DoD's $38.7M contract for R&D services awarded to KBR WYLE SERVICES, LLC

Contract Overview

Contract Amount: $38,684,839 ($38.7M)

Contractor: KBR Wyle Services, LLC

Awarding Agency: Department of Defense

Start Date: 2020-09-03

End Date: 2025-11-28

Contract Duration: 1,912 days

Daily Burn Rate: $20.2K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: COST PLUS FIXED FEE

Sector: R&D

Official Description: DEVICES, COMPONENTS, AND SUBSYSTEM TRADE STUDIES AND ANALYSES

Place of Performance

Location: HUNTSVILLE, MADISON County, ALABAMA, 35806

State: Alabama Government Spending

Plain-Language Summary

Department of Defense obligated $38.7 million to KBR WYLE SERVICES, LLC for work described as: DEVICES, COMPONENTS, AND SUBSYSTEM TRADE STUDIES AND ANALYSES Key points: 1. Contract focuses on trade studies and analyses for devices, components, and subsystems. 2. Awarded under full and open competition, suggesting a competitive bidding process. 3. The contract duration extends over five years, indicating a long-term need. 4. Performance is in Alabama, potentially impacting the local economy and workforce. 5. The contract type is Cost Plus Fixed Fee, which can incentivize cost control. 6. Research and Development in Physical, Engineering, and Life Sciences is a critical sector for innovation.

Value Assessment

Rating: good

The contract value of approximately $38.7 million over five years for R&D services appears reasonable when benchmarked against similar complex research and analysis contracts. The Cost Plus Fixed Fee (CPFF) structure, while carrying some risk of cost overruns, is common for R&D where scope can evolve. Without specific comparable contract data for identical trade studies, a precise value-for-money assessment is challenging, but the pricing structure suggests an effort to manage contractor profit while allowing for necessary research flexibility.

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 bids. The fact that it was competed suggests that the Department of Defense sought the best value through a competitive process. The number of bidders is not specified, but full and open competition generally leads to a wider pool of potential offerors, which can drive down prices and improve the quality of proposals.

Taxpayer Impact: Taxpayers benefit from full and open competition as it typically fosters a more competitive environment, leading to potentially lower prices and better service offerings compared to sole-source or limited competition awards.

Public Impact

The primary beneficiaries are the Department of Defense and its various branches, which will receive critical research and analysis to inform the development of new devices, components, and subsystems. Services delivered include trade studies and analyses, essential for understanding the feasibility, performance, and cost-effectiveness of various technological options. The geographic impact is concentrated in Alabama, where the contractor, KBR WYLE SERVICES, LLC, will perform the work, potentially creating or sustaining high-skilled jobs in the region. Workforce implications include the employment of scientists, engineers, and technical analysts required to conduct complex research and provide expert insights.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost Plus Fixed Fee contracts can sometimes lead to higher overall costs if not managed diligently, as the contractor is reimbursed for all allowable costs plus a fixed fee.
The evolving nature of R&D can make it difficult to precisely define scope upfront, potentially leading to contract modifications and cost adjustments.
Reliance on a single contractor for a significant duration may limit opportunities for other firms to gain experience in this specific niche of R&D.

Positive Signals

Awarded through full and open competition, indicating a robust selection process and potential for competitive pricing.
KBR WYLE SERVICES, LLC is an established contractor with experience in government services, suggesting a degree of reliability and expertise.
The long-term nature of the contract (over five years) provides stability for the program and ensures continuity of critical research and analysis.
The focus on trade studies and analyses supports informed decision-making in technology development, potentially leading to more effective and efficient defense systems.

Sector Analysis

This contract falls within the Research and Development sector, specifically focusing on physical, engineering, and life sciences. This sector is crucial for technological advancement and national security, involving significant investment in innovation. Comparable spending benchmarks in this area are highly variable, depending on the specific technologies and research scope. However, contracts for advanced engineering analysis and system design often represent substantial investments, reflecting the complexity and criticality of the work.

Small Business Impact

The data indicates this contract was not set aside for small businesses (ss: false, sb: false). As a result, small businesses are unlikely to be direct prime contractors. However, KBR WYLE SERVICES, LLC may engage small businesses as subcontractors to fulfill specific needs or provide specialized services, contributing to the broader small business ecosystem. The absence of a small business set-aside means opportunities for prime contracts were open to all responsible sources, including large businesses.

Oversight & Accountability

Oversight for this contract will likely be managed by the Department of the Air Force, a component of the Department of Defense. Accountability measures are typically embedded within the Cost Plus Fixed Fee contract structure, requiring detailed reporting on costs and progress. Transparency is facilitated through contract award databases and reporting requirements. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse.

Related Government Programs

Defense Research and Development
Advanced Technology Development
Systems Engineering and Analysis
Aerospace Component Research
Subsystem Design and Prototyping

Risk Flags

Cost Overrun Risk (CPFF)
Scope Creep Potential
Limited Small Business Participation (Prime)

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $38.7 million to KBR WYLE SERVICES, LLC. DEVICES, COMPONENTS, AND SUBSYSTEM TRADE STUDIES AND ANALYSES

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 Air Force).

What is the total obligated amount?

The obligated amount is $38.7 million.

What is the period of performance?

Start: 2020-09-03. End: 2025-11-28.

What is the historical spending pattern for KBR WYLE SERVICES, LLC with the Department of Defense, particularly in R&D services?

Analyzing historical spending for KBR WYLE SERVICES, LLC with the Department of Defense reveals a consistent engagement in various service areas, including R&D. While specific figures for R&D alone require deeper data dives, the company's overall contract awards from DoD often span several hundred million dollars annually across different contract types and agencies. This particular $38.7 million award represents a significant, but not unprecedented, investment in their capabilities for trade studies and analyses. Past performance in similar R&D contracts would be a key indicator of their ability to successfully execute this current award, with a focus on adherence to cost, schedule, and technical performance metrics.

How does the Cost Plus Fixed Fee (CPFF) structure compare to other contract types for similar R&D services in terms of value for money?

The Cost Plus Fixed Fee (CPFF) structure is commonly used in R&D where the scope of work is not precisely defined at the outset, allowing for flexibility as research progresses. Compared to Firm-Fixed-Price (FFP) contracts, CPFF offers less price certainty for the government but can be more effective in encouraging innovation and managing risks associated with unknown technical challenges. While FFP contracts provide greater cost predictability, they can stifle creativity or lead to contractors avoiding complex, high-risk research areas. For R&D services like trade studies, CPFF can offer better value by ensuring that necessary research is conducted without the contractor being unduly penalized for unforeseen technical hurdles, provided robust oversight is in place to manage costs and prevent inefficiencies.

What are the key performance indicators (KPIs) typically used to assess the success of R&D contracts focused on trade studies and analyses?

Key performance indicators (KPIs) for R&D contracts involving trade studies and analyses often focus on the quality and utility of the delivered information, as well as adherence to schedule and budget. Examples include the timeliness and accuracy of technical reports, the clarity and comprehensiveness of the analyses provided, and the extent to which the studies inform subsequent design and development decisions. Meeting defined milestones for study completion, providing actionable recommendations, and demonstrating cost-effectiveness in the research process are also critical. The ultimate measure of success often lies in how well the trade studies contribute to the selection of optimal components and subsystems, leading to more robust and efficient end-products for the Department of Defense.

What is the typical duration and funding profile for similar R&D trade study contracts within the Department of Defense?

The typical duration for R&D trade study contracts within the Department of Defense can vary significantly, but a five-year period, as seen in this $38.7 million award, is not uncommon for complex, multi-faceted research efforts. Funding profiles often involve incremental funding tied to specific milestones or periods of performance, especially under CPFF arrangements. Shorter-term contracts might focus on a specific component or subsystem analysis, while longer durations allow for broader investigations, iterative studies, and the integration of findings across multiple technology areas. The $38.7 million total contract value, spread over approximately 1912 days (roughly 5.25 years), suggests an average annual funding of around $7.3 million, which is within the expected range for specialized R&D services requiring expert analysis.

What are the potential risks associated with awarding R&D contracts to a single large contractor like KBR WYLE SERVICES, LLC?

Awarding R&D contracts to a single large contractor like KBR WYLE SERVICES, LLC carries several potential risks. One primary concern is the potential for reduced competition and innovation over time, as other firms may have fewer opportunities to engage with the government in this specific area. There's also a risk of vendor lock-in, where the government becomes heavily reliant on the incumbent contractor, making it difficult to switch providers or adopt new technologies. Furthermore, large contractors may have higher overhead costs compared to smaller, more specialized firms. While KBR WYLE SERVICES, LLC is experienced, ensuring continuous competitive pressure through vigilant oversight and exploring future opportunities for smaller businesses remains important for long-term value and technological advancement.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Scientific Research and Development Services › Research and Development in the Physical, Engineering, and Life Sciences (except Nanotechnology and Biotechnology)

Product/Service Code: RESEARCH AND DEVELOPMENT › OTHER RESEARCH/DEVELOPMENT

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 1

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Parent Company: Brown & Root Industrial Services Holdings, LLC

Address: 22309 EXPLORATION DR, LEXINGTON PARK, MD, 20653

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $43,985,869

Exercised Options: $43,985,869

Current Obligation: $38,684,839

Actual Outlays: $3,188,532

Subaward Activity

Number of Subawards: 98

Total Subaward Amount: $16,233,593

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: FA807518D0015

IDV Type: IDC

Timeline