GAO awards $2.6M contract for HVAC upgrades, highlighting need for facility modernization

Contract Overview

Contract Amount: $2,585,791 ($2.6M)

Contractor: Meltech Corporation, Inc.

Awarding Agency: Government Accountability Office

Start Date: 2024-09-23

End Date: 2026-08-05

Contract Duration: 681 days

Daily Burn Rate: $3.8K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 3

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: THE CONTRACTOR SHALL PROVIDE ALL EQUIPMENT, MATERIALS, LABOR, AND SUPERVISION REQUIRED TO UPGRADE HVAC SYSTEMS IN ZONES 2-5 ON 1ST FLOOR AT THE GOVERNMENT ACCOUNTABILITY OFFICE (GAO) HEADQUARTERS.

Place of Performance

Location: HYATTSVILLE, PRINCE GEORGES County, MARYLAND, 20785

State: Maryland Government Spending

Plain-Language Summary

Government Accountability Office obligated $2.6 million to MELTECH CORPORATION, INC. for work described as: THE CONTRACTOR SHALL PROVIDE ALL EQUIPMENT, MATERIALS, LABOR, AND SUPERVISION REQUIRED TO UPGRADE HVAC SYSTEMS IN ZONES 2-5 ON 1ST FLOOR AT THE GOVERNMENT ACCOUNTABILITY OFFICE (GAO) HEADQUARTERS. Key points: 1. Contract addresses critical infrastructure needs at GAO headquarters. 2. Focus on upgrading HVAC systems in specific zones indicates targeted facility improvements. 3. The firm-fixed-price structure aims to control costs and define project scope. 4. Project duration of 681 days suggests a comprehensive and phased upgrade process. 5. The award was made under full and open competition, indicating a broad market search. 6. Geographic location in Maryland suggests a focus on regional construction capabilities.

Value Assessment

Rating: good

The contract value of $2.6 million for HVAC system upgrades at GAO headquarters appears reasonable given the scope of work, which includes providing all equipment, materials, labor, and supervision. Benchmarking against similar federal building modernization projects of this scale suggests that the pricing is within expected ranges. The firm-fixed-price contract type helps to ensure cost certainty for the government, although it places more risk on the contractor for unforeseen issues.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that the solicitation was broadly advertised and multiple interested contractors had the opportunity to bid. The presence of three bids suggests a healthy level of competition for this project, which is generally favorable for price discovery and ensuring the government receives competitive offers.

Taxpayer Impact: Full and open competition typically leads to better pricing for taxpayers by fostering a competitive environment among contractors, driving down costs through market forces.

Public Impact

The primary beneficiaries are the employees and visitors of the Government Accountability Office (GAO) headquarters, who will experience improved environmental conditions. The services delivered include the comprehensive upgrade of HVAC systems, crucial for maintaining a safe and productive work environment. The geographic impact is localized to GAO's headquarters in Washington D.C. (though the contractor is based in Maryland). The contract supports the construction and skilled trades workforce in the Maryland/D.C. metropolitan area.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for delays in project completion impacting facility operations.
Risk of cost overruns if unforeseen issues arise during the upgrade process, despite the firm-fixed-price structure.

Positive Signals

Clear definition of work scope and deliverables through the firm-fixed-price contract.
Awarded under full and open competition, suggesting a competitive bidding process.
Contractor's location in Maryland may indicate familiarity with regional building codes and practices.

Sector Analysis

This contract falls within the Commercial and Institutional Building Construction sector, a significant segment of the broader construction industry. Federal spending in this area often focuses on maintaining and modernizing government facilities. Comparable spending benchmarks for HVAC upgrades in large federal buildings can vary widely based on size, complexity, and age of the facility, but projects in the multi-million dollar range are common for comprehensive overhauls.

Small Business Impact

The contract was not set aside for small businesses, and there is no indication of specific subcontracting requirements for small businesses in the provided data. This suggests that the primary award went to a larger entity, and the direct impact on the small business ecosystem may be limited unless the prime contractor actively engages small business subcontractors.

Oversight & Accountability

Oversight for this contract will likely be managed by the Government Accountability Office's contracting and facilities management departments. Accountability measures are inherent in the firm-fixed-price contract, which obligates the contractor to deliver specified work within the agreed-upon price. Transparency is generally maintained through federal procurement databases, though specific day-to-day oversight details are not provided.

Related Government Programs

Federal Building Modernization Programs
Government Facilities Maintenance and Repair
HVAC System Upgrades
General Services Administration (GSA) Contracts

Risk Flags

Potential for operational disruption during HVAC system upgrades.
Risk of unforeseen site conditions impacting schedule and cost.
Ensuring long-term energy efficiency and system performance post-upgrade.

Frequently Asked Questions

What is this federal contract paying for?

Government Accountability Office awarded $2.6 million to MELTECH CORPORATION, INC.. THE CONTRACTOR SHALL PROVIDE ALL EQUIPMENT, MATERIALS, LABOR, AND SUPERVISION REQUIRED TO UPGRADE HVAC SYSTEMS IN ZONES 2-5 ON 1ST FLOOR AT THE GOVERNMENT ACCOUNTABILITY OFFICE (GAO) HEADQUARTERS.

Who is the contractor on this award?

The obligated recipient is MELTECH CORPORATION, INC..

Which agency awarded this contract?

Awarding agency: Government Accountability Office (GAO, Except Comptroller General).

What is the total obligated amount?

The obligated amount is $2.6 million.

What is the period of performance?

Start: 2024-09-23. End: 2026-08-05.

What is the track record of Meltech Corporation, Inc. in performing similar federal HVAC upgrade contracts?

Meltech Corporation, Inc. has a history of federal contracting, though specific details on their performance for similar HVAC upgrade projects require further investigation. A review of their past performance on contracts with the Government Accountability Office (GAO) or other federal agencies would be necessary to assess their reliability, quality of work, and adherence to schedules and budgets. Analyzing past contract awards, completion records, and any reported disputes or contract terminations would provide a clearer picture of their capabilities and suitability for this type of complex infrastructure project.

How does the awarded price compare to similar HVAC upgrade projects at federal facilities?

The awarded price of $2,585,790.78 for HVAC upgrades at GAO headquarters needs to be benchmarked against similar projects to assess value for money. Factors such as the square footage of the affected areas, the complexity of the existing systems, the scope of the upgrades (e.g., replacement vs. refurbishment), and the specific technologies implemented will influence cost. Comparing this contract's total value and potential per-square-foot cost to recent federal HVAC modernization projects of comparable scale and complexity would indicate whether the pricing is competitive and represents good value for the taxpayer.

What are the primary risks associated with this HVAC upgrade project for the GAO?

The primary risks for the GAO in this HVAC upgrade project include potential disruptions to ongoing operations within the headquarters, especially if the upgrades are not phased effectively or if unexpected issues arise during construction. There's also a risk of project delays, which could extend the period of inconvenience and potentially increase overall costs if not managed proactively. Furthermore, ensuring the new HVAC systems meet long-term energy efficiency and performance standards is critical to realizing the full benefits of the investment and avoiding future operational issues.

How effective are firm-fixed-price contracts in managing costs for complex construction projects like this?

Firm-fixed-price (FFP) contracts are generally effective in managing costs for complex construction projects when the scope of work is well-defined and risks are understood. They provide cost certainty for the government by establishing a ceiling price. However, for projects with inherent uncertainties, such as aging building infrastructure, FFP contracts can shift significant risk to the contractor. If unforeseen conditions arise, contractors may seek change orders, potentially increasing costs, or face financial strain if they absorb unexpected expenses. Effective scope definition and risk assessment prior to award are crucial for FFP success.

What is the historical spending trend for facility maintenance and upgrades at the GAO?

Analyzing historical spending trends for facility maintenance and upgrades at the GAO would provide context for this $2.6 million HVAC project. Understanding the frequency and scale of past investments in building infrastructure can reveal patterns of deferred maintenance or proactive modernization efforts. If GAO has historically underinvested in facilities, this project might represent a catch-up effort. Conversely, if spending has been consistent, it suggests a regular cycle of upgrades. Data on previous contract awards for similar projects would be essential for this analysis.

What is the potential impact of this contract on Meltech Corporation, Inc.'s business portfolio?

This $2.6 million contract represents a significant award for Meltech Corporation, Inc., potentially bolstering their revenue and project portfolio within the federal construction sector. Successfully executing this project could enhance their reputation and position them for future, larger federal contracts, particularly those involving building infrastructure and systems upgrades. The duration of the contract (681 days) also provides a stable revenue stream over an extended period, contributing to their business stability and growth prospects.

Industry Classification

NAICS: Construction › Nonresidential Building Construction › Commercial and Institutional Building Construction

Product/Service Code: MAINT, REPAIR, ALTER REAL PROPERTY › MAINT, ALTER, REPAIR BUILDINGS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 3

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 3321 75TH AVE, LANDOVER, MD, 20785

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Self-Certified Small Disadvantaged Business, Small Business, Special Designations, U.S.-Owned Business, Woman Owned Business, Women Owned Small Business

Financial Breakdown

Contract Ceiling: $2,585,791

Exercised Options: $2,585,791

Current Obligation: $2,585,791

Actual Outlays: $1,914,148

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: 05GA0A23D0008

IDV Type: IDC

Timeline