VA awards $14.17M contract for electrical distribution upgrades at NY facility, completed in 18 months

Contract Overview

Contract Amount: $14,174,435 ($14.2M)

Contractor: Sawtooth Construction JV II LLC

Awarding Agency: Department of Veterans Affairs

Start Date: 2025-09-12

End Date: 2025-09-30

Contract Duration: 18 days

Daily Burn Rate: $787.5K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 4

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: 632-15-101 REPLACE PRIMARY ELECTRICAL DISTRIBUTION, PH 1

Place of Performance

Location: NORTHPORT, SUFFOLK County, NEW YORK, 11768

State: New York Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $14.2 million to SAWTOOTH CONSTRUCTION JV II LLC for work described as: 632-15-101 REPLACE PRIMARY ELECTRICAL DISTRIBUTION, PH 1 Key points: 1. Contract value appears reasonable given the scope of electrical infrastructure replacement. 2. Full and open competition suggests a competitive bidding process was utilized. 3. Definitive contract type indicates a single award with potential for follow-on orders. 4. Project duration of 18 months is standard for complex construction projects of this nature. 5. Firm fixed price contract type shifts risk to the contractor. 6. Location in New York may influence labor and material costs.

Value Assessment

Rating: good

The contract value of $14.17 million for electrical distribution upgrades seems aligned with the scope of work for a facility of this size. Benchmarking against similar federal projects for power and communication line construction (NAICS 237130) would provide a more precise value-for-money assessment. The firm fixed-price structure indicates that the contractor bears the risk of cost overruns, which is generally favorable for the government when the scope is well-defined. The award to Sawtooth Construction JV II LLC warrants a review of their past performance on similar projects.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition after exclusion of sources, indicating that all responsible prospective contractors were permitted to submit bids. The presence of 4 bidders suggests a healthy level of competition for this project. A competitive bidding process generally leads to better price discovery and potentially lower costs for the government compared to sole-source or limited competition scenarios.

Taxpayer Impact: The use of full and open competition is beneficial for taxpayers as it encourages multiple companies to bid, driving down prices and ensuring the government receives the best value for its investment.

Public Impact

The primary beneficiaries are the Department of Veterans Affairs and the veterans who utilize the facility, ensuring reliable power for critical services. The project will deliver essential upgrades to the primary electrical distribution system, enhancing safety and operational continuity. The geographic impact is localized to the specific VA facility in New York (SN: NEW YORK, ST: NY). The contract is expected to create or sustain jobs in the construction sector within the New York region.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for schedule delays if unforeseen site conditions are encountered during construction.
Risk of material cost fluctuations impacting the fixed-price contract if not adequately managed by the contractor.
Ensuring adequate quality control and inspection throughout the 18-month project duration.

Positive Signals

Firm fixed-price contract provides cost certainty for the government.
Full and open competition suggests a competitive award process.
Award to a joint venture (Sawtooth Construction JV II LLC) may indicate capacity to handle complex projects.
Project duration is defined, allowing for clear planning and execution timelines.

Sector Analysis

This contract falls within the construction sector, specifically related to power and communication line construction. The market for electrical infrastructure upgrades is substantial, driven by aging systems and the need for modernization across federal facilities. Comparable spending benchmarks for similar electrical system replacement projects at federal installations would provide further context on the value of this award.

Small Business Impact

The contract data indicates that small business participation was not a specific set-aside (SS: false, SB: false). While this contract was not set aside for small businesses, the prime contractor, Sawtooth Construction JV II LLC, may engage small businesses as subcontractors. Further analysis would be needed to determine the extent of small business subcontracting and its impact on the small business ecosystem.

Oversight & Accountability

Oversight for this contract will likely be managed by the Department of Veterans Affairs contracting officers and project managers. The firm fixed-price nature of the contract shifts much of the cost risk to the contractor, but the government retains oversight responsibility for quality, schedule, and compliance with contract terms. Transparency is facilitated through contract award databases, and any Inspector General involvement would depend on specific findings of fraud, waste, or abuse.

Related Government Programs

Federal Building and Facilities Construction
Military Construction
Utility System Upgrades
Department of Veterans Affairs Capital Investments

Risk Flags

Potential for cost overruns if contractor mismanages fixed-price risk.
Risk of schedule delays impacting facility operations.
Quality control concerns inherent in large construction projects.
Dependency on contractor's financial stability and performance.

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $14.2 million to SAWTOOTH CONSTRUCTION JV II LLC. 632-15-101 REPLACE PRIMARY ELECTRICAL DISTRIBUTION, PH 1

Who is the contractor on this award?

The obligated recipient is SAWTOOTH CONSTRUCTION JV II 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 $14.2 million.

What is the period of performance?

Start: 2025-09-12. End: 2025-09-30.

What is the track record of Sawtooth Construction JV II LLC on similar federal projects?

A review of Sawtooth Construction JV II LLC's past performance is crucial for assessing the risk associated with this contract. Information on their experience with electrical distribution upgrades, particularly in a federal context and within the specified timeframe, would be beneficial. Examining their performance on previous firm fixed-price contracts can indicate their ability to manage costs and schedules effectively. Data on project completion rates, any disputes or claims filed, and client satisfaction would provide a comprehensive picture of their reliability and capability to execute this $14.17 million project successfully for the Department of Veterans Affairs.

How does the awarded price compare to similar electrical infrastructure projects at federal facilities?

To benchmark the value-for-money, the awarded price of $14.17 million should be compared against similar electrical distribution upgrade projects undertaken by other federal agencies or within the Department of Veterans Affairs. Factors such as project scope, facility size, geographic location (which impacts labor and material costs), and the complexity of the electrical systems being replaced are critical for a fair comparison. Analyzing cost per square foot or cost per linear foot of distribution line replaced, if available, could offer a more granular comparison. Without specific comparable data, the current assessment relies on the general understanding that such infrastructure projects are substantial investments.

What are the primary risks associated with this firm fixed-price contract for electrical upgrades?

The primary risks associated with this firm fixed-price contract for electrical upgrades primarily lie with the contractor, Sawtooth Construction JV II LLC. These include the risk of underestimating project costs, encountering unforeseen site conditions (e.g., hazardous materials, unexpected subsurface obstructions) that increase labor or material expenses, or facing supply chain disruptions for critical components. While the government is protected from cost overruns, risks to the government could include contractor default if they cannot absorb unexpected costs, potential quality compromises if the contractor seeks to cut corners to maintain profitability, or schedule delays if the contractor struggles with execution. Robust government oversight is essential to mitigate these potential risks.

How effective are the VA's oversight mechanisms for large construction contracts like this one?

The Department of Veterans Affairs typically employs a multi-layered oversight approach for large construction contracts. This usually involves dedicated project managers, contracting officers' representatives (CORs), and potentially third-party construction management firms. Oversight focuses on ensuring adherence to contract specifications, quality control, safety compliance, and schedule milestones. The effectiveness can vary based on the experience of the oversight personnel, the clarity of the contract documents, and the contractor's own quality control processes. Regular site inspections, progress meetings, and thorough documentation are key components of effective oversight to ensure the successful completion of the electrical distribution upgrades.

What is the historical spending trend for electrical infrastructure upgrades at VA facilities?

Analyzing historical spending trends for electrical infrastructure upgrades at VA facilities is essential for understanding the scale and frequency of such investments. This contract, valued at $14.17 million, represents a significant capital expenditure. Examining VA budget allocations and actual expenditures for facility maintenance, repair, and modernization over the past 5-10 years would reveal patterns. Understanding whether this project is part of a larger, ongoing modernization initiative or an isolated upgrade can provide context. Trends might indicate increasing investment due to aging infrastructure or specific facility needs, helping to contextualize the current award within broader VA capital planning.

What are the implications of the 'definitive contract' award type for future spending?

A definitive contract, especially when awarded under full and open competition, typically signifies a single, fully negotiated contract with a defined scope, price, and delivery schedule. In this case, the contract is for $14.17 million with an estimated completion date. While this specific award is for a defined amount, the 'definitive contract' designation doesn't inherently imply future spending unless it's structured with options for follow-on work or if it's part of a larger indefinite-delivery/indefinite-quantity (IDIQ) contract vehicle, which is not specified here. However, the successful completion of this phase could lead to future contracts for subsequent phases or other facility upgrades if the need arises and funding is available.

Industry Classification

NAICS: Construction › Utility System Construction › Power and Communication Line and Related Structures Construction

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: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: 36C24225R0044

Offers Received: 4

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 4307 REGENCY DR, GLENVIEW, IL, 60025

Business Categories: Category Business, Joint Venture Economically Disadvantaged Women Owned Small Business, Joint Venture Women Owned Small Business, Partnership or Limited Liability Partnership, Self-Certified Small Disadvantaged Business, Service Disabled Veteran Owned Business, Small Business, Special Designations, U.S.-Owned Business, Veteran Owned Business, Woman Owned Business, Women Owned Small Business

Financial Breakdown

Contract Ceiling: $14,174,435

Exercised Options: $14,174,435

Current Obligation: $14,174,435

Contract Characteristics

Multi-Year Contract: Yes

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Timeline