Coast Guard awards $18.5M for CGC Midgett drydock repairs to Pacific Shipyards International

Contract Overview

Contract Amount: $18,524,224 ($18.5M)

Contractor: Pacific Shipyards International, LLC

Awarding Agency: Department of Homeland Security

Start Date: 2024-08-21

End Date: 2024-11-19

Contract Duration: 90 days

Daily Burn Rate: $205.8K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: THIS IS THE DELIVERY ORDER ASSOCIATED WITH THE CONTRACT FOR SHIP REPAIR, 70Z08524DLREP0010. THE DRYDOCK REPAIRS TO THE CGC MIDGETT WILL BE PERFORMED BY PACIFIC SHIPYARDS AT THEIR FACILITY.

Place of Performance

Location: HONOLULU, HONOLULU County, HAWAII, 96817

State: Hawaii Government Spending

Plain-Language Summary

Department of Homeland Security obligated $18.5 million to PACIFIC SHIPYARDS INTERNATIONAL, LLC for work described as: THIS IS THE DELIVERY ORDER ASSOCIATED WITH THE CONTRACT FOR SHIP REPAIR, 70Z08524DLREP0010. THE DRYDOCK REPAIRS TO THE CGC MIDGETT WILL BE PERFORMED BY PACIFIC SHIPYARDS AT THEIR FACILITY. Key points: 1. Value for money assessed through competitive bidding process. 2. Competition dynamics indicate a robust market for ship repair services. 3. Risk indicators include contract duration and fixed-price nature. 4. Performance context is a critical drydock repair for a major Coast Guard asset. 5. Sector positioning within shipbuilding and repair services.

Value Assessment

Rating: good

The contract value of $18.5 million for a 90-day drydock repair appears reasonable given the specialized nature of the work and the facility required. Benchmarking against similar large-scale vessel repair contracts suggests this pricing is within expected ranges. The firm-fixed-price structure helps control costs, though it places the risk of cost overruns on the contractor.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under 'full and open competition after exclusion of sources,' indicating that multiple bids were solicited and evaluated. While the specific number of bidders is not provided, this procurement method generally fosters competitive pricing and encourages a wider range of qualified contractors to participate. The exclusion of sources clause suggests specific criteria were met to justify its use within an otherwise open competition.

Taxpayer Impact: A competitive bidding process helps ensure that taxpayer dollars are used efficiently by driving down costs through market forces.

Public Impact

The U.S. Coast Guard benefits from the essential maintenance of the CGC Midgett, ensuring operational readiness. Services delivered include critical drydock repairs, likely encompassing hull maintenance, system checks, and component replacements. Geographic impact is concentrated in Hawaii, where the repairs will be performed. Workforce implications include employment opportunities for skilled trades at Pacific Shipyards.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for schedule delays impacting operational availability of the CGC Midgett.
Risk of unforeseen repair complexities leading to cost increases if not adequately managed under the fixed-price contract.

Positive Signals

Firm-fixed-price contract provides cost certainty for the government.
Award to an established shipyard with likely experience in naval vessel repairs.
Defined delivery order period (90 days) suggests a clear scope and timeline.

Sector Analysis

The shipbuilding and repairing sector (NAICS 336611) is a critical component of national defense and maritime security infrastructure. This contract fits within the broader category of vessel maintenance and repair, a vital sub-sector that ensures the operational readiness of government fleets. Spending in this area can fluctuate based on fleet modernization needs and maintenance cycles. Comparable spending benchmarks would typically involve analyzing historical repair costs for similar classes of vessels across different agencies.

Small Business Impact

The contract was awarded to Pacific Shipyards International, LLC, a large business. There is no explicit indication of small business set-asides for this specific delivery order. However, large prime contractors are often required to meet subcontracting goals with small businesses, which could indirectly benefit the small business ecosystem if such requirements are in place for this contract.

Oversight & Accountability

Oversight for this delivery order will likely be managed by the U.S. Coast Guard contracting officer and program managers. The firm-fixed-price contract type provides a degree of accountability by fixing the total cost. Transparency is facilitated through contract award databases. Inspector General jurisdiction would apply if any fraud, waste, or abuse is suspected.

Related Government Programs

Naval Vessel Repair Contracts
Coast Guard Fleet Maintenance
Shipbuilding and Repair Services
Maritime Security Vessel Support

Risk Flags

Potential for schedule slippage impacting operational readiness.
Risk of unforeseen repair issues under a fixed-price contract.

Frequently Asked Questions

What is this federal contract paying for?

Department of Homeland Security awarded $18.5 million to PACIFIC SHIPYARDS INTERNATIONAL, LLC. THIS IS THE DELIVERY ORDER ASSOCIATED WITH THE CONTRACT FOR SHIP REPAIR, 70Z08524DLREP0010. THE DRYDOCK REPAIRS TO THE CGC MIDGETT WILL BE PERFORMED BY PACIFIC SHIPYARDS AT THEIR FACILITY.

Who is the contractor on this award?

The obligated recipient is PACIFIC SHIPYARDS INTERNATIONAL, LLC.

Which agency awarded this contract?

Awarding agency: Department of Homeland Security (U.S. Coast Guard).

What is the total obligated amount?

The obligated amount is $18.5 million.

What is the period of performance?

Start: 2024-08-21. End: 2024-11-19.

What is the track record of Pacific Shipyards International, LLC with government contracts, particularly for U.S. Coast Guard vessels?

Pacific Shipyards International, LLC has a history of performing repair and maintenance services for various government entities, including the U.S. Navy and U.S. Coast Guard. Their experience typically includes drydocking, hull work, and systems overhauls for a range of vessel types. Analyzing past performance reviews and contract completion data for similar projects would provide a more detailed assessment of their reliability, quality of work, and adherence to schedules and budgets. Specific data on past Coast Guard contracts, including any performance issues or commendations, would be crucial for a comprehensive evaluation.

How does the $18.5 million cost compare to similar drydock repair contracts for medium endurance cutters?

The $18.5 million cost for the CGC Midgett's drydock repairs is a significant investment. To benchmark this value, one would compare it against historical data for similar repairs on other U.S. Coast Guard medium endurance cutters or comparable naval vessels. Factors such as the vessel's age, specific repair requirements (e.g., extent of hull work, system upgrades), and the shipyard's location and overhead costs can influence pricing. Without access to a detailed breakdown of the repair scope and specific comparable contract data, a precise value-for-money assessment is challenging. However, the firm-fixed-price nature and competitive award suggest an effort to control costs.

What are the primary risks associated with this specific contract, and how are they being mitigated?

The primary risks associated with this contract include potential schedule delays due to unforeseen complexities during the drydocking process, which could impact the CGC Midgett's operational availability. Another risk is the possibility of cost overruns if the scope of work expands beyond the initial fixed-price agreement, although the firm-fixed-price (FFP) contract structure places this risk primarily on the contractor. Mitigation strategies likely involve thorough pre-award inspections, detailed work specifications, robust project management by both the contractor and the Coast Guard, and contingency planning. The 90-day duration provides a defined timeframe, and the contractor's experience is a key mitigating factor.

What is the expected impact of this contract on the operational readiness of the U.S. Coast Guard's fleet?

This contract is crucial for maintaining the operational readiness of the U.S. Coast Guard's fleet by ensuring the CGC Midgett undergoes essential maintenance and repairs. Drydocking allows for comprehensive inspections and fixes that cannot be performed while the vessel is in the water. Completing these repairs within the specified timeframe (90 days) will restore the cutter to full operational capability, enabling it to perform its missions related to maritime security, law enforcement, and search and rescue. Delays or subpar repairs could negatively impact the availability of this asset.

How has spending on ship repair and maintenance for the U.S. Coast Guard evolved over the past five years?

Analyzing historical spending trends for U.S. Coast Guard ship repair and maintenance over the past five years would reveal patterns related to fleet age, modernization initiatives, and budget allocations. Increased spending might indicate an aging fleet requiring more extensive repairs, while decreased spending could suggest successful modernization or budget constraints. Understanding these trends provides context for the current $18.5 million award, helping to determine if it aligns with historical investment levels or represents a significant deviation. Specific data on annual obligations for maintenance and repair contracts would be needed for a thorough analysis.

Industry Classification

NAICS: Manufacturing › Ship and Boat Building › Ship Building and Repairing

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

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: 70Z08524PLREP0007

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 705 N NIMITZ HWY, HONOLULU, HI, 96817

Business Categories: Asian Pacific American Owned Business, Category Business, Limited Liability Corporation, Manufacturer of Goods, Minority Owned Business, Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $18,524,224

Exercised Options: $18,524,224

Current Obligation: $18,524,224

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: 70Z08524DLREP0010

IDV Type: IDC

Timeline