Treasury's Mint awarded $11.4M for copper rolling, drawing, and extruding services to PMX Industries

Contract Overview

Contract Amount: $11,372,967 ($11.4M)

Contractor: PMX Industries, Inc.

Awarding Agency: Department of the Treasury

Start Date: 2006-11-28

End Date: 2007-09-30

Contract Duration: 306 days

Daily Burn Rate: $37.2K/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 STRIP + METAL

Place of Performance

Location: CEDAR RAPIDS, LINN County, IOWA, 52404

State: Iowa Government Spending

Plain-Language Summary

Department of the Treasury obligated $11.4 million to PMX INDUSTRIES, INC. for work described as: PROVIDE 5, 10 & 25-CENT STRIP + METAL Key points: 1. The contract value of $11.4 million for 306 days of service suggests a significant investment in specialized metal processing. 2. Competition dynamics for this contract are crucial to understanding price efficiency for essential minting materials. 3. The fixed-price with economic price adjustment (FPEPA) contract type introduces potential cost volatility based on market fluctuations. 4. The contract's duration of 306 days indicates a focused, short-term need for these specific metalworking services. 5. The award to PMX Industries, Inc. positions them as a key supplier for the U.S. Mint's operational needs. 6. The absence of small business set-aside flags suggests this contract was not specifically targeted for smaller enterprises.

Value Assessment

Rating: fair

Benchmarking the value of this contract is challenging without more detailed cost breakdowns or comparisons to similar specialized metal processing contracts. The fixed-price with economic price adjustment (FPEPA) structure introduces a degree of uncertainty in the final cost. However, the award amount of $11.4 million for a 306-day period suggests a substantial expenditure for the services rendered, implying a need for high-quality or specialized processing capabilities.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded as a competitive delivery order, indicating that multiple vendors had the opportunity to bid. The fact that it was competed suggests a deliberate effort to solicit offers and identify the most advantageous terms for the government. The number of bidders is not specified, but a competitive process generally leads to better price discovery and potentially more favorable pricing for the government compared to sole-source awards.

Taxpayer Impact: A competitive award process helps ensure that taxpayer dollars are used efficiently by fostering price competition among potential suppliers.

Public Impact

The primary beneficiary of this contract is the United States Mint, which receives essential copper materials for its operations. The services delivered include copper rolling, drawing, and extruding, critical for producing coinage and other metallic products. The geographic impact is primarily centered around the operations of the U.S. Mint and its supply chain. Workforce implications may include employment opportunities at PMX Industries, Inc. related to the specialized manufacturing processes.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

The FPEPA clause introduces potential for cost increases due to market volatility in copper prices.
Lack of specific detail on the number of bidders makes it difficult to fully assess the strength of competition.
The contract's relatively short duration might indicate a need for ongoing re-competition, potentially leading to administrative overhead.

Positive Signals

The contract was awarded through a full and open competitive process, suggesting a robust selection of vendors.
The award to a single vendor implies a focused relationship for a specific need, potentially leading to efficiency.
The use of a fixed-price contract, even with an economic adjustment, aims to provide cost certainty.

Sector Analysis

The contract falls within the broader industrial manufacturing and materials sector, specifically focusing on non-ferrous metal processing. This sector is vital for numerous industries, including coinage, electronics, and construction. The U.S. Mint's reliance on such specialized services highlights the importance of a stable and competitive domestic supply chain for critical materials. Comparable spending benchmarks would typically involve other government contracts for metal fabrication or specialized material supply.

Small Business Impact

The contract details indicate that this was not a small business set-aside. Therefore, there are no direct subcontracting requirements mandated for small businesses under this specific award. The impact on the small business ecosystem is indirect, as PMX Industries, Inc. may engage small businesses in its own supply chain, but this is not a contractual obligation from this award.

Oversight & Accountability

Oversight for this contract would typically fall under the purview of the U.S. Mint's contracting officers and potentially the Department of the Treasury's Inspector General. Accountability measures are embedded in the contract terms, including performance standards and payment schedules. Transparency is facilitated through contract award databases, though detailed performance metrics are often internal.

Related Government Programs

U.S. Mint Operations
Precious Metals Procurement
Industrial Materials Manufacturing
Government Supply Chain Management

Risk Flags

Potential for cost volatility due to economic price adjustment clause.
Limited transparency on the number of bidders in the competitive process.
Short contract duration may necessitate frequent re-competition.

Frequently Asked Questions

What is this federal contract paying for?

Department of the Treasury awarded $11.4 million to PMX INDUSTRIES, INC.. PROVIDE 5, 10 & 25-CENT STRIP + METAL

Who is the contractor on this award?

The obligated recipient is PMX INDUSTRIES, INC..

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $11.4 million.

What is the period of performance?

Start: 2006-11-28. End: 2007-09-30.

What is the historical spending pattern for copper rolling, drawing, and extruding services by the U.S. Mint?

Analyzing historical spending for these specific services requires access to detailed procurement data over multiple fiscal years. Without direct access to the U.S. Mint's historical contract databases, it's difficult to provide precise figures. However, general trends in government spending on industrial materials can be inferred from broader economic indicators and defense or infrastructure spending patterns. The U.S. Mint's needs are likely tied to coinage production volumes, which can fluctuate based on economic conditions and public demand. Past awards for similar services would provide the best benchmark, but such data is not readily available in this context. It is reasonable to assume that spending in this category would be relatively stable, with variations driven by production targets and the competitive landscape for suppliers.

How does the price per unit for copper processing compare to market rates or similar government contracts?

Determining a precise per-unit cost for copper processing under this contract is not feasible with the provided data. The contract value is a total award amount for a defined period and scope of work, not broken down by specific units processed. To compare this to market rates or similar contracts, one would need to know the exact quantity of copper processed (e.g., by weight or volume) and the specific types of rolling, drawing, and extruding performed. Furthermore, market rates can vary significantly based on the complexity of the process, the grade of copper, and prevailing market conditions. Without these granular details, a direct per-unit cost comparison is speculative. However, the competitive nature of the award suggests the government sought to achieve a price that was deemed fair and reasonable in the market.

What is PMX Industries, Inc.'s track record with government contracts, particularly with the U.S. Mint?

PMX Industries, Inc. has a history of receiving government contracts, including those with the U.S. Mint. Their involvement in providing copper rolling, drawing, and extruding services indicates a specialized capability that aligns with the Mint's operational requirements. A comprehensive review of their contract history would reveal the number and value of past awards, performance ratings, and any instances of disputes or contract terminations. For this specific contract, the award suggests a level of confidence in their ability to meet the government's needs. Further investigation into their past performance on similar contracts would provide a clearer picture of their reliability and quality of service.

What are the key performance indicators (KPIs) used to measure the success of this contract?

Key performance indicators for this contract would likely focus on the quality and timeliness of the copper materials supplied, as well as adherence to specifications. Specific KPIs could include defect rates for the rolled, drawn, or extruded copper, on-time delivery performance against scheduled requirements, and compliance with the economic price adjustment provisions. The contract's fixed-price nature, even with an economic adjustment, implies a strong emphasis on cost control within the agreed-upon parameters. Performance would also be assessed against the technical specifications outlined in the contract, ensuring the copper meets the required metallurgical properties and dimensions for coinage production.

What is the potential risk associated with the economic price adjustment (EPA) clause in this contract?

The primary risk associated with the economic price adjustment (EPA) clause in this contract is the potential for cost overruns if market prices for copper or related inputs increase significantly during the contract period. While the EPA is designed to protect both the contractor from losses due to market fluctuations and the government from excessively high initial fixed prices, it introduces a degree of cost uncertainty. The U.S. Mint will need to monitor market trends closely and ensure that the adjustment mechanisms are applied fairly and transparently according to the contract's terms. The extent of this risk is mitigated by the contract's duration and the specific indices or formulas used for price adjustments, which are typically defined within the contract itself.

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: 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: Poongsan Holdings Corporation (UEI: 687755603)

Address: 5300 WILLOW CREEK DR SW, CEDAR RAPIDS, IA, 02

Business Categories: Category Business, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $11,372,967

Exercised Options: $11,372,967

Current Obligation: $11,372,967

Parent Contract

Parent Award PIID: TMK0202

IDV Type: IDC

Timeline