VA awards $7.37M contract for facility renovations, highlighting construction sector activity

Contract Overview

Contract Amount: $7,370,843 ($7.4M)

Contractor: Riley Contracting Group, Inc.

Awarding Agency: Department of Veterans Affairs

Start Date: 2022-01-31

End Date: 2027-08-19

Contract Duration: 2,026 days

Daily Burn Rate: $3.6K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 3

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: RENOVATE SPS/SPD

Place of Performance

Location: FAYETTEVILLE, CUMBERLAND County, NORTH CAROLINA, 28301

State: North Carolina Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $7.4 million to RILEY CONTRACTING GROUP, INC. for work described as: RENOVATE SPS/SPD Key points: 1. Contract value represents a moderate investment in facility upkeep for the VA. 2. Competition dynamics suggest a potentially competitive bidding environment for this type of work. 3. Performance risk appears manageable given the nature of construction projects. 4. This contract aligns with broader federal efforts to modernize infrastructure. 5. The project falls within the commercial and institutional building construction sector.

Value Assessment

Rating: good

The contract value of $7.37 million for facility renovations is within a typical range for projects of this scope. Benchmarking against similar VA renovation contracts would provide a clearer picture of value for money. The firm-fixed-price structure helps control costs, but detailed cost breakdowns are not available to assess pricing reasonableness comprehensively. Without specific cost data, it's difficult to definitively state if this represents excellent value, but it appears reasonable for the described work.

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,' indicating that while the competition was broad, specific sources may have been excluded based on predefined criteria. The presence of 3 bidders suggests a moderate level of competition. This level of competition is generally favorable for price discovery, likely leading to a more competitive bid than a sole-source award.

Taxpayer Impact: A competitive bidding process helps ensure that taxpayer dollars are used efficiently by driving down prices through market forces.

Public Impact

Veterans and VA staff will benefit from improved facilities. The contract delivers essential building construction and renovation services. The geographic impact is localized to the facility being renovated in North Carolina. The project will likely create or sustain jobs within the construction industry workforce.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for scope creep in renovation projects if unforeseen issues arise.
Ensuring timely completion within the fixed-price contract to avoid cost overruns.

Positive Signals

Firm-fixed-price contract provides cost certainty.
Award to a single contractor simplifies management and execution.
Defined period of performance with clear start and end dates.

Sector Analysis

The commercial and institutional building construction sector is a significant part of the U.S. economy, encompassing a wide range of projects from small renovations to large-scale new builds. Federal spending in this sector supports infrastructure maintenance and modernization across various agencies. Comparable spending benchmarks for similar VA facility renovations would typically range from a few hundred thousand to several million dollars, depending on the complexity and scale of the work.

Small Business Impact

This contract was not set aside for small businesses, and there is no indication of subcontracting requirements specifically for small businesses. The award to Riley Contracting Group, Inc., a single entity, does not inherently signal opportunities for small business participation unless the prime contractor voluntarily engages them. Further analysis would be needed to determine if small businesses are involved in the supply chain or as subcontractors.

Oversight & Accountability

The contract is subject to standard federal procurement oversight mechanisms. The Department of Veterans Affairs is responsible for monitoring contract performance and ensuring compliance. Transparency is facilitated through contract databases like FPDS. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse related to the contract.

Related Government Programs

VA Facilities Management
Federal Building Construction
Infrastructure Modernization Programs

Risk Flags

Potential for unforeseen site conditions impacting cost and schedule.
Contractor performance and quality control.
Timely completion to meet VA operational needs.

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $7.4 million to RILEY CONTRACTING GROUP, INC.. RENOVATE SPS/SPD

Who is the contractor on this award?

The obligated recipient is RILEY CONTRACTING GROUP, INC..

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 $7.4 million.

What is the period of performance?

Start: 2022-01-31. End: 2027-08-19.

What is Riley Contracting Group, Inc.'s track record with the VA and other federal agencies?

A review of federal procurement data indicates that Riley Contracting Group, Inc. has received multiple federal contracts, primarily from the Department of Defense and the Department of Veterans Affairs. Their contract history includes various construction and maintenance services. Analyzing the past performance ratings and any reported issues on previous VA contracts would provide insight into their reliability and capability for this specific renovation project. Understanding their experience with similar-sized projects and their adherence to schedules and budgets on prior federal work is crucial for assessing their suitability.

How does the $7.37 million contract value compare to similar VA renovation projects?

The $7.37 million award for renovating Service and Supply (SPS/SPD) facilities falls within a moderate range for federal construction projects. To benchmark value, one would compare this figure against the square footage renovated, the scope of work (e.g., structural, electrical, plumbing upgrades), and the location's cost of living and construction. For instance, similar-sized renovations at other VA medical centers or administrative buildings could range from $3 million to $10 million. Without specific details on the scope and location, a precise comparison is difficult, but the amount suggests a significant but not exceptionally large-scale renovation.

What are the primary risks associated with this firm-fixed-price renovation contract?

The primary risks for a firm-fixed-price renovation contract include potential cost overruns if unforeseen conditions are discovered during the work (e.g., asbestos, structural issues not identified in initial surveys), which could lead to change orders and increased costs. Schedule delays are another significant risk, potentially impacting the VA's operations. Contractor performance risk, such as quality of work or failure to meet specifications, is also present. The VA mitigates these risks through thorough pre-bid site assessments, clear contract specifications, robust project oversight, and performance bonds from the contractor.

How effective is the 'Full and Open Competition After Exclusion of Sources' method for this type of contract?

The 'Full and Open Competition After Exclusion of Sources' method aims to balance broad competition with specific requirements. It allows the agency to solicit bids from all responsible sources but may exclude certain sources based on specific, justifiable criteria (e.g., past performance issues, specific certifications). For a construction project like this, it could be used if certain pre-qualification criteria are necessary for safety or specialized expertise. While it's more competitive than a sole-source award, the exclusion of sources means it's less competitive than pure 'full and open' competition, potentially impacting the final price. The fact that three bidders participated suggests it did not unduly limit competition in this instance.

What is the historical spending trend for facility renovations at the Department of Veterans Affairs?

The Department of Veterans Affairs consistently allocates significant funds towards facility maintenance, repair, and renovation to support its vast network of hospitals, clinics, and administrative buildings. Historical spending data reveals a steady demand for these services, often driven by aging infrastructure, evolving healthcare needs, and regulatory compliance requirements. Annual spending on renovations can fluctuate based on budget appropriations, specific modernization initiatives, and emergency repair needs. Analyzing trends over the past 5-10 years would show an average annual expenditure in the hundreds of millions to billions of dollars for facility upkeep and upgrades across the VA system.

Industry Classification

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

Product/Service Code: CONSTRUCT OF STRUCTURES/FACILITIES › CONSTRUCTION OF BUILDINGS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: SEALED BID

Solicitation ID: 36C24622B0002

Offers Received: 3

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Riley Contracting Group Inc.

Address: 219 EAST CHATHAM ST STE 100, CARY, NC, 27511

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Service Disabled Veteran Owned Business, Small Business, Special Designations, U.S.-Owned Business, Veteran Owned Business

Financial Breakdown

Contract Ceiling: $7,473,758

Exercised Options: $7,473,758

Current Obligation: $7,370,843

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline