KBR Services awarded $21.6M for USMC sustainment, highlighting repair and maintenance needs

Contract Overview

Contract Amount: $21,563,196 ($21.6M)

Contractor: KBR Services, LLC

Awarding Agency: Department of Defense

Start Date: 2024-07-01

End Date: 2025-06-30

Contract Duration: 364 days

Daily Burn Rate: $59.2K/day

Competition Type: FULL AND OPEN COMPETITION

Pricing Type: COST PLUS FIXED FEE

Sector: Defense

Official Description: MCPP - USMC SUSTAINMENT

Place of Performance

Location: JACKSONVILLE, DUVAL County, FLORIDA, 32226

State: Florida Government Spending

Plain-Language Summary

Department of Defense obligated $21.6 million to KBR SERVICES, LLC for work described as: MCPP - USMC SUSTAINMENT Key points: 1. Contract focuses on essential repair and maintenance for industrial machinery and equipment. 2. Full and open competition suggests a potentially competitive pricing environment. 3. Delivery order structure indicates a need for specific, time-bound services. 4. The contract duration of approximately one year points to ongoing sustainment requirements. 5. The North American Industry Classification System (NAICS) code 811310 signifies a specialized service sector. 6. The contract's value is moderate within the context of large-scale defense sustainment efforts.

Value Assessment

Rating: good

The contract value of $21.6 million for a one-year period appears reasonable for sustainment services. Benchmarking against similar contracts for industrial machinery repair and maintenance would provide a more precise value-for-money assessment. The Cost Plus Fixed Fee (CPFF) pricing structure, while common, requires careful oversight to ensure costs remain controlled and the fixed fee is justified by the scope of work. Without specific performance metrics or detailed cost breakdowns, a definitive assessment of cost efficiency is challenging, but the competitive award suggests a degree of price awareness.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit offers. This approach generally fosters a competitive environment, which can lead to better pricing and service quality. The number of bidders is not specified, but the fact that it was competed fully suggests that multiple entities were interested and capable of performing the required services. This level of competition is a positive indicator for price discovery and efficient resource allocation.

Taxpayer Impact: Full and open competition is beneficial for taxpayers as it increases the likelihood of obtaining services at competitive prices, thereby maximizing the value of federal dollars spent.

Public Impact

The U.S. Marine Corps (USMC) is the primary beneficiary, receiving critical sustainment services for its equipment. Services delivered include repair and maintenance of commercial and industrial machinery and equipment. The contract is geographically focused on Florida (ST, SN), indicating a concentration of USMC assets or operations in that state. This contract supports the operational readiness of the Marine Corps by ensuring equipment functionality.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns with CPFF contracts if not closely monitored.
Dependence on a single contractor for critical sustainment services could pose a risk if performance falters.
Scope creep could increase the overall cost beyond the initial award amount.

Positive Signals

Awarded through full and open competition, suggesting a robust selection process.
Focus on sustainment ensures readiness of essential military equipment.
Contract duration provides stability for service delivery and planning.

Sector Analysis

This contract falls within the industrial machinery and equipment repair and maintenance sector, a critical component of the defense industrial base. This sector supports the operational readiness of military branches by ensuring that complex machinery and equipment remain functional. The market for such services is characterized by specialized expertise and often requires adherence to stringent government standards. Comparable spending benchmarks would typically involve analyzing other sustainment contracts for similar equipment across different military branches or agencies.

Small Business Impact

The contract data indicates that small business participation (ss: false, sb: false) was not a primary set-aside criterion for this specific award. While this contract was not set aside for small businesses, KBR Services, as a large prime contractor, may have subcontracting opportunities. The extent to which small businesses will be involved will depend on KBR's subcontracting plan and the availability of qualified small business vendors for specific components or services within the scope of this contract. Further analysis of subcontracting reports would be needed to assess the actual impact on the small business ecosystem.

Oversight & Accountability

Oversight for this contract will likely be managed by the Department of the Navy, under the broader Department of Defense umbrella. Mechanisms would include contract performance reviews, financial audits, and adherence to reporting requirements stipulated in the contract. Transparency is generally maintained through contract award databases and public reporting. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse related to the contract.

Related Government Programs

USMC Equipment Maintenance Programs
Defense Industrial Base Sustainment Contracts
Naval Sea Systems Command (NAVSEA) Support Contracts
Military Vehicle and Equipment Repair Services

Risk Flags

Cost Plus Fixed Fee (CPFF) pricing requires diligent oversight to manage costs.
Potential for supply chain disruptions impacting repair timelines.
Ensuring availability of specialized parts for military-grade equipment.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $21.6 million to KBR SERVICES, LLC. MCPP - USMC SUSTAINMENT

Who is the contractor on this award?

The obligated recipient is KBR 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 $21.6 million.

What is the period of performance?

Start: 2024-07-01. End: 2025-06-30.

What is KBR Services, LLC's track record with similar Department of Defense sustainment contracts?

KBR Services, LLC has a significant history of performing large-scale support and sustainment contracts for the Department of Defense and other government agencies. Their portfolio often includes logistics, base operations, engineering, and technical services. For sustainment contracts specifically, KBR has experience managing complex maintenance, repair, and overhaul (MRO) operations for various types of military equipment, including vehicles, aircraft components, and industrial machinery. Their past performance on similar contracts, often valued in the tens to hundreds of millions of dollars, indicates a capacity to handle substantial requirements. However, a detailed review of their performance ratings, any past disputes, or contract modifications on prior relevant awards would be necessary for a comprehensive assessment of their suitability for this specific USMC sustainment task.

How does the $21.6 million award compare to historical spending on USMC sustainment in Florida?

Comparing the $21.6 million award to historical spending on USMC sustainment in Florida requires access to detailed historical contract data specific to the region and service type. Without that granular data, a direct comparison is difficult. However, $21.6 million for a one-year contract focused on industrial machinery and equipment repair and maintenance represents a significant but not extraordinary investment for a major military branch like the USMC. The Marine Corps operates substantial facilities and maintains a large inventory of equipment, particularly in states like Florida with significant training and operational bases. This award suggests a consistent need for specialized maintenance services to ensure operational readiness, aligning with typical defense spending patterns for equipment upkeep. Further analysis would involve examining trends in maintenance spending over several fiscal years for the USMC in Florida to identify any anomalies or significant shifts.

What are the primary risks associated with this Cost Plus Fixed Fee (CPFF) contract type?

The primary risks associated with a Cost Plus Fixed Fee (CPFF) contract type revolve around cost control and contractor incentive. For the government, the main risk is that the contractor may not be sufficiently incentivized to control costs, as the government agrees to reimburse all allowable costs incurred. If the contractor's cost estimates are inaccurate or if unforeseen issues arise, the total cost to the government could exceed initial projections. The fixed fee provides the contractor with a guaranteed profit margin, but it doesn't directly link profit to cost efficiency. This necessitates robust government oversight, including detailed cost audits and performance monitoring, to ensure that costs are reasonable and allocable to the contract. Contractor risk includes the potential for disallowed costs if they do not adhere strictly to contract terms and allowable cost principles.

How does the NAICS code 811310 (Commercial and Industrial Machinery and Equipment Repair and Maintenance) inform the scope and potential challenges of this contract?

The NAICS code 811310 signifies that the contract's scope is focused on the specialized repair and maintenance of commercial and industrial machinery and equipment. This implies a need for skilled technicians, specific diagnostic tools, and potentially access to original equipment manufacturer (OEM) parts or approved equivalents. Potential challenges include the complexity and variety of machinery the USMC operates, the need for rapid turnaround times to minimize equipment downtime, and ensuring compliance with stringent military specifications and safety standards, which often exceed commercial requirements. Furthermore, sourcing specialized parts for older or unique military equipment can be a logistical challenge. The contractor must possess the technical expertise and supply chain capabilities to address these specific demands effectively.

What is the significance of the contract being awarded as a 'Delivery Order'?

The designation of this contract as a 'Delivery Order' (aw: DELIVERY ORDER) is significant because it implies that this is likely one of multiple orders placed against a larger, pre-existing indefinite-delivery/indefinite-quantity (IDIQ) contract or a similar type of basic ordering agreement. Delivery orders typically specify the exact goods or services to be provided, the quantity, and the delivery schedule for a particular requirement. This structure allows the government to procure services incrementally as needed, offering flexibility and responsiveness. For this specific contract, it means the $21.6 million represents the value allocated for a defined period (likely one year, given the duration) and scope, and that the overall IDIQ contract may have a larger ceiling value and a longer potential period of performance, allowing for future orders.

What does the contract's geographic focus on Florida imply for USMC operations?

The contract's geographic focus on Florida (ST, SN) suggests that a significant portion of the USMC's industrial machinery and equipment requiring sustainment services is located or operated within that state. Florida hosts several major Marine Corps installations, including Camp Lejeune (though primarily in NC, it has significant training and operational ties), Marine Corps Air Station (MCAS) Beaufort (SC, but near FL), and MCAS Cherry Point (NC). These bases house extensive operational units and training facilities that rely on a wide array of machinery, from ground support equipment to specialized training simulators. The concentration of services in Florida indicates a strategic decision to centralize or efficiently manage maintenance for assets deployed or based in that region, likely to ensure the readiness of units operating from or training in the southeastern United States.

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

Solicitation ID: M6700418R0014

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Parent Company: Brown & Root Industrial Services Holdings, LLC

Address: 601 JEFFERSON ST, HOUSTON, TX, 77002

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: $22,324,969

Exercised Options: $22,324,969

Current Obligation: $21,563,196

Subaward Activity

Number of Subawards: 11

Total Subaward Amount: $897,247

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: M6700419D0001

IDV Type: IDC

Timeline