DoD's $591M War Reserve Materiel Contract with DynCorp Faces Scrutiny Over Value and Competition
Contract Overview
Contract Amount: $591,568,334 ($591.6M)
Contractor: Dyncorp International LLC
Awarding Agency: Department of Defense
Start Date: 2008-06-11
End Date: 2017-04-30
Contract Duration: 3,245 days
Daily Burn Rate: $182.3K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 5
Pricing Type: COST PLUS AWARD FEE
Sector: Other
Official Description: SERVICES IN SUPPORT OF WAR RESERVE MATERIEL: STORAGE, ISSUANCE, REFURBISHMENT.
Plain-Language Summary
Department of Defense obligated $591.6 million to DYNCORP INTERNATIONAL LLC for work described as: SERVICES IN SUPPORT OF WAR RESERVE MATERIEL: STORAGE, ISSUANCE, REFURBISHMENT. Key points: 1. Significant contract value of $591.6M for essential war materiel support. 2. DynCorp International LLC holds the contract, raising questions about market concentration. 3. The contract's Cost Plus Award Fee structure may incentivize cost overruns. 4. Facilities Support Services sector, crucial for military readiness, is the focus. 5. Lack of small business participation noted.
Value Assessment
Rating: questionable
The $591.6M award for storage, issuance, and refurbishment of war reserve materiel is substantial. Without detailed cost breakdowns and performance metrics, assessing its value against industry benchmarks is difficult. The Cost Plus Award Fee structure warrants close examination for potential inefficiencies.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under full and open competition, suggesting a competitive bidding process. However, the long duration and specific nature of services could limit future competition and potentially lead to vendor lock-in.
Taxpayer Impact: Taxpayer funds are utilized for essential defense logistics. The effectiveness of the competition and contract management will determine the ultimate value for taxpayers.
Public Impact
Ensures readiness of critical war materiel for national defense. Supports military operations through efficient logistics and maintenance. Potential for job creation within the defense support services sector. Highlights the complexity and cost of maintaining strategic reserves.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Cost Plus Award Fee structure
- Lack of small business participation
- Long contract duration (3245 days)
- Potential for vendor lock-in
Positive Signals
- Full and open competition awarded
- Essential service for national security
- Significant investment in defense readiness
Sector Analysis
This contract falls within the Facilities Support Services sector, which is critical for maintaining government infrastructure and operational readiness. Spending in this sector can vary widely based on agency needs and geopolitical factors. Benchmarks are difficult without specific service details.
Small Business Impact
The data indicates no small business participation in this contract. This suggests a potential gap in opportunities for small businesses within this specific defense support services niche, which could be explored for future contracting strategies.
Oversight & Accountability
The contract's long duration and Cost Plus Award Fee structure necessitate robust oversight to ensure cost control and performance. Regular audits and performance reviews are crucial for accountability and to prevent potential waste or fraud.
Related Government Programs
- Facilities Support Services
- Department of Defense Contracting
- Department of the Air Force Programs
Risk Flags
- Cost Plus Award Fee structure
- Lack of small business participation
- Long contract duration
- Potential for cost overruns
- Limited transparency on performance metrics
Tags
facilities-support-services, department-of-defense, definitive-contract, 100m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $591.6 million to DYNCORP INTERNATIONAL LLC. SERVICES IN SUPPORT OF WAR RESERVE MATERIEL: STORAGE, ISSUANCE, REFURBISHMENT.
Who is the contractor on this award?
The obligated recipient is DYNCORP INTERNATIONAL LLC.
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Air Force).
What is the total obligated amount?
The obligated amount is $591.6 million.
What is the period of performance?
Start: 2008-06-11. End: 2017-04-30.
How does the cost of storage, issuance, and refurbishment compare to industry standards for similar materiel support contracts, and what mechanisms are in place to ensure cost-effectiveness?
Assessing cost-effectiveness requires detailed performance metrics and cost breakdowns not provided. The Cost Plus Award Fee structure, while incentivizing performance, can also lead to higher costs if not tightly managed. Benchmarking against similar DoD or commercial contracts for materiel management and refurbishment would be necessary to determine if this $591.6M award represents fair value.
What are the specific risks associated with the Cost Plus Award Fee (CPAF) structure in this contract, and how are they mitigated to protect taxpayer interests?
The primary risk of CPAF is the potential for contractors to increase costs to maximize award fees, leading to cost overruns. Mitigation strategies include clearly defined performance metrics, stringent oversight, independent cost audits, and robust negotiation of the base fee and award fee structure to ensure alignment with government objectives and taxpayer value.
Given the 'full and open competition' award, what is the likelihood of future competition for these services, and are there any provisions to prevent vendor lock-in over the contract's extended durati
While initially awarded competitively, the long duration (3245 days) and specialized nature of war materiel support can create barriers to entry for new competitors. Agencies should actively plan for future competition by breaking down requirements, encouraging market research, and potentially incorporating contract clauses that facilitate knowledge transfer and phased transitions to prevent long-term vendor dependency.
Industry Classification
NAICS: Administrative and Support and Waste Management and Remediation Services › Facilities Support Services › Facilities Support Services
Product/Service Code: OPERATION OF GOVT OWNED FACILITY › OPERATE GOVT OWNED BUILDINGS
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Solicitation ID: FA489007R0014
Offers Received: 5
Pricing Type: COST PLUS AWARD FEE (R)
Evaluated Preference: NONE
Contractor Details
Parent Company: Cerberus Capital Management, L.P. (UEI: 014784388)
Address: 13500 HERITAGE PKWY, FORT WORTH, TX, 76177
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Limited Liability Corporation, Not Designated a Small Business
Financial Breakdown
Contract Ceiling: $614,409,462
Exercised Options: $614,409,462
Current Obligation: $591,568,334
Contract Characteristics
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Cost or Pricing Data: NO
Timeline
Start Date: 2008-06-11
Current End Date: 2017-04-30
Potential End Date: 2017-04-30 00:00:00
Last Modified: 2018-05-08
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