DoD's $58M IT Systems Support contract awarded to KBR Wyle Services, LLC, lacked competition

Contract Overview

Contract Amount: $58,150,805 ($58.2M)

Contractor: KBR Wyle Services, LLC

Awarding Agency: Department of Defense

Start Date: 2013-11-01

End Date: 2015-09-30

Contract Duration: 698 days

Daily Burn Rate: $83.3K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: COST PLUS FIXED FEE

Sector: IT

Official Description: IGF::CT::IGF ITS SYSTEMS SUPPORT.

Place of Performance

Location: HUNTSVILLE, MADISON County, ALABAMA, 35806

State: Alabama Government Spending

Plain-Language Summary

Department of Defense obligated $58.2 million to KBR WYLE SERVICES, LLC for work described as: IGF::CT::IGF ITS SYSTEMS SUPPORT. Key points: 1. The contract's value of $58.15 million over two years suggests a significant investment in IT infrastructure. 2. Awarded on a cost-plus-fixed-fee basis, this contract type can incentivize cost overruns if not closely monitored. 3. The lack of competition raises concerns about potential overpayment and reduced incentive for cost efficiency. 4. The contract was awarded to a single vendor, indicating potential limitations in market exploration. 5. The services provided fall under 'Other Computer Related Services,' a broad category requiring specific performance metrics. 6. The contract duration of 698 days is typical for complex IT support services.

Value Assessment

Rating: questionable

Benchmarking the value of this $58.15 million contract is challenging without specific service details and performance metrics. However, the 'cost plus fixed fee' structure, combined with a sole-source award, raises questions about whether the government secured the best possible price. Without competitive bids, it's difficult to ascertain if KBR Wyle Services, LLC's pricing aligns with market rates for similar IT systems support. Further analysis would require comparing the specific services rendered against industry standards and the profit margins typically seen in comparable sole-source IT contracts.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning only one vendor, KBR Wyle Services, LLC, was solicited. This approach bypasses the standard competitive bidding process, which typically involves multiple companies vying for the contract. While sole-source awards can be justified in specific circumstances (e.g., urgent needs, unique capabilities), they generally lead to less price discovery and potentially higher costs for the government compared to fully competed contracts. The absence of competition limits the government's ability to leverage market forces to achieve the most favorable terms.

Taxpayer Impact: Taxpayers may have paid a premium for these IT services due to the lack of competitive pressure. Without multiple bids, there's less assurance that the price reflects the lowest reasonable cost for the required support.

Public Impact

The Department of Defense benefits from continuous IT systems support, ensuring operational readiness. This contract likely supports critical defense infrastructure and personnel by maintaining essential computer systems. The geographic impact is primarily within Alabama, where the contract was administered. The contract supports a workforce skilled in IT systems maintenance and support, contributing to the federal IT labor market.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may lead to higher costs for taxpayers.
Cost-plus-fixed-fee contracts require diligent oversight to prevent cost overruns.
The broad 'Other Computer Related Services' category could obscure specific performance issues.

Positive Signals

KBR Wyle Services, LLC is a known entity in government contracting, suggesting some level of established capability.
The contract was awarded to a single vendor, potentially indicating a streamlined process for a specific need.
The fixed fee component provides some cost certainty compared to pure cost-reimbursement contracts.

Sector Analysis

This contract falls within the broader IT services sector, a critical component of federal spending. The 'Other Computer Related Services' NAICS code (541519) encompasses a wide range of IT support functions. The federal government is a major consumer of IT services, with significant annual spending across various agencies. Comparable spending benchmarks would typically involve analyzing IT support contracts within the Department of Defense and other large federal agencies, looking at contract values, durations, and service types to gauge the relative cost-effectiveness of this award.

Small Business Impact

This contract does not appear to have a small business set-aside component, as indicated by 'sb': false. Furthermore, the 'ss' (small business) flag is also false. This suggests that the primary award was not targeted towards small businesses, and there's no explicit indication of a subcontracting plan for small businesses within the provided data. The impact on the small business ecosystem is therefore likely minimal for this specific contract, as it was awarded to a larger entity without specific small business participation mandates.

Oversight & Accountability

Oversight for this contract would typically fall under the Defense Contract Management Agency (DCMA), as indicated by the 'sa' field. The 'cost plus fixed fee' (CPFF) contract type necessitates robust oversight to ensure that costs are reasonable and allocable, and that the fixed fee is earned appropriately. Transparency is often enhanced through contract reporting systems, but the specific mechanisms for this sole-source award are not detailed here. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

DoD IT Modernization Programs
Defense Information Systems Agency (DISA) Contracts
Federal Civilian IT Services Spending
IT Support Services Contracts

Risk Flags

Sole-source award limits price competition.
Cost-plus-fixed-fee contract requires robust oversight.
Lack of detailed service scope hinders value assessment.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $58.2 million to KBR WYLE SERVICES, LLC. IGF::CT::IGF ITS SYSTEMS SUPPORT.

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 (Defense Contract Management Agency).

What is the total obligated amount?

The obligated amount is $58.2 million.

What is the period of performance?

Start: 2013-11-01. End: 2015-09-30.

What specific IT systems were supported under this contract, and what was the performance history of KBR Wyle Services, LLC on similar contracts?

The provided data indicates the contract was for 'IGF ITS SYSTEMS SUPPORT' under NAICS code 541519 ('Other Computer Related Services'). Specific system details are not available in this summary. KBR Wyle Services, LLC has a history of performing various IT and engineering support services for the government. However, without access to detailed past performance reviews or specific metrics from this contract, it's difficult to definitively assess their performance history on this particular engagement. A deeper dive into contract performance reports and any associated award-fee evaluations would be necessary to understand their track record on this specific IT systems support task.

How does the $58.15 million cost compare to similar IT support contracts awarded by the DoD or other agencies during the 2013-2015 period?

Comparing the $58.15 million cost requires context regarding the scope and duration of services. This contract spanned approximately two years (November 2013 to September 2015). To benchmark effectively, one would need to identify comparable IT systems support contracts awarded within the Department of Defense or other federal agencies during the same timeframe. Key comparison points would include the number of systems supported, the complexity of the support (e.g., help desk, network management, cybersecurity), the labor categories involved, and the contract type. Given this was a sole-source award, it's plausible that the price might be higher than a competitively bid contract for similar services. A comprehensive analysis would involve querying contract databases for similar solicitations and awards to establish a market price range.

What were the justifications for awarding this contract on a sole-source basis, and were alternative competitive strategies considered?

Sole-source awards are typically justified under specific circumstances outlined in the Federal Acquisition Regulation (FAR), such as when only one responsible source can provide the required supplies or services, or in cases of urgent and compelling need. Without the specific justification documentation for this contract (often found in a Justification and Approval document), it's impossible to know the precise reasons. Common justifications include proprietary technology, unique contractor capabilities, or situations where competition is deemed not feasible or not in the government's best interest. The lack of competition suggests that either these conditions were met, or the process for exploring competition was limited.

What are the key performance indicators (KPIs) and service level agreements (SLAs) associated with this contract, and how was performance measured?

The provided data does not include specific Key Performance Indicators (KPIs) or Service Level Agreements (SLAs) for this contract. For an 'IT Systems Support' contract, typical KPIs might include system uptime percentages, response times for issue resolution, patch deployment rates, and user satisfaction scores. Performance measurement under a Cost Plus Fixed Fee (CPFF) contract often involves monitoring adherence to the scope of work, delivery schedules, and quality standards, alongside financial oversight. The effectiveness of the oversight mechanisms and the clarity of the performance standards would be crucial in determining if the government received adequate value, especially given the sole-source nature of the award.

What is the historical spending trend for 'IGF ITS SYSTEMS SUPPORT' or similar IT services within the Department of Defense?

Historical spending trends for 'IGF ITS SYSTEMS SUPPORT' specifically are not detailed in the provided data. However, the Department of Defense (DoD) is consistently one of the largest federal spenders on Information Technology (IT) services. Annual IT spending across the DoD often runs into the tens of billions of dollars, encompassing a wide array of services including infrastructure, software development, cybersecurity, and systems support. Contracts like this one, valued at over $58 million, represent a portion of that larger IT expenditure. Analyzing broader DoD IT spending patterns would reveal a consistent demand for such services, driven by the need to maintain complex and evolving defense systems.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Computer Systems Design and Related Services › Other Computer Related Services

Product/Service Code: IT AND TELECOM - INFORMATION TECHNOLOGY AND TELECOMMUNICATIONS › ADP AND TELECOMMUNICATIONS

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Offers Received: 1

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Parent Company: KBR, Inc. (UEI: 784072626)

Address: 345 BOB HEATH DR, HUNTSVILLE, AL, 35806

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

Financial Breakdown

Contract Ceiling: $58,150,805

Exercised Options: $58,150,805

Current Obligation: $58,150,805

Subaward Activity

Number of Subawards: 15

Total Subaward Amount: $11,524,268

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline