DoD's $33.5M IGF Australia FMS Program Management Services contract awarded to KBR Wyle Services, LLC

Contract Overview

Contract Amount: $33,544,853 ($33.5M)

Contractor: KBR Wyle Services, LLC

Awarding Agency: Department of Defense

Start Date: 2017-08-29

End Date: 2022-11-30

Contract Duration: 1,919 days

Daily Burn Rate: $17.5K/day

Competition Type: NOT AVAILABLE FOR COMPETITION

Number of Offers Received: 1

Pricing Type: COST PLUS FIXED FEE

Sector: Defense

Official Description: IGF::OT::IGF AUSTRALIA FMS PROGRAM MANAGEMENT SERVICES DIRECTED SOURCE

Place of Performance

Location: HUNTSVILLE, MADISON County, ALABAMA, 35806

State: Alabama Government Spending

Plain-Language Summary

Department of Defense obligated $33.5 million to KBR WYLE SERVICES, LLC for work described as: IGF::OT::IGF AUSTRALIA FMS PROGRAM MANAGEMENT SERVICES DIRECTED SOURCE Key points: 1. Contract awarded on a directed source basis, raising questions about competition and potential value. 2. Significant duration of 1919 days suggests a long-term need for these services. 3. The contract type (Cost Plus Fixed Fee) can lead to cost overruns if not managed tightly. 4. Awarded to a single contractor, limiting opportunities for market-driven price discovery. 5. Geographic location of performance in Alabama may indicate specific operational needs or contractor presence. 6. The 'Engineering Services' NAICS code suggests a focus on technical and specialized support.

Value Assessment

Rating: questionable

Benchmarking the value of this contract is challenging due to its directed source nature and lack of publicly available comparable data. The Cost Plus Fixed Fee structure, while common for complex services, carries inherent risks of cost escalation. Without competitive bids, it's difficult to ascertain if the fixed fee adequately compensates the contractor for the scope of work or if it represents a fair market price. Further analysis would require access to detailed cost breakdowns and performance metrics.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a directed source basis, meaning it was not openly competed. This approach is typically used when a specific contractor possesses unique capabilities or when urgent circumstances preclude a full and open competition. The lack of multiple bidders means there was no opportunity for price negotiation driven by market forces, potentially leading to a higher overall cost for the government.

Taxpayer Impact: Taxpayers may have paid a premium due to the absence of competitive pressure. The directed source award bypasses the standard procurement process designed to secure the best value through competition.

Public Impact

The primary beneficiaries are likely the Department of Defense and potentially allied nations receiving foreign military sales support. Services delivered include program management, crucial for the successful execution of complex international defense initiatives. Performance is located in Alabama, suggesting a concentration of specialized defense support capabilities within that state. The contract supports a specialized workforce in engineering and program management, contributing to the defense industrial base.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may result in higher costs for taxpayers.
Cost Plus Fixed Fee contract type introduces risk of cost overruns.
Directed source award bypasses standard competitive procurement processes.
Limited transparency into the justification for sole-source award.

Positive Signals

Contract awarded to an established entity (KBR Wyle Services, LLC) with presumed expertise.
Long contract duration suggests a stable and ongoing requirement met by the contractor.
Services provided are critical for foreign military sales program execution.

Sector Analysis

This contract falls within the Engineering Services sector, a critical component of the broader defense industrial base. The market for specialized program management and engineering support for foreign military sales is often characterized by a limited number of highly qualified contractors. Comparable spending benchmarks are difficult to establish without more specific details on the scope of services, but large-scale defense support contracts can range from tens to hundreds of millions of dollars.

Small Business Impact

The data indicates this contract was not set aside for small businesses, nor does it appear to have specific subcontracting requirements for small businesses mentioned. As a directed source award to a large contractor, the direct impact on the small business ecosystem is likely minimal unless KBR Wyle Services, LLC actively engages small businesses in its supply chain. Further investigation into subcontracting plans would be needed to assess the full impact.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of the Navy's contracting and program management offices. The Inspector General for the Department of Defense would have jurisdiction for audits and investigations. Transparency is limited by the directed source nature of the award, but contract performance reports and financial audits are standard oversight mechanisms.

Related Government Programs

Foreign Military Sales Program Management
Defense Contract Management
Engineering Services Contracts
Department of Defense Support Services

Risk Flags

Directed Source Award
Cost Plus Fixed Fee Contract Type
Lack of Competition

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $33.5 million to KBR WYLE SERVICES, LLC. IGF::OT::IGF AUSTRALIA FMS PROGRAM MANAGEMENT SERVICES DIRECTED SOURCE

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 $33.5 million.

What is the period of performance?

Start: 2017-08-29. End: 2022-11-30.

What specific justification was provided for the directed source award of this contract?

The justification for a directed source award typically stems from unique capabilities possessed by the contractor, urgent and compelling needs that preclude full and open competition, or specific statutory requirements. For the IGF Australia FMS Program Management Services contract, the directed source nature suggests that either KBR Wyle Services, LLC was deemed the only entity capable of performing the required specialized services, or there were critical time constraints. Without access to the official Justification for Other than Full and Open Competition (JOFOC) document, the precise rationale remains undisclosed. This lack of transparency is a common concern with sole-source awards, as it limits the public's ability to verify the necessity of bypassing competitive procedures.

How does the Cost Plus Fixed Fee (CPFF) contract type compare to other award types for similar services?

Cost Plus Fixed Fee (CPFF) contracts are common for complex services where the scope of work is difficult to define precisely at the outset, or when research and development is involved. In a CPFF contract, the contractor is reimbursed for allowable costs plus a fixed fee representing profit. This differs from Firm-Fixed-Price (FFP) contracts, where the price is set regardless of actual costs, offering greater cost certainty to the government but potentially higher risk for the contractor. For program management services, FFP might be preferred if the scope is well-defined and stable. However, the CPFF structure allows for flexibility, which can be beneficial for evolving foreign military sales programs. The primary risk with CPFF is potential cost overruns if cost controls are not rigorously enforced by the government.

What is the historical spending pattern for IGF Australia FMS Program Management Services?

Analyzing the historical spending pattern for this specific contract reveals a single award of $33,544,852.99 with a duration from August 29, 2017, to November 30, 2022, spanning 1919 days. This indicates a continuous, long-term requirement for these program management services over approximately five years. Without data on prior or subsequent contracts for the same or similar services under the IGF Australia FMS program, it's difficult to establish a broader trend. However, the substantial value and duration suggest this is a significant and ongoing component of the foreign military sales support infrastructure for Australia.

What are the potential risks associated with a directed source award for specialized defense services?

Directed source awards, while sometimes necessary, carry several potential risks. The most significant is the lack of competition, which can lead to inflated prices as the government foregoes the opportunity to leverage market forces for better value. There's also a risk of complacency from the awarded contractor, who may face less pressure to innovate or maintain high performance standards without competitive threats. Furthermore, the justification for directed source awards can sometimes be opaque, raising concerns about fairness and potential favoritism. For specialized defense services, ensuring the contractor maintains the necessary expertise and security clearances throughout the contract term is also critical, and without competition, the government has fewer options if performance falters.

How does the 'Engineering Services' NAICS code relate to the contract's purpose?

The North American Industry Classification System (NAICS) code 541330, 'Engineering Services,' indicates that the primary business activity associated with this contract involves the application of engineering principles and knowledge to provide services such as design, development, consulting, and project management. For the IGF Australia FMS Program Management Services contract, this NAICS code suggests that the services rendered go beyond basic administrative support. They likely encompass technical expertise, planning, oversight of engineering aspects of defense systems, and ensuring compliance with technical specifications relevant to foreign military sales. This aligns with the complexity often found in managing international defense programs.

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: NOT AVAILABLE FOR COMPETITION

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: N0042117R0020

Offers Received: 1

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Parent Company: KBR, Inc.

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: $46,267,140

Exercised Options: $42,061,037

Current Obligation: $33,544,853

Subaward Activity

Number of Subawards: 7

Total Subaward Amount: $12,922,076

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Timeline