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Why KBR lost Afghanistan

Apparently the Army Contracting Center at Rock Island has determined that the lowest bid is not always the best value. Finally some common sense. The decision to leave KBR out of the LOGCAP IV awards in Afghanistan were based on the “best value” approach which also took into consideration past performance. Evidently KBR’s seven years of past performance in Afghanistan did not give them much of an advantage. Hmmm Go figure.

Army announces new contracts for Afghanistan

Jul 15, 2009
By Jon Connor

ROCK ISLAND, Ill. (July 14, 2009) — Two new task orders supporting LOGCAP IV contract operations in Afghanistan are now in effect, Army officials announced July 7.

DynCorp International, LLC was awarded the work for southern Afghanistan and Fluor Intercontinental was selected for work in northern Afghanistan, the Army Sustainment Command at Rock Island, Ill., announced.

KBR also competed for the contracts, officials said. KBR has held a number of LOGCAP contracts to support Operation Enduring Freedom and Operation Iraqi Freedom.

The task orders encompass base life-support services and logistics support, which include base setup, food service, facilities maintenance, and morale, welfare and recreation to name a few, said Jim Loehrl, executive director, Rock Island Contracting Center, Rock Island, Ill.

The two task-order awards include moving all existing work in LOGCAP III to LOGCAP IV, plus capacity to stand up additional base camps, Loehrl said.

The task orders were awarded with pricing for one base year effective July 7, and four option years. Depending on growth in Afghanistan, the two task orders could potentially total $15 billion over five years, Loehrl explained.

This is based on each task order’s base year costing $1.5 billion plus a potential four option years.

“It all depends on what the growth is in Afghanistan as we continue to put troops in Afghanistan and where they go,” Loerl said. “We built the contract capacity to handle that.”

The selection process was an “integrated source selection encompassing technical management proposals, past performance, and costs,” Loehrl said.

From this, a “best-value” decision is then made, Loehrl said, which will benefit the Soldiers and other personnel, and give taxpayers the most value.

The contracting office issued a solicitation outlining the task order requirements and the terms and conditions under which the task order would be administered. The solicitation contained criteria against which each of the contractors’ proposals was evaluated.

“The concept hinges on the principle that while price is always a factor in the selection process, price alone does not define the best value for the taxpayer,” said Amy Hayden, chief, LOGCAP IV Contracting Branch, Rock Island, Ill.

“The best-value approach takes into account the fact that it may be in the government’s best interest to pay a premium to receive a better product or service,” she said.

The new task orders are the continuation of the Army’s plan to transition work from the single-award LOGCAP III contract to the multiple-award LOGCAP IV contract. So far, there have been 10 task orders awarded under LOGCAP IV, Loehrl said.

Loehrl said bidders not selected have the option to protest the award decision. “They certainly are allowed to protest,” Loehrl said. “That certainly is a possibility.”

Protests would be filed with the General Accountability Office, Hayden said.

“While there are circumstances under which contract performance my proceed despite the filing of the GAO-level protest, under normal circumstances, the government must suspend contract performance until the protest is resolved,” Hayden said.

The support for the services, however, would continue. Additionally, KBR can bid for future LOGCAP IV task orders, Loehrl said.

The Army had previously transitioned all LOGCAP work in Kuwait from LOGCAP III to LOGCAP IV (DynCorp), as well as awarded some new work in Afghanistan under LOGCAP IV (Fluor).

These newly announced task orders will transition all work in Afghanistan to LOGCAP IV. Similar processes to compete and transition the work in Iraq are also underway.

“The transition will be operationally driven, and methodically undertaken to ensure a transition that is seamless to the warfighter,” Hayden added.

“The transition is not a ‘turn-key’ operation and is extremely complex,” said Lee Thompson, LOGCAP executive director, Rock Island, Ill.

“Before we even begin the legacy task-order transitions, we will be starting the urgent work required for force expansion [in Afghanistan].”

The first step in the process is to conduct a post-award conference scheduled in early August, Thompson said. The conferees will discuss such areas as transition touch-points, explain the process, and reach agreements between contractors on the conduct of the transition, known as protocols, Thompson said.

“During the transition the incumbent continues to provide services and will do so until the U.S. government is satisfied that the incoming performance contractor can assume full operation of the function,” Thompson explained. “Once the IPC has demonstrated full operational capability, the incumbent is officially released from responsibility and the IPC is officially assigned full responsibility and accountability for performance execution.”

As with all government contracts, reviews, audits, and continuous oversight of contractor performance will be ongoing to make sure government and American taxpayers’ interests are protected, Sustainment Command officials said.

The contractors’ performance will be measured by the Defense Contract Management Agency and Defense Contract Audit Agency in accordance with pre-established performance standards, ASC officials said.

“DCMA and DCAA provide oversight of contractor business systems, and the LOGCAP IV task orders contain award-fee provision incentives for the the contractors to maintain these systems at an adequate level. DCMA also provides quality assurance representatives in-theater to oversee the contractors’ work,” Hayden explained.

“Finally, DCAA reviews contractor billings to ensure they are appropriate. In combination, these measures provide a high degree of protection against inappropriate practices during the execution of these task orders,” she said.

LOGCAP — Logistics Civil Augmentation Program — is an Army initiative to hire civilian contractors to perform services supporting the U.S. military in wartime and other contingencies. Use of contractors allows military units to focus on combat operations.

(Linda Theis, deputy public affairs officer, Army Sustainment Command, contributed to this article.(click HERE for a link to the original article)

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30 Comments

  1. Comment by Ksniper777:

    Well it is going to be an interesting turn of events once this is transition starts. I hope the winners will be able to perform up to standard. Good Luck to fluor and Dyncorp

  2. Comment by Contractor_Baf:

    We`ll ia really sorry that people dont aprechiate what most of us KBR employees have done over here. It is really easy to judge KBR as a whole but people dont know is that the HQ in Iraq and the one in Afghanistan have been running in different budgets. That`s why KBR was not taken in consideration for this bid. The 32 bil spent just last year of course scared everyone compared to the 3 bil of the 2 companies but no one knows that the whole budget over here was just 660 mil. And while KBR in Iraq has been messing up big time, here in Afghanistan we`ve always have been awarded exellent on our evaluation by the DCMA. Ask the warfighters 1 year after Fluor will take over how they will feel. No one back home doesent have a clue of what kind of operations we deal with over here and the new bid just made it harder on everyone. With the new salaries the new companies are coming in, they will force every expat to go back home and istead they will be replaced with Indians and Philipinos (despite the fact that it is considered a felony from their own to hire those poeple in a war zone).

    Ms Sparky’s Response:
    The average everyday KBR employee is not what I have a problem with. I was one of those. Most KBR employees are hard working and are trying to do the best they can with the management they have. My problem is with KBR management from Bill Utt on down.

    As far as KBR’s excellent evaluations from the DCMA. They were getting as well in Iraq at the same time soldiers were dying from electrocution. So…the DCMA and other on the Board have clearly been called to task for their Award Fee determinations.

    KBR management is the one that lost Kuwait, Afghanistan and soon to be Iraq for KBR not it employees.

    • Comment by WOB:

      You say you were an electrician with KBR? Then you must know that your claiming that KBR had anything to do with those soldiers being electrocuted is BS. Therefore, it’s clear that it’s not only the bosses at KBR you don’t like, it’s the people, too. It’s not Bill Utt who was wiring/grounding those buildings …

      Stop lying.

  3. Comment by Baboo Remembers:

    Hey contractor in Baf, Tell me a little sump’in sump’in now…what makes you think you’ve done a great job? Just because some gives a plaque and a little bit piece paper slaps you on the ass, don’t mean dick son!

    Don’t me get me wrong now, I met some decent folk from time to time and it ain’t bad with the dfac across the street and it ain’t rough on the base and now you can say, “I seen it with his eyes.”

  4. Comment by another contractor:

    This “contractor” may know what the budget is but he is dead wrong that every ex-pat will go home because of new salaries. Dyncorp tried this in Iraq in the Civpol program. They were paying 75K. They could not keep billets so they increased pay to 138.5K. Also he fails to take in account the 70-80% must be US. That is about the same percentage as the construction program (10Billion) for Guam to build new facilities. The bill mandates 70% must be US and hired at the “Hawaiin prevailing wage” and not the lowest wage! This with the fact Japan is paying half.
    It was the likes of David Toney who by the way had his son hired as a HVAC Foreman and at the same camp, Ghazni as to why KBR had mgt. problems. He had little knowledge but he has a Universal. I questioned him on HVAC basics last year and he knew nothing.He said he worked for his uncle pulling wire. He is a good kid and learns quickly but at 20 years old why is he a foreman? He came in at 19. Why a foreman? The Leesville gang! The same one that call their wives up and say how they are loved but have Balkan girlfriends on the side, he he. One thinks that they love their dogs more than their family when one talks with them. This is just one aspect how KBR turned a blind eye when the rules were broken. This, nepotism, also creates low morale, anger, cronyism and mis-trust. If KBR followed rules like the SOW 1.1.102 (OSHA) instead of just putting in TSTIs and HR policy then it may be a good company to work for. The rules look good on paper but in practice they are non-existent unless they want you fired.

  5. Comment by another:

    KBR sucks

  6. Comment by Over Here:

    Some rumors:

    • Fluor will wait until the end of July to see if KBR protests the award, which is their right to do so. If KBR doesn’t protest (they will, as this guarantees them 90 more days of milking the US taxpayer and screwing their employees), then Fluor will hold “Job Fairs” and begin the transition process.

    • The electricians have until early September to finish the grounding and bounding task (they won’t finish it), after which it will be decided whether or not KBR electricians stay to finish the task.

    And get a load of this:

    Believe it or not, ex-pats are getting written up far more and for more minor infractions than before KBR lost the contract. The thinking amongst we Americans is that individual KBR managers are viewing ex-pats as competition for Fluor management positions. Another, more disturbing theory is that by lowering the ratios even further and removing qualified expats from the theatre, KBR can both screw Fluor and look better to the military.

  7. Comment by Baboo Remembers:

    Amen brother!

  8. Comment by Jimbo:

    “Believe it or not, ex-pats are getting written up far more and for more minor infractions than before KBR lost the contract. The thinking amongst we Americans is that individual KBR managers are viewing ex-pats as competition for Fluor management positions. ”

    It is no different than it was in the Balkans. RIF the Ex-pats, and hire lower paid TCN’s. The “managers” always manage to stay though.

  9. Comment by Baboo Remembers:

    The same theory would apply to DynCorp. If I were KBR I would open the bag off dirty tricks and sabotage and effort by DnyCorp and Flour to be successful at any level. So what if the new guy complains they can’t ‘get er done.’ This sets the stage for a triumphant return so they can say I told you so. Now I can really overcharge you morons more than before and stockholder shares rise back to a satisfactory level with their slogan, “Nobody does it like KBR.”

  10. Comment by KBR Wife:

    Over Here is right about ex-pats being written up and/or given verbal counselings for minor issues. My husband has been in Iraq at the same base for over four years and in the same department; he’s never been ‘counseled’ or written up for anything until just a few days ago. He has been extremely careful to follow the rules and regulations, no matter how frequently they changed (and they do change, sometimes several times a day). He’s there to do a good job for himself, the troops, and KBR. He’s been a foreman for a couple of years but at this time is the acting supervisor since the supe is out on EOC; therefore, he has to check, sign, and turn in time sheets every Saturday night/Sunday morning (depending on if it’s the end-of-month time crunch – you all remember that, don’t you?). While signing the 30-something time sheets for his department, he inadvertently left off the last number of his SAP on ONE timesheet. It went through three other department checks (project controls, etc.) before it was ‘caught’. Whomever the last person was to check the timesheets is an ass…they obviously were nit-picking to find something, anything to target. Why not just add the last number since there were more than 30 other time sheets correctly signed with entire SAP number on it? Common sense!! Hard to find in years past, almost non-existent now…

    For those remaining in Iraq, watch your every step, thought, and word. Big brother IS watching and waiting to nail you on anything.

    Good luck!

  11. Comment by Jims thoughts:

    KBR Wife, I hope he is able to hang in there and not be forced out, he really sounds like one of the few honorable people left here.

    Bamboo Remembers, I hope they remember that they, and we, are here to serve the Troops and not to let petty issues such as being kicked out for failing the contract to make them let the camps sink and the Troops feel the lack of effort and upkeep. IF they do such I hope the Marines help them out the gate with a large sized boot.

    We will see how few professionals KBR retain by the condiion of the camps on the handover dates, the people there already know what is wrong and how to fix it, passing that information on will make taking care of teh Troops easier for all but I doubt they will see it that way.

  12. Comment by Jimbo:

    Baboo, were you in the Balkans? That very thing happened when DynCorp won the LogCap2 contract in ’98, but couldn’t provide the seamless turnover demanded by the client. (BRSC simply said they’d terminate everyone and go home. BRSC also owned much of the heavy equipment on the sites at the time.)

    DynCorp ended up losing the LogCap2 contract on that basis, and BRSC won the 10year no-compete contract.

    BRSC later ended up taking the majority of contract jobs over there, bumping out Raytheon, Lockheed, and others.

  13. Comment by Baboo Remembers:

    No, I’m just aware of the bag of dirty tricks people play. I had alot of contacts at one time. Most of them crapped out or some better than beat them at that their own game.

  14. Comment by Baboo Remembers:

    If the Marines need an extra set of boots or an anchor, I’ll give’em mine!

  15. Comment by amanra:

    Does anybody know anything about meeting in Kandahar between Jim Luchsinger the head of KBR in Afghanistan and Fluor and Dynacorp?

  16. Comment by Baboo Remembers:

    I’m sure it’s regarding the transition from contractor to contractor. The military should be involved with the meeting. I’m sure one of the contractors will offer him a job.

  17. Comment by KBR_Truckdriver:

    Does anyone have any clue whats going to happen in iraq come the end of august? There’s alot of speculation going on over here but no answers. I was just wondering if anyones heard anything. And yes the managment is covering there ass’s more and more buy shifting blame on everyone but themselves for a lousy job they do.

  18. Comment by Judy777:

    KBR lost Afghanistan because the management is incompetent. These managers couldn’t manage a redneck turkey shoot with one shooter!

  19. Comment by kbr wife:

    Here in Baf if your a mason, being in the click and having good relationship with upper management, your chances of being written up are very slim or terminated. My husband has been there for many years and just resently he got written up and moved to his old job as when he started. But all must come to an end and what goes up must come down. There is a God and he sees who is fair and who is not. God bless each and everyone who has served our country.

  20. Comment by Baboo:

    Let me guess, BAF Masons are from Louisiana….

  21. Comment by amanra:

    Dear blogger,

    We have wrote a lot about KBR Management and issues here in the country.
    What do you think about new guys who are coming here to established New Management, new rules and new policies??? Have you heard anything yet??
    I hope, they do care more then these guys.

    Ms Sparky’s Response:
    One would hope that Fluor and Dyncorp have the sense to see what KBR has created with their poor management policies. I believe it is what caused them to lose the contract.

    Hopefully Fluor and Dyncorp are going to chose a different path. But as long as they continue to gather up upper level KBR managers they are destine to repeat KBR’s performance.

  22. Comment by frankinfish:

    I too was a k.b.r. employee in Iraq 2004-2005 and another outfit 2006…management as well as some k.b.r. employees caused a lot of trouble, broke rules and laws, I saw this, got treated badly while others profited….

    Can not say mch more due to legal reasons…
    many of us were damned if we did damned if we didn’t…..k.b.r. does suck….the upper management that is, most people were patriotic, we made good money, was hated by the military, and a cover up done by management,cheating was rampant……this may come out years into the future, but not now……..

  23. Comment by Firemazdaman:

    I am currently a KBR Employee Ex-pat, former Marine working in Afghanistan, and Yes this whole thing stinks and it feels like KBR is trying to wash there hands clean of us and setting the two contractors up for failure. But I was just wandering if anyone knows what the current salaries or pay for Dyncorp and Fluor are going to be, lets say for a plumber or a cook. Is pay going up or down and what are my options right now, go home or stick it out with kbr till the end. Just need a little advice.

  24. Comment by ballgame:

    Everyone keeps saying that Fluor and Dyncorp are gathing up all of KBR’s senior management and that this is going to suck. First off……the “senior senior” staff they are getting are/will be in the states. And yes…even some of their future in country managers will be former KBR People….however, that doesn’t mean that they will suck. I know for a fact that two of their future “in country” management staff are two that fought senior management on all their shady deals. And even filed formal complaints with their ethics line as well. Of course nothing was done….thats the KBR way, and thats why they left that company and are now working for Fluor.

    So lets be careful of using a broad brush to paint a bad picture on all of Fluor and Dyncorps future management…even if they did work for KBR at sometime in the past.

    Cheers

  25. Comment by Ksniper777:

    Firemazdaman said,on August 23rd, 2009 at 9:07 pm I am currently a KBR Employee Ex-pat, former Marine working in Afghanistan, and Yes this whole thing stinks and it feels like KBR is trying to wash there hands clean of us and setting the two contractors up for failure. But I was just wandering if anyone knows what the current salaries or pay for Dyncorp and Fluor are going to be, lets say for a plumber or a cook. Is pay going up or down and what are my options right now, go home or stick it out with kbr till the end. Just need a little advice.

    Ride it out, don’t jump ship yet see what Fluor or Dyncorp will offer. I know that Dyncorp pay 800 toward your ticket and you get 10 days and that is it. I personal would stick it out because DynCorp and or Fluor is going south. Fluor pays more for vacations 4 days travel and 9 days of vacation but there leadership is like tryants.
    I hope you won’t be disappointed.

  26. Comment by Fluor Foreman:

    Ballgame one thing it is true Fluor is hiring ex KBR managers
    several ex KBR here in Greenville now
    another contractor said
    it is not what you know it is who you know in KBR

    with Fluor you have to take a test to get certified
    I know a few master electricians that failed the test

  27. Comment by VAZHAYIL RAVINDRANATHAN:

    IT IS REALLY SO SAD ABOUT THE NEWS AND THE DECISION. KBR IS ONE OF THE BEST ORGANIZATION IN THE WORLD AND THEY PROVED IT. THERE ARE FEW MISTAKES BUT IT DOESN’T MEAN THAT KBR IS A WORST
    COMPANY. THEIR MANAGEMENT IS REALLY APPRECIABLE
    AND TALENTED PEOPLE. US ARMY MUST CONSIDER THEIR NAME FIRST. BECAUSE THEY HAVE A GOOD TEAM OF WORKERS AND EVERY EQUIPMENT. MOST OF THE EMPLOYEES ARE HIGHLY QUALIFIED AND TALENTED. LOG CAP V MUST GIVE TO KBR. KBR CAN ONLY MAINTAIN
    WELL. OTHER COMPANIES CAN NOT DO LIKE KBR. WHY OTHERS WANTED TO PUT KBR IN BLACK LIST. IT IS SO BAD AND SO SAD. KINDLY INVESTIGATE THE REAL TRUTH ABOUT KBR.

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