DoD's $83.9M Bunker Hill Ship Repair Contract Awarded to BAE Systems Under Full and Open Competition
Contract Overview
Contract Amount: $83,919,266 ($83.9M)
Contractor: BAE Systems Maritime Solutions SAN Diego Inc.
Awarding Agency: Department of Defense
Start Date: 2007-10-31
End Date: 2009-10-15
Contract Duration: 715 days
Daily Burn Rate: $117.4K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 2
Pricing Type: COST PLUS AWARD FEE
Sector: Defense
Official Description: ACCOMPLISH THE FY 08 REPAIR, MAINTENANCE, AND ALTERATION FOR US BUNKER HILL (CG52) NON DRY-DOCKING CNO SCHEDULED AVAILABILITY
Place of Performance
Location: SAN DIEGO, SAN DIEGO County, CALIFORNIA, 92136
Plain-Language Summary
Department of Defense obligated $83.9 million to BAE SYSTEMS MARITIME SOLUTIONS SAN DIEGO INC. for work described as: ACCOMPLISH THE FY 08 REPAIR, MAINTENANCE, AND ALTERATION FOR US BUNKER HILL (CG52) NON DRY-DOCKING CNO SCHEDULED AVAILABILITY Key points: 1. The contract covers repair, maintenance, and alteration for the US Bunker Hill (CG52) non-dry-docking CNO scheduled availability. 2. Awarded to BAE Systems Maritime Solutions, the contract value is $83.9 million. 3. The acquisition method was full and open competition, indicating a competitive bidding process. 4. The contract type is Cost Plus Award Fee (CPAF), which incentivizes contractor performance. 5. This falls under the Ship Building and Repairing sector, specifically NAICS 336611.
Value Assessment
Rating: good
The contract value of $83.9 million for a 715-day period appears reasonable for complex ship repair and maintenance. Benchmarking against similar naval vessel repair contracts would provide a more precise assessment.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The use of full and open competition suggests a robust price discovery process, allowing multiple qualified bidders to compete. This method is generally expected to yield competitive pricing.
Taxpayer Impact: Taxpayer funds are being used for essential military asset maintenance, with competition aiming to ensure value for money.
Public Impact
Ensures the operational readiness of a key naval asset, the USS Bunker Hill. Supports jobs within the shipbuilding and repair industry, particularly in California. The CPAF contract structure aims to balance cost control with contractor performance incentives. The duration of the contract (715 days) indicates a significant scope of work.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Potential for cost overruns inherent in CPAF contracts if performance incentives are not well-defined.
- Long contract duration could introduce risks related to material cost fluctuations or unforeseen technical challenges.
Positive Signals
- Full and open competition likely resulted in a competitive price.
- Award to an established maritime solutions provider suggests technical capability.
- CPAF structure can drive efficiency and quality if managed effectively.
Sector Analysis
This contract falls within the shipbuilding and repair sector, which is critical for maintaining naval fleet readiness. Spending in this sector can fluctuate based on fleet modernization needs and maintenance cycles.
Small Business Impact
The data does not indicate any specific set-asides for small businesses. The prime contractor, BAE Systems Maritime Solutions, is a large entity, suggesting limited direct subcontracting opportunities for small businesses on this specific award, though this cannot be definitively concluded without more information.
Oversight & Accountability
The Department of the Navy, under the Department of Defense, is responsible for oversight. The CPAF contract type requires diligent monitoring of costs and performance to ensure accountability and value.
Related Government Programs
- Ship Building and Repairing
- Department of Defense Contracting
- Department of the Navy Programs
Risk Flags
- Cost overruns risk with CPAF structure.
- Long contract duration (715 days) increases exposure to market volatility.
- Potential for scope creep if not tightly managed.
- Dependence on a single large contractor for critical repairs.
Tags
ship-building-and-repairing, department-of-defense, ca, dca, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $83.9 million to BAE SYSTEMS MARITIME SOLUTIONS SAN DIEGO INC.. ACCOMPLISH THE FY 08 REPAIR, MAINTENANCE, AND ALTERATION FOR US BUNKER HILL (CG52) NON DRY-DOCKING CNO SCHEDULED AVAILABILITY
Who is the contractor on this award?
The obligated recipient is BAE SYSTEMS MARITIME SOLUTIONS SAN DIEGO 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 $83.9 million.
What is the period of performance?
Start: 2007-10-31. End: 2009-10-15.
What specific performance metrics are tied to the 'Award Fee' component of the Cost Plus Award Fee contract, and how are they measured?
The specific performance metrics for the award fee are not detailed in the provided data. Typically, for ship repair contracts, these metrics could include adherence to schedule, quality of workmanship, safety compliance, and responsiveness to government direction. The Navy's contracting officer would establish and monitor these metrics, with the award fee determined based on the contractor's performance against them.
How does the $83.9 million cost compare to historical repair costs for similar naval vessels of the Bunker Hill's class?
Without specific historical data for comparable vessels and repair types, a direct comparison is difficult. However, the contract value of $83.9 million for a 715-day availability suggests a substantial scope of work. Factors like the vessel's age, specific systems requiring repair, and market rates for labor and materials in San Diego would influence this cost.
What are the potential risks associated with the 715-day duration of this repair contract, and how are they mitigated?
The long duration presents risks such as potential cost increases due to inflation or material price volatility, and the possibility of unforeseen technical issues arising during the extended period. Mitigation strategies likely include robust contract clauses addressing cost escalation, contingency planning for unexpected repairs, and close project management by the Navy to monitor progress and address challenges promptly.
Industry Classification
NAICS: Manufacturing › Ship and Boat Building › Ship Building and Repairing
Product/Service Code: SHIPS, SMALL CRAFT, PONTOON, DOCKS
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Offers Received: 2
Pricing Type: COST PLUS AWARD FEE (R)
Evaluated Preference: NONE
Contractor Details
Parent Company: BAE Systems PLC (UEI: 217304393)
Address: 2205 E BELT ST, SAN DIEGO, CA, 90
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Manufacturer of Goods, Not Designated a Small Business
Financial Breakdown
Contract Ceiling: $84,896,611
Exercised Options: $83,919,266
Current Obligation: $83,919,266
Timeline
Start Date: 2007-10-31
Current End Date: 2009-10-15
Potential End Date: 2009-10-15 00:00:00
Last Modified: 2010-07-06
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