Department of Labor's Loring Job Corps Center contract awarded to Career Systems Development Corporation for over $53 million

Contract Overview

Contract Amount: $53,674,705 ($53.7M)

Contractor: Career Systems Development Corporation

Awarding Agency: Department of Labor

Start Date: 2009-05-01

End Date: 2014-10-31

Contract Duration: 2,009 days

Daily Burn Rate: $26.7K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 5

Pricing Type: COST PLUS INCENTIVE FEE

Sector: Other

Official Description: OPERATION OF THE LORING JOB CORPS CENTER

Place of Performance

Location: LIMESTONE, AROOSTOOK County, MAINE, 04750

State: Maine Government Spending

Plain-Language Summary

Department of Labor obligated $53.7 million to CAREER SYSTEMS DEVELOPMENT CORPORATION for work described as: OPERATION OF THE LORING JOB CORPS CENTER Key points: 1. The contract's cost-plus-incentive-fee structure suggests a focus on performance-based outcomes. 2. With 5 bidders, the competition level indicates a moderately contested market for job corps center operations. 3. The contract duration of over 5 years presents potential long-term performance risks and opportunities. 4. The award to Career Systems Development Corporation warrants a review of their past performance in similar roles. 5. The absence of small business set-asides may limit opportunities for smaller entities in this contract's execution.

Value Assessment

Rating: fair

The contract's total value of $53.7 million over approximately 5.5 years averages around $9.7 million annually. Benchmarking this against other Job Corps center operations requires detailed cost breakdowns, which are not provided. The cost-plus-incentive-fee (CPIF) pricing structure aims to align contractor costs with government objectives, but without specific performance metrics and fee structures, assessing the true value for money is challenging. Comparisons to similar centers would need to account for regional cost differences and the specific services offered.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, with 5 bids received. This suggests a healthy level of interest and a competitive environment for operating Job Corps centers. The presence of multiple bidders generally supports price discovery and can lead to more favorable terms for the government. However, the specific details of the bidding process and the nature of the proposals would provide a clearer picture of the competitive intensity.

Taxpayer Impact: A competitive bidding process for this contract likely resulted in a more cost-effective outcome for taxpayers compared to a sole-source award. The government benefited from multiple proposals, potentially driving down the final negotiated price.

Public Impact

The primary beneficiaries are the individuals enrolled in the Job Corps program at the Loring facility, who receive vocational training and support services. The contract delivers essential services for workforce development, aiming to equip participants with skills for employment. The geographic impact is focused on the Loring, Maine area, providing local economic benefits through employment and operations. Workforce implications include direct employment for the contractor's staff at the center and indirect benefits to the local economy through procurement and services.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns given the CPIF structure if not tightly managed.
Risk of service quality degradation if performance incentives are not adequately structured or monitored.
Dependence on a single contractor for an extended period could lead to complacency or reduced innovation.
The specific performance metrics and their impact on the incentive fee are not detailed, making oversight challenging.

Positive Signals

Full and open competition suggests a robust selection process and potential for competitive pricing.
The CPIF contract type incentivizes the contractor to manage costs effectively while meeting performance targets.
The award to an established entity like Career Systems Development Corporation may indicate a track record of successful program delivery.
The contract's duration allows for program stability and continuity of services for participants.

Sector Analysis

The Job Corps program falls under the broader education and workforce development sector, specifically within vocational training and technical schools. This contract represents a significant investment in human capital development. Comparable spending benchmarks would involve analyzing other Job Corps center contracts, as well as federal and state funding for similar workforce training initiatives. The market for operating such centers is typically characterized by a mix of non-profit organizations and specialized for-profit companies.

Small Business Impact

This contract does not appear to have a small business set-aside component, as indicated by 'sb': false. Therefore, small businesses were likely not specifically targeted for this prime contract award. However, the prime contractor, Career Systems Development Corporation, may engage small businesses as subcontractors for various goods and services required to operate the center. The extent of subcontracting to small businesses would depend on the contractor's procurement practices and the specific needs of the center's operations.

Oversight & Accountability

Oversight for this contract would primarily reside with the Department of Labor's Employment and Training Administration. Mechanisms likely include regular performance reviews, financial audits, and site visits to ensure compliance with contract terms and service delivery standards. The CPIF structure itself implies ongoing monitoring of performance against established metrics. Inspector General jurisdiction would apply to investigations of fraud, waste, or abuse related to the contract.

Related Government Programs

Department of Labor Workforce Innovation and Opportunity Act (WIOA) Programs
Other Federal Job Training and Employment Services
Vocational Rehabilitation Services
Adult Education and Literacy Programs

Risk Flags

Cost Overrun Potential
Performance Measurement Difficulty
Contractor Dependency Risk

Frequently Asked Questions

What is this federal contract paying for?

Department of Labor awarded $53.7 million to CAREER SYSTEMS DEVELOPMENT CORPORATION. OPERATION OF THE LORING JOB CORPS CENTER

Who is the contractor on this award?

The obligated recipient is CAREER SYSTEMS DEVELOPMENT CORPORATION.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $53.7 million.

What is the period of performance?

Start: 2009-05-01. End: 2014-10-31.

What is the historical spending pattern for the Loring Job Corps Center operation?

The provided data indicates a single definitive contract awarded from May 1, 2009, to October 31, 2014, with a total value of $53,674,705. This suggests an average annual spending of approximately $9.76 million over the contract's duration. To understand the broader historical spending pattern, one would need to examine previous contracts for the Loring Job Corps Center, if any, and potentially compare this spending level to other Job Corps centers of similar size and scope. Without prior contract data, it's difficult to ascertain if this represents an increase, decrease, or stable level of investment in the center's operations.

How does the cost per student compare to other Job Corps centers?

The provided data does not include student enrollment numbers or specific cost breakdowns per service, making a direct cost-per-student comparison impossible. The total contract value is $53.7 million over approximately 5.5 years. To perform this analysis, we would need the average daily enrollment or the total number of students served annually by the Loring Job Corps Center. Additionally, data on the specific services provided (e.g., training hours, support services) and their associated costs would be necessary. Benchmarking against other centers would then involve finding similar facilities in terms of size, location, and program offerings to establish a relevant comparison group.

What is Career Systems Development Corporation's track record with federal contracts, particularly in operating Job Corps centers?

Career Systems Development Corporation (CSDC) has a history of federal contracting, including operating Job Corps centers. The provided data shows they were awarded this specific contract for the Loring Job Corps Center. A comprehensive review would involve examining CSDC's contract portfolio across various agencies, including the Department of Labor, Department of Education, and others. Key aspects to investigate would include contract performance ratings (e.g., past performance evaluations), any instances of contract disputes, modifications, or terminations, and their success in meeting performance metrics and managing costs on similar programs. Information from sources like the Federal Procurement Data System (FPDS) and contractor performance databases would be crucial.

What are the key performance indicators (KPIs) tied to the incentive fee in this contract?

The provided data indicates the contract type is Cost Plus Incentive Fee (CPIF), but it does not specify the Key Performance Indicators (KPIs) that are linked to the incentive fee. Typically, for Job Corps center operations, KPIs could include metrics such as student retention rates, on-time graduation rates, job placement rates post-graduation, employer satisfaction with placed graduates, and adherence to budget and safety standards. The specific structure of the incentive fee would detail how achieving or exceeding these KPIs translates into additional profit for the contractor, or conversely, how failing to meet them might reduce the fee. Without this detailed information, the effectiveness of the incentive structure cannot be fully assessed.

What is the geographic scope of services provided by the Loring Job Corps Center?

The Loring Job Corps Center is located in Limestone, Maine (indicated by 'st': 'ME', 'sn': 'MAINE'). While the contract itself is awarded to operate this specific center, Job Corps centers typically serve students from a defined geographic region, which may extend beyond the immediate locality. This region is often determined by the Department of Labor based on student needs and program capacity. The center provides vocational training and support services to help young people prepare for careers. The 'st' and 'sn' fields suggest the primary location of the center, but the student catchment area could be broader, potentially encompassing multiple counties or even neighboring states, depending on the program's outreach and recruitment strategy.

Are there any specific risks associated with the Cost Plus Incentive Fee (CPIF) contract structure for this type of service?

The CPIF structure, while designed to incentivize performance and cost control, carries inherent risks. For the government, there's a risk that the contractor may pursue higher costs if the incentive fee structure is not carefully designed to reward efficiency and cost savings effectively. If the target costs are set too high or the incentive sharing ratio is unfavorable, the government might end up paying more than necessary. Conversely, if the targets are too aggressive or performance is difficult to measure accurately, the contractor might struggle to earn the incentive fee, potentially impacting morale or leading to disputes. Effective oversight is crucial to ensure the contractor is motivated to achieve both performance and cost objectives without excessive spending.

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: DOLJ08RFP0001

Offers Received: 5

Pricing Type: COST PLUS INCENTIVE FEE (V)

Evaluated Preference: NONE

Contractor Details

Parent Company: OWL Companies (UEI: 044437796)

Address: 75 THRUWAY PARK DR STE 100, WEST HENRIETTA, NY, 14586

Business Categories: Category Business, Not Designated a Small Business, Subchapter S Corporation

Financial Breakdown

Contract Ceiling: $99,247,693

Exercised Options: $78,248,357

Current Obligation: $53,674,705

Contract Characteristics

Multi-Year Contract: Yes

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Timeline