Navy awards $27.9M for vessel maintenance in Hawaii, with 3 bids received

Contract Overview

Contract Amount: $27,899,687 ($27.9M)

Contractor: Pacific Shipyards International, LLC

Awarding Agency: Department of Defense

Start Date: 2020-11-30

End Date: 2021-09-24

Contract Duration: 298 days

Daily Burn Rate: $93.6K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 3

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: ACCOMPLISH DEPOT LEVEL MAINTENANCE AND REPAIR AVAILABILITIES OF U.S. WATERBORNE VESSELS AND SURFACE SHIPS VISITING OR HOMEPORTED IN THE HAWAIIAN ISLANDS.

Place of Performance

Location: PEARL HARBOR, HONOLULU County, HAWAII, 96860

State: Hawaii Government Spending

Plain-Language Summary

Department of Defense obligated $27.9 million to PACIFIC SHIPYARDS INTERNATIONAL, LLC for work described as: ACCOMPLISH DEPOT LEVEL MAINTENANCE AND REPAIR AVAILABILITIES OF U.S. WATERBORNE VESSELS AND SURFACE SHIPS VISITING OR HOMEPORTED IN THE HAWAIIAN ISLANDS. Key points: 1. Contract focuses on depot-level maintenance and repair for U.S. waterborne vessels. 2. Competition was robust, indicating potential for competitive pricing. 3. Performance period is relatively short, suggesting a need for ongoing procurement. 4. The contract is a delivery order under a larger indefinite-delivery/indefinite-quantity (IDIQ) vehicle. 5. Geographic focus on Hawaii may present logistical challenges and opportunities. 6. The firm-fixed-price structure shifts risk to the contractor.

Value Assessment

Rating: good

The contract value of $27.9 million for depot-level maintenance and repair of U.S. waterborne vessels in Hawaii appears reasonable given the specialized nature of the work. Benchmarking against similar contracts for naval vessel maintenance in the Pacific region would provide a more precise assessment, but the presence of multiple bidders suggests a competitive pricing environment. The firm-fixed-price contract type indicates that the government has secured a defined cost for the services, assuming the contractor can manage their expenses effectively.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, with three bids received. This level of competition is generally positive, suggesting that multiple capable contractors were aware of and interested in the requirement. The presence of three bidders indicates a healthy market for these services and provides the agency with options, likely leading to more competitive pricing than a sole-source or limited competition scenario.

Taxpayer Impact: The full and open competition with multiple bidders is beneficial for taxpayers as it drives down prices through market forces and ensures the government receives the best value for its investment in vessel maintenance.

Public Impact

U.S. Navy vessels and surface ships requiring maintenance and repair in Hawaii benefit from this contract. Services include depot-level maintenance and repair, ensuring operational readiness of naval assets. The geographic impact is concentrated in the Hawaiian Islands, supporting naval operations in the Pacific. This contract supports skilled labor in the shipbuilding and repair industry within Hawaii.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if unforeseen repair issues arise, despite the firm-fixed-price structure.
Dependence on a single contractor for critical maintenance in a strategically important location.
Logistical complexities of performing depot-level maintenance in Hawaii could impact timelines and costs.

Positive Signals

Firm-fixed-price contract shifts cost risk to the contractor.
Full and open competition with multiple bidders suggests a competitive market.
Contract supports critical operational readiness for U.S. Navy vessels.

Sector Analysis

The shipbuilding and repair sector is a critical component of national defense and maritime commerce. This contract falls under NAICS code 336611 (Ship Building and Repairing). The market for naval ship maintenance is specialized, often dominated by a few large players with the necessary infrastructure and security clearances. Spending in this sector is heavily influenced by defense budgets and geopolitical needs. Comparable spending benchmarks would typically involve analyzing other contracts for similar maintenance services awarded to shipyards in the U.S. or allied nations.

Small Business Impact

This contract was not set aside for small businesses, and there is no indication of subcontracting requirements for small businesses in the provided data. The primary contractor, Pacific Shipyards International, LLC, is likely a large business. This means the direct economic impact on the small business ecosystem for this specific award is minimal, though the contractor may engage small businesses as suppliers or service providers indirectly.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and the contracting officer's representative (COR) from the Department of the Navy. Performance monitoring, quality assurance, and adherence to contract terms are key oversight functions. Transparency is generally maintained through contract award databases like FPDS. Inspector General jurisdiction would apply if fraud, waste, or abuse were suspected.

Related Government Programs

Naval Sea Systems Command (NAVSEA) contracts
Ship maintenance and repair contracts
Department of Defense vessel support services
Pacific Fleet maintenance requirements

Risk Flags

Potential for schedule delays due to logistical challenges in Hawaii.
Risk of unforeseen repair requirements impacting fixed-price budget.
Contractor performance history needs thorough review for reliability.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $27.9 million to PACIFIC SHIPYARDS INTERNATIONAL, LLC. ACCOMPLISH DEPOT LEVEL MAINTENANCE AND REPAIR AVAILABILITIES OF U.S. WATERBORNE VESSELS AND SURFACE SHIPS VISITING OR HOMEPORTED IN THE HAWAIIAN ISLANDS.

Who is the contractor on this award?

The obligated recipient is PACIFIC SHIPYARDS INTERNATIONAL, LLC.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $27.9 million.

What is the period of performance?

Start: 2020-11-30. End: 2021-09-24.

What is the track record of Pacific Shipyards International, LLC with the Department of Defense?

Pacific Shipyards International, LLC has a history of performing contracts with the Department of Defense, primarily focused on ship repair and maintenance. Analyzing their past performance on similar contracts, particularly those involving naval vessels and depot-level work, would reveal their reliability, quality of work, and adherence to schedules and budgets. Reviewing contract award histories and any associated performance evaluations or disputes would provide a comprehensive understanding of their capabilities and past successes or challenges in fulfilling government requirements.

How does the awarded price compare to similar vessel maintenance contracts in the region?

A precise comparison of the $27.9 million award to similar contracts is challenging without access to a broader dataset of recent naval vessel maintenance awards in the Hawaiian or broader Pacific region. However, the presence of three bidders under full and open competition suggests that the pricing is likely competitive. Factors such as the specific types of vessels, the scope of work (depot-level vs. intermediate), the duration of the contract, and the prevailing labor and material costs in Hawaii would all influence the final price. A detailed benchmark analysis would require identifying comparable contracts and adjusting for these variables.

What are the primary risks associated with this contract for the Navy?

The primary risks for the Navy in this contract include potential cost overruns if unexpected repair needs arise, despite the firm-fixed-price structure. Schedule delays are also a risk, particularly given the logistical complexities of performing depot-level maintenance in Hawaii, which could impact the operational readiness of the vessels. Furthermore, over-reliance on a single contractor for critical maintenance in a strategically vital location like Hawaii could pose a risk if the contractor experiences financial difficulties or performance issues. Ensuring robust oversight and clear communication channels is crucial to mitigating these risks.

How effective is the firm-fixed-price contract type in ensuring value for money for this type of service?

The firm-fixed-price (FFP) contract type is generally considered effective in ensuring value for money when the scope of work is well-defined and the risks are manageable. For depot-level maintenance and repair, where unforeseen issues can arise, FFP places the burden of cost control on the contractor. This incentivizes efficiency and careful planning. However, if the scope is not fully understood upfront, it could lead to change orders or disputes. The Navy benefits from cost certainty, but must ensure the contractor has the capability to absorb potential cost fluctuations to avoid performance compromises.

What are the historical spending patterns for vessel maintenance in Hawaii by the Department of the Navy?

Historical spending patterns for vessel maintenance in Hawaii by the Department of the Navy would likely show consistent investment due to the strategic importance of the region and the presence of significant naval assets. This specific contract, valued at $27.9 million for a period of less than a year, represents a portion of that ongoing expenditure. Analyzing multi-year spending trends would reveal the typical scale of such procurements, the frequency of contract awards, and the primary contractors involved. This context helps in assessing whether the current award aligns with historical investment levels and priorities.

What is the significance of awarding a delivery order versus a new contract for this requirement?

Awarding a delivery order (DO) signifies that this requirement is being fulfilled under an existing indefinite-delivery/indefinite-quantity (IDIQ) contract. This approach is often used for services that are expected to be needed over time but with variable quantities or specific taskings. It allows the agency to procure services more rapidly and efficiently than initiating a new full and open competition for each individual need. The existence of an IDIQ contract implies that a broader competition likely occurred previously to establish the terms and conditions under which multiple delivery orders could be issued.

Industry Classification

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

Product/Service Code: MAINT, REPAIR, REBUILD EQUIPMENT › NON-NUCLEAR SHIP REPAIR

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: N0002419R4442

Offers Received: 3

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: $27,914,626

Exercised Options: $27,899,687

Current Obligation: $27,899,687

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: N0002420D4448

IDV Type: IDC

Timeline