Department of Labor's $22.3M contract for technical and trade schools awarded to Management & Training Corporation

Contract Overview

Contract Amount: $22,267,195 ($22.3M)

Contractor: Management & Training Corporation

Awarding Agency: Department of Labor

Start Date: 2016-07-01

End Date: 2017-03-31

Contract Duration: 273 days

Daily Burn Rate: $81.6K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: COST PLUS FIXED FEE

Sector: Other

Official Description: IGF::CT::IGF

Place of Performance

Location: MORGANFIELD, UNION County, KENTUCKY, 42437

State: Kentucky Government Spending

Plain-Language Summary

Department of Labor obligated $22.3 million to MANAGEMENT & TRAINING CORPORATION for work described as: IGF::CT::IGF Key points: 1. The contract's value of $22.3 million for a 9-month period suggests a high per-diem or per-student cost. 2. Awarded as a sole-source contract, it bypasses competitive bidding, potentially limiting price discovery and value for taxpayers. 3. The cost-plus-fixed-fee (CPFF) pricing structure carries inherent risk, as costs can escalate beyond initial estimates. 4. The contract duration of 273 days is relatively short, raising questions about long-term program sustainability and efficiency. 5. The specific NAICS code (611519) indicates a focus on vocational training, a critical sector for workforce development. 6. The absence of small business set-aside or subcontracting goals warrants scrutiny regarding broader economic impact.

Value Assessment

Rating: questionable

The contract's value of $22.3 million for a 273-day period translates to a significant daily expenditure. Without comparable contract data or detailed cost breakdowns, it is difficult to benchmark the value for money. The CPFF structure, while allowing for flexibility, can lead to cost overruns if not managed tightly. The lack of competition further complicates a robust value assessment.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning it was not competed. This approach is typically used when only one responsible source is available or in cases of urgent need. The lack of competition means that the government did not benefit from the price reductions and innovation that can arise from a bidding process. This raises concerns about whether the government obtained the best possible price and terms.

Taxpayer Impact: Sole-source awards mean taxpayers may not be getting the most competitive pricing. Without multiple bids, there's less pressure on the contractor to offer the lowest possible cost, potentially leading to higher overall spending.

Public Impact

The primary beneficiaries are likely individuals seeking technical and trade education, potentially improving their workforce readiness. The services delivered are expected to be vocational training programs, equipping individuals with specific job skills. The contract is geographically focused on Kentucky (ST: KY, SN: KENTUCKY), suggesting a localized impact on training services. The contract could have implications for the local workforce development ecosystem by providing training opportunities and potentially creating jobs within the training institutions.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits competitive pressure, potentially increasing costs for taxpayers.
Cost-plus-fixed-fee (CPFF) contract type carries inherent risk of cost escalation.
Short contract duration (273 days) may indicate a lack of long-term strategic planning or a temporary need.
No indication of small business participation or subcontracting goals limits broader economic impact.
Lack of detailed performance metrics or outcome data makes it difficult to assess program effectiveness.

Positive Signals

Contract supports vocational training, addressing critical workforce development needs.
Focus on specific technical and trade skills can lead to improved employment outcomes for participants.
The award to a known entity (Management & Training Corporation) might suggest a level of established capability.

Sector Analysis

The contract falls within the Education and Training sector, specifically focusing on vocational and technical education. This sector is crucial for developing a skilled workforce aligned with industry demands. Comparable spending in this area can vary widely based on program scope, duration, and the number of participants. The market for vocational training is often characterized by a mix of public institutions, private schools, and non-profit organizations, with varying degrees of government funding and oversight.

Small Business Impact

The contract does not appear to include any specific small business set-aside provisions, nor is there information indicating subcontracting goals for small businesses. This suggests that the primary contractor, Management & Training Corporation, is expected to perform the majority of the work. The absence of small business participation could limit opportunities for smaller entities within the training and education ecosystem to contribute to this federal contract and potentially hinder the broader impact on the small business economy.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of Labor's Office of the Assistant Secretary for Administration and Management (OASAM). As a sole-source award, scrutiny might be higher to ensure justification for the lack of competition. The CPFF structure necessitates robust financial oversight to monitor costs and prevent overruns. Transparency regarding performance metrics and outcomes would be crucial for assessing accountability, though specific details are not provided in the summary data.

Related Government Programs

Workforce Innovation and Opportunity Act (WIOA) programs
Job Corps
Adult Education and Family Literacy Act programs
Federal Pell Grants for vocational training

Risk Flags

Sole-source award lacks competitive justification.
CPFF contract type increases government financial risk.
Short contract duration may indicate a lack of long-term planning.
No small business participation noted.
Performance metrics and outcomes not specified.

Frequently Asked Questions

What is this federal contract paying for?

Department of Labor awarded $22.3 million to MANAGEMENT & TRAINING CORPORATION. IGF::CT::IGF

Who is the contractor on this award?

The obligated recipient is MANAGEMENT & TRAINING CORPORATION.

Which agency awarded this contract?

Awarding agency: Department of Labor (Office of the Assistant Secretary for Administration and Management).

What is the total obligated amount?

The obligated amount is $22.3 million.

What is the period of performance?

Start: 2016-07-01. End: 2017-03-31.

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

The provided data indicates the contract was awarded as 'NOT COMPETED' and is 'SOLE SOURCE'. Typically, sole-source awards are justified when only one responsible source is capable of providing the required services, or in cases of urgent and compelling need where competition is not feasible. Without further documentation from the Department of Labor, the precise justification remains unclear. Common reasons include unique capabilities, proprietary technology, or a critical, time-sensitive requirement that cannot be met through a competitive process. This lack of competition warrants careful review by oversight bodies to ensure taxpayer funds are used efficiently and effectively.

How does the cost structure (Cost Plus Fixed Fee) impact the overall value and risk for the government?

A Cost Plus Fixed Fee (CPFF) contract structure means the contractor is reimbursed for all allowable costs incurred, plus a predetermined fixed fee representing profit. While this structure can be useful for research and development or services where costs are difficult to estimate upfront, it shifts much of the financial risk to the government. If the contractor's costs exceed initial projections, the government pays more. The fixed fee, however, provides some predictability in profit. For this $22.3 million contract over 273 days, the CPFF structure necessitates rigorous government oversight to monitor expenditures and ensure costs remain reasonable and allocable to the contract objectives. Without strong oversight, there's a risk of cost overruns impacting the overall value for money.

What are the expected outcomes and performance metrics for this vocational training contract?

The provided data does not specify the expected outcomes or performance metrics for this contract. However, for vocational training contracts, typical metrics often include participant completion rates, job placement rates post-training, average starting wages of placed participants, and employer satisfaction. The effectiveness of the training in meeting industry demands and improving participants' long-term career prospects would be key indicators of success. Without clearly defined and measurable outcomes, it is challenging to assess the contract's performance and its true value to the workforce development mission.

What is the historical spending pattern for similar vocational training services by the Department of Labor?

Historical spending data for similar vocational training services by the Department of Labor is not provided in the summary. However, the Department of Labor frequently contracts for workforce development and training programs through various initiatives, including those funded by the Workforce Innovation and Opportunity Act (WIOA). Analyzing past contracts for vocational training, their durations, costs, and outcomes would provide valuable context for assessing the current $22.3 million award. Understanding trends in sole-source versus competed awards, and the cost-effectiveness of different training providers, would offer insights into whether this contract represents a typical or outlier investment.

What is the track record of Management & Training Corporation in delivering government-funded vocational training programs?

Management & Training Corporation (MTC) is a known entity in the correctional and workforce training sectors, often managing Job Corps centers and other government-funded programs. Their track record typically involves operating facilities and delivering educational and vocational services. A comprehensive assessment would require reviewing past performance evaluations, contract compliance records, and any reported issues or successes from previous government engagements. While MTC has experience, the specific performance quality and cost-effectiveness on prior contracts would be crucial for evaluating their suitability and performance under this particular Department of Labor award.

Industry Classification

NAICS: Educational Services › Technical and Trade Schools › Other Technical and Trade Schools

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

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: DOLETA16C0065

Offers Received: 1

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Address: 500 N MARKET PLACE DR STE 100, CENTERVILLE, UT, 84014

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, Subchapter S Corporation, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $44,437,580

Exercised Options: $22,267,195

Current Obligation: $22,267,195

Actual Outlays: $-35,752

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline