DoD's $10.46M ship repair contract awarded to Pacific Shipyards International, LLC

Contract Overview

Contract Amount: $10,460,684 ($10.5M)

Contractor: Pacific Shipyards International, LLC

Awarding Agency: Department of Defense

Start Date: 2025-01-15

End Date: 2026-01-16

Contract Duration: 366 days

Daily Burn Rate: $28.6K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 2

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: SHIP REPAIR

Place of Performance

Location: HONOLULU, HONOLULU County, HAWAII, 96817

State: Hawaii Government Spending

Plain-Language Summary

Department of Defense obligated $10.5 million to PACIFIC SHIPYARDS INTERNATIONAL, LLC for work described as: SHIP REPAIR Key points: 1. Value for money appears fair given the firm-fixed-price structure and 366-day duration. 2. Competition dynamics indicate a full and open process after exclusion of sources, suggesting a deliberate procurement strategy. 3. Risk indicators are moderate, with a single award and a fixed-price contract type. 4. Performance context is within the scope of naval ship maintenance and repair. 5. Sector positioning is within the defense industrial base, specifically naval shipbuilding and repair.

Value Assessment

Rating: fair

The contract's value of $10.46 million for a 366-day period suggests a daily rate of approximately $28,581. This rate needs to be benchmarked against similar naval ship repair contracts to determine true value for money. The firm-fixed-price (FFP) contract type is generally favorable for the government as it shifts cost risk to the contractor, but it requires careful initial pricing.

Cost Per Unit: $28,581 per day

Competition Analysis

Competition Level: limited

The contract was awarded under 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES,' indicating that while competition was sought, certain sources were excluded. This suggests a potentially limited pool of eligible bidders, which could impact price discovery. The presence of two bids implies some level of competition, but the exclusion criteria warrant further investigation.

Taxpayer Impact: The exclusion of sources may have limited the competitive landscape, potentially leading to higher prices than if all qualified sources had been allowed to bid. Taxpayers benefit from any competition that does occur, but the extent of this benefit is constrained by the limited bidder pool.

Public Impact

The primary beneficiaries are the U.S. Navy fleet requiring maintenance and repair services. Services delivered include essential upkeep and repair for naval vessels, ensuring operational readiness. The geographic impact is centered in Hawaii, where Pacific Shipyards International is located. Workforce implications include job creation and sustainment within the maritime repair industry in Hawaii.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for limited competition due to source exclusion.
Firm-fixed-price contracts can lead to contractor cost-cutting if not closely monitored.
Dependence on a single contractor for a critical service.

Positive Signals

Firm-fixed-price contract provides cost certainty for the government.
Award to an established company with a presence in Hawaii.
Contract duration of over a year allows for consistent service delivery.

Sector Analysis

The naval shipbuilding and repair sector is a critical component of the defense industrial base. This contract falls under NAICS code 336611 (Ship Building and Repairing). Spending in this sector is substantial, driven by the need to maintain and modernize a large fleet. Benchmarks for ship repair vary widely based on vessel type, complexity of work, and location, but daily rates can range from tens of thousands to hundreds of thousands of dollars.

Small Business Impact

The data indicates this contract was not specifically set aside for small businesses (ss: false, sb: false). There is no explicit information on subcontracting plans for small businesses. The impact on the small business ecosystem is likely minimal unless Pacific Shipyards International actively engages small businesses for subcontracted work.

Oversight & Accountability

Oversight will likely be managed by the Department of the Navy's contracting and program management offices. Accountability measures are embedded in the firm-fixed-price contract terms, requiring delivery of specified services. Transparency is facilitated by the Federal Procurement Data System (FPDS), where this award is reported. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Naval Vessel Repair Contracts
Ship Maintenance and Modernization Programs
Defense Logistics Agency (DLA) Support Contracts

Risk Flags

Limited competition due to source exclusion.
Potential for cost overruns if contractor efficiency is overestimated.
Dependence on a single contractor for critical repair services.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $10.5 million to PACIFIC SHIPYARDS INTERNATIONAL, LLC. SHIP REPAIR

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 $10.5 million.

What is the period of performance?

Start: 2025-01-15. End: 2026-01-16.

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

Pacific Shipyards International, LLC has a history of receiving contracts from the Department of Defense, primarily for ship repair and maintenance services. Analyzing past performance reviews, contract modifications, and any past performance issues would provide a clearer picture of their reliability and capability. Their presence in Hawaii suggests a strategic importance for supporting naval operations in the Pacific theater. Further investigation into their financial stability and capacity to handle large-scale repair projects is recommended to fully assess their track record.

How does the daily rate of $28,581 compare to similar naval ship repair contracts?

The daily rate of approximately $28,581 for this contract needs careful benchmarking. Rates for naval ship repair can vary significantly based on the type of vessel (e.g., aircraft carrier vs. destroyer), the complexity of the required repairs, labor costs in the region, and the specific services included. Contracts for routine maintenance might fall within this range, while major overhauls or specialized repairs could command higher daily rates. A comprehensive comparison would involve analyzing recent awards for similar vessel classes and repair scopes, ideally within the same geographic region or with similar operational demands, to ascertain if this rate represents good value for money.

What are the specific reasons for excluding certain sources in this 'Full and Open Competition After Exclusion of Sources' award?

The designation 'Full and Open Competition After Exclusion of Sources' implies that the initial solicitation was broad, but specific criteria were applied to narrow down the pool of eligible bidders. Reasons for exclusion can range from unmet technical qualifications, past performance issues, inability to meet security requirements, or specific statutory or regulatory limitations. Without access to the detailed justification documents for this specific procurement, it's difficult to pinpoint the exact reasons. However, such exclusions are intended to ensure that only capable and responsible contractors are considered, though they can also limit competition and potentially increase costs.

What is the potential impact of a firm-fixed-price contract on cost control for this ship repair work?

A firm-fixed-price (FFP) contract places the primary responsibility for cost control on the contractor. This means Pacific Shipyards International, LLC is obligated to complete the work for the agreed-upon price, regardless of their actual costs. While this offers budget certainty for the Navy, it also means the contractor bears the risk of cost overruns. Conversely, if the contractor is highly efficient, they retain the profit. Effective oversight by the Navy is still crucial to ensure the quality of work meets specifications and that the contractor is not cutting corners to maximize profit, which could lead to future performance issues or increased lifecycle costs.

What is the historical spending trend for ship repair services by the Department of the Navy in Hawaii?

Historical spending data for ship repair services by the Department of the Navy in Hawaii would reveal trends in contract awards, average contract values, and the primary contractors utilized. Analyzing this trend could indicate whether spending has been consistent, increasing, or decreasing, and whether Pacific Shipyards International, LLC has been a dominant or recurring awardee. Such analysis helps in understanding the market dynamics, the Navy's reliance on local repair capabilities, and potential budget planning for future repair needs in the region. It also provides context for the current $10.46 million award.

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 AFTER EXCLUSION OF SOURCES

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: N3225323R0003

Offers Received: 2

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: $10,460,684

Exercised Options: $10,460,684

Current Obligation: $10,460,684

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: N3225324D0700

IDV Type: IDC

Timeline