DoD's $136M Engineering Services Contract to KBR Wyle Services Shows Mixed Value and Limited Competition
Contract Overview
Contract Amount: $136,072,789 ($136.1M)
Contractor: KBR Wyle Services, LLC
Awarding Agency: Department of Defense
Start Date: 2008-10-10
End Date: 2015-12-31
Contract Duration: 2,638 days
Daily Burn Rate: $51.6K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 3
Pricing Type: COST PLUS INCENTIVE FEE
Sector: Defense
Official Description: UCA - ESD 3.0 BLOCK 1 EFFORT
Place of Performance
Location: LEXINGTON PARK, SAINT MARYS County, MARYLAND, 20653
State: Maryland Government Spending
Plain-Language Summary
Department of Defense obligated $136.1 million to KBR WYLE SERVICES, LLC for work described as: UCA - ESD 3.0 BLOCK 1 EFFORT Key points: 1. The contract's cost-plus-incentive-fee structure suggests a focus on performance, but requires careful monitoring of cost overruns. 2. With only 3 bidders, the competition level may have limited price discovery and potentially inflated costs. 3. The contract duration of over 6 years indicates a long-term need for these engineering services. 4. The absence of small business set-asides raises questions about opportunities for smaller firms in this large contract. 5. The contract's performance period spans a significant portion of the late 2000s and mid-2010s, offering historical context. 6. The engineering services sector is critical for defense readiness, supporting complex technological advancements.
Value Assessment
Rating: fair
Benchmarking the value of this $136 million contract is challenging without specific performance metrics and detailed cost breakdowns. The cost-plus-incentive-fee (CPIF) contract type can lead to cost overruns if not managed tightly, potentially impacting overall value. Comparing it to similar large-scale engineering services contracts awarded by the DoD during the same period would provide a clearer picture of whether the pricing was competitive and if the services delivered represented good value for money.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
This contract was awarded under full and open competition, with 3 bids received. While 'full and open' indicates a broad solicitation, the low number of bidders (3) suggests that the market for these specific, high-value engineering services may be concentrated among a few large firms. This limited competition could have implications for price negotiation and potentially lead to less aggressive bidding.
Taxpayer Impact: A limited number of bidders in a full and open competition can mean that taxpayers may not have benefited from the most competitive pricing achievable if more firms had participated.
Public Impact
The primary beneficiaries are the Department of Defense, specifically the Air Force, receiving critical engineering support. Services delivered likely include design, analysis, testing, and integration for complex defense systems. The geographic impact is centered around the Department of Defense's operational and research facilities, primarily in Maryland. Workforce implications include employment for highly skilled engineers and technical professionals within KBR Wyle Services and potentially its subcontractors.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Potential for cost overruns due to the Cost Plus Incentive Fee (CPIF) contract type if performance incentives are not well-aligned with cost control.
- Limited competition (3 bidders) may have resulted in higher-than-optimal pricing for taxpayers.
- Lack of specific small business set-aside could limit opportunities for smaller, specialized engineering firms.
- The long contract duration could lead to scope creep or evolving requirements that are not efficiently managed.
Positive Signals
- Awarded under full and open competition, ensuring a broad initial solicitation.
- The CPIF structure incentivizes contractor performance, potentially leading to higher quality outcomes if managed effectively.
- The contract addresses a long-term need for specialized engineering services within the Department of Defense.
- KBR Wyle Services, LLC is an established contractor with experience in defense-related services.
Sector Analysis
This contract falls within the Engineering Services sector (NAICS 541330), a vital component of the defense industrial base. This sector provides the specialized expertise required for the design, development, and sustainment of complex military systems. The total market for engineering services is substantial, with defense contracts representing a significant portion. Comparable spending benchmarks would involve analyzing other large-scale engineering support contracts awarded by the DoD to firms of similar size and capability.
Small Business Impact
This contract did not include a specific small business set-aside, as indicated by 'sb: false'. This means that opportunities for small businesses were likely limited to subcontracting roles, if any were mandated or pursued by the prime contractor. The absence of a set-aside on a contract of this magnitude could mean fewer direct opportunities for small businesses to compete for prime contract work in this specialized engineering domain, potentially impacting the small business ecosystem within the defense sector.
Oversight & Accountability
Oversight for this contract would typically be managed by the contracting officer and the relevant program management office within the Department of the Air Force. Accountability measures are embedded in the Cost Plus Incentive Fee (CPIF) structure, which links contractor profit to performance against cost, schedule, and technical targets. Transparency would be assessed through contract reporting mechanisms and public contract databases, though detailed performance data may be limited. Inspector General jurisdiction would apply to investigations of fraud, waste, or abuse.
Related Government Programs
- Defense Engineering Services Contracts
- Air Force Research and Development Support
- Logistics and Technical Support Services
- Aerospace Engineering Services
- Systems Engineering and Integration Contracts
Risk Flags
- Limited competition may have led to suboptimal pricing.
- Cost-plus contract types carry inherent risk of cost overruns.
- Lack of small business set-aside limits direct opportunities for SMBs.
- Contract duration requires ongoing vigilant oversight.
Tags
defense, department-of-defense, air-force, engineering-services, full-and-open-competition, delivery-order, cost-plus-incentive-fee, maryland, large-contract, professional-services, technical-services
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $136.1 million to KBR WYLE SERVICES, LLC. UCA - ESD 3.0 BLOCK 1 EFFORT
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 Air Force).
What is the total obligated amount?
The obligated amount is $136.1 million.
What is the period of performance?
Start: 2008-10-10. End: 2015-12-31.
What was the specific nature of the engineering services provided under this contract?
While the data indicates 'UCA - ESD 3.0 BLOCK 1 EFFORT' and 'Engineering Services', the precise nature of the services is not detailed. Typically, such contracts for the Department of Defense (DoD) and Air Force involve a broad range of activities including systems engineering, design, analysis, testing, integration, and technical support for complex defense platforms and technologies. Given the 'Block 1 Effort' designation, it likely supported an early phase of a specific program, possibly related to command and control systems or electronic warfare, requiring specialized engineering expertise for development and initial deployment.
How does the $136 million total value compare to similar engineering services contracts awarded by the DoD during the 2008-2015 period?
The $136 million total award value for this contract is substantial, placing it among significant engineering services procurements. During the 2008-2015 period, the DoD awarded numerous large contracts for engineering and technical support, often in the hundreds of millions or even billions of dollars, particularly for major weapon systems development and sustainment. This specific contract's value appears moderate to high within the context of specialized engineering support, but its relative competitiveness and value-for-money would depend heavily on the scope, duration, and criticality of the services rendered compared to other similar sole-source or competed contracts.
What are the potential risks associated with a Cost Plus Incentive Fee (CPIF) contract structure for this type of service?
The primary risk with a CPIF contract is the potential for cost overruns if the target costs are not accurately estimated or if the incentive structure does not sufficiently penalize excessive spending. While CPIF aims to incentivize contractor efficiency and performance, it requires robust government oversight to ensure that the incentive targets are challenging yet achievable and that the final cost remains reasonable. If poorly managed, the government could end up paying significantly more than anticipated, diminishing the overall value proposition despite potential performance gains.
Given the 'full and open competition' with 3 bidders, what does this imply about the contractor landscape for these services?
The fact that this contract was competed under 'full and open' conditions but only attracted 3 bidders suggests a potentially concentrated market for these specific engineering services. This could indicate high barriers to entry, such as specialized expertise, security clearances, or existing infrastructure requirements, that limit the number of capable firms. While competition occurred, a smaller pool of bidders might reduce the downward pressure on pricing compared to a scenario with numerous, highly competitive bids, potentially impacting cost efficiency for the government.
What is the historical spending trend for engineering services by the Department of the Air Force in Maryland?
Historical spending data for engineering services by the Department of the Air Force (DAF) in Maryland would likely show a consistent and significant investment, given Maryland's concentration of defense agencies, research institutions (like the National Security Agency), and military installations. The DAF, along with other branches of the DoD, relies heavily on engineering support for its advanced technology programs, cybersecurity initiatives, and platform modernization efforts. Spending in this sector in Maryland has historically been robust, reflecting the state's strategic importance in national defense and its ecosystem of specialized contractors.
How effective was KBR Wyle Services, LLC in managing this contract based on its duration and value?
Assessing the effectiveness of KBR Wyle Services, LLC on this $136 million contract, which ran from October 2008 to December 2015 (over 7 years), requires more granular performance data than provided. However, the contract's successful completion through multiple delivery orders suggests a baseline level of effectiveness in meeting the Air Force's needs. The CPIF structure implies that performance incentives were likely in play, and the government's decision to award and manage multiple orders over such a long period generally indicates satisfaction with the contractor's ability to deliver required services, though specific cost and performance metrics would be needed for a definitive evaluation.
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: FULL AND OPEN COMPETITION
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Offers Received: 3
Pricing Type: COST PLUS INCENTIVE FEE (V)
Evaluated Preference: NONE
Contractor Details
Parent Company: KBR, Inc.
Address: 22309 EXPLORATION DR, LEXINGTON PARK, MD, 20653
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $136,072,789
Exercised Options: $136,072,789
Current Obligation: $136,072,789
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: F0470102D0006
IDV Type: IDC
Timeline
Start Date: 2008-10-10
Current End Date: 2015-12-31
Potential End Date: 2015-12-31 00:00:00
Last Modified: 2024-09-13
More Contracts from KBR Wyle Services, LLC
- Bioastronautics Contract-Activities for the Health &productivity of Crews Working and Living in Space — $1.5B (National Aeronautics and Space Administration)
- Fpds-Ng Mission Systems Operations Contract (msoc) — $1.0B (National Aeronautics and Space Administration)
- THE Purpose of This Contract IS to Acquire Engineering Services and Related Services to MSD and Related Organizations Throughout Gsfc, AS Required, for the Formulation, Design, Development, Fabrication, Integration, Testing, Verification, and Operations of Space Flight and Ground System Hardware and Software, Including Development and Validation of NEW Technologies to Enable Future Space and Science Missions. the Engineering Areas of Emphasis ARE Multidisciplinary With Concentration in the Mechanical Engineering Areas of Materials, Structural Analysis and Loads, Mechanical Design, Electromechanical Design, Thermal, Contamination and Coatings, Manufacturing and Integration and Test — $728.5M (National Aeronautics and Space Administration)
- 200106!000121!1700!F7004 !marine Corps Logistics Base !M6700499C0002 !a!n!*!n!p00015 !20010228!20080930!041014242!041014242!139691877!n!honeywell Technology Solutions!7000 Columbia Gateway Driv!columbia !md!21046!35000!031!12!jacksonville !duval !florida !+000004292865!n!n!000000000000!j049!maint & Repair of Eq/Maintenance & Repair Shop EQ !a4a!combat Vehicles !2000!NOT Discernable or Classified !811310!*!*!3! ! !C!*!*!*!B!*!*!A! !A !N!J!2!006!B! !C!Y!Z! ! !N!C!N! ! ! !a!a!a!a!000!a!d!n! ! ! ! ! ! !0001! — $670.1M (Department of Defense)
- Mission Operations Management Services (moms) — $623.8M (National Aeronautics and Space Administration)
Other Department of Defense Contracts
- Federal Contract — $51.3B (Humana Government Business Inc)
- Lrip LOT 12 Advance Acquisition Contract — $35.1B (Lockheed Martin Corporation)
- SSN 802 and 803 Long Lead Time Material — $34.7B (Electric Boat Corporation)
- 200204!008532!1700!AF600 !naval AIR Systems Command !N0001902C3002 !A!N! !N! !20011026!20120430!008016958!008016958!834951691!n!lockheed Martin Corporation !lockheed Blvd !fort Worth !tx!76108!27000!439!48!fort Worth !tarrant !texas !+000026000000!n!n!018981928201!ac15!rdte/Aircraft-Eng/Manuf Develop !a1a!airframes and Spares !2ama!jast/Jsf !336411!E! !3! ! ! ! ! !99990909!B! ! !A! !a!n!r!2!002!n!1a!a!n!z! ! !N!C!N! ! ! !a!a!a!a!000!a!c!n! ! ! !Y! !N00019!0001! — $34.2B (Lockheed Martin Corporation)
- KC-X Modernization Program — $32.0B (THE Boeing Company)