PBGC's $23M Pension Management Contract Awarded to GM Investment Management Corp

Contract Overview

Contract Amount: $22,972,864 ($23.0M)

Contractor: General Motors Investment Management Corp

Awarding Agency: Pension Benefit Guaranty Corporation

Start Date: 2010-10-01

End Date: 2016-03-31

Contract Duration: 2,008 days

Daily Burn Rate: $11.4K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: CFO/CID

Place of Performance

Location: NEW YORK, NEW YORK County, NEW YORK, 10153

State: New York Government Spending

Plain-Language Summary

Pension Benefit Guaranty Corporation obligated $23.0 million to GENERAL MOTORS INVESTMENT MANAGEMENT CORP for work described as: CFO/CID Key points: 1. The contract value is $22.97 million. 2. This was a sole-source award, indicating limited competition. 3. The contract duration spans over 5 years. 4. The sector is financial services, specifically portfolio management.

Value Assessment

Rating: questionable

The contract value of $22.97 million for portfolio management over 5 years appears high without competitive benchmarking. The lack of competition makes it difficult to assess if the pricing is fair or if a better deal could have been secured.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

The contract was awarded on a sole-source basis, meaning there was no open competition. This significantly limits price discovery and may lead to higher costs for taxpayers.

Taxpayer Impact: The lack of competition in this sole-source award raises concerns about potential overspending of taxpayer funds.

Public Impact

Taxpayers may be paying a premium due to the absence of competitive bidding. The PBGC's fiduciary responsibility to manage assets efficiently is tested by this non-competitive award. Transparency in government contracting is reduced when sole-source awards are utilized.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits competition and price discovery.
Potential for overpayment due to lack of competitive pricing.
Contract duration is lengthy, increasing risk over time.

Positive Signals

Contract awarded to a well-known entity (GM Investment Management).
Fixed-price contract provides some cost certainty.

Sector Analysis

This contract falls within the financial services sector, specifically portfolio management. Government spending in this area often involves managing large asset pools, and competitive bidding is crucial to ensure cost-effectiveness.

Small Business Impact

There is no indication that small businesses were involved in this sole-source award, which is typical for specialized financial management services.

Oversight & Accountability

The sole-source nature of this award warrants scrutiny to ensure the PBGC adequately justified the lack of competition and obtained fair value for taxpayer money.

Related Government Programs

Portfolio Management
Pension Benefit Guaranty Corporation Contracting
Pension Benefit Guaranty Corporation Programs

Risk Flags

Sole-source award
Lack of competitive pricing
Potential for overpayment
Long contract duration
Limited transparency

Frequently Asked Questions

What is this federal contract paying for?

Pension Benefit Guaranty Corporation awarded $23.0 million to GENERAL MOTORS INVESTMENT MANAGEMENT CORP. CFO/CID

Who is the contractor on this award?

The obligated recipient is GENERAL MOTORS INVESTMENT MANAGEMENT CORP.

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 $23.0 million.

What is the period of performance?

Start: 2010-10-01. End: 2016-03-31.

What was the justification for awarding this contract on a sole-source basis instead of seeking competitive bids?

The justification for a sole-source award typically involves unique capabilities, urgent needs, or a lack of available alternatives. Without specific documentation from the PBGC, it's impossible to determine the exact reasoning. However, such awards often raise questions about whether a more competitive process could have yielded better pricing or a wider range of qualified providers.

How does the per-unit cost of this portfolio management contract compare to industry benchmarks for similar services?

Benchmarking the per-unit cost is challenging without knowing the specific services rendered and the assets under management. However, given the $22.97 million value over five years and the absence of competition, it is reasonable to question whether the pricing aligns with market rates. A competitive process would have provided a clearer benchmark.

What measures are in place to ensure the effectiveness and accountability of GM Investment Management Corp. in managing PBGC's pension assets under this contract?

While the contract is fixed-price, effectiveness relies on performance metrics and oversight. The PBGC should have established clear deliverables, reporting requirements, and performance standards. Regular reviews and audits would be essential to ensure the contractor is meeting its obligations and that PBGC's assets are being managed prudently and effectively.

Industry Classification

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

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

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: PBGC01-RP-10-0020

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: General Motors Company (UEI: 832447812)

Address: 767 FIFTH AVENUE, NEW YORK, NY, 10153

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

Financial Breakdown

Contract Ceiling: $22,972,864

Exercised Options: $22,972,864

Current Obligation: $22,972,864

Contract Characteristics

Multi-Year Contract: Yes

Commercial Item: COMMERCIAL ITEM

Timeline