Labor Department's $35M Tulsa JC Center Contract with Res-Care Inc. Faces Scrutiny Over Value and Competition

Contract Overview

Contract Amount: $35,283,253 ($35.3M)

Contractor: Res-Care, Inc

Awarding Agency: Department of Labor

Start Date: 2003-10-01

End Date: 2008-08-31

Contract Duration: 1,796 days

Daily Burn Rate: $19.6K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 4

Pricing Type: COST PLUS INCENTIVE FEE

Sector: Other

Official Description: OPERATION OF TULSA JC CENTER

Place of Performance

Location: TULSA, TULSA County, OKLAHOMA, 74110

State: Oklahoma Government Spending

Plain-Language Summary

Department of Labor obligated $35.3 million to RES-CARE, INC for work described as: OPERATION OF TULSA JC CENTER Key points: 1. The contract awarded to Res-Care, Inc. for operating the Tulsa Job Corps Center totaled $35,283,253. 2. Competition was full and open, suggesting a competitive bidding process. 3. The contract type is Cost Plus Incentive Fee, which can incentivize cost control but also carries inherent risks. 4. The sector is Facilities Support Services, a broad category with varying cost benchmarks.

Value Assessment

Rating: fair

The Cost Plus Incentive Fee structure requires careful monitoring to ensure costs remain reasonable and performance targets are met. Without specific benchmarks for Job Corps center operations, assessing the pricing against similar contracts is challenging.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, which typically leads to better price discovery. However, the effectiveness of this competition in securing the best value for this specific service needs further analysis.

Taxpayer Impact: Taxpayer funds were utilized for this contract. The value for money depends on the efficiency and effectiveness of the services provided by Res-Care, Inc.

Public Impact

Operates a Job Corps Center, providing training and employment services to youth. Contract duration spanned nearly five years, indicating a long-term commitment. The services provided are crucial for workforce development and individual economic opportunity.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost Plus Incentive Fee contracts can lead to cost overruns if not managed tightly.
Lack of specific per-unit cost benchmarks makes value assessment difficult.
The contract ended in 2008, limiting current relevance for direct comparison.

Positive Signals

Awarded under full and open competition.
The contract supported a vital government program (Job Corps).
The contract was successfully completed, suggesting operational continuity.

Sector Analysis

Facilities Support Services (NAICS 561210) encompass a wide range of activities. Benchmarking costs for operating a specialized facility like a Job Corps center requires detailed operational data, which is not readily available.

Small Business Impact

The data does not indicate whether small businesses were involved as subcontractors. Further investigation would be needed to determine the extent of small business participation.

Oversight & Accountability

The contract's duration and cost structure suggest a need for robust oversight by the Department of Labor to ensure performance and cost control. The 'OK' status for performance and stability is positive but warrants detailed review.

Related Government Programs

Facilities Support Services
Department of Labor Contracting
Employment and Training Administration Programs

Risk Flags

Potential for cost overruns inherent in Cost Plus Incentive Fee contracts.
Lack of detailed performance data makes value assessment difficult.
Absence of specific per-unit cost benchmarks hinders comparison.
Contract concluded in 2008, limiting direct applicability to current spending.

Frequently Asked Questions

What is this federal contract paying for?

Department of Labor awarded $35.3 million to RES-CARE, INC. OPERATION OF TULSA JC CENTER

Who is the contractor on this award?

The obligated recipient is RES-CARE, 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 $35.3 million.

What is the period of performance?

Start: 2003-10-01. End: 2008-08-31.

What was the actual performance against the incentive fee targets, and how did this impact the final cost to the government?

The provided data does not detail the specific performance metrics or the outcomes related to the incentive fee structure. Understanding the contractor's achievement of targets would be crucial to assessing whether the incentive fee effectively controlled costs or led to higher expenditures for comparable performance.

How did the final cost compare to the initial estimates or bids received during the full and open competition?

While the contract was awarded under full and open competition, the data does not provide a comparison between the final cost and the initial bids or estimates. This information is essential for evaluating the effectiveness of the competition in securing competitive pricing and identifying potential cost escalations during the contract period.

Were there any significant challenges or disputes during the contract's execution that impacted service delivery or cost?

The 'OK' status for stability and performance suggests no major reported issues. However, a deeper dive into contract performance reports and any associated documentation would be necessary to confirm the absence of significant challenges that might have affected service delivery or led to unexpected cost adjustments.

Industry Classification

NAICS: Administrative and Support and Waste Management and Remediation Services › Facilities Support Services › Facilities Support Services

Product/Service Code: OPERATION OF GOVT OWNED FACILITY › OPERATE GOVT OWNED BUILDINGS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation ID: JC-RIV-2-01

Offers Received: 4

Pricing Type: COST PLUS INCENTIVE FEE (V)

Contractor Details

Parent Company: Onex Rescare Acquisition, LLC (UEI: 966833399)

Address: 10140 LINN STATION RD, LOUISVILLE, KY, 40223

Business Categories: Category Business, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $40,969,533

Exercised Options: $40,969,219

Current Obligation: $35,283,253

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Timeline