Department of Education awards $66.1M contract for contact center support, with a 90-day performance benchmark

Contract Overview

Contract Amount: $66,131,333 ($66.1M)

Contractor: Edfinancial Services LLC

Awarding Agency: Department of Education

Start Date: 2024-11-01

End Date: 2026-10-31

Contract Duration: 729 days

Daily Burn Rate: $90.7K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 4

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: STEADY-STATE TASK ORDER 2 AWARDED AGAINST THE EDFINANCIAL NEXT GEN (NG) BUSINESS PROCESS OPERATIONS (BPO) IDIQ CONTRACT FOR NON-SERVICING AND SPECIALTY PROGRAMS (SPS) CONTACT CENTER SUPPORT AND BACK-OFFICE PROCESSING.

Place of Performance

Location: KNOXVILLE, KNOX County, TENNESSEE, 37922

State: Tennessee Government Spending

Plain-Language Summary

Department of Education obligated $66.1 million to EDFINANCIAL SERVICES LLC for work described as: STEADY-STATE TASK ORDER 2 AWARDED AGAINST THE EDFINANCIAL NEXT GEN (NG) BUSINESS PROCESS OPERATIONS (BPO) IDIQ CONTRACT FOR NON-SERVICING AND SPECIALTY PROGRAMS (SPS) CONTACT CENTER SUPPORT AND BACK-OFFICE PROCESSING. Key points: 1. The contract focuses on non-servicing and specialty programs, indicating a niche area of support. 2. A firm-fixed-price structure suggests predictable costs for the government. 3. The award is a delivery order against an existing IDIQ, implying a streamlined procurement process. 4. The duration of 729 days (approximately 2 years) provides a medium-term commitment. 5. The contract is not set aside for small businesses, suggesting larger prime contractors are involved. 6. The benchmark of 90 days for performance is a key metric for evaluating success.

Value Assessment

Rating: good

The contract value of $66.1 million over two years averages to approximately $33 million annually. This appears reasonable for comprehensive contact center and back-office processing support, especially for specialized programs. Benchmarking against similar contracts for niche government support services would provide further clarity, but the firm-fixed-price nature offers cost certainty. The 90-day performance benchmark is a critical indicator of expected efficiency and effectiveness.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that multiple vendors had the opportunity to bid. This process is designed to foster competitive pricing and encourage innovation. The presence of 4 bidders suggests a healthy level of interest and competition for this type of specialized government support service. The competitive nature should theoretically drive down costs and improve service quality.

Taxpayer Impact: Full and open competition generally benefits taxpayers by ensuring the government receives the best possible value through a wide range of offers and potentially lower prices due to market forces.

Public Impact

The Department of Education benefits from specialized contact center and back-office support for its non-servicing and specialty programs. Students and program participants likely receive improved assistance and processing for specific educational initiatives. The contract supports jobs within the financial transaction processing and customer service sectors. The primary geographic impact is within Tennessee, where the contractor is located.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for scope creep if 'specialty programs' are not clearly defined.
Reliance on a single vendor for critical back-office functions could pose a risk if performance falters.
Ensuring the 90-day performance benchmark is consistently met requires robust monitoring.

Positive Signals

Awarded under full and open competition, suggesting competitive pricing.
Firm-fixed-price contract provides cost predictability.
Existing IDIQ contract streamlines the procurement process.
Clear performance benchmark (90 days) allows for objective evaluation.

Sector Analysis

This contract falls within the Financial Transactions Processing, Reserve, and Clearinghouse Activities sector, specifically focusing on business process operations for specialized government programs. The market for government contact center and back-office support is substantial, with agencies increasingly outsourcing these functions to specialized firms. Comparable spending benchmarks would involve analyzing other IDIQ contracts for similar support services across federal agencies, which often run into tens or hundreds of millions of dollars annually.

Small Business Impact

This contract was not set aside for small businesses, as indicated by 'sb': false. This suggests that the primary awardee, EDFINANCIAL SERVICES LLC, is likely a larger entity capable of handling the scope and scale of the requirement. There is no explicit mention of subcontracting requirements for small businesses within the provided data, but it is common for larger prime contractors to engage small businesses for specific components of such contracts, though this is not guaranteed.

Oversight & Accountability

Oversight for this contract will likely be managed by the Department of Education's contracting officers and program managers. Performance will be monitored against the specified 90-day benchmark and other contractual terms. 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 Education Student Loan Servicing Contracts
Federal Contact Center Services
Financial Services for Government Programs
Business Process Outsourcing (BPO) for Federal Agencies

Risk Flags

Performance Benchmark Adherence
Scope Definition Clarity
Vendor Performance History

Frequently Asked Questions

What is this federal contract paying for?

Department of Education awarded $66.1 million to EDFINANCIAL SERVICES LLC. STEADY-STATE TASK ORDER 2 AWARDED AGAINST THE EDFINANCIAL NEXT GEN (NG) BUSINESS PROCESS OPERATIONS (BPO) IDIQ CONTRACT FOR NON-SERVICING AND SPECIALTY PROGRAMS (SPS) CONTACT CENTER SUPPORT AND BACK-OFFICE PROCESSING.

Who is the contractor on this award?

The obligated recipient is EDFINANCIAL SERVICES LLC.

Which agency awarded this contract?

Awarding agency: Department of Education (Department of Education).

What is the total obligated amount?

The obligated amount is $66.1 million.

What is the period of performance?

Start: 2024-11-01. End: 2026-10-31.

What is the historical performance of EDFINANCIAL SERVICES LLC on similar government contracts?

EDFINANCIAL SERVICES LLC has a history of performing government contracts, particularly within the student loan servicing and financial management space for the Department of Education. While specific performance metrics for past contracts are not detailed here, their repeated awards suggest a satisfactory track record. Analyzing past contract performance reports, past performance questionnaires, and any documented disputes or corrective actions would provide a more granular understanding of their reliability and effectiveness in fulfilling complex government requirements. Their experience with the Department of Education's specific program needs is a key positive indicator.

How does the $66.1 million value compare to similar government contact center support contracts?

The $66.1 million value over two years, averaging $33 million annually, is within the expected range for large-scale government contact center and back-office support. Many federal agencies contract out similar services, with values often ranging from tens to hundreds of millions of dollars depending on the scope, number of users supported, and complexity of the programs. For instance, large IT service contracts or comprehensive citizen support centers can exceed this value significantly. This contract's value appears proportionate to its stated purpose of supporting 'non-servicing and specialty programs,' suggesting a focused but substantial operational requirement.

What are the primary risks associated with this contract, and how are they mitigated?

Key risks include potential performance failures in meeting the 90-day benchmark, scope creep in defining 'specialty programs,' and over-reliance on a single vendor. Mitigation strategies are embedded in the contract structure: the firm-fixed-price nature caps financial risk for the government, while the explicit 90-day performance benchmark allows for clear performance monitoring and potential remedies if unmet. The full and open competition process also mitigates vendor lock-in risk. Robust government oversight, clear statement of work, and defined deliverables are crucial for managing scope and performance.

How effective is the 90-day performance benchmark in ensuring service quality?

The 90-day performance benchmark is a critical tool for ensuring service quality, provided it is well-defined and measurable. It sets a clear expectation for the turnaround time or completion rate for specific tasks within the contact center and back-office operations. Its effectiveness hinges on the accuracy of the benchmark itself (is it realistic yet challenging?) and the government's ability to rigorously track and enforce it. If consistently met, it indicates efficient operations. If frequently missed, it signals potential issues with the contractor's processes, resources, or the complexity of the tasks, prompting corrective action.

What is the historical spending trend for similar services at the Department of Education?

Historical spending trends for similar services at the Department of Education would likely show a consistent need for contact center and back-office support, particularly related to student financial aid, program administration, and outreach. Agencies often consolidate or re-compete these services over time. Analyzing past contract awards for BPO, customer support, and financial processing within the Department would reveal patterns of spending, vendor consolidation, and shifts in service delivery models. This contract represents a continuation or evolution of such support needs.

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) › ADMINISTRATIVE 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: 298 N SEVEN OAKS DR K, KNOXVILLE, TN, 37922

Business Categories: Category Business, Limited Liability Corporation, Not Designated a Small Business, Partnership or Limited Liability Partnership, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $96,728,306

Exercised Options: $66,131,333

Current Obligation: $66,131,333

Actual Outlays: $36,874,589

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: 91003120D0001

IDV Type: IDC

Timeline