Leidos awarded $508M for Afghanistan bridge support, a sole-source contract with significant duration

Contract Overview

Contract Amount: $508,205,279 ($508.2M)

Contractor: Leidos, Inc.

Awarding Agency: Department of Defense

Start Date: 2017-08-24

End Date: 2022-05-31

Contract Duration: 1,741 days

Daily Burn Rate: $291.9K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: SMW MI-17 CLS BRIDGE AFGHANISTAN

Place of Performance

Location: WARNER ROBINS, HOUSTON County, GEORGIA, 31088

State: Georgia Government Spending

Plain-Language Summary

Department of Defense obligated $508.2 million to LEIDOS, INC. for work described as: SMW MI-17 CLS BRIDGE AFGHANISTAN Key points: 1. Contract awarded on a sole-source basis, raising questions about price discovery and potential for overpayment. 2. The contract's long duration (1741 days) suggests a need for sustained support, but also increases long-term cost exposure. 3. Fixed-price contract type aims to control costs, but the lack of competition may negate this benefit. 4. The award to a single contractor, Leidos, Inc., warrants scrutiny regarding their qualifications and past performance in similar complex environments. 5. Geographic focus on Afghanistan indicates a high-risk operating environment, potentially impacting cost and execution. 6. The absence of small business set-asides or subcontracting requirements suggests limited direct benefit to the small business ecosystem for this specific award.

Value Assessment

Rating: questionable

Benchmarking the value of this contract is challenging due to its sole-source nature and specific operational context in Afghanistan. Without competitive bids, it's difficult to ascertain if the $508 million represents a fair market price. The fixed-price structure offers some cost control, but the lack of competition means taxpayers may not have received the best possible value. Further analysis would require comparing the scope of services to similar support contracts in comparable high-risk environments, which are likely scarce.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning it was not competed among multiple vendors. This typically occurs when only one vendor possesses the unique capabilities or resources required for the service, or in situations where urgency or national security dictates a direct award. The lack of competition limits price discovery and may result in higher costs for the government compared to a competitively bid contract.

Taxpayer Impact: Sole-source awards mean taxpayers do not benefit from the cost savings typically achieved through competitive bidding processes. This can lead to higher overall expenditures for government services.

Public Impact

The primary beneficiaries are the U.S. military operations in Afghanistan, receiving critical logistical and support services. Services delivered include essential bridge construction and maintenance, vital for infrastructure and operational mobility. The geographic impact is concentrated within Afghanistan, supporting U.S. and allied forces operating in the region. Workforce implications are likely significant for Leidos, Inc., requiring specialized personnel with experience in complex, high-risk environments.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits competitive pressure, potentially inflating costs.
Long contract duration increases exposure to cost overruns and performance degradation.
Operating in Afghanistan presents inherent security and logistical risks that could impact delivery and cost.
Lack of transparency in the sole-source justification requires further review.
No clear indication of small business participation or subcontracting opportunities.

Positive Signals

Fixed-price contract type provides cost certainty if scope is well-defined.
Leidos, Inc. is a large, established contractor with experience in complex government projects.
The contract addresses a critical need for infrastructure support in a challenging operational theater.

Sector Analysis

This contract falls within the 'Other Support Activities for Air Transportation' NAICS code, though the description 'CLS BRIDGE AFGHANISTAN' suggests a broader logistical and construction support role. The defense sector, particularly in support of overseas operations, often involves large, complex contracts for specialized services. The market for such services in high-risk, remote locations is limited, often leading to sole-source or limited competition awards. Comparable spending benchmarks are difficult to establish due to the unique operational context.

Small Business Impact

This contract does not appear to have a small business set-aside component, nor is there explicit information regarding subcontracting plans for small businesses. The sole-source nature of the award further limits opportunities for small businesses to participate directly. This suggests that the primary focus was on securing the required services from a specific large contractor, rather than fostering small business engagement.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of the Army and potentially the Department of Defense's Inspector General, especially given the significant dollar value and operational context. Transparency is limited due to the sole-source nature. Accountability measures would be defined within the contract's terms and conditions, focusing on performance milestones and deliverables. The effectiveness of oversight in a remote, high-risk environment like Afghanistan is a critical consideration.

Related Government Programs

Afghanistan Security Forces Fund (ASFF)
Logistics Civil Augmentation Program (LOGCAP)
Base Operations Support (BOS)

Risk Flags

Sole-source award
High-risk operating environment
Long contract duration
Lack of small business participation

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $508.2 million to LEIDOS, INC.. SMW MI-17 CLS BRIDGE AFGHANISTAN

Who is the contractor on this award?

The obligated recipient is LEIDOS, INC..

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Army).

What is the total obligated amount?

The obligated amount is $508.2 million.

What is the period of performance?

Start: 2017-08-24. End: 2022-05-31.

What specific justification was provided for awarding this contract on a sole-source basis?

Sole-source awards are typically justified when only one responsible source is available or capable of meeting the agency's needs. For a contract of this magnitude and complexity in a challenging environment like Afghanistan, justifications often cite unique capabilities, proprietary technology, or urgent requirements that cannot be met through competitive means. Without access to the specific Justification and Approval (J&A) document, it's impossible to detail the exact reasons. However, common factors include specialized expertise in construction and logistics within active conflict zones, established presence and security protocols, and the need for continuity of essential services without disruption. The Department of the Army would have had to formally document and approve this justification, often requiring higher-level review due to the dollar value and non-competitive nature.

How does the $508 million contract value compare to similar bridge support or logistical contracts in Afghanistan or other high-risk operational theaters?

Direct comparisons for this specific contract are challenging due to its sole-source nature and the unique operational context of Afghanistan. However, large-scale logistical and construction support contracts in similar theaters, such as those awarded under programs like LOGCAP (Logistics Civil Augmentation Program), have historically run into billions of dollars over their lifecycles. The $508 million for a 1741-day period (approximately 4.7 years) translates to roughly $108 million per year. This annual figure needs to be assessed against the scope of services, which includes bridge support, implying significant engineering, materials, labor, and security costs. While high, the cost per year might be within the expected range for extensive, high-risk infrastructure projects in a theater like Afghanistan, especially when considering the lack of competition and associated risk premiums.

What are the key performance indicators (KPIs) and risk mitigation strategies embedded within this contract?

Key performance indicators (KPIs) for a contract like this would likely focus on the timely completion of bridge construction and repair projects, adherence to safety standards, quality of materials and workmanship, and operational availability of completed infrastructure. Risk mitigation strategies would be crucial given the Afghan operating environment. These could include robust security protocols for personnel and equipment, contingency planning for supply chain disruptions, force protection measures, and clear communication channels with military leadership. The fixed-price nature of the contract incentivizes the contractor to manage costs, but the government would still need to monitor performance closely to ensure KPIs are met and risks are actively managed throughout the contract's duration.

What is Leidos, Inc.'s track record with similar large-scale, sole-source contracts in challenging overseas environments?

Leidos, Inc. has a substantial track record of performing large-scale government contracts, including significant work in defense, intelligence, and logistics. They have been involved in various support roles in overseas operations, often requiring complex logistical and technical solutions. While specific details on their past sole-source awards in environments as challenging as Afghanistan might require deeper investigation into contract databases, Leidos is generally recognized as a capable prime contractor for such demanding requirements. Their experience often includes managing complex supply chains, providing technical expertise, and operating within security-sensitive areas. However, the success and value proposition of any sole-source award, including this one, ultimately depends on the specific execution and oversight applied.

How has historical spending on bridge construction and support in Afghanistan trended, and does this contract represent an anomaly?

Historical spending on bridge construction and support in Afghanistan has been substantial, driven by the U.S. military's long-term presence and the need for critical infrastructure to support operations and reconstruction efforts. Programs like the Afghanistan Infrastructure and Reconstruction Fund (AIRF) and various Department of Defense initiatives have allocated billions towards such projects over the past two decades. Spending trends can fluctuate based on strategic shifts, troop levels, and security conditions. A $508 million contract for bridge support, especially if sole-source and long-duration, is not necessarily an anomaly in the context of sustained U.S. engagement in Afghanistan, where infrastructure development and maintenance were consistently prioritized. However, the specific details of the award (sole-source, contractor, duration) would determine if it deviates from typical contracting patterns.

Industry Classification

NAICS: Transportation and Warehousing › Support Activities for Air Transportation › Other Support Activities for Air Transportation

Product/Service Code: AEROSPACE CRAFT AND STRUCTURAL COMPONENTS

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Leidos Holdings, Inc.

Address: 700 N FREDERICK AVE, GAITHERSBURG, MD, 20879

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

Financial Breakdown

Contract Ceiling: $661,295,499

Exercised Options: $570,956,015

Current Obligation: $508,205,279

Subaward Activity

Number of Subawards: 312

Total Subaward Amount: $83,802,721

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline