Marine Management LLC contract for freight transportation valued at $62.8M, awarded under full and open competition

Contract Overview

Contract Amount: $62,793,824 ($62.8M)

Contractor: U.S. Marine Management, LLC

Awarding Agency: Department of Defense

Start Date: 2017-03-07

End Date: 2021-09-30

Contract Duration: 1,668 days

Daily Burn Rate: $37.6K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 8

Pricing Type: FIRM FIXED PRICE

Sector: Transportation

Official Description: IGF::CT::IGF BASE CHARTER HIRE&REIMBURSABLE FUNDING N103A1 STANGLER

Place of Performance

Location: NORFOLK, NORFOLK CITY County, VIRGINIA, 23513

State: Virginia Government Spending

Plain-Language Summary

Department of Defense obligated $62.8 million to U.S. MARINE MANAGEMENT, LLC for work described as: IGF::CT::IGF BASE CHARTER HIRE&REIMBURSABLE FUNDING N103A1 STANGLER Key points: 1. The contract's value of $62.8 million over its duration suggests a significant need for deep sea freight transportation services. 2. Awarded under full and open competition, this contract likely benefited from a competitive bidding process to ensure fair pricing. 3. The firm fixed-price contract type indicates that the contractor assumed the risk for cost overruns. 4. The contract duration of 1668 days (approximately 4.5 years) points to a long-term requirement for these services. 5. The absence of small business set-aside flags suggests the primary awardee is not a small business, and subcontracting opportunities may be limited. 6. The contract's performance period spans from March 2017 to September 2021, providing context for its operational timeline.

Value Assessment

Rating: good

The contract value of $62.8 million for deep sea freight transportation over approximately 4.5 years appears reasonable given the nature of the services. Benchmarking against similar large-scale logistics contracts would provide a more precise value-for-money assessment. The firm fixed-price structure generally aligns with market practices for predictable service delivery, transferring cost risk to the contractor.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit bids. The presence of 8 bidders suggests a healthy level of competition for this significant contract, which typically leads to more competitive pricing and better value for the government.

Taxpayer Impact: The robust competition for this contract is beneficial for taxpayers as it likely drove down costs and ensured the government received competitive rates for essential freight transportation services.

Public Impact

The U.S. Marine Management, LLC, as the primary contractor, benefits through revenue generation and operational expansion. The contract delivers critical deep sea freight transportation services, essential for military logistics and supply chain operations. The geographic impact is global, covering international waters and ports necessary for the movement of goods. Workforce implications include employment opportunities for maritime professionals, logistics personnel, and support staff within the contractor's organization.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for limited subcontracting opportunities for small businesses due to the nature of the prime contract and competition level.
Dependence on a single prime contractor for a significant portion of freight needs could pose a risk if performance issues arise.

Positive Signals

Awarded under full and open competition, indicating a competitive marketplace for these services.
Firm fixed-price contract structure shifts cost overrun risk to the contractor, providing budget certainty.
Long contract duration suggests a stable, ongoing requirement and a potentially reliable service provider.

Sector Analysis

This contract falls within the broader transportation and logistics sector, specifically focusing on deep sea freight. The market for large-scale maritime shipping is characterized by global players, significant capital investment, and complex regulatory environments. The value of this contract, $62.8 million, represents a substantial portion of spending within this niche for the Department of the Navy, likely supporting strategic sealift or specialized cargo movements.

Small Business Impact

The data indicates that this contract was not set aside for small businesses (sb: false) and the prime contractor (U.S. Marine Management, LLC) is likely not a small business given the contract's scale. This suggests that subcontracting opportunities for small businesses may be limited unless specifically mandated or pursued by the prime. The impact on the small business ecosystem would depend on whether the prime contractor actively seeks small business partners for specialized services or supplies.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and administrative contracting officer within the Department of the Navy. Accountability measures are embedded in the contract terms, including performance standards and payment schedules. Transparency is generally maintained through contract award databases like FPDS. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Military Sealift Command Contracts
Department of Defense Logistics Support
Ocean Freight Services
Global Shipping Contracts
Maritime Transportation Services

Risk Flags

Potential for cost overruns if fuel prices or operational costs exceed projections, despite fixed-price nature.
Geopolitical risks impacting shipping lanes or port access.
Dependence on a single prime contractor for critical logistics.
Regulatory changes affecting maritime operations.
Environmental risks associated with deep sea shipping.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $62.8 million to U.S. MARINE MANAGEMENT, LLC. IGF::CT::IGF BASE CHARTER HIRE&REIMBURSABLE FUNDING N103A1 STANGLER

Who is the contractor on this award?

The obligated recipient is U.S. MARINE MANAGEMENT, LLC.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $62.8 million.

What is the period of performance?

Start: 2017-03-07. End: 2021-09-30.

What is the track record of U.S. Marine Management, LLC in performing similar federal contracts?

A review of federal procurement data would be necessary to fully assess U.S. Marine Management, LLC's track record. However, the award of a $62.8 million definitive contract under full and open competition suggests a demonstrated capability to meet the requirements of the Department of the Navy. Further analysis would involve examining past performance evaluations, any history of contract disputes or terminations, and the successful completion of prior government contracts, particularly those involving deep sea freight transportation. Understanding their experience with similar contract types (firm fixed-price) and durations is also crucial for evaluating their reliability and expertise in this domain.

How does the awarded value compare to market rates for similar deep sea freight services?

Benchmarking the $62.8 million contract value against market rates for comparable deep sea freight transportation services requires detailed analysis of freight volumes, routes, vessel types, and service durations. Without specific details on the cargo and operational scope, a precise comparison is difficult. However, the fact that the contract was awarded under full and open competition with 8 bidders suggests that the pricing was likely competitive. Industry reports on maritime shipping rates, charter costs, and logistics service provider pricing could offer a basis for comparison. A significant deviation from established market benchmarks, either higher or lower, would warrant further investigation into the specific service requirements and market conditions at the time of award.

What are the primary risks associated with this deep sea freight transportation contract?

Key risks for this contract include potential fluctuations in global fuel prices, which can impact operating costs despite the firm fixed-price structure if not adequately accounted for. Geopolitical instability in key shipping lanes or at destination ports could lead to delays or increased security costs. Furthermore, the long duration of the contract (1668 days) increases the risk of unforeseen regulatory changes affecting maritime operations. The reliance on a single prime contractor for a substantial volume of freight also presents a risk; any performance failures or disruptions by U.S. Marine Management, LLC could significantly impact the Department of the Navy's supply chain. Environmental regulations and potential for maritime incidents are also inherent risks in deep sea operations.

How effective has this contract been in meeting the Department of the Navy's freight transportation needs?

Assessing the effectiveness of this contract requires access to performance metrics and delivery records that are not publicly available in the provided data. Typically, effectiveness would be measured by on-time delivery rates, cargo condition upon arrival, adherence to schedules, and overall reliability of service. Given the contract's duration and the competitive award process, it is reasonable to infer a degree of effectiveness. However, a definitive judgment would necessitate reviewing contractor performance evaluations, user feedback from the Department of the Navy, and any reports from oversight bodies or the Inspector General concerning service delivery.

What are the historical spending patterns for deep sea freight transportation by the Department of the Navy?

Historical spending patterns for deep sea freight transportation by the Department of the Navy would reveal trends in contract values, award types, and primary service providers over time. This specific $62.8 million contract represents a significant investment. Analyzing prior years' spending on similar services would indicate whether this award is consistent with historical requirements or represents an increase or decrease in demand. Understanding the typical duration and value of previous contracts, as well as the competitive landscape (e.g., prevalence of full and open vs. other competition types), would provide valuable context for evaluating the current contract's place within the Navy's overall logistics strategy and budget.

What is the potential impact of this contract on small business participation in federal contracting?

As this contract was not a small business set-aside and was awarded to a prime contractor likely not classified as a small business, its direct impact on small business participation is likely minimal. The primary avenue for small business involvement would be through subcontracting opportunities offered by U.S. Marine Management, LLC. The extent of this subcontracting depends on the prime's strategy and the specific needs of the service delivery. Without explicit small business subcontracting goals or reporting, it's difficult to quantify the benefit. However, large contracts like this can sometimes create opportunities for specialized small businesses in areas such as maintenance, repair, or specific logistical support services, provided the prime actively seeks them out.

Industry Classification

NAICS: Transportation and Warehousing › Deep Sea, Coastal, and Great Lakes Water Transportation › Deep Sea Freight Transportation

Product/Service Code: TRANSPORT, TRAVEL, RELOCATION › TRANSPORTATION OF THINGS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: N3220516R3503

Offers Received: 8

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: A.P. Møller OG Hustru Chastine Mc-Kinney Møllers Fond TIL Almene Formaal

Address: 2510 WALMER AVE STE C, NORFOLK, VA, 23513

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

Financial Breakdown

Contract Ceiling: $62,793,824

Exercised Options: $62,793,824

Current Obligation: $62,793,824

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline