Treasury's Mint awarded $19.5M to Olin Corp for copper rolling, drawing, and extruding services

Contract Overview

Contract Amount: $19,544,598 ($19.5M)

Contractor: Olin Corporation - Winchester

Awarding Agency: Department of the Treasury

Start Date: 2006-10-02

End Date: 2007-09-30

Contract Duration: 363 days

Daily Burn Rate: $53.8K/day

Competition Type: NON-COMPETITIVE DELIVERY ORDER

Number of Offers Received: 1

Pricing Type: FIXED PRICE WITH ECONOMIC PRICE ADJUSTMENT

Sector: Other

Official Description: PROVIDE RAW METAL & STRIP

Place of Performance

Location: EAST ALTON, MADISON County, ILLINOIS, 62024

State: Illinois Government Spending

Plain-Language Summary

Department of the Treasury obligated $19.5 million to OLIN CORPORATION - WINCHESTER for work described as: PROVIDE RAW METAL & STRIP Key points: 1. The contract value represents a significant investment in essential materials for mint operations. 2. Olin Corporation's established presence suggests a degree of reliability in fulfilling this requirement. 3. The fixed-price contract with economic price adjustment introduces potential for cost fluctuations. 4. This award is a key component of the United States Mint's broader material procurement strategy. 5. The single delivery order indicates a specific, defined need rather than an ongoing service requirement. 6. The duration of the contract suggests a medium-term commitment for material supply.

Value Assessment

Rating: fair

Benchmarking the value of this specific contract is challenging without comparable data for similar specialized rolling, drawing, and extruding services for minting operations. The fixed-price with economic price adjustment (FP-EPA) structure aims to balance cost certainty with market volatility, but the final cost could exceed initial projections. The raw dollar amount of $19.5 million is substantial for a single delivery order, implying a significant volume or specialized nature of the copper processed.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded as a non-competitive delivery order, suggesting that Olin Corporation was likely the only or most suitable source for these specific copper processing services at the time of award. The lack of competition means there was no opportunity for price discovery through a bidding process, potentially leading to a higher price than if multiple vendors had competed.

Taxpayer Impact: Taxpayers may have paid a premium due to the absence of competitive bidding, as the government did not leverage multiple offers to secure the best possible price.

Public Impact

The United States Mint benefits directly through the acquisition of essential copper materials for coin production. This contract supports the ongoing operations and production targets of the Mint. The geographic impact is primarily within Illinois, where Olin Corporation's facility is located, and the broader national impact of currency production. Workforce implications are likely within Olin Corporation's manufacturing facilities, supporting skilled labor in metal processing.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition raises concerns about potential overpayment.
The FP-EPA clause introduces uncertainty regarding the final cost to the government.
Limited transparency into the justification for a sole-source award.

Positive Signals

Olin Corporation is a known entity in the ammunition and chemical industries, suggesting some level of established capability.
The contract specifies a defined scope of work (copper rolling, drawing, and extruding).
The award is a single delivery order, indicating a specific, managed requirement.

Sector Analysis

The metals and minerals sector is critical for manufacturing and industrial production. This contract falls within the broader category of industrial materials supply, specifically focusing on processed copper. The United States Mint's reliance on such specialized suppliers highlights the importance of a robust domestic industrial base for government operations. Comparable spending benchmarks are difficult to ascertain without more specific details on the exact specifications and volume of copper processed.

Small Business Impact

This contract does not appear to have a small business set-aside component, as indicated by 'ss' and 'sb' being false. There is no explicit mention of subcontracting requirements for small businesses within the provided data. Therefore, the direct impact on the small business ecosystem from this specific award is likely minimal, unless Olin Corporation voluntarily engages small businesses in its supply chain.

Oversight & Accountability

Oversight for this contract would fall under the Department of the Treasury and the United States Mint's internal procurement and financial management systems. As a non-competitive award, the justification for the sole-source nature would be subject to review. Transparency is limited by the nature of the award; further details on the justification for the sole-source award and performance monitoring would be necessary for a comprehensive assessment.

Related Government Programs

United States Mint Operations
Precious Metals Procurement
Industrial Materials Manufacturing
Copper Supply Chain

Risk Flags

Non-competitive award
Potential for cost overruns due to EPA
Lack of transparency in justification

Frequently Asked Questions

What is this federal contract paying for?

Department of the Treasury awarded $19.5 million to OLIN CORPORATION - WINCHESTER. PROVIDE RAW METAL & STRIP

Who is the contractor on this award?

The obligated recipient is OLIN CORPORATION - WINCHESTER.

Which agency awarded this contract?

Awarding agency: Department of the Treasury (United States Mint).

What is the total obligated amount?

The obligated amount is $19.5 million.

What is the period of performance?

Start: 2006-10-02. End: 2007-09-30.

What was the specific justification for awarding this contract on a non-competitive (sole-source) basis?

The provided data indicates this was a 'NON-COMPETITIVE DELIVERY ORDER' (ct: NON-COMPETITIVE DELIVERY ORDER). Typically, sole-source awards are justified when only one responsible source is available or capable of meeting the government's needs. This could be due to unique capabilities, proprietary technology, urgent and compelling circumstances, or a lack of adequate competition. Without further documentation from the awarding agency (Department of the Treasury, United States Mint), the precise reason for deeming Olin Corporation the sole source for copper rolling, drawing, and extruding services remains unspecified in this dataset. A review of the contract file or agency justifications would be necessary to understand the rationale.

How does the pricing structure (Fixed Price with Economic Price Adjustment) compare to typical contracts for similar materials?

The Fixed Price with Economic Price Adjustment (FP-EPA) contract type is common for raw materials or goods where input costs can fluctuate significantly. For copper, which is a commodity traded on global markets, an EPA clause is often used to protect both the contractor from unexpected cost increases (e.g., rising metal prices, energy costs) and the government from paying an inflated fixed price if market conditions improve. Compared to a firm fixed-price contract, FP-EPA offers more flexibility but introduces cost uncertainty. The effectiveness of the EPA in this specific contract depends on the agreed-upon adjustment formula and the volatility of copper and related input prices during the contract period (October 2006 - September 2007).

What is Olin Corporation's track record with the US Mint or similar government agencies for providing metal processing services?

Olin Corporation, particularly through its Winchester division, has a long history of manufacturing and supplying various materials, including metals. While the provided data focuses on this specific $19.5 million delivery order for copper processing, Olin's broader experience in ammunition manufacturing implies significant expertise in metalworking, drawing, and extrusion. To fully assess their track record for this specific service, one would need to examine their past performance on contracts with the US Mint or other defense and industrial agencies for similar metal processing requirements. This would involve looking at past performance evaluations, any disputes, or contract modifications.

What is the significance of 'Copper Rolling, Drawing, and Extruding' in the context of US Mint operations?

Copper is a fundamental component in the production of coinage. 'Rolling' refers to shaping metal into thin sheets, 'drawing' involves pulling metal through a die to reduce its diameter and increase its length (often used for wire or rods), and 'extruding' forces metal through a die to create a desired cross-sectional shape. For the US Mint, these processes are crucial for preparing the raw copper into the specific forms required for blanking (punching out coin discs) and potentially for other specialized metallic products. The quality and precise specifications of the processed copper are critical for ensuring the integrity, appearance, and manufacturability of coins.

How does the $19.5 million award compare to historical spending on similar materials by the US Mint?

The provided data shows a single delivery order of $19.5 million awarded in 2006 for copper processing. To compare this to historical spending, one would need to analyze the US Mint's procurement history for copper and related metal processing services over several years. This would involve identifying other contracts for similar materials, their values, durations, and the number of bidders. Without access to the Mint's comprehensive procurement database or historical spending reports, it is difficult to definitively state whether this $19.5 million award represents a typical, high, or low expenditure for such services during that period.

Industry Classification

NAICS: Manufacturing › Nonferrous Metal (except Aluminum) Production and Processing › Copper Rolling, Drawing, and Extruding

Product/Service Code: ORES, MINERALS AND PRIMARY PRODUCTS

Competition & Pricing

Extent Competed: NON-COMPETITIVE DELIVERY ORDER

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 1

Pricing Type: FIXED PRICE WITH ECONOMIC PRICE ADJUSTMENT (K)

Evaluated Preference: NONE

Contractor Details

Address: 427 N SHAMROCK ST, EAST ALTON, IL, 13

Business Categories: Category Business, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $19,544,598

Exercised Options: $19,544,598

Current Obligation: $19,544,598

Parent Contract

Parent Award PIID: TMK0203

IDV Type: IDC

Timeline