Bidding process needs transparency and competition

Blaine Dempke, president of Markey Machinery Co., a maker of winches, sent the following letter to Matthew J. Hawkins, program director of the National Science Foundation:


We are still reeling from the news that Rapp-Hydema has been awarded the Scientific Handling Systems Integrator tasks for the new ARRV. Having been involved with this project since its 2005 inception, we by no means felt we were a lock, but we had hoped that we’d be given a fair shot at the work. However, in the end, as the bidding and award process reached its culmination, we were told by Marinette specifically not to bother submitting a best and final bid (we can produce emails that clarify this lack of a competitive process, if they would be useful to you). As a result, we now suffer from the same lack of work that is afflicting the rest of the United States, work we had counted on to keep us busy and people employed for 12 – 18 months, and work that we had counted on to return us to the leadership status we enjoyed when the DESH-5 was the winch everybody wanted.

Please don’t take this as “sour grapes”….. we lose work all the time based on price. But we’re usually deeply involved in a competitive bidding situation, especially with government-sponsored projects, and end up knowing where the project will end up going to. Instead, here, we feel as if the rug has been pulled out from under us. As a result of this ordeal, and in an attempt to take away something positive, I was hoping that you could address our immediate and long-term concerns, which are:

The project is funded by ARRA money, yet our understanding is that Rapp-Hydema will engineer and manufacture this equipment in Norway or Eastern Europe (as they have in the past). How does this further the intent of the ARRA, which is to use taxpayer money specifically to put Americans back to work?

There are other American winch-builders who could have been tasked with the Research & Development to create the systems that UNOLS has clearly stated they want – ourselves, Logan Winch, Interocean, and Dynacon among others. Why is it that this group of American suppliers was not part of a competitive group used to further American technology, while also achieving the lowest possible price?

As you are probably aware, Norway has assistance programs in place to offset the expenses that Norwegian firms incur in the research and develop of new equipment, with the intent that Norway stay in the forefront of new product development, especially in the marine industry. Our understanding is that this can amount to as much as a 15% offset. Of course this works against American firms, such as ourselves, who must pay for every dime of R & D themselves. And it tends to destroy any chance for an American firm to be competitive when R & D is required, as would appear to be the case here. How is an American company expected to develop new products if its own government won’t help by awarding orders on government/taxpayer-funded projects to American firms?

Where do we go from here? Several parties have suggested that they look forward to working with us on the upcoming Ocean-Class and RCRV Projects, yet after the outcome of the ARRV Project we will be left with no opportunity to develop the products that Rapp-Hydema will have already developed by the time these next projects come to pass, thus rendering us less competitive than we may be presently. The loss of this project effectively resigns us to a non-contender role, or worst case for NOAA / NSF / NOAA, as a non-participant. How do these potential results further manufacturing and the development of new technology in America, or our ability to support you in the future?

We are working on a concept for the re-power and re-control of the standard DESH-5 that would bring it up to your current standards, including smart-winch capability and motion-comp features. This concept would renew the many DESH-5’s in the UNOLS and NOAA fleets, and allow them to serve another 20 years, presumably at lower cost than buying complete new winches. Would this concept be interesting to you? Where would it fit within the overall funding for the UNOLS fleet? Is it worthy of the considerable R & D expense it would take on our part to further develop the concept?

We sincerely value your input and guidance. If you would prefer to discuss this at your office please let me know and we’ll arrange a meeting at your convenience.

By Professional Mariner Staff