Army awards $17.8M for Fort Huachuca food services, citing non-competitive procurement

Contract Overview

Contract Amount: $17,839,710 ($17.8M)

Contractor: Department of Economic Security Arizona

Awarding Agency: Department of Defense

Start Date: 2024-06-25

End Date: 2026-12-31

Contract Duration: 919 days

Daily Burn Rate: $19.4K/day

Competition Type: NOT AVAILABLE FOR COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: FULL FOOD SERVICES, DINING FACILITIES, FORT HUACHUCA, ARIZONA

Place of Performance

Location: FORT HUACHUCA, COCHISE County, ARIZONA, 85613

State: Arizona Government Spending

Plain-Language Summary

Department of Defense obligated $17.8 million to DEPARTMENT OF ECONOMIC SECURITY ARIZONA for work described as: FULL FOOD SERVICES, DINING FACILITIES, FORT HUACHUCA, ARIZONA Key points: 1. Contract awarded on a firm-fixed-price basis, indicating predictable costs for the government. 2. The duration of the contract is over two years, suggesting a need for sustained services. 3. Awarded by the Department of the Army, aligning with defense sector spending. 4. The North American Industry Classification System (NAICS) code 722310 points to food service contractors. 5. The contract was not competed, raising questions about potential cost savings and market engagement. 6. The base value is approximately $17.8 million, with a potential ceiling not specified in the provided data.

Value Assessment

Rating: questionable

Without a competitive bidding process, it is difficult to benchmark the value for money. The firm-fixed-price structure provides cost certainty, but the absence of competition may mean the government is not receiving the most advantageous pricing. Further analysis would require comparing this award to similar food service contracts at other military installations or for comparable service scopes to assess if the pricing is in line with market rates.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning it was not open to competition from multiple bidders. The specific justification for this non-competitive award is not provided in the data. Sole-source awards can sometimes be necessary due to unique circumstances or urgent needs, but they limit the government's ability to leverage market competition to drive down prices and ensure the best value.

Taxpayer Impact: The lack of competition means taxpayers may not benefit from the cost efficiencies that a bidding process typically generates. This could result in a higher overall cost for the services provided.

Public Impact

Service members and personnel stationed at Fort Huachuca, Arizona, will receive dining facility and full food services. Ensures the provision of essential sustenance and a stable dining environment for the base population. The contract supports the operational readiness and morale of the U.S. Army. Indirectly supports local economies through contractor employment and supply chain activities in Arizona.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may lead to inflated prices.
Potential for complacency from the sole-source provider regarding service quality.
Limited transparency into the justification for sole-source award.

Positive Signals

Firm-fixed-price contract provides cost predictability.
Long-term contract (over two years) ensures service continuity.
Awarded to a contractor with experience in food service operations.

Sector Analysis

This contract falls within the food service industry, a segment of the broader services sector. The federal government is a significant consumer of food services, particularly for military installations, correctional facilities, and government cafeterias. While specific market size data for federal food service contracts is not provided, the Department of Defense alone awards billions annually for various support services, including food. This contract represents a portion of that spending, ensuring essential life support functions at a key Army installation.

Small Business Impact

The provided data indicates that this contract was not set aside for small businesses, nor does it specify any subcontracting requirements for small businesses. The award was made directly to a single entity without a competitive process that might typically include provisions for small business participation. Therefore, the direct impact on the small business ecosystem appears minimal based on this information.

Oversight & Accountability

Oversight for this contract would typically fall under the purview of the Department of the Army contracting command and the installation leadership at Fort Huachuca. Accountability measures would be defined in the contract's terms and conditions, including performance standards and payment schedules. Transparency is limited due to the sole-source nature of the award, with the justification for non-competition being a key area for potential further inquiry.

Related Government Programs

Fort Huachuca Base Operations Support
Department of Defense Food Service Contracts
Military Dining Facility Management
Army Garrison Services

Risk Flags

Sole-source award lacks competitive justification.
Potential for non-optimal pricing due to lack of competition.
Limited transparency regarding the necessity of sole-sourcing.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $17.8 million to DEPARTMENT OF ECONOMIC SECURITY ARIZONA. FULL FOOD SERVICES, DINING FACILITIES, FORT HUACHUCA, ARIZONA

Who is the contractor on this award?

The obligated recipient is DEPARTMENT OF ECONOMIC SECURITY ARIZONA.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $17.8 million.

What is the period of performance?

Start: 2024-06-25. End: 2026-12-31.

What is the specific justification for awarding this food service contract on a sole-source basis?

The provided data states the contract was 'NOT AVAILABLE FOR COMPETITION,' indicating a sole-source award. However, the specific justification for this non-competitive procurement is not detailed. Typically, sole-source awards are justified under circumstances such as urgent and compelling needs, unique capabilities of a single source, or when only one responsible source exists. Without the official justification document (e.g., a Justification and Approval or J&A), it is impossible to ascertain the precise reasons. This lack of transparency is a common concern with sole-source contracts, as it limits the public's understanding of why competition was bypassed and whether taxpayer funds are being used optimally.

How does the $17.8 million contract value compare to similar food service contracts at other Army installations?

Direct comparison of the $17.8 million value for Fort Huachuca's food services requires access to a database of similar contracts, including scope of services, installation size, and duration. However, based on general knowledge of military food service contracts, this value appears moderate for a contract spanning over two years and covering full dining facilities for a significant base population. Contracts for large installations can range from tens to hundreds of millions of dollars. The firm-fixed-price nature suggests cost predictability, but without competitive benchmarking, it's difficult to definitively state if this represents excellent or fair value. Further analysis would involve identifying comparable installations and their food service contract values.

What are the potential risks associated with a sole-source award for essential services like food?

Sole-source awards for essential services like food carry several potential risks. Firstly, the absence of competition can lead to higher prices than might be achieved through a bidding process, potentially resulting in less value for taxpayer money. Secondly, a sole-source provider may have less incentive to innovate or maintain high service standards, as there is no immediate threat of losing the contract to a competitor. This can lead to service quality degradation over time. Thirdly, it can limit the government's flexibility if the contractor's performance becomes unsatisfactory, as transitioning to a new provider under a sole-source arrangement can be complex and time-consuming. Finally, the lack of transparency in the justification for sole-sourcing can raise concerns about fairness and potential impropriety.

What is the expected performance period and what does the duration imply for service continuity?

The contract has a duration of 919 days, which translates to approximately 2 years and 6 months, with an end date of December 31, 2026. This extended duration suggests a requirement for sustained and reliable food service operations at Fort Huachuca. A longer contract term provides stability for both the government and the contractor, allowing for consistent service delivery and potentially enabling the contractor to make necessary investments in staffing and equipment. It implies that the Army views these services as critical and requires a long-term solution rather than short-term, ad-hoc arrangements.

What is the historical spending pattern for food services at Fort Huachuca, if available?

Historical spending data for food services specifically at Fort Huachuca is not provided in the current data extract. To analyze historical spending patterns, one would need to access contract databases (like FPDS or USASpending.gov) and search for previous food service contracts awarded to Fort Huachuca over multiple fiscal years. This would allow for an assessment of spending trends, identification of previous contractors, and comparison of contract values over time. Understanding historical spending is crucial for identifying significant increases or decreases in costs, evaluating the effectiveness of past procurement strategies, and establishing a baseline for future budget planning and value assessments.

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: 3425 E VAN BUREN ST, PHOENIX, AZ, 85008

Business Categories: Category Business, Government, U.S. National Government, Not Designated a Small Business, U.S. Regional/State Government

Financial Breakdown

Contract Ceiling: $28,134,056

Exercised Options: $24,611,844

Current Obligation: $17,839,710

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Timeline