Defense Budget Maps US Influence
While the future of U.S. foreign policy and worldwide military involvement in the long-run may seem obscure and uncertain, if you know where and what to look for, you may be able to foresee the future as far as ten to twenty years ahead. Look no further than LOGCAP V, otherwise known as Logistics Civilian Augmentation Program-Phase 5, the U.S. government’s next multi-billion dollar contract award plan to get the military where it needs to go. If you follow these precursors, you can draw a pretty accurate picture of future U.S. involvement in the world. The way we look ahead is by figuring out where the federal government plans to spend the right amount of resources, then draw conclusions and perform analysis as to why.
Understanding how the government operates, what it’s long-term objectives are and how decisions are made requires a unique insight one only gets from having been inside the system itself. After multiple delays since 2018, the results of the fifth phase was finally announced in April 2019, to the tune of $82 billion over the next decade. The U.S. Army Sustainment Command, headquartered in Rock Island Armory, Illinois oversees the LOGCAP program and awarded 3 of the 7 contracts to longtime contracting partner KBRwyle. Their history goes back to the early days of Operation Desert Storm and their engagement peaked in 2003 at the dawn of Operation Iraqi Freedom during LOGCAP III. The latter program mobilized the largest civilian workforce into warzones in Iraq and Afghanistan.
Awarded to KBR as a no-bid, cost-plus contract from the Bush administration, it was said that KBR received the contract because it was the only company large enough to handle a project of such unprecedented magnitude. Many argued that Vice President Dick Cheney’s company received the contract exclusively due to his connection to the company as Chief Executive. At any rate, LOGCAP’s 4th phase brought about change. With the Obama administration now in office, increased government oversight and competition were introduced. This opened the platform for companies such as DynCorp, CACI, TITAN and Flour Daniels to get involved.
“LOGCAP V contracts will be capped at $82 billion spanning 10 years, said Jerome Jastrab, project manager, Acquisition Integration & Management Center, ASC headquarters.”
On October 20, 2017, the U.S. Army Contracting Command announced their intention to issue a Request for Proposal (RFP) for the Logistics Civil Augmentation Program (LOGCAP V) logistical support services in support of the U.S. Military worldwide. The full list of services provided by LOGCAP V includes, but is not limited to:
- Setting the Theater
- Supply Operations
- Transportation Services
- Engineering Services
- Base Camp Services
- Other Logistics and Sustainment Support Services
- Minor Construction
- Food Services
- Welfare and Recreation Services
- Facility Management
The U.S. Government (USG) intends to award a minimum of four, and up to six, Indefinite Delivery, Indefinite Quantity (IDIQ) contracts to offerors whose proposals are determined to be the most beneficial to the Government. The LOGCAP V basic IDIQ contracts will consist of an initial five-year ordering period and options for five additional one-year ordering periods.
The estimated maximum dollar amount is $82,000,000,000.00 for all awards for the 10 year contract terms.
By way of context, the previous LOGCAP programs had the following “estimated maximum dollar amount[s]”:
- LOGCAP I (1992): $815 million
- LOGCAP II (1997): $42 million
- LOGCAP III (2001): $38.5 billion
- LOGCAP IV (2008): $150 billion
So, while LOGCAP V is slated to be smaller than the LOGCAP IV, the estimated maximum amount awarded remains far more than what was awarded in LOGCAPs I – III combined. The current breakdown for the LOGCAP V award is as follows:
PAE-Parsons Global Logistics Services, LLC is one of the award recipients and is hereby awarded Basic Contract W52P1J-19-D-0047 and the following task orders.
– SOUTHCOM Setting the Theater Task Order and associated Performance Task Order: $34,596,500.37
Fluor Intercontinental, Inc. is one of the award recipients and is hereby awarded Basic Contract W52P1J-19-D-0046 and the following task orders.
– AFRICOM Setting the Theater Task Order and associated Performance Task Order: $137,222,537.90
Vectrus Systems Corporation is one of the award recipients and is hereby awarded Basic Contract W52P1J-19-D-0045 and the following task orders.
– PACOM Setting the Theater Task Order and associated Performance Task Order: $349,187,574.26
– CENTCOM Setting the Theater Task Order and associated Performance Task Order: $1,033,582,366.79
Kellogg Brown & Root Services, Inc. is one of the award recipients and is hereby awarded Basic Contract W52P1J-19-D-0044 and the following task orders.
– EUCOM Setting the Theater Task Order and associated Performance Task Order: $183,304,831.67
– NORTHCOM Setting the Theater Task Order and associated Performance Task Order: $393,988,697.66
– Afghanistan Performance Task Order: $1,372,043,984.72
As predicted, companies who responded to the government’s Request For Proposal but did not receive an award began a protest, leading with contracting giant DynCorp, who filed the protest on the morning of April 25, 2019. It is unlikely that the proceedings will have any bearing on the outcome as the approval process goes through multiple phases and redundancies before a decision is reached. The projected transition date for LOGCAP V is September 2019.
The interesting allocation of funds to Afghanistan shows that the United States plans to maintain a presence there for at least another decade, even if only in an advisory role. While the Trump Administration has stated that the United States has no interest in fighting needless, long-term wars, the earmarking of $1.3 billion shows different plans to keep the region stable.
NORTHCOM and PACOM are support roles with similar budgets, asserting that they will have similar program life spans. EUROCOM is essentially a staging ground for the Middle East operations in order to push assets through Iraq, Afghanistan and until recently, Syria. In addition to this, a U.S. military presence also serves as a deterrent from Russian aggression toward Eastern Europe.
SOUTHCOM, which includes South America, is a curious bag, in that it received an inconspicuous $35 Million award designated to PAE-Parsons, a relatively new contractor whose strategic acquisition prior to the Request For Proposal allowed for this win. Since this is a Setting The Theater contract, it leads one to wonder how many bases and where are projected. A safe bet would be in Columbia near the Venezuelan border, possibly 2-3 small bases. The signals for military intervention in Venezuela are pretty clear, and this contract award solidifies it.
With ISIS nearly destroyed, the terrorist organization had no choice but to move outside the region. Flour Intercontinental received a sizable contract award for AFRICOM which is where most of the ISIS ‘fighters’ have fled. The $138 Million investment shows a solid level of U.S. commitment in the region for both humanitarian and military operations.
Given that these earmarks represent only a fraction of the $82B budget, there is good indication these Setting the Theater contracts will likely endure and transition into Operations & Maintenance contracts in the future.