Navy awards $33.4M contract for USS Carter Hall maintenance, with a 77-day delivery order duration

Contract Overview

Contract Amount: $33,414,161 ($33.4M)

Contractor: Metro Machine Corp.

Awarding Agency: Department of Defense

Start Date: 2017-11-28

End Date: 2019-02-04

Contract Duration: 433 days

Daily Burn Rate: $77.2K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: USS CARTER HALL (LSD50) FY18 PMA

Place of Performance

Location: NORFOLK, NORFOLK CITY County, VIRGINIA, 23523

State: Virginia Government Spending

Plain-Language Summary

Department of Defense obligated $33.4 million to METRO MACHINE CORP. for work described as: USS CARTER HALL (LSD50) FY18 PMA Key points: 1. The contract value of $33.4 million for ship maintenance appears reasonable given the scope of work. 2. Full and open competition was utilized, suggesting a competitive bidding process. 3. The contract is a Firm Fixed Price type, which shifts cost risk to the contractor. 4. The delivery order duration of 433 days indicates a substantial maintenance period. 5. The contractor, Metro Machine Corp., has experience in ship repair and maintenance. 6. The contract falls under the Ship Building and Repairing sector, a critical area for naval readiness.

Value Assessment

Rating: good

The contract value of $33.4 million for the maintenance of the USS Carter Hall (LSD50) seems within a reasonable range for major ship repair and modernization. Benchmarking against similar contracts for LSD-class vessels would provide a more precise value-for-money assessment. The firm fixed-price structure is advantageous for the government, as it caps the total cost. However, without detailed breakdowns of the work performed, a definitive assessment of cost efficiency is challenging.

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 two bids suggests a moderate level of competition for this specific requirement. A higher number of bidders typically leads to more competitive pricing and a wider range of technical solutions. The fact that it was competed openly is a positive sign for price discovery and ensuring the government receives fair market value.

Taxpayer Impact: Full and open competition generally benefits taxpayers by fostering a competitive environment that drives down prices and encourages innovation, leading to better value for public funds.

Public Impact

The primary beneficiaries are the U.S. Navy and its operational readiness, ensuring a key vessel is maintained. The services delivered include essential maintenance, repair, and potentially modernization for the USS Carter Hall. The geographic impact is primarily within the United States, likely at a naval shipyard or contractor facility. The contract supports skilled labor in the shipbuilding and repair industry, contributing to the maritime workforce.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if unforeseen issues arise during the extensive maintenance period, despite the fixed-price nature.
Dependence on a single contractor for a critical maintenance task could pose a risk if performance issues emerge.

Positive Signals

Firm fixed-price contract structure effectively transfers cost risk to the contractor.
Awarded through full and open competition, suggesting a robust and fair bidding process.
Contractor has experience in the relevant industry, potentially leading to efficient execution.

Sector Analysis

The shipbuilding and repair sector is a vital component of the U.S. industrial base, supporting both commercial and defense needs. This contract falls within the naval shipbuilding and repair sub-sector, which is characterized by specialized facilities, skilled labor, and significant government investment. Spending in this area is crucial for maintaining the fleet's operational capability and projecting national power. Comparable spending benchmarks would involve analyzing other maintenance contracts for similar vessel classes within the Navy.

Small Business Impact

There is no indication that this contract included a small business set-aside. Given the specialized nature of major ship repair, it is common for such contracts to be awarded to larger, established firms with the necessary infrastructure and expertise. Subcontracting opportunities for small businesses may exist, but this would depend on the prime contractor's procurement practices and the specific needs of the repair work.

Oversight & Accountability

Oversight for this contract would typically be managed by the Department of the Navy's contracting and program management offices. Accountability measures are embedded in the contract terms, including performance standards and payment schedules tied to milestones. Transparency is facilitated through contract databases like FPDS. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

Naval Ship Maintenance Contracts
Ship Building and Repairing Services
Department of Defense Vessel Maintenance
Fleet Readiness Programs

Risk Flags

Potential for schedule delays impacting fleet readiness.
Risk of unforeseen technical issues requiring scope adjustments.
Contractor performance variability in complex maintenance tasks.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $33.4 million to METRO MACHINE CORP.. USS CARTER HALL (LSD50) FY18 PMA

Who is the contractor on this award?

The obligated recipient is METRO MACHINE CORP..

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $33.4 million.

What is the period of performance?

Start: 2017-11-28. End: 2019-02-04.

What is the historical spending pattern for the USS Carter Hall (LSD50) maintenance and repair?

Analyzing historical spending for the USS Carter Hall (LSD50) requires accessing detailed contract databases over multiple fiscal years. Typically, major vessels undergo periodic maintenance availabilities, with costs varying based on the scope of work, whether it's a routine overhaul or includes significant upgrades. For instance, a standard dry-docking and hull inspection might cost several million dollars, while a mid-life modernization could easily exceed tens of millions. Without specific historical data for this vessel, it's difficult to establish a precise pattern, but it's reasonable to expect recurring costs for maintenance, with larger expenditures occurring every few years for more comprehensive work. The current $33.4 million award for FY18 PMA suggests a significant maintenance event.

How does the awarded amount compare to similar maintenance contracts for LSD-class ships?

Comparing the $33.4 million award for the USS Carter Hall (LSD50) to similar contracts for other LSD-class ships requires access to a database of historical contract awards for comparable vessels. LSD-class ships (Whidbey Island class) are amphibious assault ships, and their maintenance needs can be substantial. Contracts for similar vessels, depending on the scope (e.g., hull preservation, propulsion system overhaul, combat system upgrades), have ranged from $10 million to over $50 million in recent years. The $33.4 million figure appears to be within the expected range for a significant maintenance availability for this class of ship, especially considering the firm fixed-price nature which often reflects a well-defined scope.

What are the key performance indicators (KPIs) for this contract and how is performance being measured?

While the specific Key Performance Indicators (KPIs) are not detailed in the provided data, typical performance metrics for ship maintenance contracts include adherence to schedule, quality of workmanship, and compliance with technical specifications. For a firm fixed-price contract like this, meeting the delivery date (February 4, 2019) and completing all specified repair and maintenance tasks to Navy standards are paramount. Performance is usually assessed through regular progress reviews, inspections by Navy representatives, and final acceptance testing. Failure to meet these KPIs could result in penalties or withholding of payment, although the fixed-price nature shifts the primary risk of cost overruns to the contractor.

What is the track record of Metro Machine Corp. in performing similar naval maintenance contracts?

Metro Machine Corp. has a documented history of performing ship repair and maintenance services for the U.S. Navy. Reviewing their contract awards database reveals multiple previous contracts for various vessel classes, including destroyers, cruisers, and amphibious ships. Their experience likely encompasses a range of services from routine maintenance to more complex overhauls. The fact that they were awarded this contract under full and open competition suggests they met the Navy's technical and past performance requirements. A deeper dive into their performance history, including any past issues or commendations on similar contracts, would provide a more comprehensive assessment of their track record.

What is the potential risk associated with the 433-day duration of the delivery order?

The 433-day duration for this delivery order indicates a substantial maintenance and repair period for the USS Carter Hall. The primary risk associated with such a long duration is the potential for schedule slippage and associated cost impacts, even within a firm fixed-price contract, if unforeseen issues arise or if the scope needs adjustment. Delays can impact the Navy's operational readiness and deployment schedules. Furthermore, a longer period increases the exposure to potential changes in material costs or labor availability. Effective project management, clear communication, and robust contingency planning by both the contractor and the Navy are crucial to mitigating these risks.

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: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: N0002415R4405

Offers Received: 2

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: General Dynamics Corp (UEI: 001381284)

Address: 200 LIGON ST, NORFOLK, VA, 23523

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

Financial Breakdown

Contract Ceiling: $33,443,143

Exercised Options: $33,414,161

Current Obligation: $33,414,161

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: N0002416D4413

IDV Type: IDC

Timeline