VA awards $16.6M construction contract for Murfreesboro health center, highlighting firm fixed-price agreement

Contract Overview

Contract Amount: $16,580,524 ($16.6M)

Contractor: Dunbar Mechanical Contractors, LLC

Awarding Agency: Department of Veterans Affairs

Start Date: 2023-09-26

End Date: 2025-12-31

Contract Duration: 827 days

Daily Burn Rate: $20.0K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 2

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: CONTRACTOR TO PROVIDE ALL CONSTRUCTION SERVICES TO COMPLETE THE CONSTRUCT INTEGRATED HEALTH CENTER MINOR CONSTRUCTION PROJECT AT THE MURFREESBORO VA MEDICAL CENTER.

Place of Performance

Location: MURFREESBORO, RUTHERFORD County, TENNESSEE, 37129

State: Tennessee Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $16.6 million to DUNBAR MECHANICAL CONTRACTORS, LLC for work described as: CONTRACTOR TO PROVIDE ALL CONSTRUCTION SERVICES TO COMPLETE THE CONSTRUCT INTEGRATED HEALTH CENTER MINOR CONSTRUCTION PROJECT AT THE MURFREESBORO VA MEDICAL CENTER. Key points: 1. Contract value of $16.6 million for comprehensive construction services. 2. Project aims to complete minor construction at the Murfreesboro VA Medical Center. 3. Utilizes a firm-fixed-price contract type, shifting risk to the contractor. 4. Awarded under full and open competition, suggesting a competitive bidding process. 5. Contract duration spans over two years, from late 2023 to late 2025. 6. The contractor, Dunbar Mechanical Contractors, LLC, will provide all construction services. 7. The project falls under the Commercial and Institutional Building Construction NAICS code.

Value Assessment

Rating: good

The contract value of $16.6 million for a minor construction project at a VA medical center appears within a reasonable range for such undertakings. As a firm-fixed-price contract, the pricing is established upfront, which can be advantageous for budget certainty. Benchmarking against similar VA minor construction projects would provide a more precise value-for-money assessment, but the fixed-price nature generally indicates an effort to secure a defined cost.

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 the solicitation was made available to all responsible prospective contractors. The presence of two bidders suggests a moderate level of competition for this specific project. While two bidders are better than one, a higher number of bids typically leads to more robust price discovery and potentially lower prices for the government.

Taxpayer Impact: The full and open competition, even with two bidders, suggests that taxpayers benefited from a process designed to solicit multiple offers, aiming for competitive pricing. The fixed-price nature further protects taxpayer funds by locking in costs.

Public Impact

Veterans receiving services at the Murfreesboro VA Medical Center will benefit from improved or expanded facilities. The project will deliver essential construction services to modernize healthcare infrastructure. The geographic impact is localized to Murfreesboro, Tennessee, and surrounding areas. The construction services will likely involve a local workforce, providing employment opportunities in the Tennessee region.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if unforeseen issues arise, though mitigated by fixed-price contract.
Contractor performance risk, as the quality and timeliness of construction are critical.
Dependency on the contractor's ability to manage subcontractors effectively.

Positive Signals

Firm-fixed-price contract shifts cost risk to the contractor.
Full and open competition process aims for competitive pricing.
Award to a single contractor for all construction services streamlines project management.

Sector Analysis

This contract falls within the Commercial and Institutional Building Construction sector, a significant segment of the broader construction industry. The market for healthcare facility construction is substantial, driven by ongoing needs for modernization, expansion, and specialized medical infrastructure. Federal construction spending, particularly for agencies like the VA, represents a key component of this market, often involving complex projects requiring specialized expertise and adherence to stringent regulations.

Small Business Impact

The contract data indicates that small business set-aside was not utilized (ss: false) and that subcontracting was not a specific requirement (sb: false). This suggests that the primary award was made to a larger entity, and there is no explicit mechanism within this award notice to ensure small business participation. The impact on the small business ecosystem will depend on whether the prime contractor voluntarily engages small businesses for subcontracting opportunities.

Oversight & Accountability

Oversight for this contract will primarily be managed by the Department of Veterans Affairs. Accountability measures are embedded in the firm-fixed-price contract terms, which obligate the contractor to deliver specified construction services at an agreed-upon price. Transparency is facilitated through contract award databases, though detailed project progress and specific oversight activities may not be publicly available.

Related Government Programs

VA Medical Facility Construction
Federal Building and Infrastructure Projects
Commercial Construction Contracts
Healthcare Infrastructure Development

Risk Flags

Potential for limited competition if only two bidders participated.
Contractor performance risk in delivering complex construction services.
Need for robust VA oversight to ensure quality and adherence to schedule.

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $16.6 million to DUNBAR MECHANICAL CONTRACTORS, LLC. CONTRACTOR TO PROVIDE ALL CONSTRUCTION SERVICES TO COMPLETE THE CONSTRUCT INTEGRATED HEALTH CENTER MINOR CONSTRUCTION PROJECT AT THE MURFREESBORO VA MEDICAL CENTER.

Who is the contractor on this award?

The obligated recipient is DUNBAR MECHANICAL CONTRACTORS, 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 $16.6 million.

What is the period of performance?

Start: 2023-09-26. End: 2025-12-31.

What is the track record of Dunbar Mechanical Contractors, LLC with federal construction contracts, particularly with the VA?

A review of federal contract databases would be necessary to fully assess Dunbar Mechanical Contractors, LLC's track record. Specifically, examining past performance on VA projects, including their size, complexity, and timeliness of completion, would provide valuable insights. Data on past performance ratings, any contract disputes, or modifications would also inform an assessment of their reliability and capability. Without specific historical data on this contractor's federal awards and performance, it is difficult to provide a definitive assessment of their track record beyond the information presented in this single award.

How does the $16.6 million contract value compare to similar VA minor construction projects?

Benchmarking this $16.6 million contract against similar VA minor construction projects requires access to a database of comparable awards. Factors such as project scope (e.g., square footage, type of facility improvements), geographic location (construction costs vary regionally), and the year of award are crucial for a fair comparison. If similar projects in Tennessee or other VA medical centers of comparable size have been awarded for significantly less or more, it would indicate whether this contract represents a strong or weak value. The firm-fixed-price nature suggests a defined scope, making comparisons more direct if project details align.

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

The primary risks with this firm-fixed-price construction contract are largely borne by the contractor, Dunbar Mechanical Contractors, LLC. These include the risk of underestimating costs, encountering unforeseen site conditions (e.g., hazardous materials, unexpected structural issues), labor shortages, or material price escalations, all of which could reduce their profit margin or lead to losses if not managed effectively. For the VA, the main risks are contractor performance failure (delays, poor quality) and ensuring the final construction meets all specified requirements and standards within the agreed price. The government's risk is primarily related to ensuring adequate oversight to confirm compliance and quality.

How effective is the 'full and open competition after exclusion of sources' method for ensuring competitive pricing in construction?

The 'full and open competition after exclusion of sources' method is generally effective for ensuring competitive pricing, as it aims to solicit offers from all responsible sources. However, its effectiveness is directly tied to the number of bids received. In this case, with two bidders, the competition was present but potentially limited. A higher number of bidders typically intensifies price competition, driving down costs for the government. The exclusion of sources clause might be used for specific reasons, such as ensuring specialized capabilities, but it's important to understand why certain sources were excluded to confirm it didn't unduly limit competition.

What are the historical spending patterns for minor construction projects at the Murfreesboro VA Medical Center?

To analyze historical spending patterns for minor construction at the Murfreesboro VA Medical Center, one would need to query federal spending databases for previous contracts awarded to this specific facility. This analysis should look at the frequency, value, and types of minor construction projects undertaken over several fiscal years. Understanding past spending levels can help contextualize the current $16.6 million award, indicating whether it represents a typical investment, an increase, or a decrease in facility maintenance and upgrade activities. It would also reveal trends in contract types and competition levels for similar projects at this location.

What are the implications of the 827-day duration for this construction project?

The 827-day duration (approximately 2.27 years) for this minor construction project indicates a significant undertaking, suggesting a scope that extends beyond simple repairs or upgrades. This duration implies that the project likely involves substantial renovations, additions, or the integration of new systems within the existing Murfreesboro VA Medical Center. For the VA, a longer duration necessitates sustained project management oversight and potentially impacts the operational flow of the medical center. For the contractor, it requires long-term resource allocation and risk management planning.

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: 36C77623B0037

Offers Received: 2

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 4165 BRUNSWICK RD, BARTLETT, TN, 38133

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

Financial Breakdown

Contract Ceiling: $16,580,524

Exercised Options: $16,580,524

Current Obligation: $16,580,524

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline