A dry dock that needs millions of dollars in repairs arrived at Baltimore Marine Industries yesterday, but the huge award could slip away if a competing shipyard has its way.
BMI won the $16.6 million Navy contract last month, but a Virginia shipyard that also bid for the project quickly filed a protest with the General Accounting Office alleging that it, not BMI, should have won the job.
Norfolk Shipbuilding & Drydock Corp. (Norshipco) argued in its Aug. 25 protest that BMI underestimated the cost to transport and house those crew members of the Resolute dry dock who must stay with it in Baltimore.
The company also argued that Norshipco should have scored higher in the "past performance" category.
"We felt the Norshipco proposal was the best value to the government," said Daniel R. Weckstein, an attorney for Norshipco. "We don't think [Navy officials] are considering all the costs in determining the best value."
Norshipco had asked for the work to be put on hold while the shipyards awaited the GAO's decision.
But this month the Navy declared that "urgent and compelling circumstances" necessitated immediate work on the dry dock - which the Navy uses to lift ships out of the water for repairs - and that BMI could begin work even as the GAO reviewed the protest.
"The dry dock was planned for use early next year for overhaul work," said Pat Dolan, a Navy spokeswoman.
She said she could not comment on the bids submitted by Norshipco and BMI.
Cal Thompson, BMI's chief financial officer, said, "We don't want to debate issues like that in the media. We submitted a very credible bid for that contract. We have no reason to believe that our customer will not be very well satisfied with the performance they get here on the Resolute."
The job is expected to provide work for an average of 200 workers for about five months.
If the GAO sides with Norshipco, the Navy could be ordered to pay Norshipco for the costs associated with submitting the bid and the legal fees accrued in protesting it.
Or the GAO could order BMI to stop work on the Resolute and have it towed to Norshipco's yard for the balance of the job.
Lee Buchanan, assistant secretary of the Navy for research, development and acquisition, said he believes that the Navy acted fairly in awarding the contract to BMI.
"I know the process, but I was not part of the decision, and I was not there when the merits were discussed," he said. "But I know what was considered, and I know the extent of the deliberations and the fairness of the individuals involved, and I'm confident we did the right thing."
He added that up to 50 percent of all ship-repair bids are protested.
"It's not unusual," he said. "It is regrettable."
BMI almost didn't get to bid on the Resolute.
The Navy has a rule that ship repairs lasting less than six months must be performed at shipyards within 75 miles of a Navy home port.
That makes BMI ineligible to bid on Navy jobs originating at the Norfolk, Va., home port, which is home to the Resolute.
Rep. Robert L. Ehrlich Jr. contacted the Navy and pointed out that the home port rule should not apply to the Resolute, which is a service vessel and not on the register of Navy ships.
"Upon being educated, we said, 'You're right,'" Buchanan said. "The home port rule shouldn't apply."
The GAO must rule on Norshipco's protest by Dec. 4.