DoD's $56M LSE/ISE Support Contract Awarded to KBR Wyle Services for Radio Terminal Sets

Contract Overview

Contract Amount: $56,124,827 ($56.1M)

Contractor: KBR Wyle Services, LLC

Awarding Agency: Department of Defense

Start Date: 2010-02-01

End Date: 2017-08-31

Contract Duration: 2,768 days

Daily Burn Rate: $20.3K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: COST PLUS FIXED FEE

Sector: Defense

Official Description: LSE AND ISE SUPPORT FOR AN/ARQ-4 RADIO TERMINAL SET AND OTHER ASSOCIATE SYSTEM

Place of Performance

Location: LEXINGTON PARK, SAINT MARYS County, MARYLAND, 20653

State: Maryland Government Spending

Plain-Language Summary

Department of Defense obligated $56.1 million to KBR WYLE SERVICES, LLC for work described as: LSE AND ISE SUPPORT FOR AN/ARQ-4 RADIO TERMINAL SET AND OTHER ASSOCIATE SYSTEM Key points: 1. Contract provides essential support for AN/ARQ-4 radio terminal sets, crucial for naval communications. 2. Awarded under full and open competition, suggesting a competitive bidding process. 3. The contract duration of over 7 years indicates a long-term need for these services. 4. Cost-plus-fixed-fee contract type allows for cost reimbursement plus a fixed fee, with potential for cost overruns. 5. The contract was awarded as a delivery order, implying it's part of a larger indefinite-delivery/indefinite-quantity (IDIQ) vehicle. 6. Focus on engineering services highlights the technical expertise required for maintaining advanced radio systems.

Value Assessment

Rating: fair

Benchmarking the value of this contract is challenging without specific performance metrics or comparable contract data. The cost-plus-fixed-fee structure can lead to higher costs if not managed effectively. However, the fixed fee component provides some cost certainty for the government. The total value of over $56 million over nearly 8 years suggests a significant investment in maintaining critical communication systems.

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 bids. This typically fosters a competitive environment, potentially leading to better pricing and service offerings. The number of bidders is not specified, but the open competition suggests multiple entities likely vied for this award.

Taxpayer Impact: Full and open competition generally benefits taxpayers by promoting market efficiencies and driving down costs through competitive pressures.

Public Impact

Naval forces benefit from reliable and maintained AN/ARQ-4 radio terminal sets, ensuring effective communication capabilities. The contract supports the Department of the Navy's operational readiness and technological infrastructure. Engineering services provided contribute to the longevity and performance of critical communication hardware. The contract's impact is primarily on military operations and the defense sector's technological base.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost-plus-fixed-fee contracts can incentivize contractors to incur higher costs to achieve a larger fee, potentially increasing overall expenditure.
Lack of specific performance metrics makes it difficult to assess the true value for money and efficiency of the services rendered.
The long duration of the contract could lead to vendor lock-in and reduced flexibility in adopting newer technologies if not managed proactively.

Positive Signals

Awarded through full and open competition, which generally leads to competitive pricing and better value.
The contract supports critical communication systems, ensuring operational readiness for naval forces.
Engineering services ensure the continued functionality and potential upgrades of essential radio terminal sets.

Sector Analysis

This contract falls within the Engineering Services sector, specifically supporting defense-related electronic systems. The market for defense engineering and sustainment services is substantial, driven by the need to maintain complex and aging military hardware. Comparable spending benchmarks would involve other contracts for the sustainment and upgrade of specialized military communication or electronic warfare systems.

Small Business Impact

There is no indication that this contract included specific small business set-asides. As a large contract likely requiring specialized engineering expertise, it may involve subcontracting opportunities for small businesses, but this is not explicitly detailed. The primary contractor, KBR Wyle Services, LLC, is a large business, suggesting the focus was on securing the necessary capabilities rather than prioritizing small business participation directly.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of the Navy's contracting and program management offices. Accountability measures would be defined within the contract terms, including performance standards and reporting requirements. Transparency is facilitated by the public nature of contract awards, though detailed performance data may be restricted. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Naval Communication Systems Sustainment
Defense Electronic Systems Engineering
Radio Terminal Set Maintenance
Military Logistics and Support Services
DoD Engineering Services Contracts

Risk Flags

Cost Overrun Risk (CPFF)
Performance Measurement Difficulty
Long-Term Technology Dependency

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $56.1 million to KBR WYLE SERVICES, LLC. LSE AND ISE SUPPORT FOR AN/ARQ-4 RADIO TERMINAL SET AND OTHER ASSOCIATE SYSTEM

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 $56.1 million.

What is the period of performance?

Start: 2010-02-01. End: 2017-08-31.

What is the track record of KBR Wyle Services, LLC in providing similar engineering and support services to the Department of Defense?

KBR Wyle Services, LLC, a subsidiary of KBR, Inc., has a significant history of supporting U.S. military and government agencies with a wide range of services, including engineering, logistics, and technical support. They have been involved in numerous contracts related to aerospace, defense, and infrastructure. Their experience often includes complex system integration, maintenance, and lifecycle support for various defense platforms. Specific to radio terminal sets and communication systems, KBR has a demonstrated capability, often leveraging their engineering expertise to ensure system reliability and performance. However, the specific performance on this particular contract, AN/ARQ-4 radio terminal set support, would require a deeper dive into performance reports and customer feedback, which are not publicly detailed in this award abstract.

How does the awarded amount of $56.1 million compare to similar contracts for radio terminal set support?

Comparing the $56.1 million award for LSE and ISE support of the AN/ARQ-4 radio terminal set requires context regarding the scope, duration, and specific services included. This contract spans from February 1, 2010, to August 31, 2017 (over 7 years), averaging approximately $7.5 million per year. Similar contracts for specialized military communication equipment sustainment can vary widely. Factors influencing cost include the complexity of the technology, the level of engineering support required (e.g., diagnostics, repair, upgrades, training), the number of units supported, and the operational tempo. Without specific details on the number of radio sets, the criticality of the support, and the specific engineering tasks, a direct comparison is difficult. However, the duration and total value suggest a substantial and ongoing requirement for maintaining these communication assets.

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

The primary risk associated with a Cost Plus Fixed Fee (CPFF) contract, like the one awarded to KBR Wyle Services, LLC, is the potential for cost overruns. In a CPFF structure, the contractor is reimbursed for allowable costs incurred, plus a predetermined fixed fee representing profit. If the contractor's costs exceed initial estimates, the government bears the burden of these increased expenses, while the contractor's fee remains constant. This can incentivize less cost-consciousness from the contractor compared to fixed-price contracts. Effective oversight, robust cost accounting standards, and clear definitions of allowable costs are crucial for mitigating this risk and ensuring the government receives good value. The fixed fee, however, does provide a ceiling on the contractor's profit.

What is the expected program effectiveness or outcome based on this contract award?

The expected outcome of this contract is the sustained operational readiness and effectiveness of the AN/ARQ-4 radio terminal set and associated systems. By providing essential LSE (Logistics Support Element) and ISE (In-Service Engineering) support, the contract aims to ensure that these critical communication assets are functional, reliable, and maintained to meet naval operational requirements. This includes diagnostics, repair, maintenance, and potentially technical assistance or upgrades. Effective execution of this contract should translate to improved communication capabilities for naval forces, contributing to mission success and overall defense posture. The long duration suggests a commitment to maintaining the utility of this specific technology.

How has historical spending in the Engineering Services category (NAICS 541330) by the Department of the Navy trended?

Historical spending by the Department of the Navy (DoN) within the Engineering Services category (NAICS 541330) has generally shown a consistent and significant demand. The DoN, as a major component of the Department of Defense, relies heavily on engineering services for platform design, development, sustainment, modernization, and testing of complex naval systems, including ships, aircraft, and C4ISR (Command, Control, Communications, Computers, and Intelligence) systems. Spending in this sector often fluctuates based on major acquisition programs, modernization efforts, and readiness requirements. Over the years, the DoN has consistently awarded billions of dollars in engineering services contracts annually, reflecting the critical role these services play in maintaining technological superiority and operational capability. This specific contract, while substantial, represents a fraction of the DoN's overall engineering services expenditure.

What are the implications of awarding a delivery order under a larger IDIQ contract for this type of support?

Awarding a delivery order under a larger Indefinite-Delivery/Indefinite-Quantity (IDIQ) contract signifies that this specific task (support for AN/ARQ-4 radio terminal sets) was one of potentially many services that could be ordered from KBR Wyle Services, LLC under a pre-negotiated master contract. IDIQs are often used to streamline the procurement process for services that are expected to be needed over time but with uncertain quantities or timing. This approach allows the government flexibility to order specific services as needed, while the contractor has a framework for providing them. For taxpayers, it can mean more efficient procurement, but it also requires careful management of the overall IDIQ ceiling and individual delivery orders to ensure cost control and prevent scope creep across multiple orders.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Architectural, Engineering, and Related Services › Engineering Services

Product/Service Code: MODIFICATION OF EQUIPMENT › MODIFICATION OF EQUIPMENT

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: N0002409R3334

Offers Received: 1

Pricing Type: COST PLUS FIXED FEE (U)

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, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $111,090,742

Exercised Options: $69,598,077

Current Obligation: $56,124,827

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: N0017806D4760

IDV Type: IDC

Timeline