Department of Defense awards $164M logistics support contract to Brown & Root Services for Macedonia operations

Contract Overview

Contract Amount: $58,930,494 ($58.9M)

Contractor: Brown & Root Services

Awarding Agency: Department of Defense

Start Date: 1999-10-07

End Date: 2000-09-30

Contract Duration: 359 days

Daily Burn Rate: $164.2K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: COST PLUS AWARD FEE

Sector: Defense

Official Description: 200009!2100!000005!CA78 !TRANSATLANTIC PROGRAM CENTER !DACA7899D0003 !A!*!0038 !19991007!20000930!177582855!010810893!964409007!N!0BY16!BROWN & ROOT SERVICES, A DIVIS!9900 WESTPARK !HOUSTON !TX!77063!* !* !MK!* !* !MACEDONIA !0001!+000007098976!N!N!000000000000!R706!LOGISTICS SUPPORT SERVICES !S1 !SERVICES !1000!NOT DISCERNABLE OR CLASSIFIED !8742!5!B!S!A!B!B!*!A !Y!R!2!002!B!* !Z!N!Z!* !* !N!M!*!*!*!A!A!A!A!* !*!N!A!B!N!*!*!Y!Y!*!

Place of Performance

Location: WINCHESTER, FREDERICK County, VIRGINIA, 22602

State: Virginia Government Spending

Plain-Language Summary

Department of Defense obligated $58.9 million to BROWN & ROOT SERVICES for work described as: 200009!2100!000005!CA78 !TRANSATLANTIC PROGRAM CENTER !DACA7899D0003 !A!*!0038 !19991007!20000930!177582855!010810893!964409007!N!0BY16!BROWN & ROOT SERVICES, A DIVIS!9900 WESTPARK !HOUSTON !TX!77063!* !* !MK!* !* … Key points: 1. Contract awarded for logistics support services in Macedonia. 2. Brown & Root Services, a division of Halliburton, secured the contract. 3. The contract duration was 359 days. 4. Awarded as a Delivery Order under a larger contract. 5. The contract type was Cost Plus Award Fee. 6. The total value of this specific award was over $164 million.

Value Assessment

Rating: fair

The contract value of $164,152,855 for approximately one year of logistics support services in Macedonia appears to be within a reasonable range for such operations, though direct comparisons are difficult without more specific service details. The Cost Plus Award Fee (CPAF) structure allows for flexibility but also introduces potential for cost overruns if performance targets are not met or are exceeded without strict oversight. Benchmarking this against similar international logistics support contracts would provide a clearer picture of value for money.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that multiple bidders had the opportunity to submit proposals. The presence of two bids suggests a moderate level of competition for this specific delivery order. While full and open competition is generally preferred, the limited number of bidders for this particular award might warrant further investigation into market dynamics or potential barriers to entry for other interested parties.

Taxpayer Impact: Full and open competition is beneficial for taxpayers as it generally drives down prices through market forces. Even with only two bidders, the competitive process likely resulted in a more favorable price than a sole-source award.

Public Impact

The primary beneficiaries of this contract are the U.S. military personnel and operations in Macedonia, who receive essential logistics support. Services delivered include a broad range of logistics support, crucial for maintaining operational readiness. The geographic impact is focused on Macedonia, supporting U.S. presence and activities in the region. While not explicitly stated, such contracts often have implications for local employment and the use of local resources where feasible.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost Plus Award Fee contracts can lead to higher costs if not managed tightly.
Limited number of bidders in a full and open competition could indicate potential market concentration or barriers.
The specific nature of 'logistics support services' is broad and may obscure specific cost drivers.

Positive Signals

Awarded under full and open competition, suggesting a fair process.
The contract was a Delivery Order, implying it's part of a larger, potentially established framework.
The contractor, Brown & Root Services, has a significant track record in government contracting.

Sector Analysis

This contract falls within the broader Defense sector, specifically focusing on logistics and support services. The market for such services is substantial, driven by global military deployments and operational requirements. Companies like Brown & Root Services are key players in this niche, providing essential infrastructure and operational support to government agencies operating in diverse and often challenging environments. Comparable spending benchmarks would typically be found within broader categories of 'logistics support' or 'base operations support' contracts.

Small Business Impact

There is no explicit indication from the provided data that this contract involved small business set-asides or significant subcontracting opportunities for small businesses. The primary award went to a large, established contractor. Further analysis would be needed to determine if subcontracting plans included provisions for small business participation.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of the Army, given it was awarded by the Army. The Cost Plus Award Fee structure necessitates robust oversight to ensure performance targets are met and costs are justified. Accountability measures would be tied to the award fee criteria. Transparency would depend on the reporting requirements within the contract and the agency's policies on releasing contract details.

Related Government Programs

Base Operations Support (BOS)
Logistics and Supply Chain Management
International Operations Support
Contingency Contracting

Risk Flags

Cost Plus Award Fee contract type requires close monitoring.
Limited competition (2 bidders) in a full and open solicitation.
Contract duration is relatively short (approx. 1 year).

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $58.9 million to BROWN & ROOT SERVICES. 200009!2100!000005!CA78 !TRANSATLANTIC PROGRAM CENTER !DACA7899D0003 !A!*!0038 !19991007!20000930!177582855!010810893!964409007!N!0BY16!BROWN & ROOT SERVICES, A DIVIS!9900 WESTPARK !HOUSTON !TX!77063!* !* !MK!* !* !MACEDONIA !0001!+000007098976!N!N!000000000000!R706!LOGISTICS SUPPORT SERVICES !S1 !SERVICES !1000!NOT DISCERNABLE OR CLASSIFIED !8742!5!B!S!A!B!B!*!A !Y!R!

Who is the contractor on this award?

The obligated recipient is BROWN & ROOT SERVICES.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $58.9 million.

What is the period of performance?

Start: 1999-10-07. End: 2000-09-30.

What was the specific performance period and total value of the contract awarded to Brown & Root Services?

The contract data indicates that the performance period for this specific delivery order was from October 7, 1999, to September 30, 2000, spanning approximately 359 days. The total value awarded for this period was $164,152,855. This represents a significant investment for a little over a year of service, highlighting the critical nature and potential cost intensity of international logistics support operations.

How did the 'Cost Plus Award Fee' (CPAF) structure influence the final cost and contractor performance?

The Cost Plus Award Fee (CPAF) contract structure means that the contractor is reimbursed for allowable costs plus a fixed fee, which is then adjusted based on performance against pre-defined criteria. For this contract, Brown & Root Services would have received their costs plus a base fee, with the potential to earn an additional award fee if they exceeded performance expectations. Conversely, underperformance could reduce the fee. This structure incentivizes high performance but also requires diligent government oversight to ensure that costs are reasonable and that award fees are earned legitimately, not simply granted. The final cost of $164M reflects the base fee, allowable costs, and any award fee earned.

What were the key logistics support services provided under this contract in Macedonia?

The contract identifies the service as 'LOGISTICS SUPPORT SERVICES' (PSC R706). While the specific details are not itemized in the provided data, such services typically encompass a wide range of functions essential for military operations. This can include transportation, supply chain management, warehousing, maintenance of equipment, facility management, and potentially personnel support services. Given the location in Macedonia, these services were likely critical for supporting U.S. forces engaged in regional security or peacekeeping operations during that period.

What is the significance of this contract being a 'Delivery Order'?

This contract was issued as a 'Delivery Order' (AWARD TYPE: DELIVERY ORDER), which means it is a task order placed against a previously awarded indefinite-delivery, indefinite-quantity (IDIQ) or other type of basic contract. This implies that a broader contract vehicle was already in place, likely establishing terms, conditions, and potentially pricing structures. The issuance of a Delivery Order signifies a specific requirement for goods or services at a particular time and location, in this case, logistics support in Macedonia. It allows for flexibility in acquiring services as needed over the life of the parent contract.

What does the contractor's location in Houston, Texas, imply for a contract in Macedonia?

The contractor, Brown & Root Services, being headquartered in Houston, Texas, indicates that the administrative and potentially some management functions are based in the U.S. However, for a contract requiring on-the-ground services in Macedonia, the company would establish a local presence or utilize a network of subcontractors and local resources in the theater of operations. The Houston base signifies the corporate entity awarded the contract, while operational execution would be localized to meet the mission requirements in Macedonia.

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 2

Pricing Type: COST PLUS AWARD FEE (R)

Evaluated Preference: NONE

Contractor Details

Address: 4100 CLINTON DR, HOUSTON, TX, 77020

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: DACA7899D0003

IDV Type: IDC

Timeline