VA awards $3.9M contract for inpatient pharmacy renovation to Anchor Contracting, LLC

Contract Overview

Contract Amount: $3,931,767 ($3.9M)

Contractor: Anchor Contracting, LLC

Awarding Agency: Department of Veterans Affairs

Start Date: 2021-10-01

End Date: 2026-08-31

Contract Duration: 1,795 days

Daily Burn Rate: $2.2K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 6

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: RENOVATE INPATIENT PHARMACY

Place of Performance

Location: PHILADELPHIA, PHILADELPHIA County, PENNSYLVANIA, 19104

State: Pennsylvania Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $3.9 million to ANCHOR CONTRACTING, LLC for work described as: RENOVATE INPATIENT PHARMACY Key points: 1. Contract awarded through full and open competition, suggesting a competitive bidding process. 2. The contract type is a firm-fixed-price definitive contract, which shifts cost risk to the contractor. 3. The project aims to renovate an inpatient pharmacy, a critical healthcare infrastructure component. 4. The duration of the contract is nearly 5 years, indicating a substantial project scope. 5. The awardee, Anchor Contracting, LLC, is a new entity with limited public contract history. 6. The North American Industry Classification System (NAICS) code 236220 points to commercial and institutional building construction.

Value Assessment

Rating: fair

The contract value of $3.9 million for a pharmacy renovation appears within a reasonable range for such projects, though specific benchmarks are difficult to ascertain without detailed project scope and location specifics. The firm-fixed-price structure is standard for construction, but the lack of extensive performance data for Anchor Contracting, LLC warrants careful monitoring. Comparing this to similar VA pharmacy renovation projects would provide a clearer picture of value for money.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under 'Full and Open Competition After Exclusion of Sources,' which typically means it was broadly advertised, but certain sources were excluded based on specific criteria. The presence of 6 bidders indicates a healthy level of competition for this construction project. This competitive environment should theoretically lead to more favorable pricing for the government.

Taxpayer Impact: A competitive award process helps ensure taxpayer dollars are used efficiently by driving down costs through multiple bids.

Public Impact

Veterans will benefit from an improved and potentially more efficient inpatient pharmacy. The project will deliver renovated pharmacy facilities, enhancing healthcare delivery capabilities. The geographic impact is localized to the facility where the renovation takes place in Pennsylvania. The contract will likely create or sustain jobs in the construction sector within the local area.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Anchor Contracting, LLC appears to be a relatively new entity with limited public contract history, raising potential concerns about performance and reliability.
The exclusion of sources in the 'full and open competition' process could warrant further investigation to ensure fairness and prevent undue restrictions on potential bidders.

Positive Signals

The award was made under full and open competition, indicating a robust bidding process.
The firm-fixed-price contract type transfers cost overrun risk to the contractor.
The project addresses a critical healthcare infrastructure need for the VA.

Sector Analysis

This contract falls within the construction sector, specifically commercial and institutional building construction. The market for healthcare facility construction and renovation is substantial, driven by the need to modernize aging infrastructure and adapt to evolving medical technologies and patient care models. The VA, as a major federal healthcare provider, represents a significant client within this sector.

Small Business Impact

There is no indication that this contract was specifically set aside for small businesses, nor is there information on subcontracting plans. Given the nature and potential value of the project, it's possible that larger construction firms or joint ventures were involved, which may or may not include small business participation. Further analysis of subcontracting reports would be needed to assess the impact on the small business ecosystem.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of Veterans Affairs' contracting and program management offices. The firm-fixed-price nature of the contract implies that the government's primary oversight will focus on ensuring the contractor meets the defined scope, schedule, and quality standards. Transparency is generally maintained through contract award databases, but detailed project progress and financial oversight mechanisms are internal to the agency.

Related Government Programs

VA Medical Facility Construction
Healthcare Infrastructure Modernization
Commercial Building Renovation Contracts
Federal Construction Projects

Risk Flags

Contractor Performance Risk (New Entity)
Scope Definition Risk (Construction Project)
Potential Limited Competition Due to Source Exclusion

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $3.9 million to ANCHOR CONTRACTING, LLC. RENOVATE INPATIENT PHARMACY

Who is the contractor on this award?

The obligated recipient is ANCHOR CONTRACTING, 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 $3.9 million.

What is the period of performance?

Start: 2021-10-01. End: 2026-08-31.

What is the track record of Anchor Contracting, LLC on federal contracts?

Information on Anchor Contracting, LLC's track record with federal contracts is limited. Publicly available data suggests this is a relatively new entity. While the Department of Veterans Affairs awarded this $3.9 million contract, further investigation into their past performance, including any prior government work, subcontracts, or commercial projects, would be necessary to fully assess their capabilities and reliability. The absence of a substantial contract history could present a risk, necessitating close monitoring by the VA throughout the project lifecycle to ensure successful completion and adherence to contract terms.

How does the $3.9 million value compare to similar inpatient pharmacy renovation projects?

Benchmarking the $3.9 million contract value for an inpatient pharmacy renovation against similar projects is challenging without specific details on the scope of work, facility size, location, and the extent of renovation required. Pharmacy renovations can vary significantly in complexity, from minor upgrades to complete overhauls. However, for a project of this duration (nearly 5 years) and involving significant construction, the value appears to be within a plausible range. A more precise comparison would require access to detailed project specifications and cost breakdowns from comparable VA or other federal healthcare facility renovation projects.

What are the primary risks associated with this contract award?

The primary risks associated with this contract include the limited performance history of the awardee, Anchor Contracting, LLC, which could indicate potential issues with project management, quality control, or timely completion. The 'exclusion of sources' clause in the competition type, while potentially valid, could also be a risk if it unduly limited the pool of qualified bidders, potentially impacting price or innovation. Furthermore, the long contract duration (1795 days) increases the exposure to potential cost fluctuations or unforeseen site conditions, even with a firm-fixed-price contract, if scope changes or significant issues arise.

How effective is the firm-fixed-price contract type in managing costs for this project?

The firm-fixed-price (FFP) contract type is generally effective in managing costs for projects where the scope of work is well-defined, such as a construction renovation. It shifts the primary financial risk to the contractor, Anchor Contracting, LLC, as they are obligated to complete the work for the agreed-upon price, regardless of their actual costs. This incentivizes the contractor to control expenses and manage the project efficiently. However, FFP contracts can sometimes lead to contractors cutting corners on quality if not adequately overseen, or they may build in higher contingency costs upfront due to perceived risk. For this VA pharmacy renovation, the FFP structure provides cost certainty for the government, assuming the scope is accurately defined and managed.

What is the historical spending pattern for inpatient pharmacy renovations by the VA?

Analyzing the VA's historical spending patterns for inpatient pharmacy renovations requires access to detailed contract databases and budget allocations over several fiscal years. While this specific contract is for $3.9 million, the VA likely awards numerous contracts of varying sizes for facility upgrades and maintenance across its extensive network of medical centers. Spending can fluctuate based on infrastructure needs, congressional appropriations, and strategic priorities. Without specific historical data, it's difficult to establish a precise spending pattern, but it's reasonable to assume that facility modernization, including critical areas like pharmacies, is an ongoing and significant expenditure for the VA.

What does the 'Commercial and Institutional Building Construction' NAICS code imply for this contract?

The NAICS code 236220, 'Commercial and Institutional Building Construction,' signifies that the contract is for the construction or renovation of non-residential buildings intended for commercial or institutional use. This includes facilities like hospitals, pharmacies, schools, and office buildings. For this specific contract, it means Anchor Contracting, LLC is expected to perform general construction activities related to building or modifying the inpatient pharmacy space. This encompasses a broad range of tasks, potentially including structural work, interior finishing, mechanical, electrical, and plumbing (MEP) systems, and compliance with building codes and healthcare facility standards.

Industry Classification

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

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

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: 36C24421R0046

Offers Received: 6

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 1602 CONCHESTER HWY, BOOTHWYN, PA, 19060

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Limited Liability Corporation, Self-Certified Small Disadvantaged Business, Service Disabled Veteran Owned Business, Small Business, Special Designations, U.S.-Owned Business, Veteran Owned Business

Financial Breakdown

Contract Ceiling: $3,931,767

Exercised Options: $3,931,767

Current Obligation: $3,931,767

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline