GSA awards $3.2M design-build task order for US Tax Court space reduction in New York

Contract Overview

Contract Amount: $3,222,386 ($3.2M)

Contractor: Sheela, Inc.

Awarding Agency: General Services Administration

Start Date: 2023-11-01

End Date: 2025-07-29

Contract Duration: 636 days

Daily Burn Rate: $5.1K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 4

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: DESIGN BUILD TASK ODER FOR US TAX COURT SPACE REDUCTION PROJECT AT 26 FEDERAL PLAZA, NEW YORK, NY 10278.

Place of Performance

Location: NEW YORK, NEW YORK County, NEW YORK, 10278

State: New York Government Spending

Plain-Language Summary

General Services Administration obligated $3.2 million to SHEELA, INC. for work described as: DESIGN BUILD TASK ODER FOR US TAX COURT SPACE REDUCTION PROJECT AT 26 FEDERAL PLAZA, NEW YORK, NY 10278. Key points: 1. The contract aims to reduce space within the US Tax Court facility, suggesting a focus on efficiency and cost savings. 2. The award was made under full and open competition, indicating a broad search for qualified contractors. 3. The firm-fixed-price contract type suggests that the contractor bears the risk of cost overruns. 4. The project duration of 636 days points to a moderately complex undertaking. 5. The North American Industry Classification System (NAICS) code 236220 signifies a focus on commercial and institutional building construction. 6. The project is located in New York, a major metropolitan area with potentially higher construction costs.

Value Assessment

Rating: fair

The contract value of $3.2 million for a space reduction project appears reasonable given the scope and location. Benchmarking against similar government construction projects for space optimization in high-cost areas like New York would provide a clearer picture of value for money. The firm-fixed-price structure shifts cost risk to the contractor, which can be beneficial if managed effectively.

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 is a standard competitive procedure. While the exact number of bidders is not provided, this method generally aims to maximize competition. The presence of multiple bidders typically leads to better price discovery and potentially lower costs for the government.

Taxpayer Impact: This competitive approach is favorable for taxpayers as it increases the likelihood of receiving a fair market price for the construction services.

Public Impact

The primary beneficiaries are the General Services Administration (GSA) and the US Tax Court, through improved facility efficiency and potential cost savings. The project will deliver construction services focused on reducing the physical footprint of the Tax Court space. The geographic impact is localized to 26 Federal Plaza, New York, NY. Workforce implications will involve construction labor and project management personnel.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for scope creep if initial space reduction targets are not clearly defined.
Risk of unforeseen site conditions in an existing federal building.
Dependence on the contractor's ability to manage a firm-fixed-price contract effectively.
Coordination challenges with existing building operations during construction.

Positive Signals

Firm-fixed-price contract provides cost certainty for the government.
Full and open competition suggests a robust selection process.
Project aims for efficiency, which can lead to long-term operational savings.
Experienced contractor (implied by winning a competitive bid) likely to manage project risks.

Sector Analysis

This contract falls within the Commercial and Institutional Building Construction sector, specifically related to renovation and space optimization within government facilities. The GSA, as the primary real estate agency for the federal government, frequently awards contracts for construction and alteration projects. The market for such services in New York is robust but also highly competitive and subject to higher labor and material costs.

Small Business Impact

The provided data does not indicate if this contract included small business set-asides or subcontracting goals. Given the nature of design-build task orders, it's possible that larger firms may be prime contractors, with opportunities for small businesses to participate as subcontractors. Further analysis would be needed to determine the extent of small business involvement.

Oversight & Accountability

The General Services Administration (GSA) typically has robust oversight mechanisms for construction projects, including contract administration, quality assurance inspections, and performance monitoring. The Public Buildings Service (PBS) within GSA is responsible for managing federal buildings. Inspector General audits may also be applicable to ensure accountability and prevent fraud.

Related Government Programs

Federal Building Construction
Government Facility Modernization
Space Optimization Projects
US Tax Court Operations
GSA Public Buildings Service Contracts

Risk Flags

Potential for cost overruns if contractor mismanages fixed-price contract.
Risk of quality compromise to meet fixed price.
Unforeseen site conditions in existing federal building.
Potential for delays impacting project timeline.
Adequacy of competition level requires further scrutiny.

Frequently Asked Questions

What is this federal contract paying for?

General Services Administration awarded $3.2 million to SHEELA, INC.. DESIGN BUILD TASK ODER FOR US TAX COURT SPACE REDUCTION PROJECT AT 26 FEDERAL PLAZA, NEW YORK, NY 10278.

Who is the contractor on this award?

The obligated recipient is SHEELA, INC..

Which agency awarded this contract?

Awarding agency: General Services Administration (Public Buildings Service).

What is the total obligated amount?

The obligated amount is $3.2 million.

What is the period of performance?

Start: 2023-11-01. End: 2025-07-29.

What is the historical spending pattern for space reduction projects at the US Tax Court or similar federal agencies?

Analyzing historical spending on space reduction projects for federal agencies like the US Tax Court requires access to detailed contract databases and budget reports. Generally, such projects aim to consolidate operations, reduce real estate footprint, and lower associated utility and maintenance costs. The cost-effectiveness is often measured by the return on investment through reduced lease payments or operational expenses over time. Without specific historical data for the Tax Court, we can infer that projects of this nature are driven by a need for fiscal responsibility and operational efficiency. The current $3.2 million award for a 636-day project in New York should be compared against similar past projects to assess if the pricing is competitive and if the projected savings justify the expenditure. Factors like inflation, market conditions, and the complexity of the specific space reduction (e.g., technological integration, structural changes) will influence cost variations across different projects and time periods.

How does the firm-fixed-price contract type impact the risk profile for both the government and the contractor in this project?

A firm-fixed-price (FFP) contract is characterized by a set price that is not subject to adjustment based on the contractor's cost experience. For the government, this offers significant cost certainty, as the total expenditure is known upfront, assuming the scope of work remains unchanged. This shifts the primary risk of cost overruns to the contractor. If the contractor underestimates costs, experiences unexpected material price increases, or faces labor shortages, their profit margin will be reduced, or they could incur a loss. Conversely, if the contractor manages the project efficiently and controls costs below the fixed price, their profit will be higher. The main risk for the government under an FFP contract is that the contractor might cut corners on quality or performance to protect their profit margin if unforeseen issues arise. Therefore, robust government oversight and clear performance standards are crucial to ensure the project meets all requirements despite the contractor bearing the financial risk.

What are the potential challenges associated with a 'full and open competition after exclusion of sources' award procedure?

The 'full and open competition after exclusion of sources' procedure, as indicated in the data, is a method where the agency intends to solicit offers from all responsible sources but may exclude certain sources based on specific criteria, often related to past performance or capability, before the solicitation is issued. While it aims for broad competition, the 'exclusion of sources' aspect can raise questions if not properly justified. If the exclusion criteria are too narrow or subjective, it could inadvertently limit the pool of potential bidders, potentially reducing the level of competition and possibly leading to higher prices than under a truly unrestricted full and open competition. However, if the exclusions are based on objective, documented reasons (e.g., demonstrated inability to perform on previous similar contracts), it can help ensure that only qualified contractors participate, potentially leading to a more efficient procurement process and a higher likelihood of successful project completion. The key is transparency and justification for any exclusions.

Can the $3.2M contract value be benchmarked against similar GSA construction projects in New York City?

Benchmarking the $3.2 million contract value against similar GSA construction projects in New York City requires access to a comprehensive database of federal contract awards, including project scope, size, duration, and location. GSA projects, especially in high-cost areas like New York, can vary significantly in price due to factors such as building type, complexity of work (e.g., renovation vs. new construction, specialized systems), and market conditions at the time of award. A space reduction project, while potentially less complex than a full build-out, still involves design, demolition, and reconstruction within an occupied federal building, which adds logistical challenges and costs. To perform a robust benchmark, one would look for contracts with similar NAICS codes (e.g., 236220), contract types (firm-fixed-price), and project durations within the same metropolitan area. Without specific comparable data points, it's difficult to definitively state whether $3.2 million represents excellent, fair, or questionable value, but it provides a starting point for further detailed analysis.

What are the implications of the 636-day duration for project management and potential cost escalation?

A project duration of 636 days (approximately 21 months) for a $3.2 million design-build task order indicates a moderately complex undertaking that requires careful planning and execution. For project management, this extended timeline necessitates robust scheduling, resource allocation, and risk management strategies to ensure timely completion and prevent delays. Potential cost escalation risks, even under a firm-fixed-price contract, can arise from factors such as inflation impacting material and labor costs over the project's lifespan, though the contractor assumes this risk. Delays caused by unforeseen site conditions, permitting issues, or contractor performance problems could also indirectly impact the government if they lead to extended operational disruptions or require contract modifications (though modifications should ideally not increase the price under FFP). Effective oversight is crucial to monitor progress, identify potential issues early, and ensure the contractor adheres to the schedule and manages their costs effectively to maintain profitability without compromising quality.

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: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: 47PC0223R0032

Offers Received: 4

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 471 SYKESVILLE RD, WRIGHTSTOWN, NJ, 03

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Minority Owned Business, Self-Certified Small Disadvantaged Business, Small Business, Special Designations, Indian (Subcontinent) American Owned Business, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $3,222,386

Exercised Options: $3,222,386

Current Obligation: $3,222,386

Subaward Activity

Number of Subawards: 4

Total Subaward Amount: $1,715,000

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: 47PC0220D0009

IDV Type: IDC

Timeline