PBGC Spends $112M on Portfolio Management Services with Pacific Investment Management Company LLC

Contract Overview

Contract Amount: $112,439,174 ($112.4M)

Contractor: Pacific Investment Management Company LLC

Awarding Agency: Pension Benefit Guaranty Corporation

Start Date: 2016-04-01

End Date: 2026-09-30

Contract Duration: 3,834 days

Daily Burn Rate: $29.3K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 26

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: IGF::CT::IGF PORTFOLIO MANAGEMENT SERVICES

Place of Performance

Location: NEWPORT BEACH, ORANGE County, CALIFORNIA, 92660

State: California Government Spending

Plain-Language Summary

Pension Benefit Guaranty Corporation obligated $112.4 million to PACIFIC INVESTMENT MANAGEMENT COMPANY LLC for work described as: IGF::CT::IGF PORTFOLIO MANAGEMENT SERVICES Key points: 1. The contract awarded to Pacific Investment Management Company LLC totals $112.4 million. 2. The contract was awarded under full and open competition. 3. The contract duration is over 7 years, ending in September 2026. 4. The Pension Benefit Guaranty Corporation is the awarding agency. 5. The service category is Portfolio Management.

Value Assessment

Rating: good

The contract's fixed price structure provides cost certainty. Benchmarking against similar portfolio management contracts is difficult without more granular service details, but the overall value appears reasonable for a long-term, comprehensive service.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded through full and open competition, suggesting a robust price discovery process. This method typically leads to competitive pricing as multiple vendors can bid.

Taxpayer Impact: The competitive nature of the award is expected to yield fair pricing, maximizing taxpayer value for the services rendered.

Public Impact

Ensures professional management of pension fund assets, safeguarding beneficiaries' interests. Supports the financial stability of the Pension Benefit Guaranty Corporation. Provides essential services for managing complex investment portfolios.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Long contract duration may lead to price escalation if not managed.
Reliance on a single vendor for critical financial services.

Positive Signals

Awarded through full and open competition.
Firm fixed-price contract provides cost predictability.
Long-term engagement allows for specialized expertise development.

Sector Analysis

Portfolio management services are crucial for financial institutions and government agencies managing significant assets. Benchmarks for such services vary widely based on asset size, complexity, and service scope, but this contract appears to align with industry standards for comprehensive management.

Small Business Impact

The data does not indicate any specific provisions or participation by small businesses in this contract. Further analysis would be needed to determine if subcontracting opportunities were made available.

Oversight & Accountability

The contract is managed by the Pension Benefit Guaranty Corporation. Oversight would typically involve performance reviews, financial audits, and adherence to contractual terms to ensure accountability.

Related Government Programs

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

Risk Flags

Long contract duration.
Potential for vendor lock-in.
Reliance on a single provider for critical financial services.

Frequently Asked Questions

What is this federal contract paying for?

Pension Benefit Guaranty Corporation awarded $112.4 million to PACIFIC INVESTMENT MANAGEMENT COMPANY LLC. IGF::CT::IGF PORTFOLIO MANAGEMENT SERVICES

Who is the contractor on this award?

The obligated recipient is PACIFIC INVESTMENT MANAGEMENT COMPANY LLC.

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 $112.4 million.

What is the period of performance?

Start: 2016-04-01. End: 2026-09-30.

What specific performance metrics are used to evaluate the effectiveness of Pacific Investment Management Company LLC's portfolio management?

Performance metrics likely include investment returns against benchmarks, risk-adjusted returns, adherence to investment policies, and timely reporting. The contract's firm fixed-price nature suggests that the vendor is incentivized to meet these performance standards to ensure profitability, while the PBGC monitors these metrics to ensure fiduciary responsibility and asset protection.

What are the potential risks associated with a long-term (7+ year) contract for portfolio management services?

Long-term contracts can pose risks such as vendor lock-in, potential for price increases if market conditions change significantly, and the possibility of the vendor's expertise becoming outdated or less competitive over time. Mitigation strategies include regular performance reviews, clear contract clauses for adjustments, and contingency planning for vendor transition.

How does this contract contribute to the overall mission of the Pension Benefit Guaranty Corporation?

This contract directly supports the PBGC's mission by ensuring that its assets are professionally managed to meet its long-term obligations to pension plan participants. Effective portfolio management helps maintain the financial solvency of the PBGC, safeguarding retirement benefits for potentially millions of Americans.

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: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: PBGC01RP150008

Offers Received: 26

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 650 NEWPORT CENTER DRIVE, NEWPORT BEACH, CA, 92660

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

Financial Breakdown

Contract Ceiling: $112,439,174

Exercised Options: $112,439,174

Current Obligation: $112,439,174

Actual Outlays: $47,501,702

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Timeline