Navy awards $30.6M for ship preservation, with Electric Boat Corp. securing the sole-source contract

Contract Overview

Contract Amount: $30,639,068 ($30.6M)

Contractor: Electric Boat Corporation

Awarding Agency: Department of Defense

Start Date: 2021-11-12

End Date: 2022-08-18

Contract Duration: 279 days

Daily Burn Rate: $109.8K/day

Competition Type: NOT COMPETED

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: HS NAUTILUS PRESERVATION AVAILABILITY

Place of Performance

Location: GROTON, NEW LONDON County, CONNECTICUT, 06340

State: Connecticut Government Spending

Plain-Language Summary

Department of Defense obligated $30.6 million to ELECTRIC BOAT CORPORATION for work described as: HS NAUTILUS PRESERVATION AVAILABILITY Key points: 1. Contract awarded on a sole-source basis, limiting price competition. 2. The contract value represents a significant investment in naval asset preservation. 3. Performance period is relatively short, suggesting a focused scope of work. 4. Fixed-price contract type aims to control costs for the government. 5. No small business set-aside was applied, indicating a focus on prime contractor capabilities.

Value Assessment

Rating: fair

Benchmarking the value of this contract is challenging due to its specific nature and sole-source award. However, the $30.6 million allocated for ship preservation over a 279-day period suggests a substantial cost per day. Without comparable sole-source preservation contracts or detailed scope of work, a precise value-for-money assessment is difficult. The firm fixed-price structure provides some cost certainty, but the lack of competition inherently limits the government's ability to secure the lowest possible price.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis to Electric Boat Corporation. This means that the Department of the Navy did not conduct a competitive bidding process, likely due to the specialized nature of the work or the existing relationship with the contractor. The absence of competition means that the government did not benefit from multiple offers, which typically drives down prices and encourages innovation.

Taxpayer Impact: Taxpayers may have paid a premium due to the lack of competitive pressure. Without competing bids, it is harder to ensure that the price reflects the best possible value.

Public Impact

The primary beneficiary is the U.S. Navy, ensuring the preservation and readiness of naval assets. Services delivered include preservation activities for naval vessels, maintaining their operational status. The geographic impact is concentrated in Connecticut, where Electric Boat Corporation is located. Workforce implications include employment for skilled labor at Electric Boat Corporation involved in preservation tasks.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits competitive pricing and potential cost savings for taxpayers.
Lack of transparency in the justification for sole-source award.
Potential for cost overruns if scope is not tightly managed under fixed-price contract.

Positive Signals

Firm fixed-price contract provides cost certainty for the government.
Award to an established contractor with presumed expertise in naval shipbuilding and repair.
Contract ensures the preservation of critical naval assets.

Sector Analysis

The shipbuilding and repair industry (NAICS 336611) is a critical sector for national defense, involving complex engineering and manufacturing processes. This contract falls within the defense industrial base, focusing on the maintenance and preservation of existing naval assets rather than new construction. Spending in this sector is often characterized by large, long-term contracts, with significant barriers to entry for new competitors. Comparable spending benchmarks would typically involve other maintenance, repair, and overhaul (MRO) contracts for naval vessels.

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. The award to a large prime contractor like Electric Boat Corporation suggests that the primary focus was on their direct capabilities. This may limit opportunities for small businesses to participate directly in this specific contract, although they might be involved further down the supply chain.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of the Navy's contracting and program management offices. Accountability measures would be tied to the delivery order's terms and conditions, including performance standards and payment schedules. Transparency is limited by the sole-source nature of the award. Inspector General jurisdiction would apply to any allegations of fraud, waste, or abuse related to the contract.

Related Government Programs

Naval Ship Maintenance Contracts
Submarine Construction and Maintenance
Defense Readiness Contracts
Ship Preservation Services

Risk Flags

Sole-source award
Limited competition

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $30.6 million to ELECTRIC BOAT CORPORATION. HS NAUTILUS PRESERVATION AVAILABILITY

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 $30.6 million.

What is the period of performance?

Start: 2021-11-12. End: 2022-08-18.

What is the historical spending pattern for ship preservation services by the Department of the Navy with Electric Boat Corporation?

Analyzing historical spending patterns for ship preservation services by the Department of the Navy with Electric Boat Corporation requires access to detailed contract databases beyond the scope of this single award. Typically, such analysis would involve querying databases like FPDS or USASpending for all contracts awarded to Electric Boat Corporation under relevant NAICS codes (e.g., 336611) and contract types related to preservation, maintenance, and repair. This would reveal trends in contract values, durations, and the frequency of awards over several fiscal years. It would also help identify if this $30.6 million award is an outlier or consistent with past investments. Without this broader historical data, it's difficult to contextualize the current award within a long-term spending strategy.

How does the cost per day for this preservation contract compare to similar naval vessel preservation contracts?

To compare the cost per day for this preservation contract ($30.6 million / 279 days ≈ $109,677 per day) to similar naval vessel preservation contracts, one would need to identify comparable contracts. Key comparison factors include the type and size of the vessel, the scope of preservation work (e.g., dry-docking, component overhaul, protective coatings), and the contract type (fixed-price vs. cost-plus). Sole-source contracts, by their nature, often lack direct price comparisons. However, if data were available on competitively awarded contracts for similar preservation tasks on comparable vessels, a benchmark could be established. The absence of such comparable data makes a definitive assessment of value-for-money difficult for this specific contract.

What specific preservation tasks are included in this $30.6 million contract?

The provided data indicates the contract is for 'HS NAUTILUS PRESERVATION AVAILABILITY' awarded to Electric Boat Corporation. While the contract title suggests preservation activities, the specific tasks are not detailed in the summary data. Typically, ship preservation can encompass a wide range of activities, including cleaning, application of protective coatings, corrosion control, environmental control within the vessel, and ensuring systems remain in a state of readiness or dormancy. A full understanding of the scope would require reviewing the contract's Statement of Work (SOW) or Performance Work Statement (PWS), which would detail the exact services required, deliverables, and performance standards.

What is Electric Boat Corporation's track record with the Department of the Navy for preservation and maintenance contracts?

Electric Boat Corporation is a major defense contractor primarily known for its role in designing and constructing nuclear-powered submarines for the U.S. Navy. Their track record with the Department of the Navy is extensive, particularly in shipbuilding and complex maintenance of submarine fleets. While their primary focus is often new construction and major overhauls, they also undertake preservation and availability contracts, especially for vessels undergoing extended maintenance periods or awaiting future deployment. Accessing detailed performance histories, past performance evaluations, and specific contract award data for their preservation-related work would provide a more granular understanding of their capabilities and reliability in this specific service area.

What are the potential risks associated with a sole-source award for ship preservation?

The primary risk associated with a sole-source award for ship preservation is the potential for inflated pricing due to the lack of competitive bidding. Without competing offers, the government may not achieve the best possible price for the services rendered. Another risk is reduced incentive for the contractor to innovate or optimize performance, as there is no direct competitive pressure. Furthermore, sole-source awards can raise concerns about fairness and transparency in the procurement process. If the justification for the sole-source award is weak or if the contractor's performance is subpar, it can lead to program delays, cost overruns, and ultimately, a negative impact on naval readiness.

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: N0002416R4317

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: General Dynamics Corp

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

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $30,639,068

Exercised Options: $30,639,068

Current Obligation: $30,639,068

Actual Outlays: $16,447,133

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: N0002416D4300

IDV Type: IDC

Timeline