As a result of criticisms leveled against KBR, the Army Materiel Command ended the previous LOGCAP III contract, which KBR held, and replaced it in 2007 with the current LOGCAP round, dubbed “LOGCAP IV”. Unlike the past three rounds, under the current version three contractors (KBR, DynCorp, and Fluor Corporation) were awarded contracts, whereupon the three could compete for future task orders. LOGCAP IV has one base year and nine option years with a total potential of $5 billion per year for three of the contractors but not to exceed $150 billion over the lifetime of the contract.
Little noted is the fact that LOGCAP IV itself is managed by a contractor (Serco‐North America) and now is being split geographically between KBR, Dyncorp, and Fluor , which reduces the benefits of a multiple award Indefinite Delivery/Indefinite Quantity (IDIQ) contract that was intended to create competition on each task order.
The inimitable Ms. Sparky, who is to KBR and similar companies, what Sherlock Holmes was to Dr. Moriarty, was the first to break the news, in advance of the official notification, that KBR would receive the award.
But whether this is a good idea is far from settled. Before going any further let’s acknowledge that LOGCAP workers out in the field do critically important, if unrecognized, work such as providing laundry services and bath facilities, food service, mortuary affairs, sanitation, facilities management, morale, welfare and recreation, information management, transportation, medical services, engineering and construction, and power generation and distribution.
For KBR this is not just about money but also a chance to burnish its reputation, which its management has done a good job of tarnishing over the years thanks to billions of dollars in unsupported charges, shoddy electrical work, hazardous burn pits, and failure to protect its employees from being raped, just to name a few things.
KBR sent out an all hands email to its employees that says, “With so much negative news about KBR and the fact that we have not won a LOGCAP IV task order, it is with great pride that I am able to announce that KBR is now in the LOGCAP IV business.”
To some KBR resembles Mario Puzo’s Godfather in that it is the position of making the Army an offer it can’t refuse As the DoD IG report on the decision not to withhold payments to KBR when it should have done so under the terms of its contract, “The decision to postpone the withholding of funds was influenced by contractor claims that the withholding might adversely impact their ability to provide vital support services to the troops.”
Put another way, last May the Commission on Wartime Contracting held a hearing where Jeffrey Parsons, executive director of the Army Contracting Command had this exchange with Commission Ervin: