VA awards $19.8M construction contract for Fort Wayne specialty care building to Nora Contracting & Hagerman LLC

Contract Overview

Contract Amount: $19,767,858 ($19.8M)

Contractor: Nora Contracting & Hagerman LLC

Awarding Agency: Department of Veterans Affairs

Start Date: 2024-07-01

End Date: 2026-07-26

Contract Duration: 755 days

Daily Burn Rate: $26.2K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: CONSTRUCTION FORT WAYNE SPECIALTY CARE BUILDING

Place of Performance

Location: FORT WAYNE, ALLEN County, INDIANA, 46805

State: Indiana Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $19.8 million to NORA CONTRACTING & HAGERMAN LLC for work described as: CONSTRUCTION FORT WAYNE SPECIALTY CARE BUILDING Key points: 1. Contract awarded via full and open competition after exclusion of sources, suggesting a potentially limited but justified bidding process. 2. The definitive contract type indicates a single award with a fixed price, providing cost certainty for the government. 3. Project duration of 755 days suggests a significant construction undertaking requiring substantial oversight. 4. The contract is for commercial and institutional building construction, a common sector for federal infrastructure projects. 5. Awarded by the Department of Veterans Affairs, this project aims to enhance healthcare facilities for veterans. 6. The contract value of approximately $19.8 million falls within a moderate range for specialized construction projects of this scale.

Value Assessment

Rating: good

The contract value of $19.8 million for a specialty care building construction project appears reasonable given the scope. Benchmarking against similar VA construction projects would provide a more precise value-for-money assessment. The firm fixed-price structure helps control costs, but the absence of detailed cost breakdowns makes a granular price assessment challenging. The award to a joint venture suggests a capacity to handle a project of this magnitude.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

The contract was awarded under 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES.' This solicitation method implies that while the competition was intended to be open, certain sources were excluded, possibly due to specific qualifications or prior relationships. The number of bidders is not specified, but the 'limited' competition level might suggest fewer than a fully open solicitation, potentially impacting price discovery.

Taxpayer Impact: While the competition was not fully open, the exclusion of sources was likely justified by the agency for specific project requirements. Taxpayers benefit from a potentially more tailored solution, but the impact on achieving the lowest possible price is uncertain without knowing the number of bidders.

Public Impact

Veterans in the Fort Wayne, Indiana area will benefit from improved access to specialty healthcare services. The project will deliver a new specialty care building, enhancing the VA's healthcare infrastructure. The geographic impact is localized to Fort Wayne, Indiana, serving the veteran population in that region. Construction activities will likely create temporary employment opportunities for skilled trades and laborers in the local area.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if unforeseen site conditions arise during construction.
Risk of project delays due to supply chain disruptions or labor shortages.
Ensuring compliance with all VA facility standards and building codes requires diligent oversight.

Positive Signals

Firm fixed-price contract provides cost certainty for the government.
Award to a joint venture (Nora Contracting & Hagerman LLC) suggests combined expertise and capacity.
The project addresses a clear need for enhanced specialty care facilities for veterans.

Sector Analysis

This contract falls within the Commercial and Institutional Building Construction sector, a significant segment of the federal contracting market. The Department of Veterans Affairs is a major investor in healthcare infrastructure, frequently awarding contracts for the construction and renovation of medical facilities. Spending in this sector is driven by the need to maintain and modernize government buildings, including critical healthcare assets. Comparable spending benchmarks would involve analyzing other VA construction projects of similar size and complexity.

Small Business Impact

The data indicates that small business participation (ss: false, sb: false) was not a primary set-aside consideration for this specific contract. There is no explicit mention of subcontracting goals for small businesses. This suggests that the prime contractor(s) are likely larger entities, and the direct impact on the small business ecosystem may be limited unless they are engaged as subcontractors by Nora Contracting & Hagerman LLC.

Oversight & Accountability

Oversight for this construction contract will primarily reside with the Department of Veterans Affairs contracting officers and project managers. Accountability measures are embedded in the firm fixed-price contract terms, with penalties for delays or non-performance. Transparency is facilitated through federal contract databases, though detailed project progress reports may not be publicly available. The Inspector General's office for the VA would have jurisdiction over any potential fraud, waste, or abuse related to this contract.

Related Government Programs

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

Risk Flags

Limited competition may impact price discovery.
Potential for cost overruns if unforeseen site conditions arise.
Contractor performance history needs thorough vetting.

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $19.8 million to NORA CONTRACTING & HAGERMAN LLC. CONSTRUCTION FORT WAYNE SPECIALTY CARE BUILDING

Who is the contractor on this award?

The obligated recipient is NORA CONTRACTING & HAGERMAN 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 $19.8 million.

What is the period of performance?

Start: 2024-07-01. End: 2026-07-26.

What is the track record of Nora Contracting & Hagerman LLC in completing similar federal construction projects on time and within budget?

Assessing the track record of Nora Contracting & Hagerman LLC requires a detailed review of their past performance on federal contracts, particularly those involving healthcare facilities or similar scale construction. This would involve examining contract databases for past awards, performance evaluations (e.g., Contractor Performance Assessment Reporting System - CPARS), and any history of disputes or contract modifications. A strong track record of on-time and within-budget completion for comparable projects would indicate a lower risk for this new award. Conversely, a history of delays, cost overruns, or poor performance would raise concerns about the contractor's ability to execute this project successfully. Without specific historical data on this joint venture's performance, a definitive assessment is not possible, but it is a critical area for VA's due diligence.

How does the awarded price of $19.8 million compare to the estimated cost or market rates for similar specialty care building construction in the Fort Wayne, Indiana region?

To benchmark the $19.8 million award, a comparison with the estimated cost provided by the VA during the solicitation phase, or with market rates for similar construction projects in the Fort Wayne area, is necessary. This involves analyzing construction cost indices, recent bids on comparable projects (both federal and private sector), and consulting industry cost estimators. Factors such as building size, complexity of medical systems, site conditions, and prevailing labor/material costs in Indiana would influence this comparison. If the awarded price is significantly lower than estimates or market rates, it could indicate strong competition or potential value engineering. If it's higher, it might suggest less competitive bidding or unique project requirements. A detailed cost analysis by the VA would have informed the fairness of the price.

What are the specific risks associated with the 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES' procurement method for this project?

The 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES' method presents a unique risk profile. While intended to be competitive, the exclusion of certain sources implies that the pool of potential bidders was intentionally narrowed. This could be due to specific technical requirements, past performance issues with certain contractors, or national security concerns. The primary risk is that this limitation might have reduced the overall competition, potentially leading to a higher price than if all qualified sources were allowed to bid. It also raises questions about the justification for exclusion and whether it was truly necessary for project success. Transparency regarding the reasons for exclusion is crucial for taxpayer confidence. The VA must have documented a clear rationale for this approach to mitigate risks of perceived unfairness or suboptimal pricing.

What are the potential long-term effectiveness and operational benefits of this new specialty care building for veteran healthcare in Indiana?

The long-term effectiveness and operational benefits of the new specialty care building are expected to be substantial for veterans in the Fort Wayne area. By providing modern, dedicated facilities, the VA can likely improve the quality and accessibility of specialized medical services, potentially reducing wait times and enhancing patient outcomes. The building's design should incorporate the latest healthcare technologies and workflows, leading to greater operational efficiency for medical staff. Furthermore, consolidating services into a new, purpose-built facility can streamline patient care coordination and reduce the need for veterans to travel long distances for treatment. The success will depend on the facility's design, staffing, and integration into the broader VA healthcare network.

How does the current spending on VA construction projects in Indiana compare to historical patterns and national averages?

Analyzing Indiana's current VA construction spending against historical patterns and national averages requires access to historical VA budget data and contract award information, broken down by state and project type. This comparison would reveal whether Indiana is receiving a proportional share of VA construction investments relative to its veteran population or the condition of its existing facilities. It would also show trends in VA construction spending nationally, indicating whether this $19.8 million award is part of a larger increase or decrease in federal infrastructure investment. Without specific historical and national data, it's difficult to contextualize this single award. However, the VA generally aims for equitable distribution of resources based on need and strategic priorities.

What are the implications of the definitive contract type and firm fixed-price payment structure on potential cost savings or overruns for this project?

The definitive contract type, combined with a firm fixed-price (FFP) payment structure, is designed to provide maximum cost certainty for the government. Under an FFP contract, the contractor assumes most of the risk for cost overruns. If the project costs more than anticipated, the contractor absorbs the difference, provided the increased costs are not due to changes initiated by the government or unforeseen circumstances explicitly covered by the contract. This structure incentivizes the contractor to manage costs efficiently and complete the project within the agreed-upon price. However, it can also lead to contractors bidding higher initially to account for potential risks. For taxpayers, this means a predictable expenditure, but it limits the government's ability to benefit from cost savings if the project comes in under budget, unless specific contract clauses allow for it.

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: 36C77624C0107

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 3633 MICHIGAN AVE, DETROIT, MI, 48216

Business Categories: Black American Owned Business, Category Business, Corporate Entity Not Tax Exempt, DoT Certified Disadvantaged Business Enterprise, Minority Owned Business, 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: $19,776,858

Exercised Options: $19,776,858

Current Obligation: $19,767,858

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline