DOT's FAA awarded $16.1M for accounting services, with a follow-on to a competed action

Contract Overview

Contract Amount: $16,091,295 ($16.1M)

Contractor: AMC Systems Inc

Awarding Agency: Department of Transportation

Start Date: 2009-05-04

End Date: 2010-02-28

Contract Duration: 300 days

Daily Burn Rate: $53.6K/day

Competition Type: FOLLOW ON TO COMPETED ACTION

Number of Offers Received: 3

Pricing Type: LABOR HOURS

Sector: Other

Official Description: SERVICES - NON-PERSONNAL: LABOR - ESTIMATED COST. LABOR SHALL BE INVOICED ON A MONTHLY BASIS. CONTRACTOR'S INVOICE SHALL SHOW TOTAL DOLLAR AMOUNT DUE FOR THE MONTH. THE INVOICE DETAIL SHALL SUPPORT THE MONTLY AMOUNT DUE BASED ON HOURS USED ON LABOR RATES IN SECTION B OF ORIGINAL CONTRACT.

Place of Performance

Location: OKLAHOMA CITY, OKLAHOMA County, OKLAHOMA, 73116

State: Oklahoma Government Spending

Plain-Language Summary

Department of Transportation obligated $16.1 million to AMC SYSTEMS INC for work described as: SERVICES - NON-PERSONNAL: LABOR - ESTIMATED COST. LABOR SHALL BE INVOICED ON A MONTHLY BASIS. CONTRACTOR'S INVOICE SHALL SHOW TOTAL DOLLAR AMOUNT DUE FOR THE MONTH. THE INVOICE DETAIL SHALL SUPPORT THE MONTLY AMOUNT DUE BASED ON HOURS USED ON LABOR RATES IN SECTION B OF ORI… Key points: 1. The contract focuses on labor costs for accounting services, with invoicing tied to hours and rates. 2. The estimated cost of $16.1 million suggests a significant need for accounting support within the FAA. 3. The contract is a follow-on to a previously competed action, indicating a potential for established performance. 4. The duration of 300 days suggests a project or service period of approximately 10 months. 5. The contract was awarded to AMC SYSTEMS INC, a single entity for service delivery. 6. The North American Industry Classification System (NAICS) code 541211 points to certified public accounting services.

Value Assessment

Rating: fair

The contract's value of $16.1 million for accounting services over approximately 10 months appears substantial. Benchmarking against similar government contracts for accounting services would be necessary to determine if this represents good value for money. The pricing structure, based on labor hours and rates, is standard but requires careful monitoring to ensure efficiency and prevent cost overruns. Without specific performance metrics or comparisons to private sector accounting costs, a definitive value assessment is challenging.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract is described as a 'FOLLOW ON TO COMPETED ACTION,' implying that the original contract was subject to full and open competition. This suggests that multiple bidders likely participated in the initial award, fostering price discovery and potentially leading to competitive pricing. The follow-on nature indicates that the FAA may have been satisfied with the initial awardee's performance, but it's crucial to understand if the follow-on itself was also competed or if it was a sole-source extension based on the prior competition.

Taxpayer Impact: A competed original action generally benefits taxpayers by ensuring a competitive marketplace drives down prices. The follow-on status, if it maintained competitive elements, would continue this benefit. However, if the follow-on was not re-competed, taxpayers might not be receiving the most current competitive pricing.

Public Impact

The Federal Aviation Administration (FAA) is the primary beneficiary, receiving essential accounting and financial management support. The services delivered are focused on labor costs for accounting, likely supporting financial reporting, auditing, or budgeting functions. The geographic impact is centered around the FAA's operational areas, though the specific locations are not detailed. Workforce implications are primarily for the contractor, AMC SYSTEMS INC, who will provide the labor for these accounting services.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost creep if labor hours or rates are not strictly managed.
Dependence on a single contractor for critical accounting functions.
Lack of detailed performance metrics makes it difficult to assess efficiency beyond cost.
The 'follow-on' nature could imply less competitive pressure if not re-competed.

Positive Signals

The contract is a follow-on to a competed action, suggesting a potentially stable and proven relationship.
The invoicing mechanism tied to hours and rates provides a degree of transparency in billing.
The contract is awarded to a single entity, simplifying management and accountability.
The estimated cost is clearly defined, providing a budget ceiling for the services.

Sector Analysis

This contract falls within the professional, scientific, and technical services sector, specifically accounting services. The market for government accounting services is substantial, with agencies like the FAA requiring consistent financial expertise. Comparable spending benchmarks would involve analyzing other federal contracts for similar accounting support, considering the size of the agency and the complexity of its financial operations. The NAICS code 541211 indicates a focus on certified public accounting firms.

Small Business Impact

The data indicates this contract was not set aside for small businesses (ss: false, sb: false). Therefore, the primary contractor, AMC SYSTEMS INC, is likely a larger entity. There is no explicit information regarding subcontracting plans for small businesses. The absence of a small business set-aside suggests that the competition was open to all qualified offerors, and the focus was on the best value regardless of business size. This may limit direct opportunities for small businesses to participate in this specific contract.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and the FAA's program office responsible for financial management. Performance monitoring would likely involve reviewing monthly invoices against contracted labor rates and hours, ensuring compliance with contract terms. Transparency is provided through the contract's public award data, but detailed internal oversight mechanisms and inspector general jurisdiction are not specified in this data snippet.

Related Government Programs

Federal Financial Management Services
Government Accounting and Auditing Contracts
Department of Transportation Financial Operations
Federal Aviation Administration Financial Services

Risk Flags

Potential for cost overruns due to labor-hour based contract.
Lack of detailed performance metrics.
Follow-on action may not have undergone recent competitive bidding.
Limited transparency on specific accounting services provided.

Frequently Asked Questions

What is this federal contract paying for?

Department of Transportation awarded $16.1 million to AMC SYSTEMS INC. SERVICES - NON-PERSONNAL: LABOR - ESTIMATED COST. LABOR SHALL BE INVOICED ON A MONTHLY BASIS. CONTRACTOR'S INVOICE SHALL SHOW TOTAL DOLLAR AMOUNT DUE FOR THE MONTH. THE INVOICE DETAIL SHALL SUPPORT THE MONTLY AMOUNT DUE BASED ON HOURS USED ON LABOR RATES IN SECTION B OF ORIGINAL CONTRACT.

Who is the contractor on this award?

The obligated recipient is AMC SYSTEMS INC.

Which agency awarded this contract?

Awarding agency: Department of Transportation (Federal Aviation Administration).

What is the total obligated amount?

The obligated amount is $16.1 million.

What is the period of performance?

Start: 2009-05-04. End: 2010-02-28.

What specific accounting functions does this contract support within the FAA?

The provided data indicates the contract is for 'SERVICES - NON-PERSONNAL: LABOR - ESTIMATED COST' and specifies that 'LABOR SHALL BE INVOICED ON A MONTHLY BASIS' based on 'HOURS USED ON LABOR RATES IN SECTION B OF ORIGINAL CONTRACT.' While the NAICS code 541211 points to 'Offices of Certified Public Accountants,' the exact nature of the services is not detailed. It could encompass a range of activities such as financial statement preparation, auditing support, budget analysis, accounting system maintenance, or compliance reporting. The focus on labor hours suggests a service-intensive engagement rather than a product delivery.

How does the $16.1 million estimated cost compare to similar FAA accounting contracts?

Benchmarking the $16.1 million estimated cost requires access to a broader dataset of FAA contracts for accounting services, ideally with similar durations and scopes. Without such comparative data, it's difficult to definitively state whether this represents a high, low, or average cost. Factors influencing cost include the complexity of FAA's financial operations, the specific expertise required (e.g., specialized aviation finance), and the prevailing market rates for accounting labor. The contract's duration of approximately 10 months (300 days) is a key factor in this valuation.

What are the primary risks associated with this contract for the FAA?

The primary risks for the FAA revolve around cost control and performance. Since the contract is based on labor hours and rates, there's a risk of cost overruns if hours are not efficiently utilized or if labor rates escalate beyond expectations. Performance risk exists if the contractor, AMC SYSTEMS INC, fails to deliver the required accounting services accurately and on time, potentially impacting the FAA's financial reporting and compliance. As a follow-on to a competed action, there might be a risk of complacency or reduced competitive pressure if the follow-on was not re-competed, potentially leading to less favorable terms over time.

What does the 'FOLLOW ON TO COMPETED ACTION' status imply about contractor performance?

The 'FOLLOW ON TO COMPETED ACTION' status suggests that the original contract was awarded through a competitive process, implying that AMC SYSTEMS INC was selected based on merit and price against other bidders. A follow-on award typically indicates that the FAA was satisfied with the contractor's performance on the initial contract, leading to an extension or a new contract for similar services. However, it's important to ascertain whether this follow-on itself was competed or awarded sole-source. If it was sole-source, it implies a level of trust and established working relationship, but potentially less current price competition.

What is the significance of the NAICS code 541211 for this contract?

The North American Industry Classification System (NAICS) code 541211 signifies that the primary service being procured falls under 'Offices of Certified Public Accountants.' This code narrows the scope of the contract to professional accounting services typically rendered by firms that offer auditing, tax preparation, bookkeeping, and advisory services. For the FAA, this means they are engaging a specialized firm to handle specific financial and accounting functions, ensuring adherence to professional standards and regulatory requirements within the accounting domain.

Are there any indications of potential cost savings or efficiencies achieved through this contract?

The provided data does not contain explicit information on cost savings or efficiencies achieved. The contract structure focuses on estimated labor costs based on hours and rates, with monthly invoicing. While this provides a clear billing mechanism, it doesn't inherently guarantee savings. Efficiencies would depend on the contractor's ability to perform the required accounting tasks within the estimated hours and at the agreed-upon rates. Without performance metrics, post-award reviews, or comparisons to baseline costs, assessing achieved efficiencies is not possible from this data alone.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Accounting, Tax Preparation, Bookkeeping, and Payroll Services › Offices of Certified Public Accountants

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

Competition & Pricing

Extent Competed: FOLLOW ON TO COMPETED ACTION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 3

Pricing Type: LABOR HOURS (Z)

Evaluated Preference: NONE

Contractor Details

Address: 1000 W WILSHIRE BLVD STE 365, OKLAHOMA CITY, OK, 90

Business Categories: 8(a) Program Participant, Asian Pacific American Owned Business, Category Business, Corporate Entity Not Tax Exempt, Federally Funded Research and Development Corp, Minority Owned Business, Not Designated a Small Business, Self-Certified Small Disadvantaged Business, Small Business, Special Designations, Woman Owned Business

Financial Breakdown

Contract Ceiling: $52,057,135

Exercised Options: $51,738,418

Current Obligation: $16,091,295

Parent Contract

Parent Award PIID: DTFAAC09D00057

IDV Type: IDC

Timeline