Labor Department's $48M Contract with Education Management Corp. for Training Services

Contract Overview

Contract Amount: $47,990,002 ($48.0M)

Contractor: Education Management Corporation

Awarding Agency: Department of Labor

Start Date: 2000-09-15

End Date: 2005-09-30

Contract Duration: 1,841 days

Daily Burn Rate: $26.1K/day

Competition Type: NOT AVAILABLE FOR COMPETITION

Number of Offers Received: 1

Pricing Type: COST PLUS FIXED FEE

Sector: Other

Place of Performance

Location: SIMPSONVILLE, SHELBY County, KENTUCKY, 40067

State: Kentucky Government Spending

Plain-Language Summary

Department of Labor obligated $48.0 million to EDUCATION MANAGEMENT CORPORATION for work described as: Key points: 1. Contract awarded to Education Management Corporation for employment and training. 2. The contract value is $47,990,002. 3. The contract duration is 1841 days. 4. The contract was not available for competition. 5. The contract type is Cost Plus Fixed Fee.

Value Assessment

Rating: questionable

The Cost Plus Fixed Fee contract type can lead to cost overruns if not managed tightly. Without competitive bidding, it's difficult to assess if the $48M price is optimal compared to market rates for similar training services.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

The contract was 'NOT AVAILABLE FOR COMPETITION', indicating a limited competition scenario. This lack of competition may have hindered price discovery and potentially led to a higher price than if multiple vendors had bid.

Taxpayer Impact: The $48M spent without competitive bidding represents a potential inefficiency for taxpayers, as the best value may not have been secured.

Public Impact

Taxpayers funded nearly $48 million for employment and training services. The contract supported workforce development initiatives in Kentucky. The long duration of the contract (over 5 years) suggests a significant, ongoing need for these services.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition
Cost Plus Fixed Fee contract type
Long contract duration

Positive Signals

Addresses employment and training needs
Supports workforce development

Sector Analysis

This contract falls within the professional services sector, specifically focusing on education and training. Benchmarks for similar government contracts in this area would typically involve competitive bidding to ensure cost-effectiveness.

Small Business Impact

There is no indication in the provided data whether small businesses were involved as subcontractors or partners in this contract. The focus appears to be on a single large awardee.

Oversight & Accountability

The 'NOT AVAILABLE FOR COMPETITION' status raises questions about the oversight process that led to this procurement method. Further review would be needed to understand the justification and ensure accountability.

Related Government Programs

Department of Labor Contracting
Employment and Training Administration Programs

Risk Flags

Lack of competitive bidding
Potential for cost overruns (CPFF)
Limited transparency on justification for non-competition
No data on performance outcomes

Frequently Asked Questions

What is this federal contract paying for?

Department of Labor awarded $48.0 million to EDUCATION MANAGEMENT CORPORATION. See the official description on USAspending.

Who is the contractor on this award?

The obligated recipient is EDUCATION MANAGEMENT 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 $48.0 million.

What is the period of performance?

Start: 2000-09-15. End: 2005-09-30.

What was the specific justification for awarding this contract on a limited/non-competitive basis?

The provided data states 'NOT AVAILABLE FOR COMPETITION'. A thorough review would be required to understand the specific circumstances and documented rationale behind this decision. This could include factors like unique capabilities, urgent needs, or the absence of other qualified sources, but without further documentation, the justification remains unclear.

What were the key performance metrics and outcomes achieved under this $48M contract?

The data does not include information on performance metrics or achieved outcomes. To assess the effectiveness and value for money, details on the services delivered, participant success rates (e.g., job placement), and overall impact on employment and training goals would be necessary.

How does the Cost Plus Fixed Fee structure compare to other contract types for similar services in terms of cost control and efficiency?

Cost Plus Fixed Fee contracts can incentivize contractors to complete work efficiently to maximize their fixed fee. However, they also carry the risk of cost overruns if the government does not maintain strong oversight of the contractor's costs. For services where scope is well-defined, fixed-price contracts often offer better cost certainty for the government.

Competition & Pricing

Extent Competed: NOT AVAILABLE FOR COMPETITION

Offers Received: 1

Pricing Type: COST PLUS FIXED FEE (U)

Contractor Details

Address: 221 LAUREL RD STE 100, VOORHEES, NJ, 01

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

Timeline