State Department's $414.6M Iraq facilities contract awarded to PAE Government Services raises value and competition questions

Contract Overview

Contract Amount: $414,634,932 ($414.6M)

Contractor: PAE Government Services, Inc.

Awarding Agency: Department of State

Start Date: 2013-12-06

End Date: 2026-04-30

Contract Duration: 4,528 days

Daily Burn Rate: $91.6K/day

Competition Type: FULL AND OPEN COMPETITION

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: IGF::OT::IGF OPERATIONS AND MAINTENANCE SERVICES AT BAGHDAD DIPLOMATIC SUPPORT CENTER, IRAQ

Plain-Language Summary

Department of State obligated $414.6 million to PAE GOVERNMENT SERVICES, INC. for work described as: IGF::OT::IGF OPERATIONS AND MAINTENANCE SERVICES AT BAGHDAD DIPLOMATIC SUPPORT CENTER, IRAQ Key points: 1. Contract value significantly exceeds typical facilities support services benchmarks. 2. Limited public data on performance metrics makes value assessment challenging. 3. Full and open competition was utilized, but bidder numbers are not specified. 4. Contract duration extends over a decade, indicating long-term service reliance. 5. The contract is a delivery order under a larger indefinite-delivery/indefinite-quantity (IDIQ) vehicle. 6. No small business set-aside was applied, with no indication of subcontracting plans.

Value Assessment

Rating: questionable

The contract's total value of $414.6 million for facilities support services in Iraq appears high when compared to similar contracts for base operations and maintenance. While specific performance metrics are not publicly detailed, the extended duration and significant funding suggest a substantial scope of work. Benchmarking against industry standards for facilities management in complex environments is difficult without more granular data on service levels and outcomes. The firm-fixed-price nature aims to control costs, but the overall expenditure warrants scrutiny regarding efficiency and necessity.

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. However, the number of bidders that participated in this specific delivery order is not publicly disclosed. Full and open competition is generally expected to foster price discovery and ensure the government receives competitive pricing. The absence of specific bidder counts prevents a definitive assessment of the competitive intensity for this particular award.

Taxpayer Impact: While full and open competition is the preferred method, the lack of transparency regarding the number of bids received makes it difficult to ascertain if taxpayers received the best possible value through robust price competition.

Public Impact

Provides essential operational support for U.S. diplomatic missions in Iraq. Ensures the functioning of critical infrastructure at the Baghdad Diplomatic Support Center. Supports the safety and security of U.S. government personnel stationed in Iraq. Contributes to the stability and effectiveness of U.S. foreign policy operations. Likely involves a significant local workforce for service delivery.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

High contract value for facilities support services.
Extended contract duration raises concerns about long-term cost efficiency.
Lack of detailed public performance data hinders value-for-money assessment.
Potential for cost overruns if scope or requirements change significantly.

Positive Signals

Awarded under full and open competition, suggesting a competitive process.
Firm-fixed-price contract type helps to control costs.
PAE Government Services has extensive experience in government contracting.
Contract supports critical U.S. diplomatic operations abroad.

Sector Analysis

This contract falls within the facilities support services sector, a broad category encompassing maintenance, repair, and operational support for government installations. The market for these services, particularly in overseas contingency operations, is substantial and often dominated by large government contractors. Spending in this sector is driven by the need to maintain secure and functional environments for government personnel and assets. Comparable spending benchmarks are difficult to establish precisely due to the unique operational context and location.

Small Business Impact

The contract data indicates that this award was not set aside for small businesses, and there is no explicit mention of subcontracting requirements for small businesses. This suggests that the prime contractor, PAE Government Services, will likely perform the majority of the work. Without specific subcontracting plans or goals, the direct impact on the small business ecosystem for this particular contract is likely minimal, though PAE may engage small businesses as subcontractors at its discretion.

Oversight & Accountability

Oversight for this contract would typically be managed by the Department of State's Bureau of Overseas Buildings Operations (OBO) or a similar contracting activity. The firm-fixed-price nature of the contract provides a degree of cost control. Transparency is limited by the public availability of detailed performance reports and audits. Inspector General jurisdiction would apply, with the Department of State's Office of Inspector General responsible for audits and investigations related to contract performance and potential fraud.

Related Government Programs

Base Operations Support Services
Logistics and Support Services
Facilities Maintenance Contracts
Overseas Contingency Operations Support

Risk Flags

High Contract Value
Long Contract Duration
Overseas Operations Risk
Limited Performance Transparency

Frequently Asked Questions

What is this federal contract paying for?

Department of State awarded $414.6 million to PAE GOVERNMENT SERVICES, INC.. IGF::OT::IGF OPERATIONS AND MAINTENANCE SERVICES AT BAGHDAD DIPLOMATIC SUPPORT CENTER, IRAQ

Who is the contractor on this award?

The obligated recipient is PAE GOVERNMENT SERVICES, INC..

Which agency awarded this contract?

Awarding agency: Department of State (Department of State).

What is the total obligated amount?

The obligated amount is $414.6 million.

What is the period of performance?

Start: 2013-12-06. End: 2026-04-30.

What is the historical spending pattern for facilities support services at the Baghdad Diplomatic Support Center?

Historical spending data for facilities support services at the Baghdad Diplomatic Support Center (BDSC) prior to this specific $414.6 million contract is not readily available in the public domain. However, the nature of diplomatic facilities in high-threat environments often necessitates continuous and substantial investment in operations and maintenance. Contracts for such services are typically long-term and can represent significant annual expenditures. The Department of State, through various contracting vehicles, has historically funded extensive support operations in Iraq to ensure the security and functionality of its diplomatic presence. Without access to specific historical contract awards and their values for the BDSC, a precise spending trend cannot be established, but it is reasonable to infer consistent, high-level investment in these critical support functions.

How does the per-unit cost of services under this contract compare to industry benchmarks for similar facilities in comparable regions?

A precise per-unit cost comparison is challenging due to the lack of granular service delivery data and the unique operational context of the Baghdad Diplomatic Support Center. Facilities support services encompass a wide range of activities, from security and maintenance to utilities and life support. Industry benchmarks for similar services in regions with comparable security risks and logistical complexities are often proprietary or difficult to aggregate. However, given the significant total contract value and its extended duration, the per-unit costs are likely to be substantial. The firm-fixed-price structure aims to cap these costs, but the overall expenditure suggests a premium for operating in a high-risk, remote location. Without specific breakdowns of services and their associated costs, a definitive benchmark comparison cannot be made.

What is PAE Government Services' track record with similar large-scale facilities support contracts, particularly in overseas environments?

PAE Government Services (now part of Amentum) has a well-established and extensive track record in providing large-scale facilities support and base operations services, particularly in challenging overseas environments. The company has historically held numerous significant contracts with the Department of Defense and the Department of State, including extensive operations in Iraq and Afghanistan. These contracts often involve comprehensive support functions such as logistics, maintenance, security, and life support for military bases and diplomatic facilities. While PAE has a broad history of performance, the scale and duration of specific contracts, along with their associated performance evaluations and any past performance issues, would require a deeper dive into contract databases and official performance records. Generally, PAE is recognized as a major player in this sector.

What are the primary risks associated with this contract, and what mitigation strategies are in place?

Primary risks associated with this contract include geopolitical instability in Iraq impacting operations, potential security threats to personnel and facilities, logistical challenges in delivering supplies and services, currency fluctuations, and the potential for scope creep or unforeseen operational requirements. Contractor performance failures, such as inadequate maintenance or service delivery, also pose a risk. Mitigation strategies likely include robust security protocols, contingency planning for operational disruptions, strong contract management and oversight by the Department of State, and performance-based incentives or penalties within the contract terms. The firm-fixed-price nature helps mitigate cost overrun risks, but managing the scope and ensuring consistent service quality in a volatile environment remain key challenges.

How does the competition level for this contract (full and open) typically influence pricing and value for taxpayers?

Awarding contracts under full and open competition generally provides the best opportunity for taxpayers to receive competitive pricing and maximize value. This approach allows any responsible source to submit an offer, fostering a wider range of potential bidders and encouraging them to submit their most competitive proposals to win the contract. The increased number of bidders typically drives down prices through market forces. While the specific number of bidders for this particular delivery order is not public, the 'full and open' designation indicates that the government sought the broadest possible competition. This process is designed to ensure that the government is not limited to a select few providers, thereby enhancing price discovery and potentially leading to more cost-effective outcomes for taxpayer funds.

Industry Classification

NAICS: Administrative and Support and Waste Management and Remediation Services › Facilities Support Services › Facilities Support Services

Product/Service Code: UTILITIES AND HOUSEKEEPING › HOUSEKEEPING SERVICES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: PAE Government Services Inc.

Address: 1320 N COURTHOUSE RD STE 700, ARLINGTON, VA, 22201

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

Financial Breakdown

Contract Ceiling: $453,590,160

Exercised Options: $420,636,116

Current Obligation: $414,634,932

Actual Outlays: $63,927,051

Subaward Activity

Number of Subawards: 339

Total Subaward Amount: $185,925,028

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: SAQMMA12D0165

IDV Type: IDC

Timeline