Labor Department's $33M JCC Operations contract awarded to Management & Training Corporation shows fair value

Contract Overview

Contract Amount: $32,936,700 ($32.9M)

Contractor: Management & Training Corporation

Awarding Agency: Department of Labor

Start Date: 2017-02-01

End Date: 2022-01-31

Contract Duration: 1,825 days

Daily Burn Rate: $18.0K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 3

Pricing Type: COST PLUS INCENTIVE FEE

Sector: Other

Official Description: IGF::CT::IGF PHILADELPHIA JCC OPERATIONS, OA, AND CTS

Place of Performance

Location: PHILADELPHIA, PHILADELPHIA County, PENNSYLVANIA, 19146

State: Pennsylvania Government Spending

Plain-Language Summary

Department of Labor obligated $32.9 million to MANAGEMENT & TRAINING CORPORATION for work described as: IGF::CT::IGF PHILADELPHIA JCC OPERATIONS, OA, AND CTS Key points: 1. The contract was awarded through full and open competition, indicating a competitive bidding process. 2. The contractor, Management & Training Corporation, has a history of managing similar government programs. 3. The contract type, Cost Plus Incentive Fee, allows for performance-based adjustments to profit. 4. The duration of the contract (1825 days) suggests a long-term need for these services. 5. The contract's scope includes operations, outreach, and career transition services. 6. The geographic focus is Pennsylvania, impacting local workforce development.

Value Assessment

Rating: good

The contract's total value of approximately $33 million over five years suggests a reasonable annual spend of around $6.6 million. Benchmarking this against similar workforce development and correctional facility management contracts is challenging without more specific service details. However, the Cost Plus Incentive Fee structure implies that the government aims to incentivize efficient performance, which can lead to better value if targets are met. The contractor's experience in similar roles also suggests a degree of established operational efficiency.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, meaning all responsible sources were permitted to submit a bid. The presence of three bidders (no) suggests a moderate level of competition for this specific requirement. While three bidders indicate some level of market interest, it's not exceptionally high, which could potentially limit the downward pressure on pricing compared to a scenario with many more competitors.

Taxpayer Impact: Full and open competition is generally favorable for taxpayers as it encourages multiple companies to vie for the contract, potentially leading to lower prices and better service offerings. The presence of three bidders suggests a reasonable, though not intense, competitive environment.

Public Impact

The primary beneficiaries are individuals seeking workforce development and career transition services within Pennsylvania. The contract delivers operational support, outreach, and career transition services, likely aimed at improving employment outcomes. The geographic impact is concentrated in Pennsylvania, supporting the state's workforce initiatives. Workforce implications include potential job creation by the contractor and improved employability for service recipients.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns inherent in Cost Plus contracts if not tightly managed.
Ensuring consistent service quality across all operational sites within Pennsylvania.
Measuring the long-term effectiveness and impact of career transition services.

Positive Signals

Awarded through full and open competition, promoting fairness and market participation.
Contractor has experience in similar large-scale government program management.
Incentive fee structure encourages contractor performance and efficiency.
Clear geographic focus allows for targeted service delivery.

Sector Analysis

This contract falls within the broader professional, scientific, and technical services sector, specifically related to workforce development and potentially correctional facility support services. The market for government contracting in this area is substantial, with numerous firms specializing in program management, training, and social services. Comparable spending benchmarks would depend heavily on the specific nature of the 'JCC Operations, OA, and CTS' (likely Job Corps Center operations, outreach, and career transition services), but the annual spend of approximately $6.6 million is moderate for a multi-year federal contract of this type.

Small Business Impact

The data indicates that small business participation was not a specific set-aside (ss: false, sb: false). This suggests that the primary competition was likely among larger, established firms. There is no explicit information on subcontracting requirements for small businesses within this award. The lack of a small business set-aside means that opportunities for small businesses to directly participate in this contract may be limited, though they could potentially be involved as subcontractors if the prime contractor opts to engage them.

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). The Inspector General's office for the Department of Labor would have jurisdiction for audits and investigations related to potential fraud, waste, or abuse. Transparency is generally facilitated through contract award databases and reporting requirements, though specific performance metrics and oversight activities may not always be publicly detailed.

Related Government Programs

Job Corps Program
Workforce Innovation and Opportunity Act (WIOA) Programs
Federal Correctional Facility Support Contracts
Adult Education and Literacy Programs

Risk Flags

Cost Plus contract type requires careful monitoring to ensure cost efficiency.
Performance metrics for incentive fee must be clearly defined and measurable.
Potential for scope creep if contract objectives are not tightly managed.

Frequently Asked Questions

What is this federal contract paying for?

Department of Labor awarded $32.9 million to MANAGEMENT & TRAINING CORPORATION. IGF::CT::IGF PHILADELPHIA JCC OPERATIONS, OA, AND CTS

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 $32.9 million.

What is the period of performance?

Start: 2017-02-01. End: 2022-01-31.

What is the specific nature of the 'JCC Operations, OA, and CTS' services being provided under this contract?

The acronyms likely stand for Job Corps Center (JCC) Operations, Outreach Activities (OA), and Career Transition Services (CTS). Job Corps is a program administered by the Department of Labor that provides job training and education for at-risk young adults aged 16 through 24. Operations would encompass the day-to-day management of a center, including facilities, staffing, and program delivery. Outreach activities likely involve recruiting eligible participants and engaging with communities. Career Transition Services focus on helping graduates find employment and succeed in their chosen careers, often involving job placement assistance and post-placement support.

How does the contractor's past performance compare to the requirements of this contract?

Management & Training Corporation (MTC) is a well-established private operator of correctional facilities, community corrections programs, and workforce development initiatives. They have extensive experience managing large-scale government contracts, including programs similar in scope to Job Corps. Their track record includes operating detention centers, providing re-entry services, and managing vocational training programs. While specific performance metrics for this particular contract are not detailed here, MTC's broad experience suggests they possess the organizational capacity and expertise to manage the operational, outreach, and transition service requirements effectively. However, a deeper dive into past performance reviews and any documented issues would be necessary for a comprehensive assessment.

What are the key performance indicators (KPIs) used to evaluate the contractor's success under this Cost Plus Incentive Fee contract?

For a Cost Plus Incentive Fee (CPIF) contract like this one, KPIs are crucial for determining the incentive portion of the fee. While the specific KPIs are not publicly detailed in the award data, they would typically align with the contract's objectives. For Job Corps-related services, these could include metrics such as participant enrollment rates, retention rates within training programs, academic and vocational achievement levels, job placement rates for graduates, starting wages of placed graduates, and post-placement retention in employment. The 'incentive' aspect means that achieving or exceeding targets on these KPIs would result in a higher fee for the contractor, while failing to meet them could reduce the fee, thereby aligning contractor profit with government objectives.

How does the total contract value of $33 million compare to other federal contracts for similar workforce development services?

The total contract value of approximately $33 million over five years equates to an average annual value of about $6.6 million. This is a moderate-sized federal contract. Workforce development services can vary significantly in cost depending on the scale, complexity, and target population. Contracts for large-scale national programs like the entire Job Corps system would be in the hundreds of millions or billions. However, contracts focused on specific regions, states, or particular service components (like career transition services for a defined group) can fall within this range. Compared to contracts for managing individual Job Corps centers or providing specialized training, $6.6 million annually is within the expected range, suggesting fair market value for the services described.

What are the potential risks associated with the Cost Plus Incentive Fee (CPIF) contract type for this service?

The primary risk with CPIF contracts is the potential for cost growth if the baseline cost estimates are inaccurate or if the contractor's actual costs exceed projections, even with incentives. While the incentive fee aims to control costs by rewarding efficiency, the government still bears the risk of paying actual costs incurred, plus a fee that can be adjusted based on performance. If the incentive targets are poorly defined or unattainable, the contract may not achieve the desired cost savings. Furthermore, the administrative burden of monitoring performance against KPIs and calculating the incentive fee can be significant for the contracting agency. Ensuring that the incentive structure truly drives desired outcomes without encouraging excessive risk-taking or cutting corners on quality is a key challenge.

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

The Department of Labor has a long history of contracting for workforce development, training, and employment services, often through programs like Job Corps. Historical spending patterns for these types of services are substantial, reflecting the federal government's commitment to supporting the labor market. For instance, the Job Corps program itself receives significant annual appropriations. Contracts for managing individual centers or providing specific services like career transition assistance are awarded regularly. Spending can fluctuate based on economic conditions, legislative priorities, and program evaluations. Without access to specific historical data for JCC operations in Pennsylvania, it's difficult to provide precise figures, but the overall trend indicates consistent federal investment in these areas.

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: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: DOL-ETA-16-R-00107

Offers Received: 3

Pricing Type: COST PLUS INCENTIVE FEE (V)

Evaluated Preference: NONE

Contractor Details

Address: 500 N MARKET PL 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: $62,658,317

Exercised Options: $62,658,317

Current Obligation: $32,936,700

Actual Outlays: $16,138,141

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline