VA awards $10.4M for Brecksville energy center construction, highlighting firm-fixed-price contract for building

Contract Overview

Contract Amount: $10,379,860 ($10.4M)

Contractor: LDV, Inc.

Awarding Agency: Department of Veterans Affairs

Start Date: 2006-09-26

End Date: 2008-04-28

Contract Duration: 580 days

Daily Burn Rate: $17.9K/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: CONSTRUCTION - CLEVELAND/BRECKSVILLE CONSOLIDATION PHASE 1 ENERGY CENTER

Plain-Language Summary

Department of Veterans Affairs obligated $10.4 million to LDV, INC. for work described as: CONSTRUCTION - CLEVELAND/BRECKSVILLE CONSOLIDATION PHASE 1 ENERGY CENTER Key points: 1. Contract awarded using full and open competition after exclusion of sources, suggesting a deliberate selection process. 2. The firm-fixed-price structure aims to control costs for the Department of Veterans Affairs. 3. The contract duration of 580 days indicates a significant construction project timeline. 4. The award to LDV, INC. represents a specific investment in the VA's infrastructure. 5. The project falls under commercial and institutional building construction, a key sector for facility development.

Value Assessment

Rating: fair

The contract value of $10.4 million for a construction project of this nature requires benchmarking against similar VA facility upgrades. Without specific details on the scope of work (e.g., square footage, specific systems installed), a precise value-for-money assessment is challenging. However, the firm-fixed-price (FFP) contract type generally provides cost certainty for the government, which is a positive indicator. The award amount should be compared to the initial estimated cost if available, and to the bids received from other competitors to gauge pricing competitiveness.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

The contract was awarded under 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES.' This indicates that while the competition was intended to be open, certain sources were excluded prior to the solicitation. The exact reasons for this exclusion are not detailed in the provided data. The number of bidders (3) is relatively low, which could suggest limited market interest or specific pre-qualification criteria. A low number of bidders can sometimes lead to less competitive pricing.

Taxpayer Impact: The limited competition may have resulted in a higher price for taxpayers than if a broader, unrestricted full and open competition had been conducted. However, the exclusion of sources might have been based on specific technical capabilities required for this specialized energy center construction.

Public Impact

Veterans in the Cleveland/Brecksville area will benefit from improved energy infrastructure at the VA facility. The project delivers essential construction services for a critical energy center, ensuring operational reliability. The geographic impact is concentrated in the Cleveland/Brecksville region of Ohio. The construction activities will likely involve a local workforce, contributing to regional employment.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Limited competition (3 bidders) could indicate potential for higher costs.
The 'exclusion of sources' clause requires further investigation to ensure fairness and prevent anti-competitive practices.
Firm-fixed-price contracts can sometimes lead to change orders if the scope is not perfectly defined upfront.

Positive Signals

Firm-fixed-price contract provides cost certainty for the government.
The project addresses critical energy infrastructure needs for the VA.
Awarded to a specific contractor, indicating a selection based on qualifications.

Sector Analysis

This contract falls within the Construction sector, specifically Commercial and Institutional Building Construction. The market for federal construction projects is substantial, with agencies like the Department of Veterans Affairs consistently investing in facility upgrades and new builds. Comparable spending benchmarks would involve analyzing other VA medical center construction or energy infrastructure projects, as well as similar projects undertaken by other federal agencies. The size of this award ($10.4M) is moderate for a federal construction project.

Small Business Impact

The data indicates that small business participation was not a specific set-aside for this contract (ss: false, sb: false). There is no information provided regarding subcontracting plans or their impact on the small business ecosystem. Without explicit set-aside goals or reporting, it's difficult to assess the direct benefit to small businesses from this particular award.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of Veterans Affairs' contracting and program management offices. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse. Transparency is generally facilitated through contract databases like FPDS, where basic award information is made public. Specific performance monitoring and accountability measures would be detailed in the contract's statement of work and performance standards.

Related Government Programs

Department of Veterans Affairs Medical Facility Construction
Federal Energy Infrastructure Projects
Commercial Building Construction Contracts
Firm Fixed Price Construction Awards

Risk Flags

Limited Competition
Exclusion of Sources
Potential for Cost Overruns if Scope is Poorly Defined

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $10.4 million to LDV, INC.. CONSTRUCTION - CLEVELAND/BRECKSVILLE CONSOLIDATION PHASE 1 ENERGY CENTER

Who is the contractor on this award?

The obligated recipient is LDV, 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 $10.4 million.

What is the period of performance?

Start: 2006-09-26. End: 2008-04-28.

What was the specific reason for excluding certain sources in the 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES' process?

The provided data does not specify the exact reasons for excluding certain sources. This designation typically implies that a pre-solicitation process occurred where only certain contractors meeting specific, often technical, criteria were invited to bid, or that certain potential bidders were disqualified based on predefined requirements. To understand the rationale, one would need to review the contract's Justification and Approval (J&A) document, if one was required and filed, or the solicitation itself. Potential reasons could include highly specialized technical requirements, unique capabilities, or prior performance issues with certain firms. Without this additional documentation, it's impossible to definitively state why sources were excluded, which is crucial for assessing the fairness and competitiveness of the procurement.

How does the $10.4 million award compare to the estimated cost or the bids of the other two competitors?

The provided data indicates the award amount was $10,379,860.33 to LDV, INC. It also states there were 3 bidders in total. However, the data does not include the initial estimated cost for the project, nor does it list the bid amounts submitted by the other two competitors. To assess value for money and pricing competitiveness, this information is essential. A comparison would involve analyzing the spread between the winning bid, the other bids, and the government's estimate. A narrow spread suggests strong competition, while a wide spread might indicate issues with the estimate or the bids. Without these figures, we can only note the award amount and the number of bidders.

What are the key performance indicators (KPIs) for this construction contract, and how was LDV, INC.'s performance assessed?

The provided data does not detail the specific Key Performance Indicators (KPIs) established for this construction contract, nor does it offer an assessment of LDV, INC.'s performance. Typically, construction contracts include clauses related to schedule adherence, quality of work, safety compliance, and adherence to specifications. Performance assessments are usually documented through contract performance reports, quality assurance surveillance plans (QASPs), and final acceptance documentation. For this contract, the performance would be evaluated against the terms outlined in the Statement of Work (SOW) and any associated technical specifications. Information on LDV, INC.'s track record with this or similar VA projects would provide further context on their likely performance.

What is the historical spending pattern for similar energy center construction projects by the Department of Veterans Affairs?

Analyzing historical spending patterns for similar energy center construction projects by the VA requires access to comprehensive federal procurement data over several fiscal years. This specific contract, awarded in 2006 for work completed in 2008, represents a data point from that period. To establish a pattern, one would need to query databases like FPDS or USASpending for contracts with similar Product Service Codes (PSCs) or North American Industry Classification System (NAICS) codes (e.g., 236220 - Commercial and Institutional Building Construction) related to energy infrastructure at VA facilities. Examining the number of such contracts, their average value, duration, and competition levels over time would reveal trends in VA investment in this area. This particular $10.4 million award appears to be a moderate-sized project within this category.

What are the potential risks associated with a firm-fixed-price contract for a complex construction project like an energy center?

Firm-fixed-price (FFP) contracts offer cost certainty to the government, but they can introduce risks, particularly for complex construction projects. The primary risk is that the contractor may cut corners on quality or materials to maintain profitability if their initial cost estimates were too low or if unforeseen issues arise. For an energy center, which involves specialized systems and potentially hazardous materials or processes, inadequate execution could lead to significant operational problems, safety concerns, and costly rework. Another risk is scope creep; if the government requires changes or additions not clearly defined in the original scope, managing these through change orders under an FFP contract can become contentious and expensive. Conversely, if the contractor performs exceptionally well and manages costs efficiently, they may realize a higher profit margin than anticipated, which could be seen as a missed opportunity for the government to secure a lower price.

Industry Classification

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

Product/Service Code: ARCHITECT/ENGINEER SERVICES › ARCH-ENG SVCS - CONSTRUCTION

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: 101-06-0015

Offers Received: 3

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 1551 EAST 105TH ST, CLEVELAND, OH, 90

Business Categories: 8(a) Program Participant, Category Business, Emerging Small Business, HUBZone Firm, Minority Owned Business, Self-Certified Small Disadvantaged Business, Small Business, Small Disadvantaged Business, Special Designations, Woman Owned Business

Financial Breakdown

Contract Ceiling: $10,379,860

Exercised Options: $10,379,860

Current Obligation: $10,379,860

Timeline