Navy awards $130.8M for vessel operations, a sole-source contract for deep-sea freight

Contract Overview

Contract Amount: $130,786,897 ($130.8M)

Contractor: Crowley Government Services, Inc.

Awarding Agency: Department of Defense

Start Date: 2024-12-01

End Date: 2025-11-30

Contract Duration: 364 days

Daily Burn Rate: $359.3K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Transportation

Official Description: BRIDGE CONTRACT AWARD FOR THE OPERATION AND MAINTENANCE OF TAGOS/TAGM VESSELS.

Place of Performance

Location: JACKSONVILLE, DUVAL County, FLORIDA, 32225

State: Florida Government Spending

Plain-Language Summary

Department of Defense obligated $130.8 million to CROWLEY GOVERNMENT SERVICES, INC. for work described as: BRIDGE CONTRACT AWARD FOR THE OPERATION AND MAINTENANCE OF TAGOS/TAGM VESSELS. Key points: 1. This contract represents a significant investment in maintaining critical maritime logistics capabilities. 2. The sole-source nature of this award warrants scrutiny regarding potential cost efficiencies and market alternatives. 3. Performance will be closely monitored to ensure operational readiness and effective service delivery. 4. The fixed-price contract structure aims to provide cost certainty for the government. 5. This award falls within the broader context of defense logistics and strategic sealift support. 6. The duration of the contract suggests a need for sustained operational support.

Value Assessment

Rating: fair

Benchmarking the value of this $130.8 million contract is challenging without detailed cost breakdowns and comparisons to similar sole-source awards for vessel operations. The fixed-price nature provides some cost control, but the lack of competition limits the government's ability to leverage market forces for potentially better pricing. Further analysis would require understanding the specific services rendered and the operational complexity involved.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning only one contractor, Crowley Government Services, Inc., was solicited. This approach bypasses the competitive bidding process, which typically leads to price discovery and potentially lower costs. The justification for a sole-source award would need to be thoroughly reviewed to understand why full and open competition was not feasible.

Taxpayer Impact: The absence of competition means taxpayers may not be receiving the most cost-effective solution available in the market. Without competitive pressure, there is a risk of inflated pricing or less incentive for the contractor to optimize operational efficiency.

Public Impact

The primary beneficiaries are the Department of the Navy and the broader U.S. military, ensuring the availability of essential deep-sea freight transportation. Services delivered include the operation and maintenance of TAGOS/TAGM vessels, crucial for logistical support and strategic sealift. The geographic impact is national, supporting defense operations and potentially global deployment needs, with the contract performance location specified as Florida. Workforce implications include employment opportunities for maritime professionals, engineers, and support staff within Crowley Government Services and its subcontractors.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits competitive pressure, potentially leading to higher costs for taxpayers.
Lack of transparency in the justification for sole-sourcing requires further investigation.
Contract duration of one year may not reflect long-term strategic needs, requiring future sole-source awards.
Limited public information on specific performance metrics makes assessing value for money difficult.

Positive Signals

Contract ensures continued operation of critical maritime assets for national defense.
Fixed-price contract provides a degree of cost certainty for the government.
Experienced contractor, Crowley Government Services, Inc., is performing the work.
Contract supports essential logistical capabilities for the Department of the Navy.

Sector Analysis

The maritime logistics sector is vital for national defense and global trade. This contract for deep-sea freight transportation and vessel operations fits within the broader defense logistics and transportation services market. Comparable spending benchmarks are difficult to establish without more specific details on vessel types and service requirements, but significant government contracts in this area often run into tens or hundreds of millions of dollars annually.

Small Business Impact

This contract does not appear to have a small business set-aside component, as indicated by 'sb': false. Furthermore, the 'ss' flag is also false, suggesting no specific small business subcontracting goals were mandated within this award. This means the primary contractor, Crowley Government Services, Inc., will likely manage the entire scope of work, with limited direct subcontracting opportunities for small businesses unless initiated by the prime contractor.

Oversight & Accountability

Oversight for this contract will primarily fall under the Department of the Navy's contracting and program management offices. Accountability measures are embedded within the contract's terms and conditions, including performance standards and payment schedules. Transparency is limited due to the sole-source nature and the absence of a competitive bidding process. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Military Sealift Command Contracts
Department of Defense Transportation Services
Maritime Operations and Maintenance Contracts
Strategic Sealift Program

Risk Flags

Sole-source award lacks competitive pricing.
Potential for cost inefficiencies due to lack of competition.
Limited transparency on justification for sole-sourcing.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $130.8 million to CROWLEY GOVERNMENT SERVICES, INC.. BRIDGE CONTRACT AWARD FOR THE OPERATION AND MAINTENANCE OF TAGOS/TAGM VESSELS.

Who is the contractor on this award?

The obligated recipient is CROWLEY GOVERNMENT SERVICES, INC..

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Navy).

What is the total obligated amount?

The obligated amount is $130.8 million.

What is the period of performance?

Start: 2024-12-01. End: 2025-11-30.

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

The provided data indicates the contract was 'NOT COMPETED' and is 'sole-source'. A definitive justification for this approach is not included in the summary data. Typically, sole-source awards are justified when only one responsible source can provide the required supplies or services, such as in cases of urgent and compelling need, unique capabilities, or when competition is deemed not feasible or not in the government's best interest. A thorough review of the contract file and associated documentation would be necessary to ascertain the specific rationale provided by the Department of the Navy for not pursuing a competitive procurement for these vessel operations and maintenance services.

How does the fixed price of $130.8 million compare to similar vessel operation contracts?

Directly comparing the $130.8 million fixed price to similar contracts is challenging without more granular data on the specific types of TAGOS/TAGM vessels, their operational tempo, maintenance schedules, and the geographic areas of operation. However, for context, large-scale maritime support contracts, especially those involving specialized vessels and long-term operations, can easily reach these figures. The fixed-price nature aims to cap the government's liability, but the absence of competition means there's no direct market benchmark to assess if this price is optimal. Analysis would require benchmarking against historical sole-source awards for comparable services or against industry cost models if available.

What are the key performance indicators (KPIs) for this contract?

The provided data does not specify the Key Performance Indicators (KPIs) for this contract. However, for vessel operation and maintenance contracts, typical KPIs often include vessel availability rates, operational readiness, response times for deployment, fuel efficiency, safety incident rates, and timely completion of scheduled maintenance. The Department of the Navy would have established specific performance standards and metrics within the contract's statement of work to ensure Crowley Government Services, Inc. meets the required operational capabilities and service levels for the TAGOS/TAGM vessels.

What is Crowley Government Services, Inc.'s track record with similar Navy contracts?

Crowley Government Services, Inc. has a significant history of performing maritime services for the U.S. government, including the Navy. They are known for providing logistics, transportation, and vessel management solutions. While specific details on past TAGOS/TAGM vessel contracts are not in the provided data, their extensive experience in operating and maintaining various types of government vessels suggests a strong capability. Past performance evaluations, if publicly accessible, would offer more insight into their reliability, quality of service, and adherence to contract terms on previous engagements.

What is the historical spending trend for vessel operations and maintenance by the Department of the Navy?

Historical spending by the Department of the Navy on vessel operations and maintenance is substantial, reflecting the vast size and operational requirements of its fleet. While specific figures for TAGOS/TAGM vessel operations are not detailed here, the Navy consistently allocates billions of dollars annually towards maintaining its readiness, which includes fuel, crewing, maintenance, repair, and logistical support for its diverse range of vessels. This $130.8 million award represents a portion of that overall expenditure, and trends can be influenced by fleet modernization, operational tempo, and geopolitical demands.

Are there any identified risks associated with this specific contract award?

The primary risk identified with this contract is its sole-source nature. This lack of competition can lead to potential inefficiencies, higher costs than might be achieved through a competitive process, and reduced incentive for innovation. Other potential risks, common to such contracts, include performance issues if the contractor fails to meet operational requirements, cost overruns if the fixed-price structure proves inadequate for unforeseen circumstances (though less likely than with cost-plus), and potential delays in service delivery. The government's oversight and the contractor's past performance are key mitigating factors.

Industry Classification

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

Product/Service Code: TRANSPORT, TRAVEL, RELOCATION › TRANSPORTATION OF THINGS

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 9487 REGENCY SQUARE BLVD, JACKSONVILLE, FL, 32225

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

Financial Breakdown

Contract Ceiling: $130,786,897

Exercised Options: $130,786,897

Current Obligation: $130,786,897

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline