Defense Contracting in Iraq: Issues and Options for Congres
Source: Congressional Research Service (via Federation of American Scientists), January 26, 2007
This report will examine logistical support contracts for troop support services in Iraq primarily administered through the United States'(U.S.)Army's Logistics Civil Augmentation Program (LOGCAP). LOGCAP is an initiative to manage the use of civilian contractors that perform services in support of DOD missions during times of war and other military mobilizations. It was established on December 6, 1985 with the publication of Army Regulation 700-137.
LOGCAP has been used in a variety of military contingency operations and provides for the awarding of contingency, or bridging contracts, or for the inclusion of contingency clauses in peacetime contracts. LOGCAP contracts have been previously awarded for work in Rwanda, Haiti, Saudi Arabia, Kosovo, Ecuador, Qatar, Italy, southeastern Europe, Bosnia, South Korea, Iraq, and Kuwait. LOGCAP contracts are "costs-plus award fee" contracts, meaning that there is a fee paid based on contract costs, in addition to the potential for incentive fees based on performance. There has been a substantial shift in the types of contracts for troop support services, the size of the contracts, and the apparent lack of effective management control over the administration of the contracts and the oversight of the contractors.
Some observers have noted that costs-plus contracts have characteristics that can make oversight difficult. Others note that the very nature of the types of contracts employed in Iraq, combined with the challenges in contract administration, serve as major factors which make contract administration difficult. Given the size and scope of the contracts in Iraq, and the challenge of managing billions of DOD-appropriated dollars, many have suggested it appropriate to inquire whether these types of contracts can be managed better.