Heritage Services Corporation awarded $43.2M contract for technical and trade school services by the Department of Labor

Contract Overview

Contract Amount: $43,164,746 ($43.2M)

Contractor: Heritage Services Corporation

Awarding Agency: Department of Labor

Start Date: 2018-06-22

End Date: 2023-07-31

Contract Duration: 1,865 days

Daily Burn Rate: $23.1K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 5

Pricing Type: COST PLUS INCENTIVE FEE

Sector: Other

Official Description: IGF::OT::IGF BAMBERG JCC W/ OA CTS

Place of Performance

Location: BAMBERG, BAMBERG County, SOUTH CAROLINA, 29003

State: South Carolina Government Spending

Plain-Language Summary

Department of Labor obligated $43.2 million to HERITAGE SERVICES CORPORATION for work described as: IGF::OT::IGF BAMBERG JCC W/ OA CTS Key points: 1. Contract value of $43.2M over 5 years suggests significant investment in technical training. 2. Full and open competition indicates a potentially competitive bidding process. 3. The contract's duration of 1865 days (over 5 years) points to a long-term need for these services. 4. Awarded to Heritage Services Corporation, a single entity, highlighting potential specialization or market concentration. 5. The 'Other Technical and Trade Schools' NAICS code suggests a broad scope of vocational training. 6. The contract type 'Cost Plus Incentive Fee' implies performance-based incentives for the contractor. 7. The presence of 5 bids suggests a moderate level of competition for this requirement.

Value Assessment

Rating: fair

The total award amount of $43.2 million over approximately five years for 'Other Technical and Trade Schools' services requires further benchmarking. Without specific details on the services provided (e.g., number of students trained, specific trades covered, or performance metrics), it is difficult to assess value for money. Comparing this to similar contracts for vocational training programs across federal agencies would be necessary to determine if the pricing is competitive and if the government is receiving adequate value. The Cost Plus Incentive Fee (CPIF) structure suggests an attempt to align contractor performance with government objectives, which can be a positive indicator if well-structured.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under 'Full and Open Competition After Exclusion of Sources,' which is a less common but still competitive method. This indicates that while the competition was intended to be broad, specific sources may have been excluded for stated reasons. With 5 bids received, there was a moderate level of competition. This suggests that the market for these services is not overly concentrated, and multiple vendors were capable of meeting the requirements. The exclusion of sources, however, warrants a closer look to ensure it did not unduly limit competition or lead to suboptimal pricing.

Taxpayer Impact: The moderate competition level suggests that taxpayers likely benefited from a degree of price discovery. However, the exclusion of certain sources could potentially have limited the most competitive offers, meaning taxpayers might not have achieved the absolute lowest possible price.

Public Impact

The primary beneficiaries are likely individuals seeking vocational training and skill development through programs facilitated by Heritage Services Corporation. The services delivered encompass technical and trade education, aiming to equip individuals with skills for specific occupations. The geographic impact is centered in South Carolina, as indicated by the 'SN' field, suggesting local workforce development. Workforce implications include the potential for increased employment opportunities for trained individuals and support for industries requiring skilled labor.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

The 'Full and Open Competition After Exclusion of Sources' method, while competitive, requires scrutiny to ensure the exclusions were justified and did not stifle innovation or price competition.
The Cost Plus Incentive Fee (CPIF) contract type can lead to cost overruns if not carefully managed and monitored, potentially increasing the overall expenditure for the government.
Lack of specific performance metrics or detailed service descriptions makes it challenging to fully assess the effectiveness and value delivered by Heritage Services Corporation.
The contract's significant duration (over 5 years) necessitates ongoing oversight to ensure continued relevance and quality of services.

Positive Signals

The award through full and open competition, even with exclusions, indicates an effort to leverage market capabilities.
The receipt of 5 bids suggests a healthy interest and capability within the market for these specialized training services.
The Cost Plus Incentive Fee structure, if properly managed, can incentivize contractor performance and efficiency, leading to better outcomes.
The long-term nature of the contract suggests a sustained commitment to developing a skilled workforce, which is beneficial for both individuals and the economy.

Sector Analysis

The contract falls within the broader education and training services sector, specifically focusing on vocational and technical skills. This sector is crucial for workforce development, bridging the gap between educational institutions and industry demands. The market size for federal training contracts can be substantial, driven by various agencies' needs for specialized skills, re-skilling initiatives, and support for specific programs. Comparable spending benchmarks would involve analyzing other federal contracts for technical and trade schools, apprenticeship programs, and workforce development initiatives across agencies like Labor, Defense, and Veterans Affairs.

Small Business Impact

The data indicates that this contract was not set aside for small businesses ('ss': false, 'sb': false). Therefore, there are no direct subcontracting implications for small businesses arising from a small business set-aside. However, the prime contractor, Heritage Services Corporation, may choose to subcontract portions of this work to small businesses as part of their overall business strategy, which could indirectly benefit the small business ecosystem. Further analysis would be needed to determine if subcontracting plans were a requirement or a voluntary commitment.

Oversight & Accountability

Oversight for this contract would primarily reside within the Department of Labor, specifically the Office of the Assistant Secretary for Administration and Management (OASAM). Mechanisms likely include regular performance reviews, financial audits, and adherence to the terms of the Cost Plus Incentive Fee (CPIF) structure. Transparency is facilitated through contract award databases like FPDS. Inspector General jurisdiction would apply if any fraud, waste, or abuse is suspected within the contract's execution.

Related Government Programs

Department of Labor Workforce Innovation and Opportunity Act (WIOA) Programs
Department of Education Career and Technical Education Programs
Department of Defense Military Spouse Career Advancement Accounts (MyCAA)
Veterans Affairs Vocational Rehabilitation and Employment (VR&E) Services
State Workforce Development Grants

Risk Flags

Potential for limited competition due to source exclusions
CPIF contract type requires diligent oversight to control costs
Lack of specific performance metrics hinders value assessment
Long contract duration necessitates ongoing monitoring

Frequently Asked Questions

What is this federal contract paying for?

Department of Labor awarded $43.2 million to HERITAGE SERVICES CORPORATION. IGF::OT::IGF BAMBERG JCC W/ OA CTS

Who is the contractor on this award?

The obligated recipient is HERITAGE SERVICES CORPORATION.

Which agency awarded this contract?

Awarding agency: Department of Labor (Office of the Assistant Secretary for Administration and Management).

What is the total obligated amount?

The obligated amount is $43.2 million.

What is the period of performance?

Start: 2018-06-22. End: 2023-07-31.

What specific technical and trade skills are being provided under this contract, and how do they align with current labor market demands?

The provided data identifies the NAICS code as '611519 - Other Technical and Trade Schools,' which is broad and encompasses a wide range of vocational training. Without further details from the contract's statement of work, it is impossible to ascertain the specific skills being taught. To assess alignment with labor market demands, one would need to analyze the curriculum, training modules, and placement rates for graduates of the programs funded by this contract. Comparing these to industry-specific job growth projections and employer needs in South Carolina (the indicated state) would be crucial. For instance, if the training focuses on high-demand fields like advanced manufacturing, healthcare technology, or renewable energy, it would indicate strong alignment. Conversely, if it focuses on declining industries, the alignment would be poor.

How does the $43.2 million contract value compare to similar federal investments in vocational training over the past five years?

Comparing the $43.2 million award to similar federal investments requires identifying comparable contracts. This involves searching federal procurement databases for contracts with similar NAICS codes (e.g., 611519, 611510) and service descriptions (vocational training, technical schools, workforce development) awarded by agencies like the Department of Labor, Department of Education, or Department of Defense. The duration of the Heritage Services Corporation contract is approximately 5 years (1865 days), so a relevant comparison would involve looking at other multi-year training contracts. For example, if other agencies have awarded similar-sized contracts for comparable training durations and scopes, it would provide a benchmark. If this contract represents a significantly higher or lower investment per trainee or per training hour compared to peers, it would indicate potential overspending or exceptional value.

What are the key performance indicators (KPIs) for Heritage Services Corporation under this Cost Plus Incentive Fee (CPIF) contract, and how are they measured?

The specific Key Performance Indicators (KPIs) for this Cost Plus Incentive Fee (CPIF) contract are not detailed in the provided summary data. Typically, for vocational training contracts, KPIs might include metrics such as student completion rates, job placement rates post-training, employer satisfaction with graduates' skills, average starting salaries of placed graduates, or adherence to training schedules and budgets. Under a CPIF structure, Heritage Services Corporation would earn a base fee plus an incentive fee if they meet or exceed pre-defined performance targets. The government would monitor these KPIs through regular reporting and performance evaluations. The 'incentive' portion of the fee would be adjusted based on the contractor's performance against these targets, aiming to reward efficiency and effectiveness.

What is the track record of Heritage Services Corporation in delivering federal training contracts, particularly those of similar size and scope?

Information regarding the specific track record of Heritage Services Corporation in delivering federal training contracts is not present in the provided data. To assess their track record, one would need to conduct a search of federal procurement history databases (e.g., FPDS, SAM.gov) for past awards and performance information related to Heritage Services Corporation. Key aspects to investigate would include the number and value of previous contracts, the types of services rendered (specifically in technical and trade education), past performance ratings (if available), any history of contract disputes, terminations, or significant performance issues. A history of successful, on-time, and within-budget delivery of similar training programs would indicate a strong track record, while a pattern of problems would raise concerns.

How does the 'Full and Open Competition After Exclusion of Sources' procurement method impact potential cost savings for taxpayers compared to traditional full and open competition?

The 'Full and Open Competition After Exclusion of Sources' method introduces a layer of complexity that can affect cost savings. While it aims for broad competition, the explicit exclusion of certain sources means that the pool of potential bidders is smaller than in a standard full and open competition. This exclusion must be justified by the agency, often due to specific technical requirements, past performance issues with excluded vendors, or national security concerns. If the exclusions are well-founded and the remaining bidders are highly competitive, taxpayers could still achieve good value. However, if the exclusions were arbitrary or removed highly capable competitors, it could limit price discovery and potentially lead to higher costs than if all capable sources were allowed to bid. The fact that 5 bids were received suggests that competition was not severely stifled, but the impact of the exclusions on the final price is a key consideration.

Industry Classification

NAICS: Educational Services › Technical and Trade Schools › Other Technical and Trade Schools

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

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: 1630J3-18-R-00002

Offers Received: 5

Pricing Type: COST PLUS INCENTIVE FEE (V)

Evaluated Preference: NONE

Contractor Details

Address: 220 CORAL SANDS SUITE 1, ROCKLEDGE, FL, 32955

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $53,061,044

Exercised Options: $53,061,044

Current Obligation: $43,164,746

Actual Outlays: $31,553,902

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Timeline