Maritime Administration awards $3.6M fixed-fee contract for deep sea freight transportation services

Contract Overview

Contract Amount: $3,642,753 ($3.6M)

Contractor: Pacific-Gulf Marine, Inc.

Awarding Agency: Department of Transportation

Start Date: 2025-08-18

End Date: 2026-07-26

Contract Duration: 342 days

Daily Burn Rate: $10.7K/day

Competition Type: FULL AND OPEN COMPETITION

Pricing Type: FIRM FIXED PRICE

Sector: Transportation

Official Description: CORNHUSKER STATE FY25 FIXED FEES PGM-CRN25-1002C TASK ORDER TO FUND FIXED FEES

Place of Performance

Location: NEWPORT NEWS, NEWPORT NEWS CITY County, VIRGINIA, 23607

State: Virginia Government Spending

Plain-Language Summary

Department of Transportation obligated $3.6 million to PACIFIC-GULF MARINE, INC. for work described as: CORNHUSKER STATE FY25 FIXED FEES PGM-CRN25-1002C TASK ORDER TO FUND FIXED FEES Key points: 1. Contract awarded at a firm fixed price, indicating predictable costs for the government. 2. Full and open competition suggests a robust bidding process. 3. The contract duration of 342 days provides a defined period for service delivery. 4. The award is a delivery order, implying it's part of a larger contract vehicle. 5. The North American Industry Classification System (NAICS) code 483111 points to specialized freight transportation. 6. The contract value is relatively modest, suggesting it may not represent a core, high-volume service. 7. The contractor, Pacific-Gulf Marine, Inc., is positioned to deliver these specific transportation services.

Value Assessment

Rating: good

The contract's firm fixed price structure provides cost certainty. Benchmarking against similar deep sea freight transportation contracts would be necessary for a precise value-for-money assessment. However, the absence of significant cost overruns or change orders in the contract's history (based on available data) suggests reasonable pricing. The contract value of approximately $3.6 million for a nearly year-long service period appears within a typical range for specialized maritime logistics.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit a bid. The specific number of bidders is not provided, but this procurement method generally fosters competitive pricing and encourages a wider range of potential contractors to participate. This approach is designed to ensure the government receives the best value by leveraging market forces.

Taxpayer Impact: Full and open competition is beneficial for taxpayers as it typically leads to more competitive pricing and a broader selection of qualified providers, maximizing the efficient use of public funds.

Public Impact

The primary beneficiaries are likely entities requiring the transport of goods via deep sea freight, potentially including other government agencies or commercial partners. The service delivered is deep sea freight transportation, crucial for moving goods across oceans. The geographic impact is global, as deep sea freight operates on international shipping lanes. Workforce implications may include employment for maritime professionals, logistics personnel, and support staff involved in the transportation chain.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for increased costs if fuel prices or operational complexities exceed initial estimates, despite the fixed-price nature.
Dependence on a single contractor for a critical transportation function could pose a risk if performance issues arise.
Geopolitical instability or disruptions to global shipping routes could impact service delivery timelines and reliability.

Positive Signals

The firm fixed-price contract provides budget certainty and limits the government's exposure to cost overruns.
Awarding through full and open competition suggests a thorough vetting process and likely competitive pricing.
The defined contract period and delivery order structure imply clear expectations and manageable scope.

Sector Analysis

The deep sea freight transportation sector is a critical component of global commerce, involving the movement of large volumes of goods across oceans. This contract falls within the broader transportation and logistics industry, which is characterized by complex supply chains, significant capital investment in vessels and infrastructure, and sensitivity to global economic conditions and trade policies. The Maritime Administration's spending in this area supports national security and economic interests by ensuring the availability of vital shipping capabilities.

Small Business Impact

The provided data indicates that this contract was not set aside for small businesses (ss: false, sb: false). Therefore, there are no direct subcontracting implications or specific impacts on the small business ecosystem stemming from a set-aside provision. The primary contractor, Pacific-Gulf Marine, Inc., is likely a larger entity capable of fulfilling the requirements of deep sea freight transportation.

Oversight & Accountability

Oversight for this contract would typically be managed by the Maritime Administration (MARAD) within the Department of Transportation. Accountability measures are embedded in the firm fixed-price contract terms, requiring the contractor to deliver services as specified. Transparency is generally maintained through contract award databases and reporting requirements. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse.

Related Government Programs

Department of Transportation - Maritime Administration Contracts
Deep Sea Freight Transportation Services
Federal Maritime Commission Oversight
Defense Transportation Services
Global Shipping and Logistics Contracts

Risk Flags

Potential for performance delays due to external factors (weather, geopolitical events).
Contractor's ability to maintain profitability under fixed-price terms if operational costs increase significantly.
Dependence on a single provider for a specific transportation need.

Frequently Asked Questions

What is this federal contract paying for?

Department of Transportation awarded $3.6 million to PACIFIC-GULF MARINE, INC.. CORNHUSKER STATE FY25 FIXED FEES PGM-CRN25-1002C TASK ORDER TO FUND FIXED FEES

Who is the contractor on this award?

The obligated recipient is PACIFIC-GULF MARINE, INC..

Which agency awarded this contract?

Awarding agency: Department of Transportation (Maritime Administration).

What is the total obligated amount?

The obligated amount is $3.6 million.

What is the period of performance?

Start: 2025-08-18. End: 2026-07-26.

What is the track record of Pacific-Gulf Marine, Inc. with federal contracts, particularly in deep sea freight transportation?

A comprehensive review of Pacific-Gulf Marine, Inc.'s federal contract history would reveal their performance on previous awards. This would include examining past contract values, durations, types of services rendered, and any reported performance issues or accolades. Specifically, analyzing their experience with similar deep sea freight transportation contracts awarded by MARAD or other agencies would provide insight into their capabilities and reliability. Data on contract modifications, terminations for default, or past performance evaluations would be crucial for assessing their track record. Without specific historical data on this contractor's federal awards, it is difficult to definitively assess their track record beyond the current award.

How does the awarded price of $3.6 million compare to similar deep sea freight transportation contracts over the past five years?

To benchmark the value of this $3.6 million contract, a comparative analysis of similar deep sea freight transportation contracts awarded by the Maritime Administration or other federal agencies over the last five years is necessary. This analysis should consider contract duration, scope of services, vessel types, cargo capacity, and geographic routes. Factors such as market fluctuations in fuel costs, shipping demand, and geopolitical events can influence pricing. If comparable contracts of similar scope and duration were awarded at significantly lower or higher prices, it would indicate whether this award represents a favorable or unfavorable price for the government. The firm fixed-price nature of this award suggests a degree of cost certainty, but the underlying market rate is key to assessing value.

What are the primary risks associated with this firm fixed-price contract for deep sea freight transportation?

While firm fixed-price contracts offer cost certainty, risks can still emerge. For this deep sea freight transportation contract, potential risks include unforeseen operational challenges, such as severe weather conditions impacting transit times or requiring rerouting, which could strain the contractor's ability to meet delivery schedules within the fixed price. Fluctuations in global fuel prices, although the contract is fixed, could impact the contractor's profitability and potentially their long-term willingness to bid on future similar contracts if margins are squeezed. Furthermore, geopolitical events or port congestion could lead to delays and disruptions, impacting the timely delivery of goods. The government's risk is primarily related to potential performance failures or delays by the contractor, which could disrupt supply chains or mission-critical operations.

What is the expected effectiveness of this contract in ensuring the reliable delivery of deep sea freight services for the government?

The effectiveness of this contract hinges on several factors. The award through full and open competition suggests that the Maritime Administration selected a contractor deemed capable of meeting the service requirements. The firm fixed-price structure incentivizes the contractor to perform efficiently to maintain profitability. The defined contract period (342 days) provides a clear timeframe for service delivery. However, effectiveness will ultimately be measured by the contractor's actual performance, including on-time deliveries, cargo integrity, and adherence to all contractual obligations. Regular monitoring and oversight by MARAD will be crucial to ensure the contract's objectives are met and to address any performance deficiencies promptly.

How has federal spending on deep sea freight transportation services trended over the past decade, and where does this award fit in?

Analyzing federal spending trends in deep sea freight transportation over the past decade would provide context for this $3.6 million award. This would involve examining aggregate spending by agencies like MARAD, the Department of Defense (through the Military Sealift Command), and others that utilize such services. Trends might be influenced by global trade volumes, national security requirements, and shifts in government logistics strategies. This specific award appears to be a routine operational requirement rather than a surge in demand or a major new initiative, given its moderate value and fixed-price nature. Understanding the historical spending patterns can help determine if this award represents a typical level of investment or a deviation from the norm.

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: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 111 VETERANS MEMORIAL BLVD STE 740, METAIRIE, LA, 70005

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

Financial Breakdown

Contract Ceiling: $3,642,753

Exercised Options: $3,642,753

Current Obligation: $3,642,753

Actual Outlays: $1,704,154

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: 693JF725D000034

IDV Type: IDC

Timeline