PBGC awards $2.3M contract for portfolio management services to Ramirez Asset Management, Inc

Contract Overview

Contract Amount: $2,309,134 ($2.3M)

Contractor: Ramirez Asset Management, Inc.

Awarding Agency: Pension Benefit Guaranty Corporation

Start Date: 2024-01-01

End Date: 2026-12-31

Contract Duration: 1,095 days

Daily Burn Rate: $2.1K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 26

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: PORTFOLIO MANAGEMENT SERVICES

Place of Performance

Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20024

State: District of Columbia Government Spending

Plain-Language Summary

Pension Benefit Guaranty Corporation obligated $2.3 million to RAMIREZ ASSET MANAGEMENT, INC. for work described as: PORTFOLIO MANAGEMENT SERVICES Key points: 1. Contract awarded through full and open competition, suggesting a competitive bidding process. 2. The contract is a definitive contract with a firm fixed price, providing cost certainty. 3. The duration of 1095 days (3 years) indicates a medium-term need for these services. 4. The contract is for portfolio management and investment advice, crucial for pension fund stability. 5. The awardee, Ramirez Asset Management, Inc., will provide services to the Pension Benefit Guaranty Corporation. 6. The contract value of $2.3 million is spread over three years, averaging $767,000 annually.

Value Assessment

Rating: good

The contract value of $2.3 million over three years for portfolio management services appears reasonable given the scope. Benchmarking against similar contracts for asset management services for federal agencies of comparable size and complexity would provide a more precise value-for-money assessment. The firm fixed-price structure helps control costs. However, without specific performance metrics or detailed service breakdowns, a definitive assessment of cost-effectiveness is challenging.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit a bid. The presence of 26 bids suggests a robust competitive environment. A high number of bidders generally leads to better price discovery and can result in more favorable pricing for the government. The specific details of the bidding process and the evaluation criteria would further illuminate the effectiveness of the competition.

Taxpayer Impact: The extensive competition for this contract is beneficial for taxpayers as it likely drove down prices and ensured the government received competitive proposals for essential portfolio management services.

Public Impact

The Pension Benefit Guaranty Corporation (PBGC) benefits directly from these services, ensuring sound management of its investment portfolio. The services provided include portfolio management and investment advice, critical for the financial health of pension plans. The geographic impact is primarily within the District of Columbia, where the PBGC is headquartered. The contract supports specialized financial services roles, potentially impacting the financial services sector workforce.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for over-reliance on a single contractor for critical investment advice.
Need for robust performance monitoring to ensure services meet evolving market conditions and PBGC needs.

Positive Signals

Awarded through full and open competition, indicating a competitive market for these services.
Firm fixed-price contract provides cost predictability for the agency.
The contract duration allows for continuity of essential portfolio management services.

Sector Analysis

The contract falls within the financial services sector, specifically focusing on asset and portfolio management. This sector is characterized by specialized expertise and regulatory oversight. The market for federal government financial advisory services is competitive, with numerous firms capable of providing such support. The $2.3 million contract value is moderate within the broader context of federal spending on financial services, which can range from millions to billions depending on the agency and scope.

Small Business Impact

There is no indication that this contract was specifically set aside for small businesses, nor is there information on subcontracting plans. Given the nature of portfolio management services, it is possible that larger, specialized firms were the primary bidders. Further analysis would be needed to determine if small businesses had opportunities to participate either as prime contractors or subcontractors.

Oversight & Accountability

Oversight of this contract would typically fall under the Pension Benefit Guaranty Corporation's internal procurement and financial management divisions. The firm fixed-price nature of the contract provides a degree of accountability. Transparency would be enhanced by public reporting of contract performance and any associated audits or reviews. The Inspector General for the Department of Labor (which oversees PBGC) may have jurisdiction for oversight.

Related Government Programs

Federal Financial Advisory Services
Investment Management Contracts
Pension Fund Administration

Risk Flags

Contract performance risk
Potential for conflicts of interest
Adequacy of oversight mechanisms

Frequently Asked Questions

What is this federal contract paying for?

Pension Benefit Guaranty Corporation awarded $2.3 million to RAMIREZ ASSET MANAGEMENT, INC.. PORTFOLIO MANAGEMENT SERVICES

Who is the contractor on this award?

The obligated recipient is RAMIREZ ASSET MANAGEMENT, INC..

Which agency awarded this contract?

Awarding agency: Pension Benefit Guaranty Corporation (Pension Benefit Guaranty Corporation).

What is the total obligated amount?

The obligated amount is $2.3 million.

What is the period of performance?

Start: 2024-01-01. End: 2026-12-31.

What is the track record of Ramirez Asset Management, Inc. in managing federal contracts, particularly those involving pension funds?

Information regarding Ramirez Asset Management, Inc.'s specific track record with federal contracts, especially those related to pension funds, is not detailed in the provided data. A thorough review would require accessing federal procurement databases (like SAM.gov or FPDS) to examine past performance evaluations, contract history, and any reported issues or successes. Understanding their experience with similar agencies or asset types would be crucial for assessing their capability and reliability for this PBGC contract. Without this specific data, we rely on the competitive process to have vetted their qualifications.

How does the annual cost of this contract compare to similar portfolio management services procured by other federal agencies?

The annual cost for this contract averages approximately $767,000 ($2.3 million / 3 years). To benchmark this effectively, we would need to compare it against contracts for portfolio management and investment advice awarded by agencies of similar size and complexity to the PBGC. Factors such as the size and type of assets managed, the specific services required (e.g., strategic asset allocation, risk management, performance reporting), and the market conditions at the time of award would influence pricing. A comprehensive comparison would involve analyzing data from multiple federal contracts to identify a typical price range for comparable services.

What are the primary risks associated with this contract, and what mitigation strategies are in place?

Key risks include potential underperformance of the managed portfolio, which could impact the PBGC's financial stability, and contractor non-performance or inadequate service delivery. Another risk could be a conflict of interest if the contractor manages assets for other entities with competing interests. Mitigation strategies would likely involve robust performance metrics defined in the contract, regular performance reviews, clear reporting requirements, and potentially contingency plans for contractor failure. The PBGC's internal oversight and the competitive nature of the award process are also risk mitigation factors.

How effective is the firm fixed-price contract type in ensuring value for money for portfolio management services?

A firm fixed-price (FFP) contract is generally effective in controlling costs and providing budget certainty, as the price is set and not subject to adjustment based on the contractor's cost experience. For portfolio management, this means the PBGC knows the exact cost of the service. However, FFP can sometimes disincentivize contractors from going above and beyond if the scope is not perfectly defined, or it might lead to higher initial bids to account for contractor risk. The effectiveness here depends on how well the Statement of Work (SOW) captures all necessary services and performance expectations.

What is the historical spending trend for portfolio management services at the Pension Benefit Guaranty Corporation?

The provided data only includes details for this specific contract award. To understand historical spending trends, one would need to analyze PBGC's procurement history over several fiscal years. This would involve identifying previous contracts for similar services, their values, durations, and awardees. Analyzing these trends would reveal whether spending on portfolio management has increased, decreased, or remained stable, and whether the PBGC has consistently used competitive bidding for these services. Such analysis is crucial for understanding long-term budget planning and contractor relationships.

Given the 26 bids received, what does this indicate about the market competitiveness for federal portfolio management services?

Receiving 26 bids for this portfolio management contract strongly suggests a highly competitive market for such services within the federal sector. A large number of bidders typically indicates that multiple firms possess the necessary qualifications and are actively seeking government contracts. This level of competition is advantageous for the government, as it tends to drive down prices, encourage innovation, and ensure a wider pool of potential contractors for future needs. It also suggests that the barriers to entry for qualified firms are not excessively high.

Industry Classification

NAICS: Finance and Insurance › Other Financial Investment Activities › Portfolio Management and Investment Advice

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

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: 16PBGC23R0001

Offers Received: 26

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 61 BROADWAY, NEW YORK, NY, 10006

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

Financial Breakdown

Contract Ceiling: $2,309,134

Exercised Options: $2,309,134

Current Obligation: $2,309,134

Actual Outlays: $1,119,548

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Timeline