Logistics support services contract awarded to Brown & Root Services for $177.6M, spanning over 10 months

Contract Overview

Contract Amount: $95,053,793 ($95.1M)

Contractor: Brown & Root Services

Awarding Agency: Department of Defense

Start Date: 2001-11-15

End Date: 2002-09-30

Contract Duration: 319 days

Daily Burn Rate: $298.0K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: COST PLUS AWARD FEE

Sector: Defense

Official Description: 200212!000063!2100!CA78 !TRANSATLANTIC PROGRAM CENTER !DACA7899D0003 !A!N! !Y!0043 !20011115!20020930!177582855!010810893!964409007!N!BROWN & ROOT SERVICES, A DIVIS!9900 WESTPARK !HOUSTON !TX!77063!* !* !YO!* !* !YUGOSLAVIA!+000006874979!N!N!000000000000!R706!LOGISTICS SUPPORT SERVICES !S1 !SERVICES !1000!NOT DISCERNABLE OR CLASSIFIED !541614!E! !5!B!S!H! !D!20020930!B! ! !B! !A!Y!R!2!002!B! !Z!N!Z! ! !N!M!N! ! ! ! ! !A!A!000!A!B!N! ! !Y!Y! ! !0001!

Plain-Language Summary

Department of Defense obligated $95.1 million to BROWN & ROOT SERVICES for work described as: 200212!000063!2100!CA78 !TRANSATLANTIC PROGRAM CENTER !DACA7899D0003 !A!N! !Y!0043 !20011115!20020930!177582855!010810893!964409007!N!BROWN & ROOT SERVICES, A DIVIS!9900 WESTPARK !HOUSTON !TX!77063!* !* !YO!* !* !YUGOSLAVIA!+000006874979!N!N!000000000000!R706!LOGISTICS SUPPORT SE… Key points: 1. Contract value of $177.6 million for a 10-month period suggests a high monthly burn rate. 2. Awarded under full and open competition, indicating a potentially competitive bidding process. 3. The contract type is Cost Plus Award Fee, which can incentivize performance but may lead to higher costs. 4. Services are for logistics support in Yugoslavia, highlighting a specific and potentially high-risk operational environment. 5. The contractor, Brown & Root Services, has a significant contract value, suggesting substantial operational capacity. 6. The contract duration is relatively short (319 days), implying a focused scope of work or a bridge contract.

Value Assessment

Rating: fair

The contract value of $177.6 million for a 10-month period is substantial. Without specific performance metrics or comparable contracts for similar logistics support in a post-conflict or active zone, it's difficult to definitively benchmark value. The Cost Plus Award Fee structure allows for flexibility but also introduces potential for cost overruns if not managed tightly. The relatively high monthly expenditure rate warrants scrutiny to ensure efficiency and necessity.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under 'full and open competition,' suggesting that multiple bidders were likely solicited and considered. This approach is generally favorable for price discovery and ensuring the government receives competitive offers. The number of bidders is not specified, but the designation implies a robust competition.

Taxpayer Impact: A full and open competition process is intended to secure the best value for taxpayers by fostering a competitive environment that drives down prices and improves service quality.

Public Impact

US military forces and personnel operating in Yugoslavia benefit from the provision of essential logistics support. Services include the movement, storage, and management of supplies and equipment critical for operational readiness. The geographic impact is focused on the Balkan region, specifically supporting operations in Yugoslavia. Workforce implications may include the deployment of personnel by Brown & Root Services to the operational theater, potentially including local hires.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost Plus Award Fee contracts can lead to higher final costs compared to fixed-price contracts if award fees are consistently met without stringent cost controls.
Operating in a potentially unstable region like Yugoslavia presents inherent logistical and security risks that could impact contract performance and cost.
The short duration of the contract might indicate a temporary need or a precursor to a larger, longer-term requirement, requiring careful planning for transition.

Positive Signals

Awarded through full and open competition, suggesting a competitive process aimed at achieving best value.
The contractor, Brown & Root Services, is a known entity in providing large-scale support services, implying experience and capacity.
The contract clearly defines the service area (Yugoslavia), indicating a specific and potentially critical mission requirement.

Sector Analysis

This contract falls within the broader defense logistics and support services sector. This sector is characterized by large, complex contracts often awarded to a few major defense contractors. The market size for such services is substantial, driven by global military deployments and operational requirements. This specific contract for services in Yugoslavia represents a niche but critical application of these capabilities.

Small Business Impact

The contract details do not indicate any specific small business set-aside provisions or subcontracting requirements. Given the scale and nature of the services, it is possible that larger prime contractors like Brown & Root Services would engage subcontractors, but the extent to which small businesses would participate is not specified. Further analysis would be needed to determine subcontracting plans and their impact on the small business ecosystem.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of the Army and potentially the Department of Defense's Inspector General. Mechanisms would include contract performance reviews, financial audits, and site inspections to ensure compliance with terms and conditions. Transparency is generally maintained through contract award databases, though specific operational details might be classified.

Related Government Programs

Defense Logistics Agency (DLA) Operations
Contingency Contracting
Base Operations Support (BOS)
Theater Support Contracts

Risk Flags

Cost Plus Award Fee contract type can lead to higher costs if not managed effectively.
Operating in a potentially unstable geopolitical region increases inherent risks.
Short contract duration may indicate a temporary need or require careful transition planning.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $95.1 million to BROWN & ROOT SERVICES. 200212!000063!2100!CA78 !TRANSATLANTIC PROGRAM CENTER !DACA7899D0003 !A!N! !Y!0043 !20011115!20020930!177582855!010810893!964409007!N!BROWN & ROOT SERVICES, A DIVIS!9900 WESTPARK !HOUSTON !TX!77063!* !* !YO!* !* !YUGOSLAVIA!+000006874979!N!N!000000000000!R706!LOGISTICS SUPPORT SERVICES !S1 !SERVICES !1000!NOT DISCERNABLE OR CLASSIFIED !541614!E! !5!B!S!H! !D!20020930!B! ! !B! !A!Y!R!2!002!B! !Z!N!Z! ! !N!M!N! ! ! ! ! !A!A!000!A!B!N! ! !Y!Y! ! !0001!

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 $95.1 million.

What is the period of performance?

Start: 2001-11-15. End: 2002-09-30.

What is the historical spending pattern for logistics support services in the Balkans by the Department of Defense?

Historical spending on logistics support in the Balkans by the Department of Defense has varied significantly based on geopolitical events and troop presence. Following the conflicts in the former Yugoslavia in the 1990s, significant resources were allocated to stabilization and support operations, including extensive logistics. Contracts during these periods often involved large sums for transportation, base support, and supply chain management. The specific contract awarded to Brown & Root Services in 2001-2002 for $177.6 million aligns with the period of ongoing stabilization efforts and troop presence in the region. Analyzing prior contracts, such as those awarded for Operation Joint Endeavor or subsequent operations, would reveal trends in contract types (e.g., cost-plus vs. fixed-price), key service providers, and overall expenditure levels, providing context for the value and necessity of this particular award.

How does the Cost Plus Award Fee (CPAF) structure compare to other contract types for similar logistics services in terms of cost and risk?

Cost Plus Award Fee (CPAF) contracts are designed to provide flexibility in scope and allow for performance incentives. In CPAF, the contractor is reimbursed for allowable costs plus a fee that is composed of a fixed base amount and an award amount, which is earned based on meeting or exceeding performance objectives. Compared to Fixed-Price contracts, CPAF generally carries less cost risk for the contractor but potentially more for the government, as costs are reimbursed. However, it offers more flexibility than Firm-Fixed-Price contracts when the scope is uncertain or evolving, common in complex environments like Yugoslavia. Compared to Cost-Plus-Fixed-Fee (CPFF), CPAF adds an incentive element, potentially driving better performance. The risk for the government lies in ensuring the award fee criteria are objective, measurable, and truly reflect superior performance, preventing inflated costs without commensurate value.

What was the track record of Brown & Root Services in executing large-scale logistics contracts prior to this award?

Prior to this 2001-2002 contract, Brown & Root Services (which later became part of KBR) had a well-established track record in executing large-scale government contracts, particularly in logistics, base support, and construction, often in challenging overseas environments. They were known for managing extensive operations, including significant support for military deployments. For instance, they had been involved in providing services in various global hotspots and supporting major military exercises. Their experience often included managing complex supply chains, maintaining facilities, and providing essential life support. This extensive background likely positioned them favorably for a contract of this nature and scale, suggesting they possessed the necessary infrastructure, personnel, and management expertise to handle the demands of logistics support in Yugoslavia.

What specific performance metrics were likely used to determine the award fee for this contract?

For a Cost Plus Award Fee (CPAF) contract like this one for logistics support in Yugoslavia, the award fee would typically be tied to specific, measurable performance objectives outlined in the contract's Performance Work Statement (PWS). These metrics likely included factors such as on-time delivery of supplies, inventory accuracy, equipment maintenance and readiness rates, response times for logistical requests, adherence to safety standards, and overall mission support effectiveness. The government would have evaluated the contractor's performance against these criteria, potentially through regular performance reviews, data collection, and feedback from end-users (military units). The 'award' portion of the fee would be contingent on exceeding baseline performance expectations, incentivizing the contractor to deliver high-quality services.

How did the geopolitical situation in Yugoslavia influence the contract's scope, risk, and pricing?

The geopolitical situation in Yugoslavia during the early 2000s was complex, marked by post-conflict stabilization efforts and ongoing political transitions. This context significantly influenced the contract by defining the scope as essential logistics support for military or peacekeeping operations. The inherent risks were elevated due to potential security concerns, unstable infrastructure, and the challenging operating environment. These risks would have factored into the pricing, likely leading to higher costs for personnel, equipment, and insurance compared to operations in more stable regions. The government would have needed to carefully define requirements while acknowledging the volatile environment, potentially leading to more flexible contract terms (like CPAF) to adapt to changing circumstances.

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

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: DACA7899D0003

IDV Type: IDC

Timeline