DoD Awards $11M for Specialized Shipping Containers, Raising Questions on Competition and Value

Contract Overview

Contract Amount: $11,046,642 ($11.0M)

Contractor: Lewis Engineering Company

Awarding Agency: Department of Defense

Start Date: 2004-09-13

End Date: 2010-08-31

Contract Duration: 2,178 days

Daily Burn Rate: $5.1K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 3

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: 200412!001265!2100!W15QKN!TACOM - PICATINNY !W15QKN04C1145 !A!N! !N! ! !20040913!20050927!042120980!042120980!042120980!N!LEWIS ENGINEERING CO !1608 E HOUSTON ST !MARSHALL !TX!75670!46776!203!48!MARSHALL !HARRISON !TEXAS !+000000424527!N!N!000000000000!8145!SPECIALIZED SHIPPING & STORAGE CONTAINERS !A6 !AMMUNITION !000 !* !332992!E! !3! ! ! ! ! !99990909!B! ! !A! !A!N!J!2!003!K! !Z!N!Z! ! !N!B!N!N! ! !B! !B!A!00 !A!B!N! ! ! ! ! ! !0001! !

Place of Performance

Location: MARSHALL, HARRISON County, TEXAS, 75670

State: Texas Government Spending

Plain-Language Summary

Department of Defense obligated $11.0 million to LEWIS ENGINEERING COMPANY for work described as: 200412!001265!2100!W15QKN!TACOM - PICATINNY !W15QKN04C1145 !A!N! !N! ! !20040913!20050927!042120980!042120980!042120980!N!LEWIS ENGINEERING CO !1608 E HOUSTON ST !MARSHALL !TX!75670!46776!203!48!MARSHALL !HARR… Key points: 1. Contract awarded for specialized shipping containers, a niche but critical component for military logistics. 2. The award to Lewis Engineering Company, valued at $11.05 million, warrants scrutiny due to the competition method. 3. Potential risks include overpricing and limited vendor options, impacting overall taxpayer value. 4. The Defense sector's need for robust logistics solutions is met, but efficiency of procurement is a concern.

Value Assessment

Rating: questionable

The contract's value of $11.05 million for specialized shipping containers appears high when compared to general freight or standard container costs. Benchmarking against similar military-specific container contracts is necessary to confirm fair pricing.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

The contract was awarded under 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES,' suggesting initial limitations or a non-standard procurement process. This method can restrict competition and potentially lead to higher prices than a truly open bidding process.

Taxpayer Impact: The limited competition raises concerns about whether the government secured the best possible price, potentially leading to inefficient use of taxpayer funds.

Public Impact

Military readiness may be enhanced by the acquisition of specialized containers, ensuring safe transport of sensitive materials. Taxpayers may be overpaying if the procurement process did not adequately explore all competitive avenues. The specific nature of 'specialized shipping containers' suggests a unique requirement that might justify a more limited competition, but this needs clear justification.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Limited competition raises price concerns.
Lack of clear justification for excluding sources.
Potential for overpayment due to restricted bidding.

Positive Signals

Addresses a specific military logistics need.
Contract awarded to a US-based company.

Sector Analysis

The Department of Defense frequently procures specialized equipment for logistical support. Spending benchmarks for similar containerized solutions vary widely based on customization, material, and volume. This contract falls within the broader defense logistics spending category.

Small Business Impact

The data does not indicate if Lewis Engineering Company is a small business. Further analysis would be needed to determine the impact on small business participation in this contract.

Oversight & Accountability

The contract's award justification, particularly the 'EXCLUSION OF SOURCES' clause, requires thorough review by oversight bodies to ensure compliance and prevent potential waste or fraud.

Related Government Programs

Small Arms Ammunition Manufacturing
Department of Defense Contracting
Defense Contract Management Agency Programs

Risk Flags

Potential for inflated pricing due to limited competition.
Lack of transparency in the source exclusion process.
Risk of non-competitive award driving up costs.
Need for detailed cost-benefit analysis post-award.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $11.0 million to LEWIS ENGINEERING COMPANY. 200412!001265!2100!W15QKN!TACOM - PICATINNY !W15QKN04C1145 !A!N! !N! ! !20040913!20050927!042120980!042120980!042120980!N!LEWIS ENGINEERING CO !1608 E HOUSTON ST !MARSHALL !TX!75670!46776!203!48!MARSHALL !HARRISON !TEXAS !+000000424527!N!N!000000000000!8145!SPECIALIZED SHIPPING & STORAGE CONTAINERS !A6 !AMMUNITION !000 !* !332992!E! !3! ! ! ! ! !999

Who is the contractor on this award?

The obligated recipient is LEWIS ENGINEERING COMPANY.

Which agency awarded this contract?

Awarding agency: Department of Defense (Defense Contract Management Agency).

What is the total obligated amount?

The obligated amount is $11.0 million.

What is the period of performance?

Start: 2004-09-13. End: 2010-08-31.

What specific technical requirements necessitate the exclusion of certain sources for these specialized shipping containers, and how does this impact the overall cost-effectiveness?

The technical requirements for specialized shipping containers likely involve unique dimensions, material resilience, environmental protection, or security features tailored to specific military assets like ammunition. While these specialized needs might justify a narrower vendor pool, a robust justification is crucial. If the requirements are overly restrictive or not clearly defined, it can artificially limit competition, leading to higher prices and reduced cost-effectiveness for the taxpayer.

How does the pricing of these specialized containers compare to commercially available high-security or custom-built containers, considering the contract's fixed-price nature?

A direct comparison of the contract's pricing against commercial equivalents is challenging without detailed specifications. However, fixed-price contracts can offer predictability. If Lewis Engineering Company's pricing significantly exceeds benchmarks for comparable commercial solutions, it suggests potential overpayment, even within a fixed-price agreement. The 'exclusion of sources' could have prevented competitive pressure that would normally drive prices down.

What mechanisms are in place to ensure the quality and timely delivery of these critical containers, given the potential risks associated with limited competition?

Quality assurance and timely delivery are typically managed through contract clauses, performance metrics, and oversight by agencies like the Defense Contract Management Agency (DCMA). For contracts with limited competition, heightened vigilance is essential. This includes rigorous inspection protocols, regular progress reviews, and clear penalties for non-performance to mitigate risks and ensure the government receives the required specialized containers as specified.

Industry Classification

NAICS: Manufacturing › Other Fabricated Metal Product Manufacturing › Small Arms Ammunition Manufacturing

Product/Service Code: CONTAINERS/PACKAGING/PACKING SUPPL

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 3

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 1608 E HOUSTON ST, MARSHALL, TX, 01

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

Contract Characteristics

Cost or Pricing Data: NO

Timeline