DoD's $197.8M Ship Repair Contract with Thoma-Sea Marine Faces Scrutiny for Potential Overpricing

Contract Overview

Contract Amount: $197,843,010 ($197.8M)

Contractor: Thoma-Sea Marine Constructors, L.L.C.

Awarding Agency: Department of Defense

Start Date: 2019-01-22

End Date: 2026-06-30

Contract Duration: 2,716 days

Daily Burn Rate: $72.8K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 6

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: PRELIMINARY/CONTRACT DESIGN

Place of Performance

Location: LOCKPORT, LAFOURCHE County, LOUISIANA, 70374

State: Louisiana Government Spending

Plain-Language Summary

Department of Defense obligated $197.8 million to THOMA-SEA MARINE CONSTRUCTORS, L.L.C. for work described as: PRELIMINARY/CONTRACT DESIGN Key points: 1. The contract value of $197.8M is significant, raising questions about cost-effectiveness. 2. Full and open competition was utilized, but the final price needs validation. 3. Potential risks include cost overruns and the need for robust oversight. 4. The sector is Ship Building and Repairing, a critical but often high-cost area for defense.

Value Assessment

Rating: questionable

The contract's firm fixed price structure suggests an attempt at cost control. However, without detailed cost breakdowns or benchmarks for similar ship repair contracts, it's difficult to definitively assess if the $197.8M represents fair value. The provided 'br' (benchmark rate?) of 72844 warrants further investigation.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, which is a positive indicator for price discovery. However, the effectiveness of this competition in achieving the best possible price is not evident from the provided data alone. Further analysis of the bidding process is needed.

Taxpayer Impact: The use of full and open competition aims to ensure taxpayer funds are used efficiently. However, the final price's reasonableness will determine the true taxpayer impact.

Public Impact

This contract supports critical naval infrastructure, ensuring the readiness of the U.S. fleet. The duration of the contract (2716 days) suggests a long-term commitment to ship maintenance and repair. Awarding to a Louisiana-based company may have local economic benefits. The lack of small business participation is noted.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of small business participation
Potential for cost overruns on long-term contracts
Need for detailed cost validation

Positive Signals

Full and open competition utilized
Firm fixed price contract type
Supports critical defense infrastructure

Sector Analysis

The Ship Building and Repairing sector (NAICS 336611) is capital-intensive and requires specialized labor and facilities. Defense contracts in this sector often involve complex specifications and stringent quality requirements, which can drive up costs compared to commercial shipbuilding.

Small Business Impact

The data indicates that small businesses were not involved in this contract (ss: false, sb: false). This is a missed opportunity to foster small business growth within the defense industrial base and could potentially limit competition or innovation.

Oversight & Accountability

The long duration and significant value of this contract necessitate robust oversight from the Department of the Navy to ensure performance, manage risks, and control costs throughout its lifecycle. Regular reviews and audits will be crucial.

Related Government Programs

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

Risk Flags

Potential for cost overruns
Lack of small business participation
Long contract duration increases risk exposure
Need for detailed cost validation against benchmarks
Effectiveness of competition in securing best value requires further review

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $197.8 million to THOMA-SEA MARINE CONSTRUCTORS, L.L.C.. PRELIMINARY/CONTRACT DESIGN

Who is the contractor on this award?

The obligated recipient is THOMA-SEA MARINE CONSTRUCTORS, L.L.C..

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $197.8 million.

What is the period of performance?

Start: 2019-01-22. End: 2026-06-30.

How does the awarded price of $197.8M compare to historical spending on similar ship repair contracts by the Department of the Navy, considering the scope and complexity?

A comprehensive comparison requires access to a database of similar contracts. However, preliminary analysis suggests that the benchmark rate provided ('br': 72844) might be a starting point for evaluating the per-unit cost. Without knowing what this benchmark represents (e.g., per day, per vessel, per repair type), a definitive statement is difficult. Further investigation into the contract's specific deliverables and market rates is essential to determine if $197.8M is competitive.

What are the primary risks associated with a firm fixed-price contract of this magnitude and duration for ship repair services?

The primary risks for the government include potential cost underruns if the contractor significantly outperforms expectations, though this is less common. More critically, the contractor bears the risk of cost overruns. If unforeseen issues arise during repairs (e.g., discovery of extensive damage, material price spikes), the contractor might face financial strain, potentially impacting quality or delivery. The government's risk lies in ensuring the contractor has adequately accounted for all potential issues in their fixed price.

Given the 'full and open competition' award, what factors might still lead to concerns about the contract's overall value and effectiveness?

Even with full and open competition, concerns about value and effectiveness can arise. The initial bid prices might not fully reflect the long-term costs or potential for scope creep. If the solicitation lacked sufficiently detailed performance requirements or evaluation criteria, the 'best' value might not have been selected. Furthermore, the contractor's actual performance, adherence to schedule, and quality of work throughout the contract's duration are critical determinants of its ultimate effectiveness and value for taxpayer money.

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: TWO STEP

Solicitation ID: N0002418R2201

Offers Received: 6

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 6130 HWY 308, LOCKPORT, LA, 70374

Business Categories: Category Business, Limited Liability Corporation, Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $199,043,010

Exercised Options: $197,843,010

Current Obligation: $197,843,010

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline