Labor Department's $35.6M contract for Roswell JC Center operations awarded to Chugach Industries, Inc

Contract Overview

Contract Amount: $35,601,507 ($35.6M)

Contractor: Chugach Industries, Inc.

Awarding Agency: Department of Labor

Start Date: 2006-09-01

End Date: 2011-08-31

Contract Duration: 1,825 days

Daily Burn Rate: $19.5K/day

Competition Type: NOT AVAILABLE FOR COMPETITION

Number of Offers Received: 1

Pricing Type: COST PLUS INCENTIVE FEE

Sector: Other

Official Description: OPERATION OF ROSWELL JC CENTER

Place of Performance

Location: ROSWELL, CHAVES County, NEW MEXICO, 88203

State: New Mexico Government Spending

Plain-Language Summary

Department of Labor obligated $35.6 million to CHUGACH INDUSTRIES, INC. for work described as: OPERATION OF ROSWELL JC CENTER Key points: 1. Contract awarded on a cost-plus-incentive-fee basis, suggesting performance-based incentives. 2. Long duration of 5 years (1825 days) indicates a stable, ongoing requirement. 3. The contract was not competed, raising questions about potential cost efficiencies. 4. The specific NAICS code (611519) points to specialized technical and trade school services. 5. The contract value of $35.6 million over five years suggests a significant operational scope. 6. The contractor, Chugach Industries, Inc., has a history of government contracts.

Value Assessment

Rating: fair

Benchmarking the value of this contract is challenging without more detailed cost breakdowns or comparisons to similar operations. The cost-plus-incentive-fee structure allows for flexibility but requires careful monitoring to ensure cost control. The absence of competition makes it difficult to assess if the pricing reflects market rates or if there were opportunities for savings through a competitive bidding process. The total value of $35.6 million over five years averages to approximately $7.12 million annually, which needs to be evaluated against the scope and quality of services delivered.

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 other potential vendors. This approach is typically used when a specific contractor possesses unique capabilities or when circumstances prevent a full and open competition. The lack of competition means that the government did not benefit from the price discovery that typically occurs in a competitive bidding environment, potentially leading to higher costs than might have been achieved otherwise.

Taxpayer Impact: Taxpayers may have paid a premium due to the absence of competitive pressure to drive down prices. Without a competitive process, there is less assurance that the selected contractor offered the most cost-effective solution available.

Public Impact

The primary beneficiaries are likely participants in the Job Corps Center program, receiving vocational training and support services. Services delivered include the operation and management of the Roswell Job Corps Center, encompassing training, housing, and support. The geographic impact is focused on New Mexico, specifically the area served by the Roswell Job Corps Center. Workforce implications include employment for the contractor's staff operating the center and the development of skills for program participants entering the workforce.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition could lead to inflated costs.
Sole-source award may not represent the best value for taxpayer dollars.
Performance monitoring is crucial to ensure service quality and cost-effectiveness.

Positive Signals

Cost-plus-incentive-fee structure can incentivize contractor performance.
Long-term contract suggests a stable and reliable service provider.
Focus on Job Corps operations addresses critical workforce development needs.

Sector Analysis

The contract falls within the education and training services sector, specifically related to vocational and technical education. The Job Corps program is a significant federal initiative aimed at providing disadvantaged youth with the skills and education needed to secure employment. The market for operating such centers involves specialized management and educational expertise. Benchmarking this contract's value against other Job Corps center operations would provide further insight into its cost-effectiveness.

Small Business Impact

This contract does not appear to have a small business set-aside component, as indicated by 'sb: false'. There is no explicit information regarding subcontracting plans for small businesses. The award to a single, likely larger, entity suggests that opportunities for small businesses to participate in this specific contract may be limited unless they are part of the prime contractor's supply chain.

Oversight & Accountability

Oversight of this contract would typically be managed by the Department of Labor's Employment and Training Administration. Accountability measures would be tied to the terms of the cost-plus-incentive-fee contract, focusing on performance metrics and cost controls. Transparency would depend on the public availability of contract performance reports and audits, which are not detailed here. Inspector General jurisdiction would apply to any potential fraud, waste, or abuse.

Related Government Programs

Job Corps Program
Federal Workforce Development Programs
Vocational Training Contracts
Government Operations and Maintenance Contracts

Risk Flags

Sole-source award limits price discovery.
Potential for cost overruns in CPIF contracts if not closely managed.
Need for robust performance monitoring to ensure service quality.

Frequently Asked Questions

What is this federal contract paying for?

Department of Labor awarded $35.6 million to CHUGACH INDUSTRIES, INC.. OPERATION OF ROSWELL JC CENTER

Who is the contractor on this award?

The obligated recipient is CHUGACH INDUSTRIES, INC..

Which agency awarded this contract?

Awarding agency: Department of Labor (Employment and Training Administration).

What is the total obligated amount?

The obligated amount is $35.6 million.

What is the period of performance?

Start: 2006-09-01. End: 2011-08-31.

What is the track record of Chugach Industries, Inc. in managing similar government contracts, particularly Job Corps centers?

Chugach Industries, Inc. (CII) has a significant history of performing government contracts, including those related to facility operations and management. While specific details on their performance managing Job Corps centers are not provided in this data snippet, CII has been awarded numerous contracts across various federal agencies. Their experience often includes providing services in remote or challenging locations. A deeper dive into their past performance reviews, contract awards, and any reported issues or successes related to educational or vocational program management would be necessary to fully assess their track record for this specific contract. This would involve reviewing contract databases and agency performance reports.

How does the annual cost of this contract compare to other Job Corps center operations of similar size and scope?

The annual cost for this contract averages approximately $7.12 million ($35.6 million / 5 years). To benchmark this effectively, one would need to compare it against the annual operating costs of other Job Corps centers managed by different contractors. Key comparison factors would include the number of students served, the types of vocational programs offered, the geographic location (which can influence labor and operational costs), and the specific services provided (e.g., housing, meals, transportation). Without access to data on comparable contracts, it is difficult to definitively state whether this contract represents a good or poor value. Such analysis would require accessing a database of federal contracts and filtering for similar Job Corps operations.

What are the specific performance metrics and incentive structures within the Cost Plus Incentive Fee (CPIF) arrangement?

The Cost Plus Incentive Fee (CPIF) contract type implies that the contractor is reimbursed for allowable costs plus a fixed fee, with the fee being adjusted based on whether the final cost is above or below a target cost. The 'incentive' aspect means that the contractor is motivated to control costs by sharing in any savings or cost overruns. Specific performance metrics would be defined in the contract's Statement of Work (SOW) and could include targets for student graduation rates, job placement rates, cost efficiency in operations, facility maintenance standards, and safety compliance. The incentive fee would be adjusted based on the contractor's achievement of these metrics relative to pre-defined targets. Detailed information on these specific metrics and the fee adjustment formula would be found within the contract document itself.

What is the rationale behind awarding this contract on a sole-source basis instead of through full and open competition?

The rationale for a sole-source award, as indicated by 'NOT AVAILABLE FOR COMPETITION', typically stems from specific circumstances that preclude a competitive process. Common reasons include the existence of only one responsible source capable of providing the required services, an urgent need where competition is not feasible, or specific statutory authority allowing for non-competitive procurement. For a contract like the operation of a Job Corps center, it might be argued that the incumbent contractor possesses unique institutional knowledge, established infrastructure, and a proven operational model that would be difficult or costly to replicate quickly through a new competition. However, without explicit justification from the awarding agency, the precise reason remains speculative, and it raises concerns about potential missed opportunities for cost savings through competition.

What are the historical spending patterns for the operation of the Roswell Job Corps Center, and how does this $35.6M contract fit within that trend?

The provided data covers a single definitive contract from September 1, 2006, to August 31, 2011, totaling $35.6 million. This represents an average annual expenditure of approximately $7.12 million during that period. To understand historical spending patterns, one would need to examine contract awards for the Roswell Job Corps Center both before and after this period. This would involve looking at previous contracts awarded to other entities or potentially subsequent contracts awarded to Chugach Industries, Inc. or a different contractor. Analyzing these historical data points would reveal whether spending has been consistent, increasing, or decreasing, and whether this $35.6 million award was typical, higher, or lower than previous or subsequent contract values for the same facility.

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 AVAILABLE FOR COMPETITION

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: JC-RIV-5-08

Offers Received: 1

Pricing Type: COST PLUS INCENTIVE FEE (V)

Evaluated Preference: NONE

Contractor Details

Parent Company: Chugach Alaska Corporation (UEI: 071844021)

Address: 560 E 34TH AVE, ANCHORAGE, AK, 99503

Business Categories: 8(a) Program Participant, Category Business, Minority Owned Business, Native American Owned Business, Self-Certified Small Disadvantaged Business, Small Business, Small Disadvantaged Business, Special Designations

Financial Breakdown

Contract Ceiling: $47,922,545

Exercised Options: $35,601,507

Current Obligation: $35,601,507

Contract Characteristics

Multi-Year Contract: Yes

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Timeline