Department of Labor's $63M contract for employment services awarded to Career Systems Development Corporation

Contract Overview

Contract Amount: $63,079,963 ($63.1M)

Contractor: Career Systems Development Corporation

Awarding Agency: Department of Labor

Start Date: 2000-06-15

End Date: 2005-07-31

Contract Duration: 1,872 days

Daily Burn Rate: $33.7K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: COST PLUS FIXED FEE

Sector: Other

Place of Performance

Location: SAN JOSE, SANTA CLARA County, CALIFORNIA, 95127

State: California Government Spending

Plain-Language Summary

Department of Labor obligated $63.1 million to CAREER SYSTEMS DEVELOPMENT CORPORATION for work described as: Key points: 1. The contract's value of $63 million over five years suggests a significant investment in employment and training programs. 2. Awarded under full and open competition, this indicates a potentially competitive bidding process that could drive value. 3. The Cost Plus Fixed Fee (CPFF) contract type may incentivize cost control by the contractor while ensuring a defined profit margin. 4. The contract duration of 1872 days (approximately 5 years) allows for sustained program delivery and potential for long-term impact. 5. The 'CA' (California) state code suggests the services are likely focused on a specific geographic region, impacting the local workforce. 6. The absence of small business set-aside flags warrants further investigation into subcontracting opportunities for smaller firms.

Value Assessment

Rating: fair

The total award amount of $63,079,963 for a period of approximately five years averages to roughly $12.6 million annually. Without specific performance metrics or benchmarks for similar employment and training services, it is difficult to definitively assess value for money. The CPFF contract type can sometimes lead to higher costs compared to fixed-price contracts if not managed carefully, but it also allows for flexibility in scope. Further analysis would require comparing the outcomes and cost-effectiveness against other Department of Labor initiatives or similar state-level programs.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under 'FULL AND OPEN COMPETITION,' suggesting that all responsible sources were permitted to submit bids. This typically leads to a more robust selection process and potentially better pricing due to market forces. The number of bidders is not specified, but the open competition framework implies that multiple entities likely vied for this significant contract, aiming to provide employment and training services.

Taxpayer Impact: A full and open competition generally benefits taxpayers by fostering a competitive environment that can drive down costs and improve the quality of services offered, ensuring the government receives the best possible value for its investment.

Public Impact

Individuals seeking employment or career advancement services are the primary beneficiaries. The contract supports the delivery of job training, placement assistance, and potentially other workforce development programs. Services are likely concentrated within California, impacting the state's labor market and economy. The contract has implications for the workforce development sector, potentially creating or sustaining jobs for trainers, counselors, and administrative staff.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of specific performance metrics makes it difficult to gauge the effectiveness and true value for money.
The Cost Plus Fixed Fee (CPFF) contract type can sometimes lead to cost overruns if not closely monitored.
No indication of small business participation or subcontracting goals requires further scrutiny to ensure equitable opportunities.

Positive Signals

Awarded through full and open competition, suggesting a potentially competitive and fair process.
The contract duration of over five years allows for sustained program impact and relationship building.
The fixed fee component in the CPFF contract provides a degree of cost certainty for the government regarding contractor profit.

Sector Analysis

This contract falls within the broader government services sector, specifically focusing on workforce development and employment assistance. The market for such services includes numerous private companies and non-profit organizations specializing in training, job placement, and career counseling. The Department of Labor frequently contracts for these types of services to fulfill its mandate of promoting workforce prosperity. Benchmarking this contract's value would require comparing its cost per participant or per successful placement against similar programs administered by federal, state, or local agencies, as well as by private sector providers.

Small Business Impact

The data indicates that this contract was not specifically set aside for small businesses (ss: false, sb: false). This means that both large and small businesses were eligible to compete. Without explicit subcontracting requirements or goals mentioned, the extent to which small businesses will participate in delivering these services remains unclear. It is important to assess if the prime contractor has a robust subcontracting plan that includes opportunities for small businesses to ensure a diverse and competitive ecosystem.

Oversight & Accountability

Oversight for this contract would primarily reside with the Department of Labor's Employment and Training Administration (ETA). The CPFF contract type necessitates close monitoring of costs incurred by the contractor to ensure they align with the fixed fee and the overall contract objectives. Accountability measures would likely include regular performance reviews, reporting requirements on service delivery and outcomes, and potentially audits. Transparency would be enhanced through public contract data, but detailed program performance data might be less accessible.

Related Government Programs

Workforce Innovation and Opportunity Act (WIOA) Programs
Job Corps
American Job Centers
Wagner-Peyser Act Employment Service

Risk Flags

Cost Plus Fixed Fee contract type requires diligent oversight to manage costs.
Lack of specific performance metrics hinders value assessment.
No explicit small business subcontracting goals noted.

Frequently Asked Questions

What is this federal contract paying for?

Department of Labor awarded $63.1 million to CAREER SYSTEMS DEVELOPMENT CORPORATION. See the official description on USAspending.

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 $63.1 million.

What is the period of performance?

Start: 2000-06-15. End: 2005-07-31.

What specific employment and training services are being provided under this contract?

The provided data does not specify the exact nature of the employment and training services. However, given the awarding agency (Department of Labor) and the contract type (Cost Plus Fixed Fee), it is highly probable that the services include job counseling, skills assessment, vocational training, job search assistance, and placement services. These programs are typically designed to help unemployed or underemployed individuals acquire the necessary skills and find suitable employment, thereby contributing to the overall workforce development goals of the agency and the region.

How does the $63 million cost compare to similar federal contracts for employment services?

Comparing the $63 million total award for this five-year contract requires context regarding the scope, duration, and specific services delivered. Federal contracts for employment and training services vary widely in cost based on geographic reach, target population, and intensity of services. For instance, large-scale national programs or those serving specific populations like veterans or individuals with disabilities might have higher aggregate costs. To benchmark effectively, one would need to analyze the cost per participant, cost per successful placement, or cost per training hour against similar contracts awarded by the Department of Labor or other federal agencies like the Department of Veterans Affairs or the Department of Education over comparable periods.

What are the potential risks associated with a Cost Plus Fixed Fee (CPFF) contract for employment services?

A primary risk with CPFF contracts is the potential for cost overruns if the contractor's actual costs exceed initial estimates, although the fixed fee provides a ceiling on profit. For employment services, this could manifest if training programs prove more expensive than anticipated or if participant support services require more resources. Effective oversight is crucial to ensure the contractor manages costs prudently and that the fixed fee remains a fair incentive. Another risk is that the contractor might focus on maximizing allowable costs to ensure the fixed fee is realized, rather than on achieving the most efficient outcomes for participants and the government.

What is the track record of Career Systems Development Corporation in delivering government contracts?

The provided data does not include information on the track record of Career Systems Development Corporation. To assess their performance, one would need to examine their past contract history, including awards, performance evaluations (e.g., Contractor Performance Assessment Reporting System - CPARS), and any instances of disputes or terminations. A review of their experience with similar government contracts, particularly those related to workforce development and employment services, would be essential to gauge their capability and reliability in fulfilling the obligations of this $63 million award.

How does the geographic focus on California (st: CA) influence the contract's impact and cost?

The 'CA' state code indicates that the services under this contract are primarily intended for individuals within California. This geographic focus allows for tailored service delivery that considers the specific labor market conditions, economic factors, and workforce needs of the state. The cost of the contract is influenced by California's cost of living, wage rates for service providers, and the scale of the target population within the state. While concentrating services geographically can improve relevance and potentially efficiency, it also means the benefits are localized and do not extend to other regions.

What are the implications of this contract not having small business set-asides (ss: false, sb: false)?

The absence of small business set-asides means that the contract was open to businesses of all sizes. While this allows for maximum competition, it also raises questions about the extent to which small businesses will participate as subcontractors. Federal policy encourages small business participation in government contracting. Without specific subcontracting goals or a strong outreach program from the prime contractor, small businesses might be excluded from opportunities that could help them grow. Further investigation into the prime contractor's subcontracting plan and actual performance would be necessary to assess the impact on the small business ecosystem.

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Offers Received: 1

Pricing Type: COST PLUS FIXED FEE (U)

Contractor Details

Parent Company: OWL Companies (UEI: 044437796)

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

Business Categories: Category Business, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $63,051,777

Exercised Options: $63,313,315

Current Obligation: $63,079,963

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Timeline