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U.S. Department Of Education, Office Of Federal Student Aid, Awards MAXIMUS A Contract To Help Administer The Defaulted Student Loan Debt Program

Stocks in this article: MMS

MAXIMUS (NYSE:MMS), a leading provider of health and human services worldwide, announced today that its MAXIMUS Federal Services subsidiary has signed a new contract with the U.S. Department of Education, Office of Federal Student Aid (FSA), to provide Operation and Maintenance support for the Debt Management and Collections System (DMCS). The contract has an approximate two-year and three month base period valued at approximately $143.3 million and eight one-year option periods. Based on estimated volumes, the total contract value is expected to be approximately $848.4 million if all options are exercised. The base contract will begin on September 30, 2013 and will run through December 31, 2015.

FSA is the largest provider of student financial aid in the nation, providing more than $150 billion in federal grants, loans and work-study funds each year to more than 15 million students paying for college or career school. A critical role of FSA is managing the outstanding federal student loan portfolio and securing repayment from federal student loan borrowers. FSA utilizes the DMCS to support this important role.

Under the contract, MAXIMUS will provide a wide range of citizen-centric administrative business functions including an in-bound customer contact center to respond to inquiries from borrowers and various third parties. The Company’s comprehensive solution also includes the operation of an intake facility for correspondence, collateral and other hard-copy materials, a correspondence unit to respond to borrowers’ inquiries, a financial transaction processing center, and a mail fulfillment center.

Thomas Romeo, President of MAXIMUS Federal Services commented, “We are very excited about this new contract to support FSA in their mission of helping Americans who are struggling with their student loan debt. MAXIMUS is a trusted partner for operating government programs and providing friendly and reliable citizen services and assistance. We bring many years of experience to FSA as we expand our federal operations into new agencies that will benefit from the core competencies we’ve developed over decades of working with our government partners.”

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