Interior's USGS awards $5.7M IT services contract to KBR WYLE SERVICES, LLC for computer facilities management

Contract Overview

Contract Amount: $5,724,530 ($5.7M)

Contractor: KBR Wyle Services, LLC

Awarding Agency: Department of the Interior

Start Date: 2024-05-30

End Date: 2026-06-01

Contract Duration: 732 days

Daily Burn Rate: $7.8K/day

Competition Type: FULL AND OPEN COMPETITION

Pricing Type: COST PLUS FIXED FEE

Sector: IT

Official Description: 70292205 DCS068 TSSC TO 119 NEW

Place of Performance

Location: SIOUX FALLS, MINNEHAHA County, SOUTH DAKOTA, 57198

State: South Dakota Government Spending

Plain-Language Summary

Department of the Interior obligated $5.7 million to KBR WYLE SERVICES, LLC for work described as: 70292205 DCS068 TSSC TO 119 NEW Key points: 1. Contract awarded via full and open competition, suggesting a competitive bidding process. 2. The contract type is Cost Plus Fixed Fee, which can incentivize cost control but requires careful oversight. 3. Performance period spans over two years, indicating a need for sustained IT support. 4. The North American Industry Classification System (NAICS) code 541513 points to a focus on computer facilities management. 5. The contract is a Delivery Order under a larger contract vehicle, implying it's part of a broader IT services strategy. 6. No small business set-aside was utilized, which is typical for contracts of this nature and scope.

Value Assessment

Rating: fair

Benchmarking the value of this $5.7 million contract requires more detailed cost breakdowns and comparisons to similar IT facilities management contracts. The Cost Plus Fixed Fee (CPFF) structure means the government pays allowable costs plus a fixed fee, which can lead to cost overruns if not managed tightly. Without specific performance metrics or a comparison of the fixed fee to industry standards for this type of service, it's difficult to definitively assess value for money. However, the duration of the contract (732 days) suggests a significant scope of work.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under 'full and open competition,' indicating that all responsible sources were permitted to submit a bid. The specific number of bidders is not provided, but this method generally fosters price discovery and allows the government to select from a wide range of qualified contractors. The open competition suggests that the agency sought the best possible offer based on technical qualifications and price.

Taxpayer Impact: Taxpayers benefit from the potential for competitive pricing and the assurance that the agency explored multiple options to secure the best value for IT facilities management services.

Public Impact

The U.S. Geological Survey (USGS) will benefit from enhanced computer facilities management. Services delivered will likely include maintenance, support, and operational management of IT infrastructure. The geographic impact is primarily focused on South Dakota, where the delivery order is assigned. Workforce implications may include the need for specialized IT personnel to support the contract's objectives.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost Plus Fixed Fee contracts require diligent oversight to ensure costs remain reasonable and the fixed fee is justified.
Lack of specific bidder count makes it hard to gauge the intensity of competition.
Limited information on performance metrics makes it challenging to assess the contractor's track record on this specific award.

Positive Signals

Awarded through full and open competition, indicating a broad search for qualified vendors.
The contract is a delivery order under a larger vehicle, suggesting it aligns with a pre-vetted strategic IT procurement.
The contract has a defined performance period, providing clarity on the expected duration of services.

Sector Analysis

This contract falls within the IT services sector, specifically focusing on computer facilities management. The IT services market is vast and highly competitive, with numerous companies offering specialized support for government agencies. Contracts like this are crucial for maintaining the operational integrity of federal IT infrastructure. Benchmarking would involve comparing the contract value and scope to similar IT support services awarded to other federal agencies or within the broader IT services industry.

Small Business Impact

This contract was not set aside for small businesses, nor does it indicate any specific subcontracting requirements for small businesses. This is common for IT services contracts that may require specialized expertise or scale typically found in larger firms. The absence of small business participation goals means direct impact on the small business ecosystem for this specific award is likely minimal, though the prime contractor may engage small businesses in their supply chain.

Oversight & Accountability

Oversight for this Cost Plus Fixed Fee contract will likely be managed by the U.S. Geological Survey's contracting officers and program managers. They will be responsible for monitoring costs, ensuring adherence to the contract terms, and verifying performance. The fixed fee component requires careful review of allowable costs to prevent overspending. Transparency is facilitated through contract databases, but detailed operational oversight rests with the agency.

Related Government Programs

IT Infrastructure Management Services
Computer Systems Design Services
Federal IT Procurement
IT Support Services

Risk Flags

Cost Plus Fixed Fee contract type requires diligent cost oversight.
Limited information on the number of bidders in the full and open competition.

Frequently Asked Questions

What is this federal contract paying for?

Department of the Interior awarded $5.7 million to KBR WYLE SERVICES, LLC. 70292205 DCS068 TSSC TO 119 NEW

Who is the contractor on this award?

The obligated recipient is KBR WYLE SERVICES, LLC.

Which agency awarded this contract?

Awarding agency: Department of the Interior (U.S. Geological Survey).

What is the total obligated amount?

The obligated amount is $5.7 million.

What is the period of performance?

Start: 2024-05-30. End: 2026-06-01.

What is the typical fixed fee percentage for Cost Plus Fixed Fee IT services contracts of this size and scope?

The fixed fee percentage in Cost Plus Fixed Fee (CPFF) contracts can vary significantly based on the complexity of the work, the perceived risk, and the contractor's profit expectations. For IT services contracts in the federal space, fixed fees typically range from 5% to 15% of the estimated cost. However, this is a broad generalization. Factors such as the level of competition, the specific services required (e.g., routine maintenance vs. complex system integration), and the contractor's established relationship with the agency can influence the fee. Without detailed cost breakdowns and comparisons to similar contracts awarded by the Department of the Interior or other agencies for computer facilities management, it is difficult to pinpoint an exact benchmark for this $5.7 million contract. Agencies aim to negotiate fees that are competitive enough to attract qualified contractors while ensuring fair value for taxpayer dollars.

How does the performance period of 732 days compare to similar IT facilities management contracts?

A performance period of 732 days, approximately two years, is a common duration for IT facilities management contracts. This timeframe allows for stable service delivery and avoids the administrative overhead associated with very short-term contracts, while also providing flexibility for the agency to re-evaluate needs or market conditions. Longer contracts (e.g., 5 years) might be seen for more strategic, long-term IT infrastructure development, whereas shorter contracts (e.g., 1 year) could be used for specific projects or when uncertainty is high. For ongoing operational support like computer facilities management, a two-year period is generally considered standard, offering a balance between continuity and adaptability for the agency.

What are the potential risks associated with a Cost Plus Fixed Fee contract for IT services?

The primary risk with Cost Plus Fixed Fee (CPFF) contracts is that the contractor may have less incentive to control costs compared to fixed-price contracts, as the government agrees to pay all allowable costs. While the fixed fee provides some incentive for efficiency, there's a risk of cost growth if the 'cost' portion of the contract escalates beyond initial estimates. This necessitates robust government oversight to scrutinize allowable costs and ensure the contractor is performing efficiently. For IT services, scope creep or unforeseen technical challenges can also drive up costs, potentially impacting the overall value if not managed proactively. The agency must have strong program management and financial oversight capabilities to mitigate these risks effectively.

What does the NAICS code 541513 (Computer Facilities Management Services) typically encompass?

The NAICS code 541513, Computer Facilities Management Services, broadly covers establishments primarily engaged in providing on-site management and operation of clients' computer systems and/or data processing facilities. This includes services such as operating data centers, managing computer systems, and providing technical support for IT infrastructure. It can encompass a wide range of activities including system monitoring, network management, hardware and software maintenance, disaster recovery planning, and ensuring the security and availability of IT resources. Contracts under this code are vital for agencies relying on robust and continuously available IT operations.

How does the 'Delivery Order' (DO) award type impact this contract's context?

A Delivery Order (DO) indicates that this contract is a task order issued under a pre-existing indefinite-delivery, indefinite-quantity (IDIQ) contract or a similar contract vehicle. This means the underlying contract vehicle itself likely underwent a competitive process, establishing terms, conditions, and potentially pricing structures. The DO then specifies the exact goods or services, quantities, and delivery schedules for a particular need. This approach allows agencies to procure services more efficiently and rapidly once the larger IDIQ contract is in place, often leveraging pre-negotiated rates. It suggests this $5.7 million award is part of a broader, strategically sourced IT services agreement.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Computer Systems Design and Related Services › Computer Facilities Management Services

Product/Service Code: TECHNICAL REPRESENTATIVE SVCS. › TECHNICAL REPRESENTATIVE SERVICES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Parent Company: KBR, Inc.

Address: 7701 GREENBELT RD STE 400, GREENBELT, MD, 20770

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: $6,259,404

Exercised Options: $5,724,530

Current Obligation: $5,724,530

Actual Outlays: $4,829,102

Subaward Activity

Number of Subawards: 2

Total Subaward Amount: $158,495

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: 140G0121D0001

IDV Type: IDC

Timeline