DoD's $16.4M Food Services Contract with Palmetto Goodwill Raises Value and Competition Concerns
Contract Overview
Contract Amount: $16,376,889 ($16.4M)
Contractor: Palmetto Goodwill Services
Awarding Agency: Department of Defense
Start Date: 2003-10-03
End Date: 2008-09-30
Contract Duration: 1,824 days
Daily Burn Rate: $9.0K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: FIXED PRICE
Sector: Other
Official Description: 200403!000005!1700!MA40A !FISC JACKSONVILLE - LARGE PURCHA!N6883603C0049 !A!N! !N! ! !20031003!20040930!099875700!099875700!099875700!N!GOODWILL INDS OF LOWER SC !5640 RIVERS AVE !NORTH CHARLEST !SC!29406!29815!015!45!GOOSE CREEK !BERKELEY !S CAROLINA!+000003556380!N!N!000000000000!S203!FOOD SERVICES !S1 !SERVICES !000 !* !722310!E! !3! ! ! ! ! !99990909!B! ! !N!Z!D!U!J!1!001!N!5A!C!N!Z! ! !Y!D!N! ! ! ! ! !A!A!000!A!B!N! ! ! ! ! !N69214!0001! !
Place of Performance
Location: NORTH CHARLESTON, CHARLESTON County, SOUTH CAROLINA, 29406
Plain-Language Summary
Department of Defense obligated $16.4 million to PALMETTO GOODWILL SERVICES for work described as: 200403!000005!1700!MA40A !FISC JACKSONVILLE - LARGE PURCHA!N6883603C0049 !A!N! !N! ! !20031003!20040930!099875700!099875700!099875700!N!GOODWILL INDS OF LOWER SC !5640 RIVERS AVE !NORTH CHARLEST !SC!29406!29815!015!45!GOOSE CREEK !BERK… Key points: 1. The contract awarded to Palmetto Goodwill Services for food services represents a significant expenditure. 2. The 'NOT COMPETED' status raises questions about potential price discovery and value for taxpayer money. 3. While supporting a non-profit, the lack of competition could indicate a missed opportunity for cost savings. 4. The IT sector is not directly involved, but the contract's structure may offer lessons for other service procurements.
Value Assessment
Rating: questionable
The contract's value of $16.4 million for food services appears high, especially given the lack of competition. Benchmarking against similar food service contracts, particularly those that underwent competitive bidding, would be crucial to assess if this price is reasonable.
Cost Per Unit: N/A
Competition Analysis
Competition Level: limited
This contract was not competed, indicating a limited competition approach. This method can lead to higher prices and reduced innovation compared to full and open competition, as there is less pressure to offer the best value.
Taxpayer Impact: The lack of competition may result in taxpayers paying more than necessary for these food services, potentially diverting funds from other critical government needs.
Public Impact
Taxpayers may be overpaying for essential food services due to a lack of competitive bidding. The award to a non-profit organization, while potentially beneficial for social programs, warrants scrutiny regarding procurement fairness. This contract highlights the importance of competitive processes in ensuring government efficiency and cost-effectiveness.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Lack of competition
- Potentially inflated price
- Limited transparency in price discovery
Positive Signals
- Supports a non-profit organization
- Long-term contract provides stability
Sector Analysis
This contract falls under general services, specifically food services, within the broader Department of Defense spending. Benchmarks for similar service contracts are highly variable, but a lack of competition often inflates costs compared to competitively awarded contracts.
Small Business Impact
The contract was awarded to Goodwill Industries, a non-profit organization, not a small business. There is no indication of small business participation or subcontracting in the provided data.
Oversight & Accountability
The 'NOT COMPETED' status suggests potential oversight gaps or justifications for sole-sourcing that require further examination to ensure accountability and adherence to procurement regulations.
Related Government Programs
- Food Service Contractors
- Department of Defense Contracting
- Department of the Navy Programs
Risk Flags
- Lack of competitive bidding
- Potential for above-market pricing
- Limited transparency in award justification
- No clear small business participation
Tags
food-service-contractors, department-of-defense, sc, definitive-contract, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $16.4 million to PALMETTO GOODWILL SERVICES. 200403!000005!1700!MA40A !FISC JACKSONVILLE - LARGE PURCHA!N6883603C0049 !A!N! !N! ! !20031003!20040930!099875700!099875700!099875700!N!GOODWILL INDS OF LOWER SC !5640 RIVERS AVE !NORTH CHARLEST !SC!29406!29815!015!45!GOOSE CREEK !BERKELEY !S CAROLINA!+000003556380!N!N!000000000000!S203!FOOD SERVICES !S1 !SERVICES !000 !* !722310!E! !3! ! ! ! ! !999
Who is the contractor on this award?
The obligated recipient is PALMETTO GOODWILL SERVICES.
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Navy).
What is the total obligated amount?
The obligated amount is $16.4 million.
What is the period of performance?
Start: 2003-10-03. End: 2008-09-30.
What was the justification for not competing this food services contract, and how does it align with federal procurement regulations for limited competition?
The justification for not competing this contract is not explicitly detailed in the provided data. Federal regulations allow for limited competition under specific circumstances, such as when only one responsible source can satisfy agency requirements. However, a thorough review would be needed to confirm if the conditions for limited competition were met and if alternative sources were adequately considered.
How does the per-unit cost of these food services compare to industry benchmarks for similar contracts awarded through full and open competition?
Without specific per-unit cost breakdowns and access to comparable competitively awarded contracts, a direct comparison is difficult. However, contracts awarded under limited competition are generally expected to be higher priced than those secured through robust bidding processes. Further analysis would require detailed cost data and market research on similar food service contracts.
What is the long-term financial impact on the Department of Defense and taxpayers if this contract's pricing is indeed above market rates due to lack of competition?
If the pricing is above market rates, the long-term financial impact could be substantial, potentially amounting to millions of dollars in overspending over the contract's duration. This could reduce the funds available for other critical defense needs or necessitate higher overall budget allocations. It underscores the importance of competitive sourcing for maximizing taxpayer value.
Industry Classification
NAICS: Accommodation and Food Services › Special Food Services › Food Service Contractors
Product/Service Code: UTILITIES AND HOUSEKEEPING › HOUSEKEEPING SERVICES
Competition & Pricing
Extent Competed: NOT COMPETED
Offers Received: 1
Pricing Type: FIXED PRICE (J)
Contractor Details
Address: 5640 RIVERS AVE, NORTH CHARLEST, SC, 29406
Business Categories: AbilityOne Program Participant, Category Business, Not Designated a Small Business, Special Designations
Contract Characteristics
Commercial Item: COMMERCIAL ITEM
Cost or Pricing Data: NO
Timeline
Start Date: 2003-10-03
Current End Date: 2008-09-30
Potential End Date: 2008-09-30 00:00:00
Last Modified: 2021-08-01
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