DOT awards $3.56M for maritime vessel water chemicals, a sole-source procurement

Contract Overview

Contract Amount: $3,564,652 ($3.6M)

Contractor: Drew Marine USA Inc

Awarding Agency: Department of Transportation

Start Date: 2023-08-02

End Date: 2026-08-31

Contract Duration: 1,125 days

Daily Burn Rate: $3.2K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: THE CONTRACTOR SHALL PROVIDE ALL SUPPLIES AND MATERIALS FOR VARIOUS WATER CHEMICALS FOR MARAD VESSELS.

Place of Performance

Location: WHIPPANY, MORRIS County, NEW JERSEY, 07981

State: New Jersey Government Spending

Plain-Language Summary

Department of Transportation obligated $3.6 million to DREW MARINE USA INC for work described as: THE CONTRACTOR SHALL PROVIDE ALL SUPPLIES AND MATERIALS FOR VARIOUS WATER CHEMICALS FOR MARAD VESSELS. Key points: 1. Contract focuses on essential water chemicals for MARAD vessels, indicating a critical operational need. 2. The sole-source nature of this award warrants scrutiny regarding potential cost efficiencies and market alternatives. 3. Limited competition suggests a potential risk of elevated pricing compared to a more open bidding process. 4. The contract duration of nearly three years provides stability for the supplier but limits re-evaluation opportunities. 5. Fixed-price contract type offers cost certainty for the government, shifting performance risk to the contractor. 6. The procurement falls under the 'Soap and Other Detergent Manufacturing' NAICS code, highlighting the specific product category.

Value Assessment

Rating: fair

Benchmarking the value of this contract is challenging due to its sole-source nature and specific product requirements. Without competitive bids, it's difficult to definitively assess if the $3.56 million price represents optimal value for money. However, the firm fixed-price structure provides cost predictability. Further analysis would require comparing the unit prices of the chemicals to market rates or similar government contracts, if available.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning only one vendor was solicited. This approach is typically used when only one responsible source is available or when there's a compelling justification for excluding full and open competition. The lack of multiple bidders means there was no direct price competition, which could potentially lead to higher costs for the government than if multiple companies had vied for the contract.

Taxpayer Impact: The absence of competition means taxpayers may not be benefiting from the most cost-effective pricing achievable through a competitive bidding process. This could result in a less efficient use of federal funds.

Public Impact

MARAD vessels will receive necessary water chemicals, ensuring operational readiness and safety. The contract supports the continued operation and maintenance of the Maritime Administration's fleet. The primary beneficiaries are the personnel and operations aboard MARAD vessels. The contract has a national geographic impact, supporting federal maritime assets across various locations. Workforce implications are likely limited to the supplier's operations and logistics for chemical provision.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits competitive pricing and potential cost savings for taxpayers.
Lack of competition may reduce incentives for the contractor to offer innovative or cost-saving solutions.
Dependence on a single supplier could create supply chain risks if the contractor faces disruptions.

Positive Signals

Firm fixed-price contract provides budget certainty and shifts performance risk to the contractor.
The contract ensures a consistent supply of essential chemicals for critical maritime operations.
The supplier, DREW MARINE USA INC, is likely experienced in providing these specialized chemicals.

Sector Analysis

This contract falls within the chemical manufacturing sector, specifically related to detergents and cleaning supplies. The market for specialized chemicals for maritime applications can be niche, potentially justifying sole-source awards in some instances due to specific product requirements or certifications. Government spending in this area supports the operational readiness of federal fleets, with comparable spending potentially seen across agencies operating vessels or large facilities requiring similar chemical supplies.

Small Business Impact

This contract was not set aside for small businesses, nor does it appear to have specific subcontracting requirements for small businesses mentioned in the provided data. The award to DREW MARINE USA INC, a likely established entity, suggests that small businesses may not have been primary targets for this specific procurement. Further investigation into DREW MARINE's own subcontracting practices would be needed to assess any indirect impact on the small business ecosystem.

Oversight & Accountability

Oversight for this contract would primarily reside with the Department of Transportation and the Maritime Administration. As a definitive contract, it is subject to standard federal procurement regulations and oversight. Transparency is facilitated through contract databases like FPDS. Specific accountability measures would be detailed within the contract's terms and conditions, including performance standards and payment schedules. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

MARAD Vessel Operations
Federal Fleet Maintenance
Maritime Logistics Support
Government Chemical Procurement
Detergent and Cleaning Supply Contracts

Risk Flags

Sole-source award requires justification and may indicate limited market availability or unique requirements.
Lack of competition raises concerns about potential overpricing and suboptimal value for taxpayer funds.
Contract duration of nearly three years limits opportunities for reassessment of needs or market shifts.

Frequently Asked Questions

What is this federal contract paying for?

Department of Transportation awarded $3.6 million to DREW MARINE USA INC. THE CONTRACTOR SHALL PROVIDE ALL SUPPLIES AND MATERIALS FOR VARIOUS WATER CHEMICALS FOR MARAD VESSELS.

Who is the contractor on this award?

The obligated recipient is DREW MARINE USA INC.

Which agency awarded this contract?

Awarding agency: Department of Transportation (Maritime Administration).

What is the total obligated amount?

The obligated amount is $3.6 million.

What is the period of performance?

Start: 2023-08-02. End: 2026-08-31.

What is the track record of DREW MARINE USA INC in fulfilling government contracts, particularly for chemical supplies?

DREW MARINE USA INC has a history of receiving federal contracts, primarily within the Department of Defense and Department of Transportation. While specific details on past performance for chemical supplies are not fully elaborated in this summary, their continued award of contracts suggests a level of reliability and capability in meeting government requirements. Analyzing their contract history for similar items, delivery performance, and any past performance issues or awards would provide a more comprehensive view of their track record. Their presence in the federal contracting space indicates they are a recognized supplier for certain goods and services.

How does the unit cost of these water chemicals compare to commercial market rates or similar government contracts?

Direct comparison of unit costs is not possible with the provided data, as the total contract value and duration are given, but not the specific quantities or unit prices of the water chemicals. As this was a sole-source award, there is no competitive benchmark to assess value. To perform this comparison, one would need to obtain the detailed schedule of items and prices from the contract itself and then benchmark these against catalog prices from DREW MARINE USA INC or other suppliers, as well as against historical data from similar government procurements. The lack of competition inherently makes it difficult to ascertain if the government secured the best possible price.

What are the specific risks associated with a sole-source procurement for essential maritime chemicals?

The primary risk of a sole-source procurement is the potential for inflated pricing due to the absence of competitive pressure. Taxpayers may end up paying more than necessary. Another risk is reduced incentive for the contractor to innovate or offer cost-saving measures, as they are guaranteed the contract without needing to outperform competitors. Furthermore, reliance on a single supplier can create supply chain vulnerabilities; if DREW MARINE USA INC experiences production issues, delivery delays, or financial instability, MARAD vessels could face shortages of critical chemicals, impacting operational readiness. This also limits the government's ability to explore alternative, potentially superior or more cost-effective, products.

What is the expected effectiveness of these chemicals in maintaining MARAD vessel operations?

The contract specifies 'various water chemicals for MARAD vessels,' implying these are essential for maintaining potable water systems, sanitation, and potentially other operational functions aboard ships. While the exact nature of the chemicals isn't detailed, their procurement by the Maritime Administration suggests they are critical for hygiene, safety, and compliance with maritime regulations. The effectiveness is presumed to be high, given the operational necessity. The contract's duration and value indicate a sustained need, supporting the ongoing effectiveness of these supplies in ensuring vessels are operational and safe for crew and passengers.

How does this contract's value and duration compare to historical spending patterns for similar supplies by MARAD or other agencies?

Without historical data specific to MARAD's procurement of these particular water chemicals, a direct comparison is difficult. However, a $3.56 million contract over approximately three years (August 2023 - August 2026) suggests a significant and ongoing requirement. Agencies managing fleets or large facilities often have substantial budgets for operational supplies. To assess historical patterns, one would need to query databases like FPDS for prior contracts awarded by MARAD or similar agencies (e.g., Navy, Coast Guard) for comparable chemical supplies, looking at both value and duration to identify trends and potential anomalies.

Are there any specific performance metrics or quality standards outlined in the contract for these chemicals?

The provided summary does not detail specific performance metrics or quality standards for the water chemicals. Typically, government contracts of this nature would include specifications regarding the chemical composition, purity, packaging, shelf life, and delivery timelines. Performance would likely be evaluated based on the contractor's adherence to these specifications and delivery schedules. MARAD would have internal quality assurance processes to verify the chemicals meet required standards before use. A thorough review of the contract document itself would be necessary to identify these precise requirements and standards.

Industry Classification

NAICS: Manufacturing › Soap, Cleaning Compound, and Toilet Preparation Manufacturing › Soap and Other Detergent Manufacturing

Product/Service Code: SHIP AND MARINE EQUIPMENT

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: 693JF723R000010

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 100 S JEFFERSON RD STE 204, WHIPPANY, NJ, 07981

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Manufacturer of Goods, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $3,564,652

Exercised Options: $3,564,652

Current Obligation: $3,564,652

Actual Outlays: $3,142,738

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Timeline