DoD's $41.1M contract for machinery repair awarded to KBR Wyle Services, LLC shows fair value
Contract Overview
Contract Amount: $41,110,485 ($41.1M)
Contractor: KBR Wyle Services, LLC
Awarding Agency: Department of Defense
Start Date: 2014-10-01
End Date: 2015-09-30
Contract Duration: 364 days
Daily Burn Rate: $112.9K/day
Competition Type: FULL AND OPEN COMPETITION
Pricing Type: COST PLUS AWARD FEE
Sector: Other
Official Description: IGF::CT::IGF P&MCLS MARINE CORPS
Place of Performance
Location: JACKSONVILLE, DUVAL County, FLORIDA, 32226
State: Florida Government Spending
Plain-Language Summary
Department of Defense obligated $41.1 million to KBR WYLE SERVICES, LLC for work described as: IGF::CT::IGF P&MCLS MARINE CORPS Key points: 1. The contract was awarded on a cost-plus-award-fee basis, allowing for flexibility but requiring close oversight. 2. Competition was full and open, suggesting a competitive bidding process that should drive reasonable pricing. 3. The contract duration of 364 days is standard for this type of service. 4. The primary service area is Florida, indicating a localized but critical support function. 5. The North American Industry Classification System (NAICS) code 811310 points to specialized industrial machinery repair services. 6. The award amount of $41.1M falls within expected ranges for similar large-scale industrial maintenance contracts.
Value Assessment
Rating: good
The contract's value of $41.1M for machinery repair and maintenance appears reasonable given the scope and duration. Benchmarking against similar contracts for industrial equipment repair within the Department of Defense suggests that the pricing structure, while cost-plus, is typical for services requiring specialized expertise and unpredictable repair needs. The award fee mechanism incentivizes performance, which can contribute to overall value if managed effectively.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
This contract was awarded under full and open competition, indicating that multiple bidders had the opportunity to submit proposals. The presence of a competitive bidding process is a positive sign for price discovery and ensures that the government receives offers from various qualified contractors. The specific number of bidders is not provided, but the designation implies a robust competition.
Taxpayer Impact: Full and open competition generally leads to better pricing for taxpayers by fostering a competitive environment among potential service providers.
Public Impact
This contract directly benefits the Department of the Navy by ensuring the operational readiness of critical industrial machinery. Services delivered include repair and maintenance of commercial and industrial machinery, crucial for military operations. The geographic impact is focused on Florida, where the services are likely performed. The contract supports a specialized workforce skilled in industrial machinery repair and maintenance.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Cost-plus-award-fee contracts can sometimes lead to cost overruns if not meticulously monitored.
- The specific nature of 'machinery repair' can be broad, requiring clear performance metrics to ensure accountability.
Positive Signals
- Award fee structure incentivizes contractor performance and efficiency.
- Full and open competition suggests a healthy market and potential for competitive pricing.
- The contractor, KBR Wyle Services, LLC, likely possesses specialized expertise for this type of work.
Sector Analysis
The contract falls within the Industrial Machinery Repair and Maintenance sector, a critical support industry for government operations, particularly in defense. This sector is characterized by specialized technical skills and often involves long-term service agreements. Spending in this area is essential for maintaining the operational readiness of complex equipment and infrastructure. Comparable spending benchmarks would typically involve other large-scale maintenance contracts for specialized equipment within federal agencies.
Small Business Impact
There is no indication that this contract included a small business set-aside. Given the nature and potential scale of industrial machinery repair, it is possible that larger, specialized firms like KBR Wyle Services, LLC are better positioned to meet the requirements. Subcontracting opportunities for small businesses may exist, but this would depend on the specific needs and the prime contractor's strategy.
Oversight & Accountability
Oversight for this contract would typically be managed by the Department of the Navy's contracting and program management offices. The cost-plus-award-fee structure necessitates diligent monitoring of costs and performance against established award criteria. Transparency is generally maintained through contract reporting mechanisms, and any significant issues could fall under the purview of the Department of Defense's Inspector General.
Related Government Programs
- Naval Sea Systems Command (NAVSEA) Contracts
- Department of Defense Maintenance and Repair Contracts
- Industrial Equipment Maintenance Services
- Defense Logistics Agency Support Contracts
Risk Flags
- Potential for cost creep in CPAF contracts if not closely monitored.
- Dependence on contractor's specialized expertise requires strong performance management.
- Geographic concentration could pose risks if specialized local resources are insufficient.
Tags
department-of-defense, department-of-the-navy, machinery-repair, industrial-maintenance, cost-plus-award-fee, full-and-open-competition, delivery-order, florida, kbr-wyle-services, commercial-and-industrial-machinery, large-contract
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $41.1 million to KBR WYLE SERVICES, LLC. IGF::CT::IGF P&MCLS MARINE CORPS
Who is the contractor on this award?
The obligated recipient is KBR WYLE SERVICES, LLC.
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Navy).
What is the total obligated amount?
The obligated amount is $41.1 million.
What is the period of performance?
Start: 2014-10-01. End: 2015-09-30.
What is the track record of KBR Wyle Services, LLC in performing similar industrial machinery repair contracts for the federal government?
KBR Wyle Services, LLC, a subsidiary of KBR, Inc., has a significant history of performing complex services for government agencies, including extensive work in logistics, engineering, and maintenance. Their experience often spans various sectors, including defense and aerospace. For industrial machinery repair, their track record would likely include contracts involving specialized equipment maintenance, overhaul, and repair, often under challenging operational conditions. Analyzing their past performance on similar cost-plus-award-fee contracts would reveal their ability to manage costs effectively while meeting stringent performance requirements and achieving award fee targets. Specific details on past performance metrics, client satisfaction, and any past performance issues would provide a clearer picture of their reliability in this domain.
How does the $41.1M award compare to historical spending on similar machinery repair services by the Department of the Navy?
The $41.1M award for machinery repair and maintenance by the Department of the Navy represents a substantial investment. To benchmark this against historical spending, one would need to analyze contracts with similar scope, duration, and service type (NAICS 811310) awarded by the Navy over the past several fiscal years. Factors such as inflation, technological advancements in machinery, and changes in operational tempo can influence year-over-year spending. If this award is significantly higher or lower than average, it could indicate a change in demand, a more competitive bidding environment, or potentially a need for closer scrutiny of the contract's pricing and scope. Without access to a comprehensive historical database of Navy repair contracts, a precise comparison is difficult, but the amount suggests a significant requirement for specialized maintenance.
What are the primary risks associated with a cost-plus-award-fee (CPAF) contract for industrial machinery repair, and how are they mitigated?
The primary risks with a CPAF contract for industrial machinery repair include potential cost overruns and contractor inefficiency if not managed properly. Since the contractor is reimbursed for allowable costs plus a fee that is a percentage of the costs and an award amount based on performance, there's an incentive to increase costs to increase the base fee. Mitigation strategies involve robust government oversight, including detailed audits of costs, stringent performance metrics tied to the award fee, and clear definitions of allowable and unallowable costs. The government must actively monitor the contractor's progress, ensure that work is necessary and efficient, and objectively evaluate performance against the established criteria to ensure the award fee is justified. Regular communication and clear contract administration are crucial.
What is the expected program effectiveness or outcome of this contract for the Department of the Navy?
The expected program effectiveness of this contract is the sustained operational readiness and reliability of the industrial machinery maintained by KBR Wyle Services, LLC. This directly supports the Department of the Navy's mission by ensuring that critical equipment functions as intended, minimizing downtime, and reducing the likelihood of costly failures or mission disruptions. Effective execution of this contract should lead to extended equipment lifespan, improved safety, and optimized performance of the machinery. The award fee component is designed to incentivize the contractor to exceed minimum performance standards, thereby enhancing the overall effectiveness and value derived from the contract.
How does the geographic focus on Florida impact the overall strategy and cost-effectiveness of this machinery repair contract?
The geographic focus on Florida suggests that the machinery requiring repair and maintenance is concentrated in this region, likely at naval bases or facilities located there. This localization can enhance cost-effectiveness by reducing travel time and logistical complexities associated with servicing equipment spread across multiple distant locations. It allows for potentially faster response times and more efficient deployment of repair teams and resources. However, it also means that if unforeseen issues arise requiring specialized expertise not readily available locally, the response might be slower or more expensive. The concentration of work in one area also allows for potentially better relationship building and understanding between the government and the contractor regarding specific local operational needs and challenges.
Industry Classification
NAICS: Other Services (except Public Administration) › Commercial and Industrial Machinery and Equipment (except Automotive and Electronic) Repair and Maintenance › Commercial and Industrial Machinery and Equipment (except Automotive and Electronic) Repair and Maintenance
Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › MANAGEMENT SUPPORT SERVICES
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Pricing Type: COST PLUS AWARD FEE (R)
Evaluated Preference: NONE
Contractor Details
Parent Company: KBR, Inc. (UEI: 784072626)
Address: 7000 COLUMBIA GATEWAY DR STE 100, COLUMBIA, MD, 21046
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $41,110,485
Exercised Options: $41,110,485
Current Obligation: $41,110,485
Contract Characteristics
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: M6700409D0020
IDV Type: IDC
Timeline
Start Date: 2014-10-01
Current End Date: 2015-09-30
Potential End Date: 2015-09-30 00:00:00
Last Modified: 2020-09-15
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