-profit organization
- Provides employment opportunities
Sector Analysis
Food service contracts are essential for military operations, providing meals to service members. Benchmarks for such contracts vary widely based on location, scope, and service level, but competitive bidding typically ensures better value.
Small Business Impact
This contract was not awarded to a small business. The sole-source nature limits opportunities for small businesses that might otherwise compete for similar food service contracts.
Oversight & Accountability
The sole-source award warrants close oversight to ensure the contractor is delivering services effectively and at a reasonable cost. Transparency in pricing and performance metrics is crucial for accountability.
Related Government Programs
- Food Service Contractors
- Department of Defense Contracting
- Department of the Navy Programs
Risk Flags
- Potential for overpricing due to sole-source award.
- Lack of competitive transparency.
- Long contract duration increases risk of sustained inefficiency.
- Limited visibility into specific cost drivers.
Tags
food-service-contractors, department-of-defense, il, definitive-contract, 100m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $747.5 million to GOODWILL INDUSTRIES OF SOUTHEASTERN WISCONSIN, INC.. IGF::OT::IGF FOOD SERVICE LABOR
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 $747.5 million.
What is the period of performance?
Start: 2018-10-01. End: 2026-09-30.
What specific justification was provided for the sole-source award, and were alternative competitive strategies considered?
The justification for a sole-source award is critical for understanding why competition was bypassed. Agencies typically must demonstrate that only one responsible source can satisfy the agency's needs. Without this justification, it's difficult to assess if the government received the best possible value or if opportunities for innovation and cost savings through competition were missed.
How does the per-unit cost of services under this contract compare to industry benchmarks for similar food services, considering the sole-source nature?
Assessing the per-unit cost against benchmarks is challenging without competitive data. However, sole-source contracts often carry a risk of higher pricing due to the lack of market pressure. A thorough analysis would involve comparing the contractor's pricing to publicly available data for similar services, adjusted for scope and location, to identify potential overpricing.
What performance metrics are in place to ensure the effectiveness and efficiency of the food services provided under this large, long-term contract?
Effective oversight requires clear performance metrics tied to service quality, timeliness, and cost control. For a contract of this magnitude and duration, robust monitoring is essential to ensure the government receives value for its investment. Regular performance reviews and audits should verify that the contractor is meeting all contractual obligations and delivering high-quality food services.
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
Solicitation ID: N0018918RZ025
Offers Received: 1
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Address: 5400 S 60TH ST, GREENDALE, WI, 53129
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: $1,105,094,170
Exercised Options: $869,472,131
Current Obligation: $747,466,563
Actual Outlays: $26,300,914
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES
Cost or Pricing Data: NO
Timeline
Start Date: 2018-10-01
Current End Date: 2026-09-30
Potential End Date: 2028-09-30 00:00:00
Last Modified: 2026-01-15
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