DoD's $801M Advance Planning Contract for Ship Defueling Awarded to Huntington Ingalls Inc
Contract Overview
Contract Amount: $801,147,554 ($801.1M)
Contractor: Huntington Ingalls Inc
Awarding Agency: Department of Defense
Start Date: 2014-08-01
End Date: 2017-09-01
Contract Duration: 1,127 days
Daily Burn Rate: $710.9K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: COST PLUS FIXED FEE
Sector: Defense
Official Description: PY1 RCOH DEFUELING ADVANCE PLANNING
Place of Performance
Location: NEWPORT NEWS, NEWPORT NEWS CITY County, VIRGINIA, 23607
State: Virginia Government Spending
Plain-Language Summary
Department of Defense obligated $801.1 million to HUNTINGTON INGALLS INC for work described as: PY1 RCOH DEFUELING ADVANCE PLANNING Key points: 1. Significant contract value of over $800 million for advance planning. 2. Sole-source award to Huntington Ingalls Inc. raises questions about competition. 3. Contract duration of 1127 days suggests a complex and lengthy project. 4. The 'Ship Building and Repairing' sector is a critical area for defense spending.
Value Assessment
Rating: questionable
The contract value of $801M for advance planning is substantial. Benchmarking is difficult without specific deliverables, but the scale suggests a high cost. The Cost Plus Fixed Fee (CPFF) structure can lead to cost overruns if not managed tightly.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
The contract was not competed, indicating a sole-source award to Huntington Ingalls Inc. This limits price discovery and potentially leads to higher costs for taxpayers compared to a competitive process.
Taxpayer Impact: The lack of competition for this large contract may result in a higher cost to taxpayers than if multiple vendors had vied for the work.
Public Impact
Taxpayers may be paying a premium due to the absence of competitive bidding. The long duration of the contract could indicate potential for scope creep or delays. The strategic importance of naval ship defueling means this spending is essential, but efficiency is key.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award limits competition and price discovery.
- Cost Plus Fixed Fee contract type can incentivize higher costs.
- Lack of clear per-unit cost benchmark makes value assessment difficult.
Positive Signals
- Contract supports critical national defense infrastructure.
- Awardee is a major player in shipbuilding and repair.
Sector Analysis
This contract falls within the Ship Building and Repairing sector, a vital but often high-cost area for the Department of Defense. Spending in this sector is heavily influenced by defense budgets and geopolitical factors.
Small Business Impact
The awardee, Huntington Ingalls Inc., is a large corporation, and there is no indication of small business participation in this specific contract. This sole-source award likely bypassed opportunities for small businesses to compete.
Oversight & Accountability
The sole-source nature of this contract warrants close oversight to ensure fair pricing and efficient execution. The Department of the Navy must ensure robust monitoring of costs and performance.
Related Government Programs
- Ship Building and Repairing
- Department of Defense Contracting
- Department of the Navy Programs
Risk Flags
- Lack of competition
- Cost Plus Fixed Fee contract type
- High contract value for planning phase
- Long contract duration
Tags
ship-building-and-repairing, department-of-defense, va, definitive-contract, 100m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $801.1 million to HUNTINGTON INGALLS INC. PY1 RCOH DEFUELING ADVANCE PLANNING
Who is the contractor on this award?
The obligated recipient is HUNTINGTON INGALLS 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 $801.1 million.
What is the period of performance?
Start: 2014-08-01. End: 2017-09-01.
What specific advance planning activities are covered under this $801M contract, and how do they justify the significant cost?
The contract details for 'PY1 RCOH DEFUELING ADVANCE PLANNING' are not fully specified in the provided data. However, advance planning for complex operations like ship defueling typically involves extensive technical assessments, environmental impact studies, logistical planning, and risk mitigation strategies. The high cost likely reflects the specialized expertise, long duration, and critical nature of preparing for the defueling of naval vessels.
Given the sole-source award, what mechanisms are in place to ensure Huntington Ingalls Inc. is not overcharging for these advance planning services?
With a sole-source award, oversight is crucial. The Department of the Navy should employ stringent cost-reimbursement controls, detailed performance metrics, and regular audits to monitor expenditures. Independent cost analysis and comparison with industry benchmarks for similar planning activities, where available, can help validate the reasonableness of the costs incurred by Huntington Ingalls Inc.
How will the success of this advance planning contract be measured, and what is its direct impact on the effectiveness of future defueling operations?
The success of this advance planning contract will be measured by the thoroughness and accuracy of the plans developed, adherence to schedule, and the identification and mitigation of potential risks. Effective advance planning should directly lead to smoother, safer, and more cost-efficient defueling operations, minimizing unforeseen issues and ensuring compliance with environmental and safety regulations.
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: N0002413R2111
Offers Received: 1
Pricing Type: COST PLUS FIXED FEE (U)
Evaluated Preference: NONE
Contractor Details
Parent Company: Huntington Ingalls Industries, Inc
Address: 4101 WASHINGTON AVE, NEWPORT NEWS, VA, 23607
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $832,273,711
Exercised Options: $832,273,711
Current Obligation: $801,147,554
Actual Outlays: $1,658,809
Subaward Activity
Number of Subawards: 3554
Total Subaward Amount: $495,361,407
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: YES
Timeline
Start Date: 2014-08-01
Current End Date: 2017-09-01
Potential End Date: 2017-09-01 00:00:00
Last Modified: 2025-12-19
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