Navy Awards $34.6M Contract for LHA 7 Fitting Out Availability to National Steel and Shipbuilding

Contract Overview

Contract Amount: $34,642,780 ($34.6M)

Contractor: National Steel and Shipbuilding Company

Awarding Agency: Department of Defense

Start Date: 2018-04-06

End Date: 2022-02-28

Contract Duration: 1,424 days

Daily Burn Rate: $24.3K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 3

Pricing Type: COST PLUS AWARD FEE

Sector: Defense

Official Description: LHA 7 FITTING OUT AVAILABILITY - SCN

Place of Performance

Location: SAN DIEGO, SAN DIEGO County, CALIFORNIA, 92128

State: California Government Spending

Plain-Language Summary

Department of Defense obligated $34.6 million to NATIONAL STEEL AND SHIPBUILDING COMPANY for work described as: LHA 7 FITTING OUT AVAILABILITY - SCN Key points: 1. The contract value is $34.6 million, awarded to National Steel and Shipbuilding Company. 2. This award falls under the Ship Building and Repairing sector (NAICS 336611). 3. The contract type is Cost Plus Award Fee (CPAF), indicating potential for performance-based incentives. 4. The duration of the contract is 1424 days, spanning from April 2018 to February 2022.

Value Assessment

Rating: fair

The Cost Plus Award Fee (CPAF) structure allows for flexibility but requires careful monitoring to ensure costs remain reasonable and performance targets are met. Without specific award fee criteria, it's difficult to assess the true value realization.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, suggesting a competitive bidding process. However, the specific pricing mechanisms within the CPAF structure need scrutiny to ensure competitive pricing was achieved.

Taxpayer Impact: Taxpayer funds are utilized for this contract. The CPAF structure necessitates oversight to ensure cost efficiency and value for money.

Public Impact

Supports naval shipbuilding capabilities and readiness. Contributes to the industrial base for shipbuilding and repair. Ensures the operational readiness of naval vessels.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost Plus Award Fee (CPAF) can lead to cost overruns if not managed tightly.
Lack of specific performance metrics makes it hard to gauge award fee effectiveness.
Long contract duration requires sustained oversight.

Positive Signals

Awarded under full and open competition.
Supports critical defense infrastructure.
Contract aims to ensure vessel readiness.

Sector Analysis

This contract is within the shipbuilding and repair sector, which is crucial for national defense. Spending benchmarks in this sector can vary significantly based on vessel type and complexity.

Small Business Impact

The data does not indicate any specific set-asides for small businesses. Large shipbuilding contracts often involve complex supply chains where small businesses may participate as subcontractors.

Oversight & Accountability

The Cost Plus Award Fee contract type requires robust oversight from the Department of the Navy to ensure performance standards are met and costs are controlled. Regular reviews of award fee determinations are essential.

Related Government Programs

Ship Building and Repairing
Department of Defense Contracting
Department of the Navy Programs

Risk Flags

Potential for cost overruns due to CPAF structure.
Lack of detailed performance metrics for award fee assessment.
Long contract duration requires sustained oversight.
No indication of small business participation.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $34.6 million to NATIONAL STEEL AND SHIPBUILDING COMPANY. LHA 7 FITTING OUT AVAILABILITY - SCN

Who is the contractor on this award?

The obligated recipient is NATIONAL STEEL AND SHIPBUILDING COMPANY.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $34.6 million.

What is the period of performance?

Start: 2018-04-06. End: 2022-02-28.

What were the specific award fee criteria and how were they applied to ensure fair and effective performance incentives?

The specific award fee criteria are not detailed in the provided data. Typically, these criteria would relate to schedule adherence, quality of work, cost control, and technical performance. Effective application requires clear, measurable metrics and objective evaluations by the contracting officer to ensure the contractor is incentivized for superior performance without encouraging unnecessary cost escalation.

How does the Cost Plus Award Fee structure compare to other contract types for similar naval fitting out availabilities in terms of cost control and risk mitigation?

CPAF offers more flexibility than fixed-price contracts but carries higher cost risk for the government compared to fixed-price incentives. It aims to balance cost control with performance incentives, unlike cost-plus-fixed-fee (CPFF) which offers less incentive for efficiency. For complex, uncertain projects like fitting out availabilities, CPAF can be appropriate if managed with stringent oversight and well-defined award criteria to mitigate risks.

What is the historical performance data for National Steel and Shipbuilding Company on similar naval contracts, and how does it inform the risk assessment for this award?

Historical performance data for National Steel and Shipbuilding Company on similar contracts would be crucial for a comprehensive risk assessment. Without it, it's difficult to gauge their track record regarding cost overruns, schedule delays, or quality issues. Past performance evaluations by the government would provide insights into their reliability and efficiency, informing the level of oversight required for this specific contract.

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

Solicitation ID: N0002417R2472

Offers Received: 3

Pricing Type: COST PLUS AWARD FEE (R)

Evaluated Preference: NONE

Contractor Details

Address: 2798 HARBOR DR, SAN DIEGO, CA, 92113

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: $45,638,671

Exercised Options: $44,549,326

Current Obligation: $34,642,780

Subaward Activity

Number of Subawards: 223

Total Subaward Amount: $2,775,741,312

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline