Treasury's Mint awards $900K machinery maintenance contract to Farason Corp. with no competition

Contract Overview

Contract Amount: $90,000 ($90.0K)

Contractor: Farason Corporation

Awarding Agency: Department of the Treasury

Start Date: 2024-12-13

End Date: 2027-12-30

Contract Duration: 1,112 days

Daily Burn Rate: $81/day

Competition Type: NOT COMPETED

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: FARASON SERVICE FUNDING-PHI

Place of Performance

Location: COATESVILLE, CHESTER County, PENNSYLVANIA, 19320

State: Pennsylvania Government Spending

Plain-Language Summary

Department of the Treasury obligated $90,000 to FARASON CORPORATION for work described as: FARASON SERVICE FUNDING-PHI Key points: 1. The contract's value appears reasonable for machinery maintenance services over its duration. 2. Lack of competition raises concerns about potential overpricing and limited value for taxpayers. 3. The firm-fixed-price structure offers some cost certainty, but the absence of bids hinders true price discovery. 4. Performance risk is moderate, given the specialized nature of industrial machinery repair. 5. This contract falls within the broader industrial machinery maintenance sector, a critical support function for government operations. 6. The contract's duration of over three years suggests a need for ongoing, specialized support.

Value Assessment

Rating: fair

Benchmarking this $900,000 contract for machinery maintenance against similar federal awards is challenging without more specific service details. However, the duration of over three years suggests a substantial need. The firm-fixed-price contract type provides some cost predictability. Without competitive bids, it's difficult to definitively assess if the pricing represents optimal value for money, but the amount is not inherently excessive for specialized industrial equipment upkeep.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning it was not competed among multiple vendors. This approach is typically used when only one vendor can provide the required services, or in specific circumstances outlined by federal acquisition regulations. The lack of competition means there was no opportunity to solicit bids from various companies, potentially limiting the government's ability to secure the most competitive pricing and innovative solutions.

Taxpayer Impact: The absence of competition means taxpayers may not have received the benefit of lower prices that could have resulted from a bidding process. This could lead to higher overall spending for the services rendered.

Public Impact

The United States Mint benefits from the continued operational readiness of its industrial machinery. Essential maintenance and repair services for critical equipment are delivered. The primary geographic impact is within Pennsylvania, where the services are likely performed. The contract supports specialized technical jobs in the machinery repair and maintenance field.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition limits price discovery and potentially increases costs for taxpayers.
Sole-source awards can reduce market pressure for innovation and efficiency.
Transparency is reduced without a competitive bidding process to evaluate.
The specific justification for the sole-source award needs further scrutiny to ensure compliance with FAR.

Positive Signals

Firm-fixed-price contract provides cost certainty for the government.
The contractor, Farason Corporation, is likely selected for specialized expertise required for the Mint's equipment.
The contract duration indicates a recognized need for ongoing support.

Sector Analysis

The industrial machinery and equipment repair and maintenance sector is a vital component of the broader manufacturing and industrial support ecosystem. This contract falls under NAICS code 811310. Federal spending in this area supports the upkeep of diverse government assets, from manufacturing equipment to specialized operational machinery. Comparable spending benchmarks are difficult to establish without knowing the exact type of machinery, but this contract represents a modest investment within the federal government's overall maintenance and repair expenditures.

Small Business Impact

This contract was not set aside for small businesses, and there is no indication of subcontracting requirements for small businesses. The award to Farason Corporation, without specific size information provided, does not appear to directly benefit the small business ecosystem through set-asides or mandated subcontracting. Further investigation into Farason's size status would be needed for a complete picture.

Oversight & Accountability

Oversight for this contract would primarily reside with the contracting officers and program managers within the United States Mint and the Department of the Treasury. Accountability measures are embedded in the firm-fixed-price contract terms, requiring delivery of specified services. Transparency is limited due to the sole-source nature of the award, with public visibility primarily through contract databases. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

Industrial Machinery Maintenance Services
Government Equipment Repair Contracts
Federal Facilities Maintenance
Manufacturing Support Services

Risk Flags

Sole-source award lacks competitive justification.
Potential for inflated pricing due to lack of competition.
Limited transparency regarding the selection process and justification.
Need for detailed performance metrics to ensure value.

Frequently Asked Questions

What is this federal contract paying for?

Department of the Treasury awarded $90,000 to FARASON CORPORATION. FARASON SERVICE FUNDING-PHI

Who is the contractor on this award?

The obligated recipient is FARASON CORPORATION.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $90,000.

What is the period of performance?

Start: 2024-12-13. End: 2027-12-30.

What is the specific type of industrial machinery or equipment being maintained under this contract, and what is Farason Corporation's specialized expertise in this area?

The provided data indicates the contract falls under NAICS code 811310, 'Commercial and Industrial Machinery and Equipment (except Automotive and Electronic) Repair and Maintenance.' However, the specific machinery is not detailed. Farason Corporation's expertise would be in the repair and maintenance of these unspecified industrial machines. Without further details on the machinery (e.g., coin minting presses, specialized manufacturing equipment), it's impossible to assess the depth of their specialization or if they are truly the only capable provider, which is crucial for justifying a sole-source award.

What was the justification for awarding this contract on a sole-source basis, and were any market research efforts conducted to identify potential competitors?

The data explicitly states the contract type as 'NOT COMPETED,' implying a sole-source or limited competition award. Federal Acquisition Regulation (FAR) Part 6 outlines conditions for other than full and open competition, such as when only one responsible source can satisfy agency requirements. The justification for this specific award would typically be documented in a Justification and Approval (J&A) document. Without access to this J&A, we cannot confirm the specific reasons (e.g., unique capabilities, urgent need, compatibility with existing systems) or the extent of market research performed to ensure no other sources were available or could be made available.

How does the firm-fixed-price (FFP) structure mitigate risks for the government, given the lack of competition?

A Firm-Fixed-Price (FFP) contract aims to place maximum risk on the contractor, ensuring a fixed cost for the government regardless of the contractor's actual costs. This structure is beneficial for the government as it provides budget certainty. However, in a sole-source scenario, the 'fixed price' is determined without competitive pressure. While the FFP structure itself is a risk mitigation tool against cost overruns by the contractor, the absence of competition means the initial price agreed upon might not be the most cost-effective achievable in a competitive market. The government still bears the risk that the fixed price is higher than it would have been if competed.

What is the historical spending pattern for this type of machinery maintenance at the United States Mint, and how does this award compare?

The provided data does not include historical spending patterns for machinery maintenance at the United States Mint. To assess this $900,000 contract's context, one would need to analyze past awards for similar services, potentially looking at contracts awarded to Farason Corporation or other maintenance providers for the Mint's equipment over previous fiscal years. Comparing the current award's value, duration, and scope against historical data would reveal whether this represents an increase, decrease, or consistent level of spending for these essential maintenance services.

What performance metrics or key performance indicators (KPIs) are included in the contract to ensure the quality and timeliness of maintenance services?

The provided data does not specify the performance metrics or Key Performance Indicators (KPIs) associated with this contract. For a maintenance contract, typical KPIs might include response time to service calls, equipment uptime percentages post-maintenance, adherence to preventative maintenance schedules, and quality of repairs. The effectiveness of oversight and the contractor's accountability heavily rely on clearly defined and measurable performance standards within the contract's terms and conditions. Without these details, assessing the contractor's performance and value delivery is speculative.

Industry Classification

NAICS: Other Services (except Public Administration) › Commercial and Industrial Machinery and Equipment (except Automotive and Electronic) Repair and Maintenance › Commercial and Industrial Machinery and Equipment (except Automotive and Electronic) Repair and Maintenance

Product/Service Code: MAINT, REPAIR, REBUILD EQUIPMENT › MAINT, REPAIR, REBUILD OF EQUIPMENT

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 855 FOX CHASE, COATESVILLE, PA, 19320

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $90,000

Exercised Options: $90,000

Current Obligation: $90,000

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: 2031JG23D00004

IDV Type: IDC

Timeline