DoD awards $34.6M for engineering support, with KBR Wyle Services, LLC securing the contract

Contract Overview

Contract Amount: $34,650,122 ($34.7M)

Contractor: KBR Wyle Services, LLC

Awarding Agency: Department of Defense

Start Date: 2015-09-01

End Date: 2020-03-31

Contract Duration: 1,673 days

Daily Burn Rate: $20.7K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 6

Pricing Type: COST PLUS FIXED FEE

Sector: Defense

Official Description: IGF::OT::IGF PMA265 PROGRAM MANAGEMENT AND ENGINEERING SUPPORT SERVICES

Place of Performance

Location: PATUXENT RIVER, SAINT MARYS County, MARYLAND, 20670

State: Maryland Government Spending

Plain-Language Summary

Department of Defense obligated $34.7 million to KBR WYLE SERVICES, LLC for work described as: IGF::OT::IGF PMA265 PROGRAM MANAGEMENT AND ENGINEERING SUPPORT SERVICES Key points: 1. Contract value appears reasonable given the duration and scope of engineering support services. 2. Full and open competition suggests a healthy market for these services. 3. Potential risks include cost overruns due to the Cost Plus Fixed Fee structure. 4. Performance context is critical to assess the true value delivered over the contract's lifespan. 5. This contract fits within the broader Defense sector's need for specialized engineering expertise.

Value Assessment

Rating: good

The contract's total value of $34.6 million over approximately 5.5 years (1673 days) averages to roughly $6.3 million annually. This figure seems within a reasonable range for specialized engineering and program management support services for a major federal agency like the Department of Defense. Benchmarking against similar contracts for program management and engineering support would provide a more precise value-for-money assessment, but initial indications suggest fair pricing for the services rendered.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that multiple vendors were likely invited to bid. With 6 bidders participating, this suggests a competitive environment for these engineering services. A higher number of bidders generally leads to better price discovery and potentially more favorable terms for the government, although the specific pricing structure (Cost Plus Fixed Fee) still requires careful monitoring.

Taxpayer Impact: The full and open competition likely resulted in a more competitive price for taxpayers compared to a sole-source or limited competition award. This process helps ensure that the government is not overpaying for essential engineering and program management support.

Public Impact

The Department of Defense benefits from specialized engineering and program management expertise, enhancing its operational capabilities. Services delivered include program management and engineering support, crucial for complex defense initiatives. The geographic impact is primarily within Maryland, where the contract is managed. Workforce implications include employment opportunities for engineers and program managers within the contractor's organization.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost Plus Fixed Fee (CPFF) contracts can incentivize contractors to increase costs to maximize their fee, requiring robust oversight.
The duration of the contract (over 5 years) necessitates ongoing performance monitoring to ensure continued value.
Reliance on a single contractor for critical support functions can pose a risk if performance degrades.

Positive Signals

Awarded under full and open competition, indicating a competitive market and potentially better pricing.
The contract specifies a fixed fee component, which can provide some cost certainty for the government.
The existence of multiple bidders (6) suggests a healthy level of interest and capability in the market.

Sector Analysis

The engineering services sector supporting the federal government is substantial, encompassing a wide range of specialized technical and management support. This contract falls within the broader defense industrial base, where companies provide critical expertise for military programs. Comparable spending benchmarks for similar program management and engineering support contracts within the DoD can range significantly based on scope and duration, but this $34.6 million award appears to be a mid-tier contract for such services.

Small Business Impact

There is no indication that this contract was specifically set aside for small businesses, nor is there information on subcontracting plans for small businesses. Given the nature of the services and the prime contractor, it is possible that larger firms dominate the prime contract, but subcontracting opportunities for specialized engineering tasks could exist for smaller, niche firms.

Oversight & Accountability

Oversight for this contract would typically be managed by the Defense Contract Management Agency (DCMA), which is responsible for ensuring contractor compliance with terms and conditions. The Cost Plus Fixed Fee structure necessitates rigorous financial oversight to scrutinize costs and ensure the fixed fee is justified. Transparency is generally maintained through contract reporting mechanisms, and the Inspector General's office would have jurisdiction over any allegations of fraud or mismanagement.

Related Government Programs

DoD Program Management Support Services
Engineering and Technical Services Contracts
Defense Contract Administration Services

Risk Flags

Cost Plus Fixed Fee contract type requires diligent cost oversight.
Contract duration exceeds five years, necessitating sustained performance monitoring.
Potential for scope creep in engineering services contracts.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $34.7 million to KBR WYLE SERVICES, LLC. IGF::OT::IGF PMA265 PROGRAM MANAGEMENT AND ENGINEERING SUPPORT SERVICES

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 (Defense Contract Management Agency).

What is the total obligated amount?

The obligated amount is $34.7 million.

What is the period of performance?

Start: 2015-09-01. End: 2020-03-31.

What is the track record of KBR Wyle Services, LLC with the Department of Defense?

KBR Wyle Services, LLC has a significant history of contracting with the Department of Defense across various service areas, including engineering, logistics, and base operations support. Their performance record with the DoD is generally extensive, often involving large-scale, complex projects. Specific performance metrics for this particular contract (541330 - Engineering Services) would be detailed in performance reports and CPARS (Contractor Performance Assessment Reporting System) ratings, which are not publicly available in this data snippet. However, their continued awards suggest a generally satisfactory performance history, though like any large contractor, they may have faced specific challenges or received mixed reviews on certain contracts.

How does the pricing structure (Cost Plus Fixed Fee) compare to other contract types for similar services?

Cost Plus Fixed Fee (CPFF) contracts are common for services where the scope is not precisely defined at the outset or involves research and development. In a CPFF contract, the government reimburses the contractor for allowable costs plus a predetermined fixed fee. This differs from Firm-Fixed-Price (FFP) contracts, where the price is set regardless of the actual costs incurred, offering more cost certainty to the government but potentially higher initial prices to account for contractor risk. Compared to Cost Plus Incentive Fee (CPIF) or Cost Plus Award Fee (CPAF) contracts, CPFF offers less flexibility for incentivizing performance or cost savings beyond the fixed fee. While CPFF can be advantageous when scope is uncertain, it requires diligent government oversight to control costs and prevent contractor inefficiencies from inflating the total price.

What are the primary risks associated with a Cost Plus Fixed Fee contract of this duration?

The primary risk with a Cost Plus Fixed Fee (CPFF) contract, especially one spanning over five years, is the potential for cost escalation. Since the government reimburses allowable costs, there's an inherent incentive for contractors to incur higher costs, as this doesn't directly reduce their fixed fee. This necessitates robust government oversight to scrutinize all claimed costs and ensure they are reasonable, allocable, and necessary. Another risk is scope creep; if the project's requirements expand without proper modification of the contract's scope and fee, costs can increase significantly. Furthermore, the fixed fee, once established, doesn't directly reward efficiency or cost savings, potentially leading to less motivation for the contractor to optimize resource utilization compared to other contract types.

What is the typical annual spending for engineering services within the Department of Defense?

Annual spending on engineering services within the Department of Defense (DoD) is substantial and can fluctuate based on defense priorities, modernization efforts, and specific program needs. While precise aggregate figures for 'engineering services' can vary depending on how the category is defined and reported across different agencies and contract types, the DoD consistently represents one of the largest federal buyers of such services. Historically, total federal spending on engineering and architectural services alone has been in the tens of billions of dollars annually, with a significant portion directed towards defense-related projects. This $34.6 million contract, spread over several years, represents a portion of that larger ecosystem of defense engineering support.

How does the number of bidders (6) influence the potential value for taxpayers?

Having six bidders for this contract generally indicates a healthy level of competition within the market for these specific engineering services. A higher number of bidders typically leads to more competitive pricing as companies vie for the award. This increased competition can drive down costs for the government, resulting in better value for taxpayers. It also provides the government with a wider range of technical solutions and potentially allows for better selection of the most capable and cost-effective offeror. Conversely, a low number of bidders might suggest market concentration or barriers to entry, potentially leading to higher prices and less innovation.

Industry Classification

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

Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › PROFESSIONAL SERVICES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: N0002413R3294

Offers Received: 6

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Address: 345 BOB HEATH DR, HUNTSVILLE, AL, 35806

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

Financial Breakdown

Contract Ceiling: $74,808,679

Exercised Options: $62,732,510

Current Obligation: $34,650,122

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: N0017814D8000

IDV Type: IDC

Timeline