Treasury's $19.9M Contract for Raw Gold with Coins 'N Things, Inc. Faces Scrutiny
Contract Overview
Contract Amount: $19,918,044 ($19.9M)
Contractor: Coins 'N Things, Inc.
Awarding Agency: Department of the Treasury
Start Date: 2011-09-30
End Date: 2030-05-30
Contract Duration: 6,817 days
Daily Burn Rate: $2.9K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 3
Pricing Type: FIRM FIXED PRICE
Sector: Other
Official Description: RAW GOLD
Place of Performance
Location: BRIDGEWATER, PLYMOUTH County, MASSACHUSETTS, 02324
Plain-Language Summary
Department of the Treasury obligated $19.9 million to COINS 'N THINGS, INC. for work described as: RAW GOLD Key points: 1. The contract value is substantial at $19.9 million. 2. Competition was full and open, suggesting potential for competitive pricing. 3. The long duration (over 18 years) raises concerns about price escalation and market relevance. 4. The sector involves nonferrous metal processing, a niche but critical area for mint operations.
Value Assessment
Rating: questionable
The contract's fixed price for a commodity like gold over an 18-year period is unusual. Without specific unit pricing or benchmarks, it's difficult to assess if the $19.9M represents fair value, especially given potential market fluctuations.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under full and open competition, which is positive for price discovery. However, the extremely long duration might have limited the number of truly competitive bids or incentivized bidders to factor in significant risk premiums.
Taxpayer Impact: The long-term nature of this contract, especially for a volatile commodity, could expose taxpayers to unfavorable price movements if not managed proactively.
Public Impact
Taxpayers could be exposed to significant price volatility for gold over the next 18 years. The contract's duration raises questions about the government's long-term strategy for precious metal acquisition. Ensuring fair market value for gold over such an extended period requires robust oversight.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Long contract duration for a volatile commodity
- Potential for price escalation over 18 years
- Lack of clear unit pricing for assessment
Positive Signals
- Awarded under full and open competition
- Firm fixed price contract type
Sector Analysis
This contract falls under the nonferrous metal processing sector, specifically related to the minting of coins and potentially other precious metal products. Spending benchmarks for such specialized contracts are difficult to establish due to market volatility and unique requirements.
Small Business Impact
The data does not indicate whether small businesses were involved in this procurement. Further analysis would be needed to determine the extent of small business participation.
Oversight & Accountability
The long duration of this contract necessitates strong oversight to monitor market conditions, ensure compliance with the firm fixed price, and manage potential risks associated with price fluctuations and vendor performance.
Related Government Programs
- Nonferrous Metal (except Copper and Aluminum) Rolling, Drawing, and Extruding
- Department of the Treasury Contracting
- United States Mint Programs
Risk Flags
- Long contract duration (18+ years)
- Commodity price volatility (gold)
- Potential for price escalation
- Lack of specific unit cost data
- Extended vendor performance risk
Tags
nonferrous-metal-except-copper-and-alumi, department-of-the-treasury, ma, delivery-order, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of the Treasury awarded $19.9 million to COINS 'N THINGS, INC.. RAW GOLD
Who is the contractor on this award?
The obligated recipient is COINS 'N THINGS, 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 $19.9 million.
What is the period of performance?
Start: 2011-09-30. End: 2030-05-30.
How does the firm fixed price account for potential gold price volatility over an 18-year period?
The firm fixed price for a commodity like gold over such an extended duration is a significant concern. It implies either the price was set at a point deemed favorable for the entire period, or the contractor has factored in substantial risk premiums. Without detailed pricing breakdowns or market analysis at the time of award, it's difficult to ascertain if this price truly reflects fair value or if taxpayers are exposed to unfavorable market shifts.
What are the primary risks associated with a nearly 19-year contract for raw gold?
The primary risks include significant price volatility of gold, potential obsolescence of the procured material if minting needs change, and the contractor's financial stability over such a long period. Furthermore, market conditions and geopolitical factors can drastically alter gold's value, potentially making the fixed price disadvantageous for the government or the contractor, leading to disputes or renegotiations.
How effective is a firm fixed price contract for a commodity like gold in ensuring value for money over the long term?
A firm fixed price contract for a volatile commodity like gold over an 18-year term is generally considered less effective for ensuring long-term value for money compared to shorter-term contracts or contracts with price adjustment clauses. While it offers budget certainty, it shifts the entire risk of price fluctuation to the government if the market price rises significantly above the fixed price. Conversely, if the price falls, the government might overpay.
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: FULL AND OPEN COMPETITION
Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY
Offers Received: 3
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Address: 350 BEDFORD ST STE 2, BRIDGEWATER, MA, 02324
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Small Business, Special Designations, Subchapter S Corporation, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $19,918,044
Exercised Options: $19,918,044
Current Obligation: $19,918,044
Contract Characteristics
Commercial Item: COMMERCIAL ITEM
Parent Contract
Parent Award PIID: TMHQ10C0044
IDV Type: IDC
Timeline
Start Date: 2011-09-30
Current End Date: 2030-05-30
Potential End Date: 2030-05-30 00:00:00
Last Modified: 2025-04-15
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