Department of the Navy awards $26.5M contract for engineering and technical services to Delphinus Engineering, Inc

Contract Overview

Contract Amount: $26,542,397 ($26.5M)

Contractor: Delphinus Engineering, Inc.

Awarding Agency: Department of Defense

Start Date: 2015-05-12

End Date: 2016-12-31

Contract Duration: 599 days

Daily Burn Rate: $44.3K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 3

Pricing Type: COST PLUS FIXED FEE

Sector: Defense

Official Description: ENGINEERING AND TECHNICAL SERVICES FOR IGF::CT::IGF

Place of Performance

Location: CRUM LYNNE, DELAWARE County, PENNSYLVANIA, 19022

State: Pennsylvania Government Spending

Plain-Language Summary

Department of Defense obligated $26.5 million to DELPHINUS ENGINEERING, INC. for work described as: ENGINEERING AND TECHNICAL SERVICES FOR IGF::CT::IGF Key points: 1. Contract awarded through full and open competition, indicating a competitive bidding process. 2. The contract type is Cost Plus Fixed Fee, which can lead to cost overruns if not managed carefully. 3. The contract duration is 599 days, suggesting a medium-term project. 4. The primary NAICS code (336611) points to shipbuilding and repairing, a critical defense sector. 5. The contract was awarded as a Delivery Order, implying it's part of a larger indefinite-delivery/indefinite-quantity (IDIQ) contract. 6. The contractor, Delphinus Engineering, Inc., is based in Pennsylvania. 7. The contract value is substantial, reflecting significant engineering and technical support needs.

Value Assessment

Rating: fair

Benchmarking the value of this specific contract is challenging without more detailed cost breakdowns or comparisons to similar engineering support services within the shipbuilding sector. The Cost Plus Fixed Fee (CPFF) contract type inherently carries risks of cost escalation if the fixed fee is not adequately justified by the scope of work and if oversight is not rigorous. However, the competitive award process may have helped to establish a reasonable baseline price.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under 'Full and Open Competition After Exclusion of Sources,' which suggests that while the competition was intended to be broad, specific sources may have been excluded for particular reasons. The presence of 3 bids indicates a moderate level of competition. A higher number of bidders typically leads to better price discovery and potentially lower costs for the government.

Taxpayer Impact: The competitive nature of this award, despite potential source exclusions, is generally beneficial for taxpayers as it encourages multiple firms to offer their best pricing and technical solutions.

Public Impact

The primary beneficiaries are the Department of the Navy, receiving essential engineering and technical services for its operations. Services delivered likely include design, development, testing, and maintenance support for naval vessels and related systems. The geographic impact is centered around naval facilities where these services are required, potentially impacting the Pennsylvania region where the contractor is located. Workforce implications include employment opportunities for engineers, technicians, and support staff at Delphinus Engineering, Inc.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost Plus Fixed Fee contracts can incentivize contractors to increase costs to maximize their fee, requiring robust oversight.
The 'Exclusion of Sources' clause in the competition type warrants further investigation to understand the rationale and potential impact on competition.
Limited public information on the specific deliverables makes it difficult to fully assess performance and value for money.

Positive Signals

Awarded through a full and open competition process, suggesting a fair and transparent solicitation.
The contract value of $26.5 million indicates a significant investment in critical defense capabilities.
The contractor, Delphinus Engineering, Inc., has secured a substantial award, signaling confidence from the Department of the Navy.

Sector Analysis

The shipbuilding and repair industry (NAICS 336611) is a vital component of the defense industrial base, characterized by complex engineering requirements, high capital investment, and stringent quality standards. Federal spending in this sector is heavily influenced by national security priorities and naval modernization programs. Comparable spending benchmarks would involve analyzing other contracts for similar engineering and technical services provided to naval shipbuilding and repair efforts, which often run into tens or hundreds of millions of dollars.

Small Business Impact

This contract does not appear to have a small business set-aside (ss=false, sb=false). There is no explicit information provided regarding subcontracting plans for small businesses. Without specific set-aside goals or subcontracting requirements, the direct impact on the small business ecosystem for this particular contract is likely minimal, though the prime contractor may engage small businesses as subcontractors.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of the Navy's contracting and program management offices. Accountability measures are typically embedded within the contract terms, including performance metrics, reporting requirements, and payment schedules tied to milestones. Transparency is facilitated through contract award databases like FPDS, though detailed performance data and cost breakdowns may be limited to government personnel and the contractor.

Related Government Programs

Naval Ship Systems Engineering Support
Shipbuilding and Repair Services
Defense Engineering Services
Technical Support Contracts
Cost Plus Fixed Fee Contracts

Risk Flags

Cost Plus Fixed Fee contract type carries inherent risk of cost overruns.
Competition level (3 bidders) may not yield optimal price discovery.
Specific scope of 'IGF' services is not detailed, hindering full analysis.
Rationale for 'Exclusion of Sources' in competition is not provided.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $26.5 million to DELPHINUS ENGINEERING, INC.. ENGINEERING AND TECHNICAL SERVICES FOR IGF::CT::IGF

Who is the contractor on this award?

The obligated recipient is DELPHINUS ENGINEERING, INC..

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Navy).

What is the total obligated amount?

The obligated amount is $26.5 million.

What is the period of performance?

Start: 2015-05-12. End: 2016-12-31.

What is the specific scope of 'engineering and technical services' provided under this contract?

The provided data abbreviates the contract description as 'ENGINEERING AND TECHNICAL SERVICES FOR IGF::CT::IGF'. Without further details, the precise scope remains unclear. However, given the NAICS code 336611 (Ship Building and Repairing) and the awarding agency (Department of the Navy), these services likely encompass a range of activities critical to naval vessel design, construction, maintenance, and modernization. This could include systems engineering, naval architecture, mechanical and electrical engineering support, combat systems integration, lifecycle support, technical documentation, and potentially research and development related to ship systems. The 'IGF' acronym might refer to a specific program or initiative within the Navy that requires these specialized services.

How does the Cost Plus Fixed Fee (CPFF) structure compare to other contract types for similar services?

Cost Plus Fixed Fee (CPFF) contracts are common in complex, high-risk, or R&D-intensive projects where the scope is not fully defined at the outset. The government agrees to pay the contractor's actual costs plus a fixed fee representing profit. Compared to Firm-Fixed-Price (FFP) contracts, CPFF offers more flexibility for the government if scope changes but carries a higher risk of cost overruns, as the contractor is incentivized to incur costs to earn their fee. Other types like Cost Plus Incentive Fee (CPIF) or Cost Plus Award Fee (CPAF) introduce performance-based incentives. For routine engineering services with well-defined scopes, FFP might be preferred for cost certainty. However, for developmental or highly specialized technical support in shipbuilding, CPFF can be appropriate if managed with stringent oversight.

What are the potential risks associated with Delphinus Engineering, Inc. as a contractor for this type of service?

Assessing contractor-specific risks requires a review of their past performance, financial stability, and any history of contract disputes or quality issues. The provided data does not include this information. However, general risks associated with CPFF contracts, as mentioned, include potential cost escalation if not managed properly. For Delphinus Engineering, Inc., risks could also stem from the complexity of naval systems, the need for specialized expertise, and adherence to strict military specifications and security protocols. The 'Exclusion of Sources' in the competition type might also indicate past issues or specific requirements that could pose challenges. A thorough risk assessment would necessitate examining past performance reports (e.g., CPARS) and financial health indicators.

What is the historical spending pattern for similar engineering and technical services by the Department of the Navy?

Historical spending patterns for similar services by the Department of the Navy are typically substantial, given the vastness and complexity of naval operations and platforms. The Navy consistently procures significant amounts of engineering, technical, and logistical support for its fleet, including shipbuilding, maintenance, modernization, and systems integration. Annual spending across various defense contractors for these types of services often runs into billions of dollars. Analyzing specific historical data for contracts under NAICS 336611 or related service codes would reveal trends in contract values, durations, and the prevalence of different contract types like CPFF, FFP, or IDIQs, highlighting the Navy's ongoing investment in maintaining and advancing its maritime capabilities.

How does the competition level (3 bidders) impact the value received by the government?

A competition level of 3 bidders suggests a moderate degree of competition. While better than a sole-source award, it is generally less competitive than situations involving 5 or more bidders. With fewer bidders, there is a reduced likelihood of receiving the absolute lowest price or the most innovative technical solution, as the pressure on each bidder to outperform the others is somewhat diminished. The government may not achieve the full benefits of price discovery that occurs in a highly contested market. However, the presence of multiple bidders still provides a basis for comparison and negotiation, likely resulting in a more reasonable price than if only one or two firms were capable or willing to bid.

Industry Classification

NAICS: Manufacturing › Ship and Boat Building › Ship Building and Repairing

Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › PROFESSIONAL SERVICES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: N6554012R0018

Offers Received: 3

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Address: 1510 CHESTER PIKE STE 380, EDDYSTONE, PA, 19022

Business Categories: Category Business, Minority Owned Business, Self-Certified Small Disadvantaged Business, Small Business, Special Designations, Subchapter S Corporation, Indian (Subcontinent) American Owned Business, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $26,542,544

Exercised Options: $26,542,544

Current Obligation: $26,542,397

Subaward Activity

Number of Subawards: 33

Total Subaward Amount: $15,441,156

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: N6554013D0006

IDV Type: IDC

Timeline