VA awards $22M contract for administrative management consulting, with 2 bidders

Contract Overview

Contract Amount: $21,999,120 ($22.0M)

Contractor: Pacific Institute for Research & Evaluation

Awarding Agency: Department of Veterans Affairs

Start Date: 2015-09-30

End Date: 2020-09-29

Contract Duration: 1,826 days

Daily Burn Rate: $12.0K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: IGF::OT::IGF

Place of Performance

Location: BELTSVILLE, PRINCE GEORGES County, MARYLAND, 20705

State: Maryland Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $22.0 million to PACIFIC INSTITUTE FOR RESEARCH & EVALUATION for work described as: IGF::OT::IGF Key points: 1. Contract value of $22 million over five years suggests a significant investment in administrative support. 2. The limited competition, with only two bidders, may indicate a specialized service or a concentrated market. 3. A firm-fixed-price contract type generally transfers risk to the contractor, potentially stabilizing costs. 4. The contract duration of 1826 days (5 years) allows for long-term planning and sustained support. 5. The North American Industry Classification System (NAICS) code 541611 points to a focus on management consulting services. 6. The award was made by the Department of Veterans Affairs, indicating a need for administrative expertise within the agency.

Value Assessment

Rating: fair

The contract value of approximately $22 million over five years for administrative management consulting services appears to be within a reasonable range for a federal agency of the VA's size. Benchmarking against similar contracts for management consulting services would provide a clearer picture of value for money. The firm-fixed-price structure is a positive indicator for cost control, but the actual value depends on the quality and effectiveness of the services delivered. Without specific performance metrics or comparisons to private sector rates for comparable services, a definitive value assessment is challenging.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, which is generally the preferred method for ensuring the widest possible access to potential contractors. However, with only two bidders, the level of competition was limited. This could suggest that the specific requirements of the contract were highly specialized, or that the market for such services is relatively small. A low number of bidders can sometimes lead to less competitive pricing, although the firm-fixed-price structure aims to mitigate this.

Taxpayer Impact: While full and open competition was utilized, the low number of bidders means taxpayers may not have benefited from the most aggressive pricing possible. Further analysis would be needed to determine if the pricing reflects a fair market value given the limited competition.

Public Impact

The primary beneficiary of this contract is the Department of Veterans Affairs, which receives administrative management and general management consulting services. These services are intended to improve the efficiency and effectiveness of the VA's operations. The geographic impact is likely concentrated within the VA facilities or offices where the consulting services are applied, potentially across various states. Workforce implications could include the engagement of specialized consultants and potential internal staff training or process improvements within the VA.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Limited competition with only two bidders could indicate potential market concentration or barriers to entry for other firms.
The effectiveness of the consulting services in achieving desired administrative improvements is not explicitly detailed.
The specific deliverables and performance metrics are not provided, making it difficult to assess the contractor's track record on this specific award.

Positive Signals

The contract was awarded under full and open competition, adhering to federal procurement principles.
The firm-fixed-price contract type provides cost certainty for the government.
The contract duration of five years allows for sustained support and potential for long-term strategic improvements.

Sector Analysis

Administrative Management and General Management Consulting Services (NAICS 541611) represent a significant segment of the professional services market. Federal agencies frequently procure these services to enhance operational efficiency, implement new strategies, and manage complex programs. The total federal spending on management consulting is substantial, with agencies like the VA being major consumers due to their large scale and intricate operational needs. This contract fits within the broader category of professional services supporting government administration.

Small Business Impact

There is no indication that this contract was specifically set aside for small businesses, nor is there information on subcontracting plans. Given the nature of management consulting and the contract value, it is possible that larger firms were the primary participants. Further investigation would be needed to determine if small businesses had opportunities to participate either as prime contractors or subcontractors.

Oversight & Accountability

Oversight for this contract would typically fall under the purview of the Department of Veterans Affairs' contracting officers and program managers. Inspector General oversight may also be applicable, particularly concerning potential fraud, waste, or abuse. Transparency is generally maintained through contract award databases, but detailed performance reviews and specific oversight activities are often internal to the agency.

Related Government Programs

Management and Management Consulting Services
Professional Services Contracts
Department of Veterans Affairs Administrative Support

Risk Flags

Limited Competition
Potential for Undefined Scope in FFP Contract

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $22.0 million to PACIFIC INSTITUTE FOR RESEARCH & EVALUATION. IGF::OT::IGF

Who is the contractor on this award?

The obligated recipient is PACIFIC INSTITUTE FOR RESEARCH & EVALUATION.

Which agency awarded this contract?

Awarding agency: Department of Veterans Affairs (Department of Veterans Affairs).

What is the total obligated amount?

The obligated amount is $22.0 million.

What is the period of performance?

Start: 2015-09-30. End: 2020-09-29.

What specific administrative challenges was the VA seeking to address with this contract?

The provided data indicates the contract is for 'Administrative Management and General Management Consulting Services' (NAICS 541611) awarded to the PACIFIC INSTITUTE FOR RESEARCH & EVALUATION. While the specific administrative challenges are not detailed in the summary data, contracts of this nature typically aim to improve operational efficiency, streamline processes, enhance organizational structure, develop strategic plans, or implement new management systems. Given the awardee's name, it's plausible the VA sought expertise in research-informed management strategies or program evaluation to address complex administrative issues within the department. Further review of the contract's statement of work would be necessary to identify the precise objectives and challenges.

How does the awarded amount of $22 million compare to typical spending on similar consulting services by the VA or other large federal agencies?

The $22 million awarded over five years equates to an average annual value of $4.4 million. This figure is substantial but falls within the expected range for major federal agencies like the Department of Veterans Affairs, which manage extensive operations and require significant administrative support. Large-scale consulting engagements for strategic planning, organizational reform, or system implementation can easily reach these figures. Benchmarking against contracts for similar NAICS codes (541611) across agencies like HHS, DoD, or GSA would provide a more precise comparison. However, without access to detailed contract databases filtered by specific service types and agency size, a definitive comparison is difficult. The firm-fixed-price nature suggests a defined scope, which can influence overall cost compared to cost-plus contracts.

What are the potential risks associated with a contract having only two bidders, even if competed under 'full and open' terms?

A contract with only two bidders, even under full and open competition, presents several potential risks. Firstly, it suggests limited market availability or high barriers to entry for other qualified firms, which could mean the government is not benefiting from the full spectrum of potential solutions or innovations. Secondly, with fewer competitors, the pricing power shifts, and the government might not achieve the most cost-effective outcome. There's a risk that the two bidders may have had prior knowledge or established relationships that influenced their proposals. Lastly, if one of the bidders withdraws or fails to perform, the government has very limited alternative options, increasing program risk and potentially leading to delays or increased costs to find a replacement.

What is the track record of the PACIFIC INSTITUTE FOR RESEARCH & EVALUATION in delivering similar administrative consulting services to the federal government?

The provided data identifies the PACIFIC INSTITUTE FOR RESEARCH & EVALUATION (PIRE) as the contractor. To assess their track record, one would need to examine their past performance on federal contracts, particularly those related to administrative management and general management consulting (NAICS 541611). This would involve reviewing contract databases for previous awards, performance evaluations (e.g., Contractor Performance Assessment Reporting System - CPARS), and any documented successes or failures. Without this specific performance history, it's difficult to ascertain their reliability and effectiveness in delivering similar services. PIRE's name suggests a potential focus on research and evaluation, which could be a strength for analytical consulting but requires verification against their actual project history.

How does the firm-fixed-price (FFP) contract type influence the risk and value proposition for the VA in this scenario?

The firm-fixed-price (FFP) contract type is generally advantageous for the VA as it shifts the primary risk of cost overruns to the contractor, PACIFIC INSTITUTE FOR RESEARCH & EVALUATION. This provides budget certainty and predictability, making financial planning more straightforward. The value proposition lies in receiving the defined scope of services at a predetermined price. However, the success of an FFP contract hinges on a well-defined Statement of Work (SOW). If the SOW is ambiguous or incomplete, the contractor may deliver less than expected, or disputes may arise. Conversely, if the contractor is highly efficient, they retain any cost savings, which is a benefit to them but means the VA might be paying a premium if the contractor's actual costs are significantly lower than anticipated. The VA's value is maximized when the FFP price accurately reflects a fair market rate for the specified services and quality.

Industry Classification

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

Product/Service Code: EDUCATION AND TRAINING › EDUCATION AND TRAINING SERVICES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 2

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 11720 BELTSVILLE DR STE 900, BELTSVILLE, MD, 20705

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

Financial Breakdown

Contract Ceiling: $25,635,036

Exercised Options: $21,999,120

Current Obligation: $21,999,120

Subaward Activity

Number of Subawards: 12

Total Subaward Amount: $8,099,940

Contract Characteristics

Commercial Item: COMMERCIAL ITEM

Parent Contract

Parent Award PIID: GS10F0128R

IDV Type: FSS

Timeline