Department of Energy's $46M contract with General Electric for ammunition manufacturing shows long-term commitment
Contract Overview
Contract Amount: $46,091,504 ($46.1M)
Contractor: General Electric CO
Awarding Agency: Department of Energy
Start Date: 2000-03-15
End Date: 2005-06-28
Contract Duration: 1,931 days
Daily Burn Rate: $23.9K/day
Pricing Type: COST PLUS AWARD FEE
Sector: Other
Place of Performance
Location: LARGO, PINELLAS County, FLORIDA, 33773
State: Florida Government Spending
Plain-Language Summary
Department of Energy obligated $46.1 million to GENERAL ELECTRIC CO for work described as: Key points: 1. The contract's duration suggests a sustained need for the manufactured goods. 2. The cost-plus-award-fee structure incentivizes performance but requires careful oversight. 3. Limited competition data prevents a full assessment of value for money. 4. The specific nature of ammunition manufacturing may limit the pool of qualified bidders. 5. Geographic concentration in Florida warrants attention for supply chain resilience. 6. The absence of small business set-asides indicates a focus on large prime contractors.
Value Assessment
Rating: fair
Benchmarking the value of this contract is challenging without more detailed cost breakdowns or comparisons to similar ammunition manufacturing contracts. The cost-plus-award-fee (CPAF) structure allows for flexibility but can lead to higher costs if not managed effectively. The total award amount of $46 million over approximately five years suggests a significant investment, but the per-unit cost or efficiency metrics are not readily available for direct comparison.
Cost Per Unit: N/A
Competition Analysis
Competition Level: unknown
The competition level for this contract is not specified in the provided data. Ammunition manufacturing can be a specialized field, potentially leading to limited competition. If the contract was competed, the number of bidders would be crucial to understanding price discovery. If it was sole-source or had limited competition, it raises questions about whether the government secured the best possible pricing.
Taxpayer Impact: The level of competition directly impacts taxpayer value. Robust competition typically drives down prices, while limited competition may result in higher costs for the government.
Public Impact
The Department of Energy benefits from a secured supply of manufactured goods, likely for national security or operational purposes. The contract supports manufacturing activities within Florida, potentially impacting the local workforce and economy. The services delivered are related to the manufacturing of ammunition, a critical component for various government functions. The long-term nature of the contract provides stability for the contractor and ensures a consistent supply chain for the agency.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Lack of transparency on competition level hinders value assessment.
- Cost-plus-award-fee contracts require diligent oversight to prevent cost overruns.
- Specialized nature of ammunition manufacturing may limit competitive bidding opportunities.
Positive Signals
- Long contract duration indicates a stable, ongoing need met by the contractor.
- The award to a major manufacturer like General Electric suggests a focus on reliability and capacity.
- The contract is a definitive contract, implying a clear scope and commitment.
Sector Analysis
This contract falls within the manufacturing sector, specifically focusing on ammunition production. The market for defense-related manufacturing is substantial, with significant government spending allocated to ensure supply chain security and readiness. Contracts of this nature are crucial for maintaining domestic industrial capabilities. Benchmarking against other ammunition manufacturing contracts would provide further context on pricing and terms.
Small Business Impact
The provided data indicates that this contract was not set aside for small businesses (ss: false, sb: false). This suggests that the primary contractor, General Electric, is a large business. There is no information on subcontracting plans, but for a contract of this magnitude and nature, it is common for large prime contractors to engage small businesses for specialized components or services, though this is not guaranteed.
Oversight & Accountability
Oversight for this contract would primarily fall under the Department of Energy's contracting and program management offices. The cost-plus-award-fee structure necessitates robust monitoring of performance, costs, and adherence to contract terms to ensure accountability and value. Inspector General jurisdiction would apply to investigations of fraud, waste, or abuse related to the contract.
Related Government Programs
- Defense Ammunition Procurement
- Industrial Base Manufacturing Contracts
- Department of Energy Supply Chain Management
Risk Flags
- Cost-plus-award-fee contracts require diligent oversight.
- Limited competition data obscures true value for money.
- Specialized manufacturing may limit bidder pool.
Tags
manufacturing, ammunition, department-of-energy, general-electric, definitive-contract, cost-plus-award-fee, long-term-contract, florida, large-business, national-security
Frequently Asked Questions
What is this federal contract paying for?
Department of Energy awarded $46.1 million to GENERAL ELECTRIC CO. See the official description on USAspending.
Who is the contractor on this award?
The obligated recipient is GENERAL ELECTRIC CO.
Which agency awarded this contract?
Awarding agency: Department of Energy (Department of Energy).
What is the total obligated amount?
The obligated amount is $46.1 million.
What is the period of performance?
Start: 2000-03-15. End: 2005-06-28.
What specific types of ammunition were manufactured under this contract, and what was the intended use?
The provided data indicates the North American Industry Classification System (NAICS) code as 332993, which corresponds to 'Ammunition (except Small Arms) Manufacturing'. This category includes a wide range of ammunition products, excluding small arms ammunition. Without further details from the contract itself, the specific types of ammunition and their intended use (e.g., for military, research, or other governmental applications) remain unspecified. The Department of Energy's involvement suggests potential applications related to national security, energy research facilities, or specialized governmental operations that require such manufactured goods.
How does the $46 million award amount compare to typical spending for similar ammunition manufacturing contracts?
Comparing the $46 million award to typical spending for similar ammunition manufacturing contracts is difficult without more specific data points. Ammunition contracts can vary significantly in scope, quantity, and type, influencing their total value. However, for a contract spanning over five years (March 2000 to June 2005), $46 million represents a substantial investment. Major defense contractors often handle multi-million dollar contracts for ammunition, but the specific market rates and typical contract values for the types of ammunition General Electric manufactured for the Department of Energy would require access to specialized defense procurement databases or historical contract analysis reports.
What were the key performance metrics and award criteria used in the Cost Plus Award Fee (CPAF) structure for this contract?
The provided data does not detail the specific performance metrics or award criteria for this Cost Plus Award Fee (CPAF) contract. In a CPAF structure, the contractor is reimbursed for allowable costs plus a base fee, and an award fee is earned based on achieving specific performance objectives. These objectives are typically defined in the contract's schedule and can include factors like quality, timeliness, cost control, technical innovation, and customer satisfaction. For ammunition manufacturing, metrics might relate to production yield, defect rates, on-time delivery, and adherence to stringent safety and quality standards. The 'award fee' component incentivizes the contractor to exceed minimum performance requirements.
What is General Electric's track record in defense or specialized manufacturing contracts of this nature?
General Electric (GE) has a long and extensive history as a major industrial conglomerate, with significant involvement in defense and specialized manufacturing sectors. While GE is widely known for its aviation, power, and healthcare divisions, it has also historically produced components and systems for defense applications. Their track record in large-scale manufacturing contracts is generally strong, characterized by technological expertise and production capacity. However, specific details regarding their performance on ammunition manufacturing contracts, particularly for the Department of Energy, would require a deeper dive into their contract history and performance reviews beyond the scope of this summary data.
Were there any identified risks or challenges associated with this contract, and how were they managed?
The provided data does not explicitly list risks or challenges associated with this specific contract. However, general risks inherent in long-term manufacturing contracts, especially those involving specialized products like ammunition and utilizing a CPAF structure, can include supply chain disruptions, cost overruns, quality control issues, and potential changes in government requirements. The CPAF structure itself implies a need for active management to ensure the 'award fee' is earned appropriately and that costs remain controlled. The long duration (over five years) also presents risks related to evolving technology or geopolitical factors that might impact the need for the manufactured goods.
What was the historical spending trend for ammunition manufacturing by the Department of Energy prior to and during this contract period?
The provided data does not offer historical spending trends for ammunition manufacturing by the Department of Energy. This specific contract, awarded in March 2000 and ending in June 2005, represents a significant expenditure of approximately $46 million. To understand the historical context, one would need to analyze the Department of Energy's procurement data for similar goods and services in the years preceding and following this contract. This would help determine if this was a typical level of investment, an increase, or a decrease in spending for such manufacturing capabilities within the agency.
Industry Classification
NAICS: Manufacturing › Other Fabricated Metal Product Manufacturing › Ammunition (except Small Arms) Manufacturing
Product/Service Code: OPERATION OF GOVT OWNED FACILITY › OPERATE GOVT OWNED BUILDINGS
Contractor Details
Business Categories: Category Business, Not Designated a Small Business
Financial Breakdown
Contract Ceiling: $32,713,389
Exercised Options: $32,713,389
Current Obligation: $46,091,504
Actual Outlays: $2,104,242
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Timeline
Start Date: 2000-03-15
Current End Date: 2005-06-28
Potential End Date: 2005-06-28 00:00:00
Last Modified: 2025-04-24
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