The Federal Retirement Thrift Investment Board announced a five-year, $18.1 million contract Monday that will establish a Thrift Savings Plan call center in southwestern Virginia.
SI International, a Virginia-based technology systems company, was awarded the contract to operate the call center in Clintwood, Va., according to Thrift board officials. The contract is currently being handled by the National Finance Center, a government agency run by the Agriculture Department, in New Orleans. NFC will no longer handle call center work for the Thrift plan, but the facility will still be responsible for other administrative tasks, including data entry and accounting. TSP Executive Director Gary Amelio said the NFC call center work costs the Thrift plan $12.5 million annually to operate.
"We are going to save the plan's participants $40 million over five years," Amelio said. "And I have no doubt the service levels will be superior as well."
TSP-which serves as a 401(k)-style plan for federal employees-has 3.5 million participants and more than $150 billion in assets. It previously awarded a contract for a parallel call center in Maryland. TSP officials have praised the Maryland facility, but some plan participants have expressed concerns about their personal and financial information being handled by a private contractor.
Thrift board members have pressed staff to seek greater savings and efficiencies. Board Chairman Andrew Saul lauded the most recent contract.
The Clintwood call center was previously used by Internet travel broker Travelocity, which closed it in late 2004 in an attempt to reverse poor financial fortunes. Saul said the community needed an employer and TSP found a great deal.
"It is a win-win situation," Saul said. "We have a very reliable partner down there."
On top of the $18.1 million contract, TSP officials will also spend up to $500,000 upfront to purchase existing equipment. Still, Thrift staff members said the plan is coming out ahead in the deal.
The new call center should be up and running in about two months. Amelio said Travelocity left an experienced and eager workforce in place.
"There is already a highly trained nucleus," he told the Thrift board. "We happened to be at the right place at the right time and got an incredible deal."
"We couldn't have found a better building," said Mark Hagerty, the incoming director for automated systems at the Thrift plan.