Transportation contract for ship repair services awarded to Keystone Shipping Services, Inc. for over $2.6 million

Contract Overview

Contract Amount: $2,679,984 ($2.7M)

Contractor: Keystone Shipping Services, Inc.

Awarding Agency: Department of Transportation

Start Date: 2024-07-27

End Date: 2025-08-17

Contract Duration: 386 days

Daily Burn Rate: $6.9K/day

Competition Type: NOT COMPETED

Pricing Type: FIRM FIXED PRICE

Sector: Transportation

Official Description: CAPE DIAMOND FISCAL YEAR BRIDGE PER DIEM FOR SERVICES SHIP REPAIR SERVICES.

Place of Performance

Location: NORFOLK, NORFOLK CITY County, VIRGINIA, 23505

State: Virginia Government Spending

Plain-Language Summary

Department of Transportation obligated $2.7 million to KEYSTONE SHIPPING SERVICES, INC. for work described as: CAPE DIAMOND FISCAL YEAR BRIDGE PER DIEM FOR SERVICES SHIP REPAIR SERVICES. Key points: 1. The contract value of $2.68 million for ship repair services appears to be a significant investment for the Maritime Administration. 2. The 'NOT COMPETED' status raises questions about potential missed opportunities for cost savings through competitive bidding. 3. The duration of 386 days suggests a substantial scope of work for the awarded services. 4. The firm-fixed-price contract type provides cost certainty for the government, but may limit flexibility. 5. The absence of small business set-aside flags indicates this contract was not specifically targeted for small business participation. 6. The contract falls under the 'Deep Sea Freight Transportation' NAICS code, aligning with the agency's mission.

Value Assessment

Rating: fair

Benchmarking the value of this contract is challenging without specific details on the scope of 'ship repair services'. However, a $2.68 million award for a single delivery order over approximately one year suggests a substantial service requirement. Comparing this to similar contracts for comparable vessel types and repair complexity would be necessary to assess if the pricing is competitive. The firm-fixed-price nature offers predictability but could be less advantageous if unforeseen issues arise that require additional work not covered by the initial scope.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded as 'NOT COMPETED', indicating a sole-source or limited competition procurement. Without further details on the justification for this approach, it is difficult to assess the level of competition. Sole-source awards can sometimes be necessary for specialized services or urgent requirements, but they typically limit the government's ability to secure the best possible pricing through a competitive process.

Taxpayer Impact: A non-competed award means taxpayers may not have benefited from the cost savings that could arise from multiple vendors bidding on the contract.

Public Impact

The primary beneficiaries of this contract are likely the U.S. Navy or other government entities requiring ship repair services for vessels managed by the Maritime Administration. The services delivered will focus on maintaining and repairing ships, ensuring operational readiness and extending the lifespan of maritime assets. The geographic impact is primarily within Virginia, where the contract is being performed. The contract supports specialized labor within the maritime repair industry, potentially impacting shipyards and skilled trades in the region.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may lead to higher costs for taxpayers.
Limited transparency into the justification for a sole-source award.
Potential for scope creep or cost overruns if not managed tightly due to fixed-price nature.

Positive Signals

Firm-fixed-price contract provides budget certainty.
Award to an established entity (Keystone Shipping Services, Inc.) may indicate reliability.
Contract supports critical maritime infrastructure maintenance.

Sector Analysis

The maritime industry, particularly ship repair and maintenance, is a critical sector for national security and economic activity. This contract falls within the broader transportation and defense industrial base. The Maritime Administration plays a key role in supporting U.S. maritime capabilities. Spending in this sector can fluctuate based on fleet readiness requirements, shipbuilding programs, and the age of existing vessels. Comparable spending benchmarks would typically be found within defense or transportation agency budgets for similar vessel maintenance contracts.

Small Business Impact

The data indicates that this contract was not set aside for small businesses (sb: false) and there is no indication of subcontracting requirements for small businesses (ss: false). This suggests that the procurement process did not prioritize small business participation. Consequently, the direct economic impact on the small business ecosystem within the maritime repair sector may be limited for this specific award.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of Transportation's Maritime Administration. Accountability measures are inherent in the firm-fixed-price contract type, which obligates the contractor to deliver specified services for an agreed-upon price. Transparency regarding the justification for the sole-source award would be a key area for oversight assessment. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

Maritime Administration Ship Maintenance Contracts
Department of Transportation Vessel Repair Services
Defense Logistics Agency Ship Support Contracts
U.S. Navy Fleet Maintenance Programs

Risk Flags

Sole-source award without clear justification.
Potential for inflated pricing due to lack of competition.
Limited transparency into the procurement process.

Frequently Asked Questions

What is this federal contract paying for?

Department of Transportation awarded $2.7 million to KEYSTONE SHIPPING SERVICES, INC.. CAPE DIAMOND FISCAL YEAR BRIDGE PER DIEM FOR SERVICES SHIP REPAIR SERVICES.

Who is the contractor on this award?

The obligated recipient is KEYSTONE SHIPPING SERVICES, INC..

Which agency awarded this contract?

Awarding agency: Department of Transportation (Maritime Administration).

What is the total obligated amount?

The obligated amount is $2.7 million.

What is the period of performance?

Start: 2024-07-27. End: 2025-08-17.

What is the specific justification for awarding this contract on a sole-source basis?

The provided data indicates the contract was 'NOT COMPETED', signifying a sole-source or limited competition award. A detailed justification would typically be documented by the agency (Maritime Administration) outlining the reasons why full and open competition was not feasible or advantageous. Common justifications include urgent and compelling needs, the unavailability of the required services from multiple sources, or specific technical requirements that only one contractor can meet. Without this documentation, it's impossible to definitively state the reason, but it implies that the agency determined that soliciting bids from multiple vendors was not appropriate or possible in this instance.

How does the awarded amount of $2.68 million compare to typical costs for similar ship repair services?

Directly comparing the $2.68 million award without detailed specifications of the 'ship repair services' is difficult. The scope could range from routine maintenance to extensive overhauls. To benchmark effectively, one would need to analyze contracts for similar vessel types (e.g., cargo ships, tankers), age, size, and the complexity of the required repairs. Data from agencies like the Navy or other commercial maritime operators performing similar work could provide context. The firm-fixed-price nature suggests a defined scope, but the actual value proposition depends heavily on the thoroughness of the initial assessment and the contractor's efficiency in execution.

What are the potential risks associated with a 'NOT COMPETED' contract award?

The primary risk of a 'NOT COMPETED' contract is the potential for paying a higher price than could be achieved through a competitive bidding process. Without multiple offers, the government loses the leverage that competition provides to drive down costs and encourage innovation. There's also a risk of reduced transparency and potential for contractor complacency if there's no competitive pressure. Furthermore, it can raise concerns about fairness and equal opportunity for other qualified businesses that were not given a chance to bid. Agencies must have strong justifications for sole-source awards to mitigate these risks.

What is the track record of Keystone Shipping Services, Inc. with federal contracts?

The provided data identifies Keystone Shipping Services, Inc. as the contractor. To assess their track record, a review of their past federal contract awards, performance reviews, and any history of disputes or contract terminations would be necessary. Information from sources like the Federal Procurement Data System (FPDS) or the Government Accountability Office (GAO) bid protest decisions could offer insights into their reliability, past performance quality, and adherence to contract terms. A positive track record would increase confidence in their ability to successfully execute this current contract.

What is the significance of the NAICS code 483111 (Deep Sea Freight Transportation) in relation to this contract?

The North American Industry Classification System (NAICS) code 483111, 'Deep Sea Freight Transportation,' indicates the primary industry classification of the contractor or the service being procured. While this contract is for 'Ship Repair Services,' the NAICS code suggests that Keystone Shipping Services, Inc. operates within or is being contracted for services related to the deep-sea freight transportation sector. This implies the ships being repaired are likely involved in the transportation of goods across oceans. The Maritime Administration's mission often involves supporting this sector, making the NAICS code relevant to the agency's overall objectives.

What are the implications of the contract duration (386 days) for the Maritime Administration?

A contract duration of 386 days, spanning over a year, suggests a significant and potentially ongoing need for the specified ship repair services. For the Maritime Administration, this implies a commitment of resources over an extended period. It could indicate a major overhaul, a series of repairs, or a service contract for a specific vessel or fleet. The duration necessitates careful planning for budget allocation and project management to ensure timely completion and effective utilization of the repaired assets. It also means the agency is relying on Keystone Shipping Services, Inc. for a substantial portion of its repair needs during this period.

Industry Classification

NAICS: Transportation and Warehousing › Deep Sea, Coastal, and Great Lakes Water Transportation › Deep Sea Freight Transportation

Product/Service Code: OPERATION OF GOVT OWNED FACILITY › OPERATE GOVT OWNED BUILDINGS

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 1 BALA PLZ STE 600, BALA CYNWYD, PA, 19004

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

Financial Breakdown

Contract Ceiling: $2,679,984

Exercised Options: $2,679,984

Current Obligation: $2,679,984

Actual Outlays: $2,679,984

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: 693JF724D000009

IDV Type: IDC

Timeline