Department of Education awards $30.1M for contact center support, with 4 task orders issued

Contract Overview

Contract Amount: $30,124,684 ($30.1M)

Contractor: Maximus Federal Services, Inc.

Awarding Agency: Department of Education

Start Date: 2023-05-05

End Date: 2024-11-04

Contract Duration: 549 days

Daily Burn Rate: $54.9K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 4

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: THE PURPOSE OF THIS REQUIREMENT IS TO ISSUE IDENTICAL STEADY-STATE TASK ORDERS FOR NON-SERVICING CONTACT CENTER SUPPORT AND BACK-OFFICE PROCESSING TO ALL BPO PROVIDERS.

Place of Performance

Location: MCLEAN, FAIRFAX County, VIRGINIA, 22102

State: Virginia Government Spending

Plain-Language Summary

Department of Education obligated $30.1 million to MAXIMUS FEDERAL SERVICES, INC. for work described as: THE PURPOSE OF THIS REQUIREMENT IS TO ISSUE IDENTICAL STEADY-STATE TASK ORDERS FOR NON-SERVICING CONTACT CENTER SUPPORT AND BACK-OFFICE PROCESSING TO ALL BPO PROVIDERS. Key points: 1. Contract aims for consistent back-office processing and contact center support across multiple vendors. 2. Full and open competition was utilized, suggesting a broad market engagement. 3. The contract is structured as firm-fixed-price, providing cost certainty for the government. 4. Performance period spans over a year, indicating a need for sustained services. 5. The award is a delivery order under an existing contract vehicle. 6. The North American Industry Classification System (NAICS) code 522320 points to financial transaction processing.

Value Assessment

Rating: good

The contract's value of $30.1 million over approximately 18 months appears reasonable for steady-state contact center and back-office support services. Benchmarking against similar large-scale BPO contracts would provide a more precise value-for-money assessment. The firm-fixed-price structure helps control costs, but the ultimate value depends on the efficiency and effectiveness of the services delivered by the awardee.

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 offers. The presence of 4 identical steady-state task orders suggests a well-defined requirement that allowed for competitive bidding. This approach generally fosters price discovery and encourages multiple bidders to offer competitive pricing.

Taxpayer Impact: Full and open competition is beneficial for taxpayers as it typically leads to lower prices and better quality services due to market forces driving efficiency and innovation.

Public Impact

Citizens and stakeholders interacting with the Department of Education will receive contact center support. Back-office processing functions critical to the Department's operations will be maintained. The services are primarily delivered in Virginia, impacting the local workforce. The contract supports the Department's mission-critical functions related to financial transactions and student services.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for vendor lock-in if steady-state requirements limit flexibility for future innovation.
Ensuring consistent service quality across multiple identical task orders requires robust performance monitoring.
Dependence on BPO providers for critical back-office functions introduces operational risk.

Positive Signals

Firm-fixed-price contract provides cost predictability for the government.
Full and open competition promotes a competitive market and potentially better pricing.
Steady-state task orders suggest a stable and predictable requirement, allowing for efficient service delivery.

Sector Analysis

This contract falls within the Business Process Outsourcing (BPO) sector, specifically focusing on financial transactions processing and contact center operations. The BPO market is highly competitive, with numerous large and small firms offering a wide range of services. Government spending in this area is substantial, supporting administrative functions across various agencies. Comparable spending benchmarks would involve analyzing other large federal contracts for similar BPO services.

Small Business Impact

The provided data indicates that small business participation (sb) is false, and there is no indication of a small business set-aside. This suggests the contract was not specifically targeted towards small businesses. Subcontracting opportunities for small businesses may exist at the discretion of the prime contractor, MAXIMUS FEDERAL SERVICES, INC., but are not explicitly mandated by the contract structure as presented.

Oversight & Accountability

Oversight for this contract will likely be managed by the Department of Education's contracting officers and program managers. Accountability measures are embedded within the firm-fixed-price structure and the delivery order mechanism, requiring the contractor to meet defined service levels. Transparency is facilitated through federal contract databases, though specific performance metrics and oversight reports may not be publicly available.

Related Government Programs

Federal Contact Center Services
Financial Transaction Processing Services
Business Process Outsourcing Contracts
Department of Education Administrative Support

Risk Flags

Potential for vendor lock-in
Service quality consistency across task orders
Dependence on contractor performance for critical functions

Frequently Asked Questions

What is this federal contract paying for?

Department of Education awarded $30.1 million to MAXIMUS FEDERAL SERVICES, INC.. THE PURPOSE OF THIS REQUIREMENT IS TO ISSUE IDENTICAL STEADY-STATE TASK ORDERS FOR NON-SERVICING CONTACT CENTER SUPPORT AND BACK-OFFICE PROCESSING TO ALL BPO PROVIDERS.

Who is the contractor on this award?

The obligated recipient is MAXIMUS FEDERAL 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 $30.1 million.

What is the period of performance?

Start: 2023-05-05. End: 2024-11-04.

What is the historical spending pattern for similar contact center and back-office support services at the Department of Education?

Analyzing historical spending for similar services at the Department of Education is crucial for context. While specific historical data for this exact requirement isn't provided, the Department frequently procures services related to student financial aid, educational program administration, and general administrative support. These procurements often involve large contracts for IT support, call centers, and data processing. Past spending trends can reveal whether this $30.1 million award represents an increase, decrease, or stable level of investment in these functions. Understanding previous contract values, durations, and awardees can also highlight potential areas for cost savings or identify contractors with a proven track record of performance and value.

How does the pricing structure (firm-fixed-price) compare to other government contracts for similar services?

The firm-fixed-price (FFP) contract type is common for services with well-defined scopes, like steady-state contact center support. This structure shifts most of the cost risk to the contractor, providing the government with budget certainty. Compared to cost-plus contracts, FFP generally incentivizes contractor efficiency. However, if the scope is not perfectly defined or unforeseen issues arise, contractors may cut corners, potentially impacting quality. For similar BPO and contact center services, FFP is often preferred when requirements are stable. Benchmarking the per-unit costs (e.g., cost per call, cost per transaction) against other FFP government contracts for comparable services would be necessary to assess if this contract's pricing is competitive.

What are the key performance indicators (KPIs) used to measure the success of this contract?

While specific KPIs are not detailed in the provided data, typical performance indicators for contact center and back-office support contracts include: average handle time (AHT), first call resolution (FCR), customer satisfaction scores (CSAT), call abandonment rate, and accuracy rates for back-office processing. For financial transactions, accuracy and timeliness are paramount. The Department of Education would establish these KPIs in the contract's Performance Work Statement (PWS). Regular performance reviews and reporting by the contractor against these KPIs are essential for oversight. Failure to meet KPIs could result in contract remedies, including financial penalties or termination, depending on the severity.

What is the track record of MAXIMUS FEDERAL SERVICES, INC. in delivering similar government contracts?

MAXIMUS FEDERAL SERVICES, INC. has a significant history of performing large-scale government contracts, particularly in areas related to health and human services, and administrative support. They are known for managing complex IT systems and providing customer service operations for various federal and state agencies. Assessing their track record for similar BPO and contact center services would involve reviewing past performance evaluations, contract awards, and any reported issues or successes on previous government engagements. Their experience suggests a capacity to handle substantial requirements, but a detailed review of their performance on comparable contracts is needed to fully gauge their reliability and effectiveness for this specific Department of Education requirement.

What are the potential risks associated with relying on a single awardee for multiple identical steady-state task orders?

Awarding multiple identical steady-state task orders to a single contractor, even under full and open competition, carries inherent risks. One primary risk is reduced leverage for future negotiations; if the contractor becomes indispensable, they may have increased bargaining power for follow-on work or contract modifications. Another risk is complacency; with a guaranteed stream of work, the contractor might reduce focus on continuous improvement or cost optimization. Furthermore, if the contractor experiences significant performance issues or financial instability, it could disrupt critical back-office operations and contact center services, impacting the Department's ability to serve its stakeholders. Diversifying awardees or incorporating mechanisms for re-competition could mitigate these risks.

Industry Classification

NAICS: Finance and Insurance › Activities Related to Credit Intermediation › Financial Transactions Processing, Reserve, and Clearinghouse Activities

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: 4

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 3120 FAIRVIEW PARK DR STE 400, FALLS CHURCH, VA, 22042

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

Financial Breakdown

Contract Ceiling: $30,124,684

Exercised Options: $30,124,684

Current Obligation: $30,124,684

Actual Outlays: $31,473,489

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: 91003120D0005

IDV Type: IDC

Timeline