Treasury's Mint Spends $10.6M on Metal for Coins, Facing Price Adjustments
Contract Overview
Contract Amount: $10,630,504 ($10.6M)
Contractor: Wieland Rolled Products North America, LLC
Awarding Agency: Department of the Treasury
Start Date: 2007-10-31
End Date: 2012-09-30
Contract Duration: 1,796 days
Daily Burn Rate: $5.9K/day
Competition Type: COMPETITIVE DELIVERY ORDER
Number of Offers Received: 2
Pricing Type: FIXED PRICE WITH ECONOMIC PRICE ADJUSTMENT
Sector: Other
Official Description: PROVIDE 5, 10, 25-CENT & $1-GOLDEN STRIP + METAL
Place of Performance
Location: EAST ALTON, MADISON County, ILLINOIS, 62024
State: Illinois Government Spending
Plain-Language Summary
Department of the Treasury obligated $10.6 million to WIELAND ROLLED PRODUCTS NORTH AMERICA, LLC for work described as: PROVIDE 5, 10, 25-CENT & $1-GOLDEN STRIP + METAL Key points: 1. Significant expenditure on specialized metal for coinage. 2. Contract awarded to a single supplier, raising competition questions. 3. Fixed price with economic adjustment introduces potential cost volatility. 4. Spending falls within the Nonferrous Metal Rolling sector.
Value Assessment
Rating: fair
The total award value of $10.6M for metal rolling services appears substantial. Benchmarking against similar contracts for specialized nonferrous metals is difficult without more granular data on metal type and specifications.
Cost Per Unit: N/A
Competition Analysis
Competition Level: limited
The contract was awarded as a competitive delivery order, but the data indicates only one known offer. This limited competition may have impacted price discovery and potentially led to a less favorable price for the government.
Taxpayer Impact: The use of fixed price with economic price adjustment introduces risk of increased costs to taxpayers if metal prices rise significantly.
Public Impact
Impacts the production of U.S. currency, affecting the availability of circulating coins. Potential for increased coin prices if metal costs escalate. Supports a specific segment of the metals manufacturing industry.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Limited competition
- Economic price adjustment risk
Positive Signals
- Essential material for coinage production
- Established supplier relationship
Sector Analysis
This contract falls under the Nonferrous Metal Rolling, Drawing, and Extruding sector. Spending benchmarks for such specialized materials are highly variable based on metal type, quantity, and market conditions.
Small Business Impact
The data does not indicate any specific provisions or participation by small businesses in this contract. The supplier, WIELAND ROLLED PRODUCTS NORTH AMERICA, LLC, is likely a large business.
Oversight & Accountability
The contract was awarded by the United States Mint, a bureau within the Department of the Treasury. Oversight would typically involve contract management and performance monitoring by the Mint to ensure delivery and quality standards are met.
Related Government Programs
- Nonferrous Metal (except Copper and Aluminum) Rolling, Drawing, and Extruding
- Department of the Treasury Contracting
- United States Mint Programs
Risk Flags
- Potential for cost overruns due to economic price adjustment.
- Limited competition may indicate suboptimal pricing.
- Lack of transparency on specific metal alloys and quality standards.
- Long contract duration (nearly 5 years) increases exposure to market fluctuations.
Tags
nonferrous-metal-except-copper-and-alumi, department-of-the-treasury, il, do, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of the Treasury awarded $10.6 million to WIELAND ROLLED PRODUCTS NORTH AMERICA, LLC. PROVIDE 5, 10, 25-CENT & $1-GOLDEN STRIP + METAL
Who is the contractor on this award?
The obligated recipient is WIELAND ROLLED PRODUCTS NORTH AMERICA, LLC.
Which agency awarded this contract?
Awarding agency: Department of the Treasury (United States Mint).
What is the total obligated amount?
The obligated amount is $10.6 million.
What is the period of performance?
Start: 2007-10-31. End: 2012-09-30.
What was the rationale for limiting competition on this significant metal supply contract?
The limited competition suggests potential factors such as specialized material requirements, unique manufacturing capabilities, or a lack of sufficient market interest from other qualified vendors. Further investigation into the solicitation process and market research conducted by the U.S. Mint would be necessary to fully understand the rationale behind the limited competition.
How has the economic price adjustment clause impacted the total cost to taxpayers over the contract's duration?
The economic price adjustment clause allows for changes in price based on fluctuations in underlying commodity costs. To assess the taxpayer impact, one would need to compare the final price paid with the initial fixed price, factoring in the specific indices or benchmarks used for adjustment and the prevailing market prices during the contract period.
What is the long-term strategy for securing competitive pricing for essential coinage metals?
The long-term strategy likely involves ongoing market analysis, fostering broader supplier engagement, and potentially exploring alternative materials or sourcing methods. The U.S. Mint may also consider contract structures that incentivize competition and mitigate risks associated with price volatility for critical raw materials.
Industry Classification
NAICS: Manufacturing › Nonferrous Metal (except Aluminum) Production and Processing › Nonferrous Metal (except Copper and Aluminum) Rolling, Drawing, and Extruding
Product/Service Code: ORES, MINERALS AND PRIMARY PRODUCTS
Competition & Pricing
Extent Competed: COMPETITIVE DELIVERY ORDER
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Offers Received: 2
Pricing Type: FIXED PRICE WITH ECONOMIC PRICE ADJUSTMENT (K)
Evaluated Preference: NONE
Contractor Details
Parent Company: KPS Capital Partners, LP (UEI: 071159078)
Address: 427 N SHAMROCK ST, EAST ALTON, IL, 13
Business Categories: Category Business, Labor Surplus Area Firm, Limited Liability Corporation, Manufacturer of Goods, Not Designated a Small Business, Special Designations
Financial Breakdown
Contract Ceiling: $10,630,504
Exercised Options: $10,630,504
Current Obligation: $10,630,504
Parent Contract
Parent Award PIID: TMHQ08C0006
IDV Type: IDC
Timeline
Start Date: 2007-10-31
Current End Date: 2012-09-30
Potential End Date: 2012-09-30 00:00:00
Last Modified: 2011-03-30
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