Department of Education awards $120M for student loan servicing, raising concerns about price adjustments
Contract Overview
Contract Amount: $119,700,131 ($119.7M)
Contractor: Great Lakes Educational Loan Services, Inc
Awarding Agency: Department of Education
Start Date: 2013-01-01
End Date: 2013-12-31
Contract Duration: 364 days
Daily Burn Rate: $328.8K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 1
Pricing Type: FIXED PRICE WITH ECONOMIC PRICE ADJUSTMENT
Sector: Other
Official Description: IGF::CT::IGF "CRITICAL FUNCTION". TASK ORDER 0005 PROVIDES SERVICING OF TITLE IV STUDENT FINANCIAL AID FOR THE JANUARY 01, 2013 TO JUNE 16, 2014 TIME PERIOD.
Place of Performance
Location: MADISON, DANE County, WISCONSIN, 53704
Plain-Language Summary
Department of Education obligated $119.7 million to GREAT LAKES EDUCATIONAL LOAN SERVICES, INC for work described as: IGF::CT::IGF "CRITICAL FUNCTION". TASK ORDER 0005 PROVIDES SERVICING OF TITLE IV STUDENT FINANCIAL AID FOR THE JANUARY 01, 2013 TO JUNE 16, 2014 TIME PERIOD. Key points: 1. The contract focuses on servicing Title IV student financial aid. 2. Great Lakes Educational Loan Services, Inc. is the awardee. 3. The contract duration is 364 days. 4. The contract type includes economic price adjustments, a potential risk.
Value Assessment
Rating: questionable
The fixed-price with economic price adjustment contract type introduces uncertainty in the final cost. Without a clear benchmark for the price adjustment mechanism, assessing value is difficult.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under full and open competition, suggesting a competitive bidding process. However, the economic price adjustment clause may have limited the effectiveness of price discovery.
Taxpayer Impact: The use of economic price adjustments could lead to costs exceeding initial estimates, potentially impacting taxpayers if not carefully managed.
Public Impact
Ensures continued access to student financial aid services for borrowers. The contract's duration is relatively short, suggesting potential for re-competition or modification. Economic price adjustments warrant close monitoring to prevent cost overruns.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Economic price adjustment clause
- Lack of specific performance metrics in provided data
Positive Signals
- Full and open competition
- Awarded to established loan servicer
Sector Analysis
This contract falls under 'Other Activities Related to Credit Intermediation' (NAICS 522390). Spending in this sector is driven by government programs and financial services supporting them. Benchmarks are difficult without more specific contract details.
Small Business Impact
The provided data does not indicate any specific provisions or set-asides for small businesses in this contract award.
Oversight & Accountability
Oversight would focus on the implementation of the economic price adjustment clause and ensuring the continued efficient servicing of student financial aid.
Related Government Programs
- Other Activities Related to Credit Intermediation
- Department of Education Contracting
- Department of Education Programs
Risk Flags
- Economic price adjustment clause introduces cost uncertainty.
- Potential for cost overruns due to price adjustments.
- Lack of detailed performance metrics in the provided data.
- Short contract duration may indicate a need for ongoing re-competition or contract modifications.
Tags
other-activities-related-to-credit-inter, department-of-education, wi, do, 100m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Education awarded $119.7 million to GREAT LAKES EDUCATIONAL LOAN SERVICES, INC. IGF::CT::IGF "CRITICAL FUNCTION". TASK ORDER 0005 PROVIDES SERVICING OF TITLE IV STUDENT FINANCIAL AID FOR THE JANUARY 01, 2013 TO JUNE 16, 2014 TIME PERIOD.
Who is the contractor on this award?
The obligated recipient is GREAT LAKES EDUCATIONAL LOAN SERVICES, INC.
Which agency awarded this contract?
Awarding agency: Department of Education (Department of Education).
What is the total obligated amount?
The obligated amount is $119.7 million.
What is the period of performance?
Start: 2013-01-01. End: 2013-12-31.
What is the specific mechanism and historical data for the economic price adjustments in this contract?
The provided data lacks details on the specific economic price adjustment mechanism. Further investigation into contract clauses and historical price adjustments for similar services would be necessary to assess its impact on the final cost and taxpayer burden. Understanding the triggers and limits of these adjustments is crucial for evaluating value.
What are the key performance indicators (KPIs) for this student loan servicing contract?
The provided data does not specify the key performance indicators (KPIs) for this contract. Effective oversight requires clearly defined metrics to measure the quality and efficiency of student loan servicing, such as call center wait times, application processing speed, and borrower satisfaction rates. Without these, assessing performance is challenging.
How does the cost of this contract compare to similar student financial aid servicing contracts?
A direct cost comparison is difficult without more detailed contract information and benchmarks for similar services. The presence of economic price adjustments adds a layer of complexity. Analyzing the base price against historical data for student loan servicing contracts, while accounting for the potential impact of price adjustments, would be necessary for a comprehensive assessment.
Industry Classification
NAICS: Finance and Insurance › Activities Related to Credit Intermediation › Other Activities Related to Credit Intermediation
Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › MANAGEMENT SUPPORT SERVICES
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY
Offers Received: 1
Pricing Type: FIXED PRICE WITH ECONOMIC PRICE ADJUSTMENT (K)
Evaluated Preference: NONE
Contractor Details
Parent Company: Great Lakes Higher Education Corporation (UEI: 121598791)
Address: 2401 INTERNATIONAL LN, MADISON, WI, 02
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $119,700,131
Exercised Options: $119,700,131
Current Obligation: $119,700,131
Parent Contract
Parent Award PIID: EDFSA09D0012
IDV Type: IDC
Timeline
Start Date: 2013-01-01
Current End Date: 2013-12-31
Potential End Date: 2013-12-31 00:00:00
Last Modified: 2014-09-24
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