DoD's $84M contract for USS DECATUR EDSRA maintenance awarded to BAE Systems Maritime Solutions

Contract Overview

Contract Amount: $84,164,853 ($84.2M)

Contractor: BAE Systems Maritime Solutions SAN Diego Inc.

Awarding Agency: Department of Defense

Start Date: 2019-09-07

End Date: 2021-02-05

Contract Duration: 517 days

Daily Burn Rate: $162.8K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: USS DECATUR EDSRA

Place of Performance

Location: SAN DIEGO, SAN DIEGO County, CALIFORNIA, 92113

State: California Government Spending

Plain-Language Summary

Department of Defense obligated $84.2 million to BAE SYSTEMS MARITIME SOLUTIONS SAN DIEGO INC. for work described as: USS DECATUR EDSRA Key points: 1. Value for money assessed through comparison with similar maintenance contracts for naval vessels. 2. Competition dynamics indicate a full and open process, potentially driving competitive pricing. 3. Risk indicators include contract type (firm fixed price) and duration, which can influence cost certainty. 4. Performance context relies on BAE Systems' historical performance in naval shipbuilding and repair. 5. Sector positioning places this contract within the broader defense shipbuilding and repair industry.

Value Assessment

Rating: good

The contract value of $84.2 million for the USS DECATUR EDSRA maintenance appears reasonable when benchmarked against similar complex naval vessel repair and modernization projects. While specific per-unit cost data is not provided, the firm fixed-price nature of the contract suggests that the Navy has a clear understanding of the expected costs. Comparisons with other maintenance availabilities for destroyers and similar vessels indicate that pricing within this range is typical for extensive overhaul and repair work.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, suggesting that multiple qualified vendors were invited to bid. The presence of a competitive bidding process is generally expected to lead to more favorable pricing and better value for the government. The number of bidders is not specified, but the 'full and open' designation implies a robust competition.

Taxpayer Impact: A full and open competition provides taxpayers with assurance that the contract was awarded to the most capable and cost-effective provider, maximizing the use of public funds.

Public Impact

The primary beneficiaries are the U.S. Navy, ensuring the operational readiness of the USS DECATUR. Services delivered include extensive maintenance, repair, and modernization of a naval vessel. Geographic impact is centered around the naval shipyard where the work is performed, likely in California. Workforce implications include employment for skilled tradespeople in shipbuilding and repair sectors.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if unforeseen issues arise during the extensive repair work.
Dependence on a single contractor for a critical maintenance period could pose schedule risks.
Ensuring consistent quality across all repair and maintenance tasks is paramount.

Positive Signals

Firm fixed-price contract provides cost certainty for the majority of the work.
BAE Systems' experience in naval shipbuilding and repair suggests a high likelihood of successful execution.
Full and open competition indicates a strong market assessment and potential for competitive pricing.

Sector Analysis

The defense shipbuilding and repair sector is a critical component of national security, involving complex, high-value contracts for vessel construction, maintenance, and modernization. This contract for the USS DECATUR EDSRA fits within the broader category of naval vessel sustainment, a market characterized by specialized expertise and significant government investment. Comparable spending benchmarks for similar naval maintenance availabilities often range in the tens to hundreds of millions of dollars, depending on the scope of work.

Small Business Impact

The data indicates this contract was awarded under full and open competition and does not specify any small business set-aside. While the prime contractor, BAE Systems, is a large entity, there may be opportunities for small businesses to participate as subcontractors. The extent of small business subcontracting would depend on BAE Systems' procurement practices and the specific requirements of the maintenance tasks.

Oversight & Accountability

Oversight for this contract would typically be managed by the Department of the Navy's contracting officers and program managers. Accountability measures are embedded in the contract terms, including performance standards and payment schedules. Transparency is facilitated through contract award databases like FPDS. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse.

Related Government Programs

Naval Vessel Maintenance and Repair
Shipbuilding and Repair Services
Defense Readiness Contracts
Fleet Modernization Programs

Risk Flags

Potential for schedule delays
Risk of unforeseen repair requirements
Quality assurance during extensive work

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $84.2 million to BAE SYSTEMS MARITIME SOLUTIONS SAN DIEGO INC.. USS DECATUR EDSRA

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 $84.2 million.

What is the period of performance?

Start: 2019-09-07. End: 2021-02-05.

What is BAE Systems Maritime Solutions' track record with similar naval maintenance contracts?

BAE Systems Maritime Solutions has a significant track record in supporting naval vessels, including extensive repair, modernization, and maintenance availabilities for various classes of ships. Their experience often encompasses complex overhauls, system upgrades, and routine maintenance. Historical data from contract databases would provide specific details on their performance metrics, on-time delivery rates, and adherence to budget on previous similar contracts. This specific contract for the USS DECATUR EDSRA builds upon that established capability, with the Navy likely having reviewed their past performance as part of the source selection process.

How does the $84.2 million cost compare to the average cost of similar naval vessel maintenance contracts?

The $84.2 million cost for the USS DECATUR EDSRA maintenance falls within the typical range for extensive overhaul and repair availabilities of naval destroyers and similar vessels. The average cost can vary significantly based on the specific class of ship, the scope of work (e.g., hull repairs, propulsion system overhauls, combat system upgrades), and the duration of the maintenance period. Contracts for major modernization efforts can easily exceed this amount, while routine maintenance might be less. Benchmarking against other recent maintenance availabilities for Arleigh Burke-class destroyers or similar platforms would provide a more precise comparison, but this figure is not considered unusually high for a comprehensive maintenance cycle.

What are the primary risks associated with this firm fixed-price contract for naval maintenance?

The primary risks associated with this firm fixed-price contract, despite offering cost certainty, revolve around potential scope creep and unforeseen conditions. If unexpected structural damage, equipment failures, or necessary upgrades are discovered during the maintenance period that were not fully anticipated or detailed in the initial scope, managing these changes can become complex. While the contract is fixed-price, modifications or change orders may be necessary, potentially leading to cost increases if not managed rigorously. Contractor performance risk also exists, where delays or quality issues could impact the Navy's operational readiness, even within a fixed-price framework.

How effective is full and open competition in ensuring value for money for naval maintenance contracts?

Full and open competition is generally considered a highly effective mechanism for ensuring value for money in naval maintenance contracts. By allowing all responsible sources to submit bids, it fosters a competitive environment where contractors are incentivized to offer their best pricing and technical solutions to win the award. This process typically leads to lower prices than sole-source or limited competition scenarios. Furthermore, it allows the government to evaluate a wider range of capabilities and innovations, potentially leading to better technical outcomes. The Navy's decision to use full and open competition for this contract suggests a belief that it would yield the most advantageous outcome for taxpayers.

What is the historical spending trend for USS DECATUR (DDG-73) maintenance and repair?

Analyzing historical spending for the USS DECATUR (DDG-73) maintenance and repair would involve examining past contract awards for its scheduled maintenance availabilities, overhauls, and any significant repair work. This would reveal trends in contract values, durations, and the types of services procured over the ship's lifecycle. For instance, one might observe an increase in complexity and cost as the ship ages and requires more extensive system upgrades or component replacements. Understanding these historical patterns helps in forecasting future maintenance costs and assessing the current $84.2 million contract in the context of the ship's overall operational and sustainment budget.

What are the implications of the contract duration (517 days) on cost and performance?

A contract duration of 517 days (approximately 17 months) for the USS DECATUR EDSRA maintenance signifies a major overhaul or modernization availability. This extended period allows for comprehensive work, including potentially complex system upgrades, hull repairs, and extensive testing. For a firm fixed-price contract, a longer duration can increase the contractor's risk exposure to market fluctuations in labor or material costs, although this is often mitigated through contract clauses. From a performance perspective, it provides ample time for thorough execution, but also necessitates robust project management from both the contractor and the Navy to ensure efficient progress and timely completion to minimize the vessel's downtime.

Industry Classification

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

Product/Service Code: MAINT, REPAIR, REBUILD EQUIPMENT › NON-NUCLEAR SHIP REPAIR

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: N0002419R4455

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: BAE Systems PLC

Address: 2205 E BELT ST, SAN DIEGO, CA, 92113

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Foreign Owned, Not Designated a Small Business, Special Designations

Financial Breakdown

Contract Ceiling: $86,227,265

Exercised Options: $84,164,853

Current Obligation: $84,164,853

Actual Outlays: $10,953,022

Subaward Activity

Number of Subawards: 112

Total Subaward Amount: $23,626,457

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NOT OBTAINED - WAIVED

Timeline