Navy awards $153.6M contract for USS Hartford advanced planning to Electric Boat Corporation

Contract Overview

Contract Amount: $153,566,174 ($153.6M)

Contractor: Electric Boat Corporation

Awarding Agency: Department of Defense

Start Date: 2012-04-26

End Date: 2016-05-31

Contract Duration: 1,496 days

Daily Burn Rate: $102.7K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: USS HARTFORD ADVANCED PLANNING

Place of Performance

Location: GROTON, NEW LONDON County, CONNECTICUT, 06340

State: Connecticut Government Spending

Plain-Language Summary

Department of Defense obligated $153.6 million to ELECTRIC BOAT CORPORATION for work described as: USS HARTFORD ADVANCED PLANNING Key points: 1. Contract awarded on a sole-source basis, limiting price competition. 2. Significant investment in advanced planning for a key naval asset. 3. Long contract duration suggests a complex and lengthy planning process. 4. Firm Fixed Price contract type aims to control costs, but sole-source nature raises concerns. 5. Focus on shipbuilding and repair sector, a critical area for national defense. 6. Contractor has a substantial history in naval shipbuilding.

Value Assessment

Rating: fair

The contract value of $153.6 million for advanced planning services is substantial. Without comparable sole-source contracts for similar advanced planning phases on naval vessels, a precise value-for-money assessment is challenging. The firm fixed-price structure is a positive cost control measure, but the lack of competition inherent in a sole-source award means the government may not have achieved the most competitive pricing possible. Benchmarking against industry standards for advanced engineering and planning services for major naval platforms would be necessary for a more definitive value assessment.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning only one bidder, Electric Boat Corporation, was solicited. This approach is typically used when a specific contractor possesses unique capabilities or when urgency precludes a competitive process. The absence of multiple bidders means there was no direct price competition, which can lead to higher costs for the government compared to a fully competed contract. The justification for this sole-source award would need to be thoroughly reviewed to ensure it aligns with federal procurement regulations.

Taxpayer Impact: The sole-source nature of this award means taxpayers did not benefit from the potential cost savings that could arise from a competitive bidding process. This could result in a higher overall expenditure for this planning phase.

Public Impact

The primary beneficiary is the U.S. Navy, which will receive advanced planning services essential for the future maintenance and potential upgrades of the USS Hartford submarine. This contract supports the continued operational readiness and technological relevance of a critical naval asset. The work is likely to be performed in Connecticut, where Electric Boat Corporation is headquartered, potentially impacting the local workforce in the shipbuilding and repair sector. The successful completion of advanced planning is crucial for the long-term service life and effectiveness of the submarine.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits competitive pricing, potentially increasing costs for taxpayers.
Lack of transparency in the justification for sole-source procurement.
Long contract duration could indicate potential for scope creep or unforeseen challenges.
Dependence on a single contractor for critical advanced planning services.

Positive Signals

Firm Fixed Price contract type provides cost certainty for the government.
Contractor's established expertise in naval shipbuilding suggests a high likelihood of successful execution.
Focus on advanced planning is crucial for maintaining the long-term viability of naval assets.

Sector Analysis

The shipbuilding and repairing industry (NAICS 336611) is a vital sector for national defense, characterized by high barriers to entry, significant capital investment, and specialized technical expertise. Major naval contracts often involve complex, long-term planning and construction phases. Electric Boat Corporation is a dominant player in this sector, particularly for submarine construction and repair. This contract fits within the broader context of ongoing naval fleet maintenance and modernization efforts, where specialized planning is essential for complex platforms.

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. As a sole-source award to a large prime contractor, the direct impact on the small business ecosystem is likely minimal unless Electric Boat Corporation voluntarily engages small businesses for specific support services. Further investigation into subcontracting plans would be needed to fully assess the impact.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of the Navy and potentially the Department of Defense's Inspector General. The firm fixed-price nature of the contract provides a degree of cost accountability. However, the sole-source award necessitates robust oversight to ensure the justification was sound and that the contractor is delivering services as specified and at a reasonable cost, even without direct price competition. Transparency regarding the sole-source justification and performance metrics would enhance accountability.

Related Government Programs

Naval Ship Maintenance Contracts
Submarine Modernization Programs
Defense Industrial Base Contracts
Shipbuilding and Repair Services

Risk Flags

Sole-source award
Lack of competition
Potential for cost overruns without competitive benchmarking

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $153.6 million to ELECTRIC BOAT CORPORATION. USS HARTFORD ADVANCED PLANNING

Who is the contractor on this award?

The obligated recipient is ELECTRIC BOAT CORPORATION.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $153.6 million.

What is the period of performance?

Start: 2012-04-26. End: 2016-05-31.

What is the specific justification provided by the Department of the Navy for awarding this contract on a sole-source basis to Electric Boat Corporation?

The provided data indicates the contract was 'NOT COMPETED'. Typically, sole-source awards are justified under specific circumstances outlined in the Federal Acquisition Regulation (FAR), such as when only one responsible source is available or capable of providing the required services, or in cases of urgent and compelling need. For a contract of this magnitude and duration, the justification would likely stem from Electric Boat Corporation's unique expertise and historical role in the design, construction, and maintenance of the specific class of submarine (likely a nuclear-powered attack submarine given the contractor). The Navy would need to formally document and approve this justification, often involving a Justification and Approval (J&A) document, to ensure compliance with procurement regulations and to demonstrate that competition was not feasible or practicable.

How does the $153.6 million cost compare to similar advanced planning contracts for naval vessels?

Directly comparing the $153.6 million cost to similar advanced planning contracts is challenging without access to a broader dataset of comparable sole-source or competed contracts for advanced planning phases of naval vessels. Advanced planning for major naval platforms, especially submarines, is inherently complex and costly due to the intricate systems, long service lives, and stringent safety and operational requirements. Factors influencing cost include the specific class of vessel, the scope of planning (e.g., routine maintenance, mid-life upgrades, new design elements), the duration of the planning effort, and the level of detail required. Given Electric Boat's specialized role, this figure might be within the expected range for such a critical and complex undertaking, but a definitive benchmark requires more specific comparative data on the scope and nature of the planning services.

What are the primary risks associated with this sole-source contract, and what mitigation strategies are in place?

The primary risk associated with this sole-source contract is the potential for inflated pricing due to the lack of competitive pressure. Without competing bids, there's a risk that the government may pay more than it would in a competitive environment. Another risk is contractor performance; while Electric Boat is a known entity, any sole-source award warrants close monitoring to ensure the contractor meets all contractual obligations effectively and efficiently. Mitigation strategies typically include robust government oversight, detailed performance metrics within the contract, and potentially independent cost analysis if feasible. The firm fixed-price structure itself acts as a cost mitigation tool by capping the government's liability, but it doesn't guarantee the lowest possible price was negotiated.

What is the expected impact of this contract on the operational readiness and future capabilities of the USS Hartford?

This contract is crucial for ensuring the continued operational readiness and future capabilities of the USS Hartford. Advanced planning is the foundational step for any significant maintenance, repair, modernization, or upgrade effort. It involves detailed engineering, logistical planning, resource allocation, and scheduling necessary to execute complex work. By investing in this advanced planning phase, the Navy is proactively addressing the submarine's lifecycle needs, ensuring that it remains a capable asset in its operational fleet. This could involve planning for system upgrades, hull integrity assessments, or other modifications required to meet evolving mission requirements and maintain technological superiority.

How does the historical spending on shipbuilding and repair contracts by the Department of the Navy compare to this specific award?

The Department of the Navy consistently allocates substantial portions of its budget to shipbuilding and repair, reflecting the critical need to maintain and modernize its fleet. Annual spending in this category often runs into the tens of billions of dollars, encompassing new construction, major overhauls, routine maintenance, and specialized planning services. A single contract of $153.6 million, while significant in absolute terms, represents a fraction of the Navy's total annual expenditure in this domain. Historical spending patterns show a continuous demand for such services, driven by the long service lives of naval vessels and the ongoing need to adapt to new technologies and threats. This contract aligns with that established pattern of significant investment in fleet sustainment and development.

Industry Classification

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

Product/Service Code: SHIPS, SMALL CRAFT, PONTOON, DOCKS

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: N0002412R4301

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: General Dynamics Corp (UEI: 001381284)

Address: 75 EASTERN POINT RD, GROTON, CT, 06340

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: $158,811,182

Exercised Options: $154,330,142

Current Obligation: $153,566,174

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: YES

Timeline