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Summary

This report examines logistical support contracts for troop support services in Iraq and Afghanistan (for Afghanistan, beginning with LOGCAP IV) administered through the U.S. Armys Logistics Civil Augmentation Program (LOGCAP). LOGCAP is an initiative designed to manage the use of civilian contractors that perform services during times of war and other military mobilizations. On April 18, 2008, DOD announced the Armys LOGCAP IV contract awards to three companies - DynCorp International LLC, Fort Worth, TX; Fluor Intercontinental, Inc, Greenville, SC; and KBR, Houston, TX, through a full and open competition. The LOGCAP IV contract calls for each company to compete for task orders. Each company may be awarded up to $5 billion annually for troop support services with a maximum annual value of $15 billion. Over the life of LOGCAP IV, the maximum contract value is $150 billion. Under LOGCAP IV, the U.S. Army Sustainment Command awarded the first performance task order on September 25, 2008 to Fluor Intercontinental, Inc., for logistical support services in Afghanistan. Congress is concerned about the Federal oversight and management of DOD contracting in Iraq, particularly under LOGCAP. Recent assessments from the Government Accountability Office (GAO), DOD Office of the Inspector General (DOD-IG), and the Special Inspector General for Iraq Reconstruction (SIGIR) reveal a lack of accountability for large sums of money spent for Iraq contracts. Congress is also concerned about contractor insurance premiums through the Defense Base Act (DBA); such premiums comprise significant costs under LOGCAP. The DBA requires that many Federal government contractors and subcontractors provide workers compensation insurance for their employees who work outside of the United States. The U.S. Armys LOGCAP contract covers costs for DBA insurance and includes significant overheard and other costs beyond the costs of the actual insurance claims. In 2007, the U.S. Army audited DBA costs under LOGCAP and uncovered rising program costs and wide fluctuations in insurance rates. The Duncan Hunter Fiscal Year (FY) 2009 Defense Authorization Act (P.L. 110-417) contains provisions that address congressional concerns over the performance of private security contractors, and well as safeguards against the potential for contractor conflicts of interest. A number of government-wide contracting provisions in P.L. 110-417 are contained in Title VIII, Subtitle G, Government-Wide Acquisition Improvements, and are known as the Clean Contracting Provisions of 2008. These provisions build on provisions enacted in the previous FY2008 Defense Authorization Act (P.L. 110-181) and are intended to reduce instances of contract waste, fraud, abuse, and mismanagement. This report will be updated as warranted.

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