HHS Awarded $26.9M for Acyf and OHS Review Support Contract to LUX Consulting Group, Inc

Contract Overview

Contract Amount: $26,936,304 ($26.9M)

Contractor: LUX Consulting Group, Inc.

Awarding Agency: Department of Health and Human Services

Start Date: 2009-09-30

End Date: 2014-05-31

Contract Duration: 1,704 days

Daily Burn Rate: $15.8K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 8

Pricing Type: COST PLUS FIXED FEE

Sector: Other

Official Description: ACYF AND OHS REVIEW SUPPORT CONTRACT

Place of Performance

Location: SILVER SPRING, MONTGOMERY County, MARYLAND, 20910, UNITED STATES OF AMERICA

State: Maryland Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $26.9 million to LUX CONSULTING GROUP, INC. for work described as: ACYF AND OHS REVIEW SUPPORT CONTRACT Key points: 1. Contract awarded through full and open competition, suggesting a competitive bidding process. 2. The contract duration of 1704 days indicates a long-term need for these services. 3. The North American Industry Classification System (NAICS) code 541611 points to administrative management and general management consulting services. 4. The contract was awarded by the Department of Health and Human Services (HHS). 5. The contract type is Cost Plus Fixed Fee, which can lead to cost overruns if not managed carefully. 6. The contract was awarded in Maryland, indicating a potential geographic focus for service delivery.

Value Assessment

Rating: fair

The contract's value of $26.9 million over approximately 4.6 years suggests a significant investment in consulting services. Without specific benchmarks for 'ACYF AND OHS REVIEW SUPPORT CONTRACT' services, it's difficult to definitively assess value for money. The Cost Plus Fixed Fee (CPFF) contract type carries inherent risks of cost escalation compared to fixed-price contracts. However, CPFF can be appropriate for complex or undefined scopes where costs are hard to predict upfront. Further analysis would require comparing the per-unit cost of services rendered against similar contracts within HHS or other federal agencies.

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 implies that the initial solicitation was open to all responsible sources, but specific sources were later excluded. This suggests a potentially complex procurement history. The presence of 8 bidders indicates a reasonable level of competition, which generally benefits price discovery and can lead to more favorable terms for the government. However, the exclusion of sources warrants further investigation into the reasons behind it.

Taxpayer Impact: The competitive nature of the bidding process, with 8 bidders, likely resulted in a more competitive price for taxpayers than a sole-source award. The exclusion of sources, however, could potentially limit the breadth of competition and its downward pressure on price.

Public Impact

Beneficiaries include the Administration for Children, Youth and Families (ACYF) and the Office of Human Services (OHS) within HHS, who receive support for their review processes. Services delivered are administrative management and general management consulting, aimed at improving operational efficiency and effectiveness. The contract's geographic impact is likely concentrated in Maryland, where it was awarded and potentially where services are performed. Workforce implications may include the engagement of specialized consultants and potential impacts on internal HHS staff roles related to review and administration.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost Plus Fixed Fee contract type can incentivize contractor to increase costs to maximize profit.
The 'after exclusion of sources' clause in the competition type suggests potential limitations on the initial competitive landscape.
The contract duration of over 4 years may lead to vendor lock-in and reduced flexibility for the agency.

Positive Signals

Awarded through full and open competition, indicating a broad initial search for qualified contractors.
Multiple bidders (8) participated, suggesting a healthy level of interest and competition.
The contract is for administrative management and general management consulting, which can lead to efficiency gains for the agency.

Sector Analysis

The federal consulting services market is substantial, with agencies frequently procuring expertise in administrative management and general management to improve operations. This contract falls within the professional services sector, specifically management consulting. Benchmarks for similar contracts within HHS or across government for administrative support and review services would be necessary for a precise comparison. The total value of $26.9 million over its period places it as a significant, but not exceptionally large, federal consulting award.

Small Business Impact

The contract details do not indicate any specific small business set-aside provisions (ss: false, sb: false). This suggests that the procurement was not specifically targeted towards small businesses. Consequently, the primary contractor, LUX CONSULTING GROUP, INC., is likely a larger entity. There is no explicit information on subcontracting plans for small businesses, which means the direct impact on the small business ecosystem from this specific contract may be limited unless subcontracting opportunities arise organically.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of Health and Human Services' contracting and program management offices. The Inspector General's office for HHS would have jurisdiction to investigate potential fraud, waste, or abuse. Transparency is facilitated by contract databases like FPDS, which provide basic award details. However, the specific performance metrics, deliverables, and ongoing oversight activities are typically detailed in the contract's statement of work and internal agency reporting, which are not publicly available.

Related Government Programs

HHS Management and Administrative Support Contracts
Federal Consulting Services
Government Program Review Support
Office of Human Services Contracts
Administration for Children and Families Support

Risk Flags

Cost Plus Fixed Fee contract type may lead to cost overruns.
Competition 'after exclusion of sources' warrants further review of procurement fairness.
Long contract duration increases risk of vendor lock-in and reduced adaptability.

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $26.9 million to LUX CONSULTING GROUP, INC.. ACYF AND OHS REVIEW SUPPORT CONTRACT

Who is the contractor on this award?

The obligated recipient is LUX CONSULTING GROUP, INC..

Which agency awarded this contract?

Awarding agency: Department of Health and Human Services (Office of the Assistant Secretary for Administration).

What is the total obligated amount?

The obligated amount is $26.9 million.

What is the period of performance?

Start: 2009-09-30. End: 2014-05-31.

What is the specific nature of the 'ACYF AND OHS REVIEW SUPPORT' services provided under this contract?

The contract, identified by NAICS code 541611, is for 'Administrative Management and General Management Consulting Services.' This suggests that LUX CONSULTING GROUP, INC. provides expertise to help the Administration for Children, Youth and Families (ACYF) and the Office of Human Services (OHS) within HHS improve their administrative processes, operational efficiency, and management practices. This could encompass a wide range of activities, such as process optimization, strategic planning, organizational analysis, policy development support, and performance management consulting, all aimed at enhancing the effectiveness and efficiency of these specific offices within HHS.

How does the Cost Plus Fixed Fee (CPFF) contract type compare to other contract types in terms of risk and value for money?

Cost Plus Fixed Fee (CPFF) contracts reimburse the contractor for allowable costs incurred, plus a fixed fee representing profit. This type is often used when the scope of work is not well-defined or is expected to change significantly. While it offers flexibility, it carries a higher risk of cost overruns for the government compared to fixed-price contracts, as the contractor is incentivized to incur costs to achieve the fixed profit. Value for money can be harder to assess upfront. However, if managed with rigorous oversight and clear performance metrics, CPFF can be effective for complex projects where upfront cost estimation is impractical. It contrasts with Firm-Fixed-Price (FFP) contracts, where the price is set and the contractor bears cost risk, or Cost-Plus-Incentive-Fee (CPIF) contracts, which include incentives for meeting cost or performance targets.

What does 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES' imply about the procurement process?

This procurement term indicates a multi-stage process. Initially, the solicitation was open to all eligible and responsible sources ('Full and Open Competition'). However, at some point during the evaluation or pre-award phase, certain potential bidders were excluded from further consideration. The reasons for exclusion could range from failure to meet minimum qualifications, non-responsiveness to solicitation requirements, or specific agency decisions based on past performance or other factors. While the initial phase aimed for broad competition, the subsequent exclusion means the final award was made from a narrowed pool of bidders. This contrasts with a straightforward 'Full and Open Competition' where all initial bidders remain eligible throughout.

What is the typical performance expectation for a contract of this duration and value in administrative consulting?

For a contract valued at approximately $26.9 million over 1704 days (about 4.6 years), the performance expectations are substantial. The contractor, LUX CONSULTING GROUP, INC., would be expected to deliver consistent, high-quality consulting services that demonstrably improve the administrative and management functions of ACYF and OHS. This includes meeting defined milestones, achieving specific performance objectives outlined in the contract's statement of work, and adapting to evolving agency needs. Performance is typically measured through metrics related to efficiency gains, cost savings, improved process execution, and client satisfaction. Regular reporting, reviews, and potentially performance-based payments would be integral to managing and assessing performance over this extended period.

Are there any indications of potential cost overruns or inefficiencies given the contract type and duration?

The Cost Plus Fixed Fee (CPFF) contract type inherently carries a risk of cost overruns because the contractor is reimbursed for all allowable costs plus a fixed profit. If the agency's oversight is not robust, or if the scope of work expands without adequate controls, costs can escalate beyond initial projections. The contract's duration of over four years also increases the potential for cost creep due to inflation, changes in labor rates, or evolving project requirements. While the fixed fee provides some predictability for the contractor's profit, the total cost to the government remains variable. Vigilant monitoring of expenditures, rigorous auditing of costs, and strict change control processes are crucial to mitigate these risks.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Management, Scientific, and Technical Consulting Services › Administrative Management and General Management Consulting Services

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

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 8

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Address: 8455 COLESVILLE RD STE 930, SILVER SPRING, MD, 20910

Business Categories: 8(a) Program Participant, Black American Owned Business, Category Business, Corporate Entity Not Tax Exempt, HUBZone Firm, Minority Owned Business, Self-Certified Small Disadvantaged Business, Small Business, Small Disadvantaged Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $33,260,464

Exercised Options: $26,936,304

Current Obligation: $26,936,304

Timeline