Transportation's $617M security systems contract to KBR Wyle Services, LLC awarded under full and open competition

Contract Overview

Contract Amount: $61,768,412 ($61.8M)

Contractor: KBR Wyle Services, LLC

Awarding Agency: Department of Transportation

Start Date: 2017-08-29

End Date: 2026-04-10

Contract Duration: 3,146 days

Daily Burn Rate: $19.6K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: TIME AND MATERIALS

Sector: Other

Official Description: IGF::OT::IGF

Place of Performance

Location: NORTH CHARLESTON, CHARLESTON County, SOUTH CAROLINA, 29406

State: South Carolina Government Spending

Plain-Language Summary

Department of Transportation obligated $61.8 million to KBR WYLE SERVICES, LLC for work described as: IGF::OT::IGF Key points: 1. Contract value of $617.7 million over its potential lifespan indicates significant investment in security systems. 2. Awarded to KBR Wyle Services, LLC, suggesting a focus on established providers with demonstrated capabilities. 3. The 'Security Systems Services (except Locksmiths)' NAICS code points to a broad range of security solutions. 4. A long performance period (2017-2026) allows for sustained service delivery and potential for evolving security needs. 5. The contract type (Time and Materials) may lead to cost variability based on actual labor and material usage. 6. The presence of two bidders suggests a moderately competitive landscape for this specific service.

Value Assessment

Rating: good

The contract's total value of $617.7 million over nearly nine years is substantial. Benchmarking this against similar large-scale security system contracts across federal agencies is challenging without more specific service details. However, the award to a single contractor suggests a competitive process that likely yielded a reasonable price for the scope of work. The Time and Materials pricing structure, while common for services requiring flexibility, warrants close monitoring to ensure costs remain aligned with the value delivered.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit offers. With two bidders, the competition level appears moderate. While more bidders could potentially drive prices lower, two offers suggest that the market for these specialized security systems services is not overly saturated, and the selected contractor likely presented a compelling technical and price proposal to win.

Taxpayer Impact: Full and open competition is generally favorable for taxpayers as it encourages multiple companies to bid, potentially leading to lower prices and better value. Even with two bidders, the process ensures a baseline of price discovery and market validation.

Public Impact

Federal agencies, particularly within the Department of Transportation and its sub-agencies like the FAA, benefit from enhanced security infrastructure. Services delivered likely include installation, maintenance, and monitoring of various security systems, such as access control, surveillance, and alarm systems. The geographic impact is likely nationwide, supporting the security needs of various transportation facilities and offices. This contract supports a workforce skilled in security system installation, maintenance, and technical support.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Time and Materials contract type can lead to cost overruns if not managed diligently.
The long duration of the contract may not fully account for rapid technological advancements in security systems.
Limited competition (two bidders) might indicate potential for higher pricing than a more robustly contested bid.

Positive Signals

Awarded through full and open competition, ensuring a fair and transparent process.
The contractor, KBR Wyle Services, LLC, is an established entity with significant federal contracting experience.
The contract duration allows for stable and continuous security services, crucial for critical infrastructure.

Sector Analysis

The security systems services sector is a critical component of federal infrastructure protection, encompassing a wide range of technologies from access control to surveillance. This contract falls within the broader IT and professional services market, with specific application to physical security. The federal government is a significant consumer of these services, with spending often driven by evolving threat landscapes and regulatory requirements. Comparable spending benchmarks would depend on the specific types of security systems and the scale of deployment.

Small Business Impact

The data indicates that this contract was not set aside for small businesses (ss: false, sb: false). Therefore, there are no direct subcontracting implications for small businesses mandated by a set-aside. However, the prime contractor, KBR Wyle Services, LLC, may engage small businesses as subcontractors to fulfill parts of the contract, depending on their own subcontracting plans and the availability of specialized small business capabilities within the security systems market.

Oversight & Accountability

Oversight for this contract would primarily reside with the Department of Transportation and the Federal Aviation Administration contracting officers and program managers. The contract's Time and Materials nature necessitates diligent oversight to ensure that labor hours and material costs are reasonable and allocable to the contract's objectives. Transparency is facilitated through contract award databases and reporting requirements. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse.

Related Government Programs

Department of Homeland Security Security Services Contracts
General Services Administration (GSA) Schedule 70 - IT Professional Services
Defense Information Technology Contracting Organization (DITCO) Contracts
Federal Protective Service Contracts

Risk Flags

Potential for cost overruns due to Time and Materials pricing structure.
Limited competition may result in suboptimal pricing.
Long contract duration could lead to technology obsolescence if not managed proactively.

Frequently Asked Questions

What is this federal contract paying for?

Department of Transportation awarded $61.8 million to KBR WYLE SERVICES, LLC. IGF::OT::IGF

Who is the contractor on this award?

The obligated recipient is KBR WYLE SERVICES, LLC.

Which agency awarded this contract?

Awarding agency: Department of Transportation (Federal Aviation Administration).

What is the total obligated amount?

The obligated amount is $61.8 million.

What is the period of performance?

Start: 2017-08-29. End: 2026-04-10.

What is the historical spending trend for security systems services by the Department of Transportation?

Analyzing historical spending trends for security systems services by the Department of Transportation (DOT) requires access to detailed historical contract data. Without specific historical figures for this contract or similar ones, it's difficult to provide a precise trend. However, federal spending on security systems has generally seen an upward trend over the past decade, driven by increased security concerns, technological advancements, and regulatory mandates. Agencies like the DOT, responsible for critical infrastructure, are likely to maintain or increase their investment in robust security solutions to protect facilities, personnel, and operations. Fluctuations may occur based on specific project needs, budget allocations, and national security priorities.

How does the per-unit cost of services under this contract compare to industry benchmarks?

Determining the per-unit cost comparison for this contract against industry benchmarks is challenging without specific details on the services rendered and their associated units. The contract is a Time and Materials (T&M) type, which means costs are based on actual labor hours and material costs, plus a fixed fee or profit. Benchmarking T&M contracts is complex because rates can vary significantly based on labor categories, skill levels, geographic location, and the specific materials used. To perform a true comparison, one would need to identify specific labor categories (e.g., security technician, project manager) and their billed hourly rates, and compare these to prevailing market rates for similar skill sets and experience levels within the security services industry, adjusted for federal contracting overhead and profit margins.

What is KBR Wyle Services, LLC's track record with federal security contracts?

KBR Wyle Services, LLC has a significant track record as a federal contractor, often involved in large-scale support services, including those related to security and facilities management. Their experience spans various government agencies, suggesting a familiarity with federal procurement processes, compliance requirements, and operational demands. While specific details on their past security systems contracts would require deeper research into federal procurement databases, their ability to win a substantial contract like this one from the Department of Transportation indicates a demonstrated capability and a competitive standing within the federal contracting landscape for complex service requirements.

What are the primary risks associated with a Time and Materials contract of this magnitude?

The primary risks associated with a Time and Materials (T&M) contract of this magnitude ($617.7 million) revolve around cost control and scope creep. Since payment is based on actual hours worked and materials consumed, there's an inherent risk that costs could escalate beyond initial expectations if not managed meticulously. This requires robust oversight from the government to ensure that labor hours are reasonable and necessary, and that material costs are fair and competitive. Another risk is the potential for scope creep, where the project's requirements may expand over time, leading to increased costs and extended timelines. Effective communication, change management processes, and strong government oversight are crucial to mitigate these risks.

How does the competition level (2 bidders) impact the value for taxpayers?

A competition level with only two bidders for a contract of this size and scope presents a mixed picture for taxpayers. On one hand, having multiple bidders ensures some level of price discovery and prevents a single entity from having a monopoly. On the other hand, a more robust competition with numerous bidders typically drives prices down more aggressively. With only two bidders, there's a possibility that the winning bid might be higher than it could have been in a more crowded field. However, the fact that it was awarded under 'full and open competition' suggests that the process was fair, and the selected contractor likely offered a compelling combination of technical capability and price that represented good value, even if not the absolute lowest possible price achievable in a hyper-competitive scenario.

What specific security systems are likely covered under NAICS code 561621?

NAICS code 561621, 'Security Systems Services (except Locksmiths),' encompasses a broad range of services related to the installation, maintenance, and monitoring of electronic security systems. This typically includes alarm systems (burglar, fire, environmental), video surveillance (CCTV) systems, access control systems (card readers, biometric scanners), intercom systems, and potentially integrated security management platforms. It covers the design, setup, repair, and ongoing servicing of these technologies, excluding services primarily focused on physical locks and keys. For a contract of this size with the Department of Transportation, it likely involves comprehensive security solutions for various facilities, potentially including airports, administrative buildings, and transportation hubs.

Industry Classification

NAICS: Administrative and Support and Waste Management and Remediation Services › Investigation and Security Services › Security Systems Services (except Locksmiths)

Product/Service Code: MAINT, REPAIR, REBUILD EQUIPMENT › MAINT, REPAIR, REBUILD OF EQUIPMENT

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: DTFAWA-17-R-00018

Offers Received: 2

Pricing Type: TIME AND MATERIALS (Y)

Evaluated Preference: NONE

Contractor Details

Parent Company: KBR, Inc.

Address: 7515 MISSION DR, LANHAM, MD, 20706

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

Financial Breakdown

Contract Ceiling: $77,037,225

Exercised Options: $61,768,424

Current Obligation: $61,768,412

Actual Outlays: $40,230,213

Subaward Activity

Number of Subawards: 57

Total Subaward Amount: $23,013,655

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline