VA awards $551K for rooftop system, highlighting potential for higher costs in sole-source construction contracts

Contract Overview

Contract Amount: $55,128 ($55.1K)

Contractor: Panel Built Inc

Awarding Agency: Department of Veterans Affairs

Start Date: 2025-09-09

End Date: 2026-04-26

Contract Duration: 229 days

Daily Burn Rate: $241/day

Competition Type: NOT COMPETED UNDER SAP

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: EMERGENCY INSTALL ROOFTOP CROSSOVER AND BRIDGE SYSTEM

Place of Performance

Location: PHOENIX, MARICOPA County, ARIZONA, 85012

State: Arizona Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $55,128 to PANEL BUILT INC for work described as: EMERGENCY INSTALL ROOFTOP CROSSOVER AND BRIDGE SYSTEM Key points: 1. The contract's value of $551,280 for a rooftop crossover and bridge system appears high for a single purchase order. 2. Lack of competition suggests potential for inflated pricing and reduced value for taxpayer dollars. 3. The firm-fixed-price contract type shifts risk to the contractor, but the absence of competition limits leverage. 4. Performance period of 229 days is reasonable for construction, but the overall cost warrants scrutiny. 5. This contract falls within the Commercial and Institutional Building Construction sector, a broad category with varying cost benchmarks. 6. The sole-source nature raises questions about whether the VA explored all available options to ensure competitive pricing.

Value Assessment

Rating: questionable

The award of $551,280 for a rooftop crossover and bridge system without competition raises concerns about value for money. Without comparable bids or market research data, it is difficult to definitively benchmark this price. However, construction projects of this nature, especially when sole-sourced, can often be subject to higher costs than if they were competitively bid. The firm-fixed-price nature is standard, but the lack of competition limits the government's ability to negotiate favorable terms.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was not competed under Simplified Acquisition Procedures (SAP) and is listed as a sole-source award. This indicates that the Department of Veterans Affairs likely determined that only one source was capable of meeting the requirement. The lack of competition means there were no other bidders to drive down the price through a bidding process, potentially leading to a higher cost for the government.

Taxpayer Impact: Sole-source awards mean taxpayers do not benefit from the price reductions typically achieved through competitive bidding, potentially resulting in a less efficient use of public funds.

Public Impact

The primary beneficiary is the Department of Veterans Affairs, which will receive the installed rooftop system. The services delivered include the emergency installation of a crossover and bridge system on a rooftop. The geographic impact is localized to the VA facility in Arizona where the installation will occur. Workforce implications are likely limited to the construction crew employed by the contractor, Panel Built Inc.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may lead to overpayment.
Sole-source justification needs thorough review to ensure necessity.
Potential for scope creep if not tightly managed due to fixed price.
Reliance on a single contractor for critical infrastructure.

Positive Signals

Firm-fixed-price contract mitigates cost overrun risk for the government.
Specific need for an emergency rooftop system suggests a critical requirement.
Contract awarded to Panel Built Inc., a known entity in construction.

Sector Analysis

This contract falls under the Commercial and Institutional Building Construction sector (NAICS 236220). This sector encompasses a wide range of construction activities for non-residential buildings. Spending in this sector can vary significantly based on project complexity, location, and market conditions. Benchmarking requires specific data on similar rooftop installations, which is not readily available for sole-source awards.

Small Business Impact

The contract indicates that small business participation was not a factor (ss: false, sb: false). There is no indication of small business set-asides or subcontracting requirements. This means the contract was not specifically aimed at supporting small businesses, and their involvement is not mandated.

Oversight & Accountability

Oversight will be managed by the Department of Veterans Affairs. As a sole-source award, scrutiny should focus on the justification for not competing the contract and ensuring the price is fair and reasonable through independent cost analysis. Transparency is limited due to the lack of public bidding data. Inspector General jurisdiction would apply if any fraud or mismanagement is suspected.

Related Government Programs

VA Facility Maintenance Contracts
Commercial Building Construction Services
Rooftop Infrastructure Projects
Emergency Construction Services

Risk Flags

Sole-source award without clear justification
Potential for inflated pricing due to lack of competition
Limited transparency in procurement process

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $55,128 to PANEL BUILT INC. EMERGENCY INSTALL ROOFTOP CROSSOVER AND BRIDGE SYSTEM

Who is the contractor on this award?

The obligated recipient is PANEL BUILT 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 $55,128.

What is the period of performance?

Start: 2025-09-09. End: 2026-04-26.

What is the specific justification for this contract being sole-source?

The provided data does not include the specific justification for this contract being sole-source. Typically, sole-source awards are granted when only one responsible source is available to provide the required goods or services. This could be due to unique capabilities, proprietary technology, urgent and compelling circumstances, or other factors that preclude competition. A thorough review of the contract file and any associated documentation would be necessary to understand the precise rationale behind this determination by the Department of Veterans Affairs.

How does the $551,280 cost compare to similar rooftop installation projects?

Direct comparison is challenging without more data. The cost of rooftop installations varies widely based on factors like the size of the roof, the complexity of the system (crossover and bridge), materials used, labor costs in the specific region (Arizona), and any specialized requirements. As this was a sole-source award, there are no competing bids to establish a market price. To assess value, the VA would need to conduct a price analysis, potentially comparing the proposed cost to historical data for similar work performed by the contractor or to industry cost estimating guides, adjusted for project specifics.

What are the potential risks associated with a sole-source award for construction?

The primary risk of a sole-source award is the potential for paying a higher price than would be achieved through competition. Without competing bids, the government has less leverage to negotiate favorable terms and pricing. Other risks include a lack of innovation that might come from multiple bidders proposing different solutions, and a potential over-reliance on a single contractor, which could create issues if that contractor fails to perform adequately. Ensuring the contractor has the necessary capacity and expertise is also critical.

What is the track record of Panel Built Inc. with the federal government?

The provided data does not include specific details on Panel Built Inc.'s track record with the federal government beyond this single purchase order. To assess their performance history, one would typically look at past federal contracts awarded to them, their performance evaluations (e.g., Contractor Performance Assessment Reporting System - CPARS), and any history of disputes or contract terminations. This information is crucial for understanding their reliability and past performance in delivering services or products to government agencies.

What is the significance of the 'EMERGENCY INSTALL' designation?

The 'EMERGENCY INSTALL' designation suggests that the need for the rooftop crossover and bridge system was urgent and time-sensitive. This urgency might have contributed to the decision to award the contract on a sole-source basis, as the standard competitive procurement process could be too lengthy to address the immediate need. However, even in emergency situations, agencies are generally required to document the circumstances justifying a sole-source award and to ensure the price remains fair and reasonable.

How does the duration of the contract (229 days) relate to the award amount?

The contract duration of 229 days (approximately 7.5 months) for an award of $551,280 suggests a moderate pace for the project. This duration allows for planning, procurement of materials, and execution of the construction work. The daily cost rate can be estimated by dividing the total award by the number of days, which would be roughly $2,407 per day. This figure needs to be evaluated against industry standards for construction labor and project management to determine if it represents good value, especially considering it's a sole-source award.

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: NOT COMPETED UNDER SAP

Solicitation Procedures: SIMPLIFIED ACQUISITION

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 302 BEASLEY ST, BLAIRSVILLE, GA, 30512

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Manufacturer of Goods, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $55,128

Exercised Options: $55,128

Current Obligation: $55,128

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Timeline