Department of Labor's $29.7M contract for training services awarded to Management & Training Corporation

Contract Overview

Contract Amount: $29,733,131 ($29.7M)

Contractor: Management & Training Corporation

Awarding Agency: Department of Labor

Start Date: 2014-04-30

End Date: 2015-04-30

Contract Duration: 365 days

Daily Burn Rate: $81.5K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: COST PLUS INCENTIVE FEE

Sector: Other

Official Description: IGF::CT::IGF THE CONTRACT # IS DOL-J14-1A-22199 THE BASE PERIOD IS 5/1/15 THRU 10/31/14 THERE IS ONE 6-MONTH OPTION

Place of Performance

Location: MORGANFIELD, UNION County, KENTUCKY, 42437

State: Kentucky Government Spending

Plain-Language Summary

Department of Labor obligated $29.7 million to MANAGEMENT & TRAINING CORPORATION for work described as: IGF::CT::IGF THE CONTRACT # IS DOL-J14-1A-22199 THE BASE PERIOD IS 5/1/15 THRU 10/31/14 THERE IS ONE 6-MONTH OPTION Key points: 1. Contract awarded on a cost-plus-incentive-fee basis, suggesting performance-based incentives. 2. The contract was not competed, raising questions about potential price efficiencies. 3. A single award indicates limited market engagement for this specific requirement. 4. The contract duration is one year, with potential for future extensions. 5. The contractor, Management & Training Corporation, has a history of receiving federal awards. 6. The North American Industry Classification System (NAICS) code 611519 points to specialized trade schools. 7. The contract is managed by the Employment and Training Administration. 8. The contract was awarded in Kentucky.

Value Assessment

Rating: questionable

The contract's value is difficult to assess without comparable data for similar services. As a cost-plus-incentive-fee contract, the final cost will depend on performance against established metrics. The base award amount of $29.7 million for a one-year term appears substantial, but its value for money hinges on the effectiveness of the training and employment services delivered. Benchmarking against other Department of Labor contracts for similar training programs would be necessary for a more definitive 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 among multiple potential vendors. This approach limits the opportunity for price discovery through market competition and may result in higher costs for the government. The rationale for a sole-source award is not provided, but it typically implies a unique capability or a situation where only one vendor can meet the requirement. The lack of competition means taxpayers do not benefit from potential cost savings that could arise from a competitive bidding process.

Taxpayer Impact: The absence of competition means taxpayers may not be receiving the best possible price for these services. Without a competitive process, there is less pressure on the contractor to offer the most cost-effective solution.

Public Impact

The primary beneficiaries are individuals seeking employment and training services funded by the Department of Labor. The contract aims to deliver vocational training and potentially job placement assistance. The geographic impact is focused on Kentucky, where the contract is managed. The workforce implications include employment for instructors and support staff at the contractor's facilities.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may lead to higher costs for taxpayers.
Sole-source award raises concerns about the government's ability to secure the best value.
Performance metrics and incentive structures are crucial for ensuring value, but details are not provided.

Positive Signals

The contract is managed by the Department of Labor, an agency with expertise in employment and training.
The cost-plus-incentive-fee structure allows for performance-based rewards, potentially driving better outcomes.
The contractor, Management & Training Corporation, likely has established infrastructure and experience in delivering such services.

Sector Analysis

The contract falls within the 'Other Technical and Trade Schools' sector, identified by NAICS code 611519. This sector encompasses institutions that provide vocational training and education in specific trades and technical fields. Federal spending in this area often supports workforce development initiatives aimed at equipping individuals with skills for in-demand occupations. Comparable spending benchmarks would involve analyzing the average cost of similar training programs administered by the Department of Labor or other federal agencies, considering factors like program duration, subject matter, and target population.

Small Business Impact

There is no indication that this contract includes a small business set-aside. The contract was awarded sole-source to Management & Training Corporation. Therefore, there are no direct subcontracting implications for small businesses stemming from this specific award. The impact on the small business ecosystem is likely minimal unless the prime contractor has a history of subcontracting with small businesses on other awards.

Oversight & Accountability

Oversight for this contract would typically be provided by the Department of Labor's contracting officers and program managers within the Employment and Training Administration. Accountability measures would be tied to the performance metrics outlined in the cost-plus-incentive-fee contract. Transparency regarding the contract's performance and expenditures would depend on the Department of Labor's reporting practices and any available Inspector General audits or reviews related to training programs.

Related Government Programs

Workforce Innovation and Opportunity Act (WIOA) programs
Job Corps
Adult Education and Family Literacy Act programs

Risk Flags

Sole-source award
Lack of competition
Potential for cost overruns due to CPIF structure if not managed tightly

Frequently Asked Questions

What is this federal contract paying for?

Department of Labor awarded $29.7 million to MANAGEMENT & TRAINING CORPORATION. IGF::CT::IGF THE CONTRACT # IS DOL-J14-1A-22199 THE BASE PERIOD IS 5/1/15 THRU 10/31/14 THERE IS ONE 6-MONTH OPTION

Who is the contractor on this award?

The obligated recipient is MANAGEMENT & TRAINING 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 $29.7 million.

What is the period of performance?

Start: 2014-04-30. End: 2015-04-30.

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

Management & Training Corporation (MTC) is a significant federal contractor, primarily known for operating Job Corps centers and correctional facilities for various government agencies, including the Department of Labor and the Federal Bureau of Prisons. MTC has a long history of managing large-scale government contracts. While specific performance data for individual contracts is often proprietary or not publicly detailed, the agency's continued awards suggest a level of satisfaction with their service delivery. However, like many large contractors, MTC has faced scrutiny and audits regarding operational efficiency, cost management, and program outcomes in the past. A thorough review would require examining specific contract performance reports and any associated Inspector General findings related to their past federal engagements.

How does the $29.7 million contract value compare to similar Department of Labor training initiatives?

Benchmarking the $29.7 million contract value requires comparing it to similar initiatives managed by the Department of Labor (DOL). The Employment and Training Administration (ETA) oversees a variety of programs, including those funded through the Workforce Innovation and Opportunity Act (WIOA). The cost of these programs can vary significantly based on their scope, duration, target population, and the specific services offered (e.g., vocational training, apprenticeships, job placement assistance). Without knowing the precise scope and duration of the services to be provided under this specific contract, a direct comparison is challenging. However, large-scale training contracts managed by ETA can range from millions to tens of millions of dollars annually. A more precise comparison would involve identifying contracts with similar NAICS codes, service descriptions, and geographic focus within DOL's portfolio.

What are the primary risks associated with a sole-source award for employment and training services?

The primary risk associated with a sole-source award for employment and training services is the potential for reduced value for money. Without competition, the government loses the opportunity to leverage market forces to drive down prices and encourage innovation. This can lead to higher costs for taxpayers. Additionally, a sole-source award might indicate a lack of available qualified vendors or a failure in the government's procurement planning. This could also mean that the chosen contractor may face less pressure to perform at a high level, as there are no immediate alternative providers. Ensuring robust oversight and clearly defined performance metrics becomes even more critical in sole-source situations to mitigate these risks and ensure program effectiveness.

How effective are cost-plus-incentive-fee (CPIF) contracts in ensuring program effectiveness for training services?

Cost-Plus-Incentive-Fee (CPIF) contracts can be effective in ensuring program effectiveness for training services, provided that the incentive and target cost structures are well-defined and aligned with desired outcomes. In a CPIF contract, the contractor is reimbursed for allowable costs plus a fee that is adjusted based on performance against pre-determined targets. For training services, these targets could include metrics such as job placement rates, participant skill attainment, retention in employment, or program completion rates. The incentive portion motivates the contractor to exceed these targets to earn a higher fee. However, the effectiveness hinges on the government's ability to establish realistic and measurable performance metrics and to accurately forecast the target cost. Poorly defined metrics or unrealistic targets can undermine the intended benefits of the CPIF structure.

What is the historical spending pattern for NAICS code 611519 by the Department of Labor?

Historical spending by the Department of Labor (DOL) under NAICS code 611519 ('Other Technical and Trade Schools') provides insight into the agency's investment in vocational and technical training. While specific aggregate data for this NAICS code alone is not readily available in public databases without specialized queries, DOL consistently allocates significant funds towards workforce development, which often includes services procured from institutions falling under this classification. These funds are typically channeled through programs aimed at upskilling the workforce, supporting specific industries, or assisting disadvantaged populations. Analyzing DOL's broader budget allocations for training and employment services, and then drilling down into specific contract awards categorized under 611519, would reveal trends in spending, the types of services procured, and the primary contractors involved over time.

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

Offers Received: 1

Pricing Type: COST PLUS INCENTIVE FEE (V)

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: $53,326,519

Exercised Options: $39,091,760

Current Obligation: $29,733,131

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline