Treasury's $24.8M debt collection contract with Pioneer Credit Recovery awarded competitively

Contract Overview

Contract Amount: $24,795,541 ($24.8M)

Contractor: Pioneer Credit Recovery, Inc

Awarding Agency: Department of the Treasury

Start Date: 2007-03-12

End Date: 2012-03-11

Contract Duration: 1,826 days

Daily Burn Rate: $13.6K/day

Competition Type: COMPETITIVE DELIVERY ORDER

Number of Offers Received: 22

Pricing Type: OTHER (APPLIES TO AWARDS WHERE NONE OF THE ABOVE APPLY)

Sector: Other

Official Description: PRIVATE COLLECTION AGENCY FOR DEBT COLLECTION SERVICES

Place of Performance

Location: ARCADE, WYOMING County, NEW YORK, 14009, UNITED STATES OF AMERICA

State: New York Government Spending

Plain-Language Summary

Department of the Treasury obligated $24.8 million to PIONEER CREDIT RECOVERY, INC for work described as: PRIVATE COLLECTION AGENCY FOR DEBT COLLECTION SERVICES Key points: 1. Contract awarded through a competitive process, suggesting potential for price discovery. 2. The contract duration of 5 years (1826 days) indicates a long-term need for these services. 3. The North American Industry Classification System (NAICS) code 523999 points to miscellaneous financial investment activities. 4. The contract was awarded as a delivery order, a common mechanism for task-specific needs within a larger framework. 5. The small business flag is false, indicating the primary awardee is not a small business. 6. The contract was awarded in New York, providing geographic context for the service provider.

Value Assessment

Rating: fair

Benchmarking the value of this debt collection contract is challenging without specific performance metrics or comparable contract data. The total award amount of $24.8 million over five years suggests an average annual value of approximately $4.96 million. Without knowing the volume of debt collected or the recovery rates achieved, it's difficult to assess if this represents good value for money. However, the competitive nature of the award implies that pricing was scrutinized against other potential offerors.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded as a competitive delivery order, indicating that multiple vendors were likely solicited and evaluated. The 'full-and-open' competition level suggests a robust process where any qualified vendor could participate. The presence of 22 bids (no) indicates significant interest and a healthy competitive environment, which generally leads to better price discovery and potentially more favorable terms for the government.

Taxpayer Impact: A competitive award process for debt collection services helps ensure that taxpayer dollars are used efficiently by driving down costs through market forces.

Public Impact

Benefits taxpayers by facilitating the recovery of outstanding government debts. Services delivered include the collection of delinquent debts owed to the Department of the Treasury. Geographic impact is national, as debt collection efforts can span across the United States. Workforce implications are primarily within the contractor's organization, Pioneer Credit Recovery, Inc.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of specific performance metrics makes it difficult to assess the effectiveness and efficiency of the debt recovery process.
The long contract duration could lead to complacency if not actively managed and monitored.
Transparency regarding the specific types of debt being collected and the success rates is limited in the provided data.

Positive Signals

The contract was awarded through a full and open competition, indicating a fair and transparent solicitation process.
A significant number of bids (22) were received, suggesting a competitive market and potentially good pricing.
The award to Pioneer Credit Recovery, Inc. suggests they met the government's requirements for this service.

Sector Analysis

The contract falls under miscellaneous financial investment activities (NAICS 523999), a broad category that includes services related to financial management and investment. The federal government frequently contracts for debt collection services to recover delinquent payments across various agencies. Spending in this sector is driven by the need to maintain fiscal integrity and recover funds owed to the public. Comparable spending benchmarks would require analyzing other federal contracts for similar debt collection services, considering factors like debt volume and type.

Small Business Impact

The data indicates that this contract was not set aside for small businesses (sb: false). The primary awardee, Pioneer Credit Recovery, Inc., is likely a larger entity. There is no direct information provided on subcontracting plans or their impact on the small business ecosystem. However, the absence of a small business set-aside suggests that the focus was on securing the most capable or cost-effective provider through open competition.

Oversight & Accountability

Oversight for this contract would primarily reside with the Bureau of the Fiscal Service within the Department of the Treasury. Accountability measures would be embedded in the contract's terms and conditions, including performance standards and reporting requirements. Transparency is facilitated by the contract's competitive award and public availability through federal procurement databases. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

Federal Debt Collection Programs
Treasury Financial Management Services
Accounts Receivable Management
Government Revenue Recovery

Risk Flags

Potential for reputational damage if contractor employs aggressive collection tactics.
Risk of data security breaches involving sensitive debtor information.
Uncertainty regarding contractor's performance and recovery rate effectiveness without specific metrics.
Compliance risk associated with adherence to debt collection laws and regulations.

Frequently Asked Questions

What is this federal contract paying for?

Department of the Treasury awarded $24.8 million to PIONEER CREDIT RECOVERY, INC. PRIVATE COLLECTION AGENCY FOR DEBT COLLECTION SERVICES

Who is the contractor on this award?

The obligated recipient is PIONEER CREDIT RECOVERY, INC.

Which agency awarded this contract?

Awarding agency: Department of the Treasury (Bureau of the Fiscal Service).

What is the total obligated amount?

The obligated amount is $24.8 million.

What is the period of performance?

Start: 2007-03-12. End: 2012-03-11.

What is the typical success rate for federal debt collection agencies like Pioneer Credit Recovery, Inc.?

The typical success rate for federal debt collection agencies can vary significantly based on the type of debt, the age of the delinquency, and the specific collection strategies employed. While specific data for Pioneer Credit Recovery, Inc. on this contract is not publicly available, the U.S. Government Accountability Office (GAO) and the Treasury Inspector General for Tax Administration (TIGTA) have reported on the effectiveness of debt collection efforts. For instance, reports often analyze recovery rates as a percentage of the total debt referred. Factors influencing success include the debtor's financial situation, the legal framework for collection, and the agency's ability to locate and engage with debtors. Without specific performance metrics tied to this $24.8 million contract, it's difficult to provide a precise success rate, but the competitive nature of the award suggests the government sought a provider capable of meeting established recovery targets.

How does the $24.8 million contract value compare to other federal debt collection contracts?

Comparing the $24.8 million contract value for Pioneer Credit Recovery, Inc. to other federal debt collection contracts requires access to a broader dataset of similar agreements. Federal agencies, including the Department of the Treasury, Department of Justice, and others, utilize various contracts for collecting delinquent debts. The total value of a contract is influenced by factors such as the volume and age of the debt portfolio, the agreed-upon commission rates or fees, and the contract duration. A $24.8 million award over five years averages approximately $4.96 million annually. This figure needs to be contextualized against the size and scope of the debt being managed. For example, contracts for collecting large volumes of tax debt or defaulted student loans might reach higher total values. Conversely, contracts for smaller, more specialized debt portfolios would naturally be lower. Without specific details on the debt types and volumes managed under this contract, a direct comparison remains qualitative.

What are the key performance indicators (KPIs) typically used to evaluate the performance of debt collection contractors?

Key Performance Indicators (KPIs) for evaluating debt collection contractors typically focus on efficiency, effectiveness, and compliance. Common KPIs include the 'debt recovery rate,' which measures the percentage of the total debt referred that is successfully collected. Another crucial metric is the 'cost per dollar collected,' indicating the efficiency of the contractor's operations. 'Time to collect' measures how long it takes to resolve a debt, impacting cash flow. 'Compliance rates' are vital to ensure adherence to all relevant laws and regulations, such as the Fair Debt Collection Practices Act (FDCPA). 'Customer satisfaction' or 'complaint rates' related to the contractor's interaction with debtors may also be monitored. For this specific contract, the Department of the Treasury would have established specific KPIs within the contract's Statement of Work (SOW) to measure Pioneer Credit Recovery, Inc.'s performance and ensure value for taxpayer money.

What is the track record of Pioneer Credit Recovery, Inc. in handling federal contracts?

Pioneer Credit Recovery, Inc. has a history of engaging with federal contracts, as evidenced by this award from the Department of the Treasury. To assess their track record thoroughly, one would need to examine their performance on previous government contracts, including any awards, terminations, or contract disputes. Information available through federal procurement databases like SAM.gov or FPDS can provide insights into their contract history, including the types of services rendered, contract values, and agencies served. A review of past performance evaluations, if publicly accessible, would offer further detail on their reliability, quality of service, and adherence to contractual obligations. Without a comprehensive review of their entire federal contract portfolio, it's challenging to provide a definitive assessment of their track record beyond this specific award.

What is the potential risk associated with outsourcing federal debt collection?

Outsourcing federal debt collection carries several potential risks that agencies must carefully manage. One primary risk is reputational damage if the contractor employs aggressive or non-compliant collection practices, which can lead to negative public perception and erode trust in government agencies. There's also a risk of data security breaches, as contractors handle sensitive personal and financial information of debtors. Performance risk is another concern; the contractor may not achieve the expected recovery rates, leading to financial losses for the government. Compliance risk is significant, as contractors must adhere to a complex web of federal and state laws, and any violations can result in legal penalties and fines. Finally, there's the risk of over-reliance on a single contractor, which can reduce flexibility and bargaining power over time. Robust oversight, clear contractual terms, and thorough vetting of contractors are essential to mitigate these risks.

Industry Classification

NAICS: Finance and Insurance › Other Financial Investment Activities › Miscellaneous Financial Investment Activities

Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › MANAGEMENT SUPPORT SERVICES

Competition & Pricing

Extent Competed: COMPETITIVE DELIVERY ORDER

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 22

Pricing Type: OTHER (APPLIES TO AWARDS WHERE NONE OF THE ABOVE APPLY) (3)

Evaluated Preference: NONE

Contractor Details

Parent Company: SLM Corp Sallie (UEI: 160002218)

Address: 26 EDWARDS ST, ARCADE, NY, 14009

Business Categories: Category Business, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $24,795,541

Exercised Options: $24,795,541

Current Obligation: $24,795,541

Parent Contract

Parent Award PIID: GS23F0217K

IDV Type: FSS

Timeline