Coast Guard awards $88.2M for patrol boat construction and program management to Marinette Marine Corporation
Contract Overview
Contract Amount: $88,248,370 ($88.2M)
Contractor: Marinette Marine Corporation
Awarding Agency: Department of Homeland Security
Start Date: 2012-02-09
End Date: 2014-09-30
Contract Duration: 964 days
Daily Burn Rate: $91.5K/day
Competition Type: FULL AND OPEN COMPETITION
Pricing Type: FIRM FIXED PRICE
Sector: Other
Official Description: CLIN 6003G HULLS 127-156, CLIN 6003H HULLS 157-166, AND 15 MONTHS OF PROGRAM MANAGEMENT
Place of Performance
Location: MARINETTE, MARINETTE County, WISCONSIN, 54143
Plain-Language Summary
Department of Homeland Security obligated $88.2 million to MARINETTE MARINE CORPORATION for work described as: CLIN 6003G HULLS 127-156, CLIN 6003H HULLS 157-166, AND 15 MONTHS OF PROGRAM MANAGEMENT Key points: 1. Contract value represents a significant investment in maritime security capabilities. 2. The fixed-price contract structure aims to control costs and provide predictability. 3. Delivery order signifies a specific task within a larger indefinite-delivery contract. 4. The duration of the contract suggests a complex and lengthy manufacturing process. 5. The award to a single entity indicates a focused approach to fulfilling this requirement.
Value Assessment
Rating: good
The total award of $88.2 million for 16 patrol boat hulls and 15 months of program management appears reasonable given the scope. While specific per-unit cost benchmarks for comparable vessels are not readily available in the provided data, the firm fixed-price nature of the contract suggests that the contractor assumed the risk for cost overruns. Benchmarking against similar naval construction projects would provide a more definitive assessment of value for money.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
This contract was awarded under full and open competition, indicating that multiple vendors had the opportunity to bid. The specific number of bidders is not provided, but the open competition suggests a healthy market for this type of specialized vessel construction. This process is designed to foster price discovery and ensure the government receives competitive offers.
Taxpayer Impact: Full and open competition generally benefits taxpayers by driving down prices through market forces and encouraging a wider range of potential suppliers to participate.
Public Impact
The U.S. Coast Guard will benefit from the delivery of new patrol boat hulls, enhancing its operational capacity. Services delivered include the construction of 127-166 boat hulls and associated program management. The geographic impact is primarily in Wisconsin, where Marinette Marine Corporation is located, but the operational impact will be nationwide for the Coast Guard. The contract supports a specialized segment of the shipbuilding workforce.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Potential for schedule delays in complex shipbuilding projects.
- Risk of cost escalation if unforeseen technical challenges arise, despite fixed-price contract.
- Dependence on a single contractor for a critical component of Coast Guard fleet modernization.
Positive Signals
- Firm fixed-price contract provides cost certainty.
- Awarded through full and open competition, suggesting competitive pricing.
- Contractor is a known entity in shipbuilding, implying relevant experience.
Sector Analysis
This contract falls within the broader defense and maritime industrial sector, specifically boat building. The market for specialized patrol vessels is competitive, with a limited number of shipyards possessing the necessary expertise and facilities. The award to Marinette Marine Corporation, a significant player in this niche, reflects the specialized nature of the requirement and the capabilities needed for its execution.
Small Business Impact
The provided data indicates that small business participation was not a specific set-aside for this contract (ss: false, sb: false). Therefore, the primary impact on small businesses would be through potential subcontracting opportunities if Marinette Marine Corporation chooses to engage them for specific components or services. The extent of this subcontracting is not detailed in the award information.
Oversight & Accountability
Oversight for this contract would typically be managed by the U.S. Coast Guard contracting officers and program managers. Accountability measures are inherent in the firm fixed-price contract terms, requiring delivery of specified assets. Transparency is generally maintained through contract award databases, though detailed performance metrics may not always be publicly disclosed. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse.
Related Government Programs
- National Security Cutter Program
- Fast Response Cutter Program
- Offshore Patrol Cutter Program
Risk Flags
- Potential for schedule slippage in complex manufacturing.
- Cost control risks inherent in fixed-price shipbuilding contracts.
- Dependence on a single supplier for critical assets.
Tags
coast-guard, homeland-security, wisconsin, boat-building, full-and-open-competition, delivery-order, firm-fixed-price, maritime-security, defense-industrial-base, shipbuilding
Frequently Asked Questions
What is this federal contract paying for?
Department of Homeland Security awarded $88.2 million to MARINETTE MARINE CORPORATION. CLIN 6003G HULLS 127-156, CLIN 6003H HULLS 157-166, AND 15 MONTHS OF PROGRAM MANAGEMENT
Who is the contractor on this award?
The obligated recipient is MARINETTE MARINE CORPORATION.
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 $88.2 million.
What is the period of performance?
Start: 2012-02-09. End: 2014-09-30.
What is the historical spending pattern for similar patrol boat construction by the U.S. Coast Guard?
Analyzing historical spending for similar U.S. Coast Guard patrol boat construction reveals a trend of significant investment in fleet modernization and capability enhancement. Over the past decade, the Coast Guard has awarded numerous contracts for various classes of cutters and boats, ranging from small response vessels to larger offshore patrol cutters. These contracts often involve complex engineering, specialized materials, and lengthy construction timelines, leading to substantial dollar values. For instance, programs like the Sentinel-class Fast Response Cutters (FRCs) and the Offshore Patrol Cutters (OPCs) have each represented multi-billion dollar investments over their lifecycles. The specific award of $88.2 million for 16 hulls and program management fits within this pattern of substantial, but necessary, capital expenditures required to maintain and expand the Coast Guard's operational reach and effectiveness in diverse maritime environments. Benchmarking this specific award against the per-unit cost and total value of previous FRC or OPC procurements, adjusted for inflation and vessel size/complexity, would provide further context on its relative value.
How does the per-unit cost of these patrol boat hulls compare to industry benchmarks?
Determining an exact per-unit cost benchmark for these specific patrol boat hulls is challenging without detailed specifications and direct comparisons to publicly available data for identical or highly similar vessels. The provided data indicates a total award of $88.2 million for 127-166 hulls and program management. If we consider only the hulls and assume a mid-point of 146 hulls, the approximate cost per hull would be around $604,440 ($88.2M / 146). However, this figure includes program management and is a simplified calculation. Patrol boat costs can vary dramatically based on size, speed, armament, sensor suites, and construction materials. For context, smaller, less complex patrol boats might cost in the hundreds of thousands, while larger, more sophisticated vessels can run into tens or even hundreds of millions of dollars each. Without knowing the exact specifications of the hulls being built by Marinette Marine Corporation, a precise comparison to industry benchmarks is difficult. However, the calculated range suggests these are likely medium-sized, specialized vessels rather than small, basic patrol craft.
What is Marinette Marine Corporation's track record with similar government contracts?
Marinette Marine Corporation, now part of Fincantieri Marinette Marine, has a significant track record of building large naval vessels and complex maritime platforms for the U.S. government, particularly the U.S. Navy and U.S. Coast Guard. They are well-known for constructing Littoral Combat Ships (LCS) and Constellation-class frigates for the Navy, which are large, technologically advanced warships. Their experience also includes building the Response Boat-Medium (RB-M) for the Coast Guard, which are smaller but critical operational assets. The award for these patrol boat hulls and program management aligns with their core competencies in shipbuilding and systems integration. Their history suggests a capacity to handle large, complex contracts, although the scale and specific requirements of this particular award would need to be assessed against their past performance on similar vessel types and contract values to fully gauge risk and capability.
What are the primary risks associated with this contract, and how are they being mitigated?
The primary risks associated with this contract revolve around the complexities inherent in shipbuilding: potential schedule delays due to manufacturing challenges, supply chain disruptions, and technical integration issues. Given the firm fixed-price nature of the contract, cost overruns represent a significant risk to the contractor, which could indirectly impact the government through potential claims or performance issues if the contractor struggles financially. Mitigation strategies typically include robust project management by both the contractor and the government, detailed technical specifications, phased delivery schedules with oversight, and contingency planning for supply chain vulnerabilities. The Coast Guard's oversight, coupled with the contractor's experience in building similar vessels, serves as a key mitigation factor. Furthermore, the contract's duration (964 days) allows for structured execution and monitoring.
How does this contract contribute to the U.S. Coast Guard's overall mission effectiveness?
This contract directly contributes to the U.S. Coast Guard's mission effectiveness by providing essential platforms for maritime law enforcement, search and rescue, and national security operations. The delivery of new patrol boat hulls enhances the Coast Guard's operational capacity, allowing for increased presence in critical maritime areas, improved interdiction capabilities, and more efficient response to emergencies. Modern patrol boats are equipped with advanced navigation, communication, and surveillance systems, enabling the Coast Guard to better monitor U.S. waters, deter illicit activities, and respond swiftly to threats. The program management component ensures the seamless integration and delivery of these assets, supporting the Coast Guard's strategic goals of maintaining maritime safety, security, and environmental protection.
Industry Classification
NAICS: Manufacturing › Ship and Boat Building › Boat Building
Product/Service Code: SHIPS, SMALL CRAFT, PONTOON, DOCKS
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: Consiglio Nazionale Delle Ricerche (UEI: 655149347)
Address: 1600 ELY ST, MARINETTE, WI, 54143
Business Categories: Category Business, Not Designated a Small Business
Financial Breakdown
Contract Ceiling: $88,248,370
Exercised Options: $88,248,370
Current Obligation: $88,248,370
Contract Characteristics
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Parent Contract
Parent Award PIID: HSCG2306DARB001
IDV Type: IDC
Timeline
Start Date: 2012-02-09
Current End Date: 2014-09-30
Potential End Date: 2014-09-30 00:00:00
Last Modified: 2021-05-11
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