VA awards $48.8M contract for boiler replacement at Albany VAMC, aiming for improved facility efficiency

Contract Overview

Contract Amount: $48,788,000 ($48.8M)

Contractor: Blueway ONE JV LLC

Awarding Agency: Department of Veterans Affairs

Start Date: 2024-09-30

End Date: 2028-02-23

Contract Duration: 1,241 days

Daily Burn Rate: $39.3K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: REPLACEMENT OF BOILERS AT ALBANY VAMC

Place of Performance

Location: ALBANY, ALBANY County, NEW YORK, 12208

State: New York Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $48.8 million to BLUEWAY ONE JV LLC for work described as: REPLACEMENT OF BOILERS AT ALBANY VAMC Key points: 1. The contract's firm-fixed-price structure aims to control costs for the boiler replacement project. 2. Competition was conducted after exclusion of sources, suggesting potential limitations in market reach. 3. The definitive contract type indicates a need for a flexible agreement over its duration. 4. The project is situated in New York, potentially impacting local employment and businesses. 5. The Plumbing, Heating, and Air-Conditioning Contractors NAICS code suggests a specialized service requirement. 6. The contract duration of 1241 days points to a significant, multi-year undertaking.

Value Assessment

Rating: fair

The contract value of $48.8 million for boiler replacement at a VAMC is substantial. Without specific benchmarks for similar VAMC boiler replacement projects or detailed cost breakdowns, a precise value-for-money assessment is challenging. The firm-fixed-price nature provides cost certainty, but the 'exclusion of sources' competition method might have limited the potential for aggressive pricing. Further analysis would require comparing this cost to similar projects in other VAMCs or to industry standards for large-scale HVAC system overhauls.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

This contract was awarded under 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES.' This indicates that while the government intended to compete the contract, certain sources were excluded from the outset. The exact reasons for this exclusion are not detailed in the provided data. This approach typically results in fewer bidders than true full and open competition, potentially impacting the range of proposals received and the final negotiated price.

Taxpayer Impact: The limited competition may mean taxpayers did not benefit from the most competitive pricing achievable through a broader outreach to all potential qualified contractors.

Public Impact

Veterans receiving care at the Albany VAMC will benefit from improved facility infrastructure and potentially more reliable heating and cooling systems. The project will deliver essential upgrades to critical building systems, ensuring operational continuity for the medical center. The geographic impact is concentrated in Albany, New York, with potential benefits for the local economy through job creation and material sourcing. The contract is expected to create or sustain jobs within the plumbing, heating, and air-conditioning contracting sector in the region.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

The 'exclusion of sources' in the competition method raises concerns about whether the full spectrum of qualified contractors was considered, potentially limiting price discovery.
The significant contract value necessitates robust oversight to ensure funds are used efficiently and effectively for the intended purpose.
The long duration of the contract (over 3 years) increases the risk of unforeseen cost escalations or performance issues if not managed proactively.

Positive Signals

The firm-fixed-price contract type provides cost certainty for the government, mitigating the risk of budget overruns related to scope changes.
The Department of Veterans Affairs is undertaking a necessary infrastructure upgrade, which is crucial for maintaining the quality of care provided to veterans.
The contract is awarded to BLUEWAY ONE JV LLC, a joint venture, which could indicate a capacity to handle complex projects and potentially foster collaboration.

Sector Analysis

The contract falls within the construction and facility maintenance sector, specifically focusing on mechanical systems. The market for large-scale HVAC and boiler replacements in federal facilities is significant, driven by the need to maintain aging infrastructure and improve energy efficiency. Comparable spending benchmarks would typically involve analyzing other VAMC infrastructure projects or similar federal building modernization efforts. The NAICS code 238220 (Plumbing, Heating, and Air-Conditioning Contractors) represents a specialized segment of the construction industry.

Small Business Impact

The provided data indicates that small business participation (sb) is false and the contract was not a small business set-aside (ss). This suggests that the primary award was not specifically targeted towards small businesses. There is no information on subcontracting plans for small businesses. Therefore, the direct impact on the small business ecosystem from this specific contract award appears limited, though the prime contractor may engage small businesses as subcontractors.

Oversight & Accountability

Oversight for this contract will primarily reside with the Department of Veterans Affairs. As a definitive contract, it likely involves specific delivery orders and performance milestones that will be monitored. Accountability measures would be tied to the terms and conditions of the firm-fixed-price agreement, including performance standards and completion deadlines. Transparency may be enhanced through contract award databases and reporting requirements, but detailed project oversight mechanisms are not specified in the provided data.

Related Government Programs

Veterans Health Administration Infrastructure Modernization
Federal Building and Fire Safety Program
Department of Veterans Affairs Capital Asset and Business Development Management

Risk Flags

Limited competition may impact price discovery.
Potential for operational disruption during construction.
Need for robust oversight due to contract value and duration.

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $48.8 million to BLUEWAY ONE JV LLC. REPLACEMENT OF BOILERS AT ALBANY VAMC

Who is the contractor on this award?

The obligated recipient is BLUEWAY ONE JV LLC.

Which agency awarded this contract?

Awarding agency: Department of Veterans Affairs (Department of Veterans Affairs).

What is the total obligated amount?

The obligated amount is $48.8 million.

What is the period of performance?

Start: 2024-09-30. End: 2028-02-23.

What is the track record of BLUEWAY ONE JV LLC in performing similar large-scale HVAC replacement projects for federal agencies?

Information regarding the specific track record of BLUEWAY ONE JV LLC in performing similar large-scale HVAC replacement projects for federal agencies is not detailed in the provided data. As a joint venture, its performance history may be a composite of its member companies or specific to projects undertaken under the JV structure. A thorough assessment would require reviewing past performance evaluations, contract completion records, and any reported issues or successes on comparable federal contracts. Understanding their experience with firm-fixed-price contracts and projects of this magnitude is crucial for evaluating their capability to successfully execute the Albany VAMC boiler replacement.

How does the $48.8 million cost compare to similar boiler replacement projects at other VA medical centers?

A direct comparison of the $48.8 million cost to similar boiler replacement projects at other VA medical centers requires access to a broader dataset of federal contracts, including project scope, facility size, age of existing systems, and geographic location, which can influence pricing. Without such comparative data, it is difficult to definitively benchmark this contract's value. However, the 'exclusion of sources' competition method suggests that the pricing might not have benefited from the full competitive pressure of an open market. Further analysis would involve identifying comparable VAMC projects and analyzing their contract values and performance metrics to assess if this award represents good value for money.

What are the primary risks associated with a multi-year boiler replacement project in a healthcare facility?

Primary risks associated with a multi-year boiler replacement project in a healthcare facility include potential disruptions to ongoing medical operations, the need for temporary HVAC solutions, and the risk of unforeseen site conditions (e.g., asbestos, structural issues) that could lead to cost overruns and schedule delays. For a VAMC, maintaining patient care continuity is paramount, making phased construction and meticulous planning critical. There's also the risk of equipment failure in the existing system during the transition period. Furthermore, managing a large workforce and complex supply chains over an extended period presents logistical challenges. The firm-fixed-price nature of this contract helps mitigate cost escalation risks for the government, but performance and schedule risks remain.

What is the expected impact of this boiler replacement on the energy efficiency and operational costs of the Albany VAMC?

The primary objective of replacing aging boilers is typically to improve energy efficiency and reduce operational costs. Modern boiler systems are designed to be more efficient, consuming less fuel and generating fewer emissions. This upgrade is expected to lead to significant savings in utility expenses for the Albany VAMC over the lifespan of the new equipment. Additionally, newer boilers are generally more reliable, reducing the likelihood of costly emergency repairs and downtime, further contributing to lower overall operational expenditures and ensuring a more stable environment for patient care.

What does 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES' imply for the bidding process and potential savings?

The term 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES' implies that the government initially intended to solicit offers from all responsible sources. However, specific sources were subsequently excluded from consideration. The reasons for exclusion are not provided but could be due to pre-qualification requirements, past performance issues, or other specific criteria. This process generally leads to fewer bidders than a true 'full and open competition' without exclusions. Consequently, the level of competition may be reduced, potentially limiting the downward pressure on pricing and the range of innovative solutions that might have emerged from a broader pool of bidders. This could mean less potential for cost savings for taxpayers compared to a fully open process.

How does the definitive contract type influence project management and potential for scope adjustments?

A definitive contract, in this context, likely refers to a contract that establishes the terms and conditions for a specific project or set of tasks, often used when the scope is well-defined but may involve multiple orders or phases over time. For a boiler replacement project, it suggests a commitment to the overall undertaking. While the contract is firm-fixed-price, which limits price changes, the definitive nature might allow for some flexibility in task sequencing or minor adjustments through contract modifications, provided they are within the overall scope and budget. However, significant scope changes would typically require formal modification and potentially renegotiation, especially under a fixed-price arrangement.

Industry Classification

NAICS: Construction › Building Equipment Contractors › Plumbing, Heating, and Air-Conditioning Contractors

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

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: SEALED BID

Solicitation ID: 36C24224B0047

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 1730 PARK ST STE 123, NAPERVILLE, IL, 60563

Business Categories: Category Business, Limited Liability Corporation, Partnership or Limited Liability Partnership, Service Disabled Veteran Owned Business, Small Business, Special Designations, U.S.-Owned Business, Veteran Owned Business

Financial Breakdown

Contract Ceiling: $48,788,000

Exercised Options: $48,788,000

Current Obligation: $48,788,000

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline