VA awards $43.6M janitorial contract to Design Build, LLC, for Puerto Rico facilities over 5 years

Contract Overview

Contract Amount: $43,598,134 ($43.6M)

Contractor: Design Build, LLC.

Awarding Agency: Department of Veterans Affairs

Start Date: 2015-03-01

End Date: 2020-08-31

Contract Duration: 2,010 days

Daily Burn Rate: $21.7K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 8

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: IGF::CT::IGF JANITORIAL SERVICES AT VA CARIBBEAN HEALTHCARE SYSTEM TO INCLUDE: SAN JUAN MEDICAL CENTER, SOUTH BED TOWER AND MAYAGUEZ AND PONCE OUTPATIENT CLINICS.

Place of Performance

Location: SAN JUAN, SAN JUAN County, PUERTO RICO, 00921

Plain-Language Summary

Department of Veterans Affairs obligated $43.6 million to DESIGN BUILD, LLC. for work described as: IGF::CT::IGF JANITORIAL SERVICES AT VA CARIBBEAN HEALTHCARE SYSTEM TO INCLUDE: SAN JUAN MEDICAL CENTER, SOUTH BED TOWER AND MAYAGUEZ AND PONCE OUTPATIENT CLINICS. Key points: 1. Contract value represents significant investment in facility maintenance for multiple VA sites. 2. Competition dynamics suggest a robust bidding process for janitorial services. 3. Performance period of over five years indicates a need for sustained service delivery. 4. Fixed-price contract type aims to control costs and provide budget certainty. 5. Geographic scope covers major medical centers and outpatient clinics in Puerto Rico. 6. The contract's duration and value may indicate a mature market for janitorial services.

Value Assessment

Rating: fair

The contract value of $43.6 million over approximately five years averages to about $8.7 million annually. Benchmarking this against similar large-scale janitorial contracts for federal healthcare facilities is challenging without more specific service scope details. However, the duration suggests a potentially competitive pricing structure was negotiated. The fixed-price nature provides cost predictability for the VA.

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,' indicating that while the initial process may have involved some exclusions, the final award was made through a broad competitive solicitation. The presence of 8 bidders (no=8) suggests a healthy level of competition for this janitorial services contract.

Taxpayer Impact: A competitive bidding process generally leads to better pricing and value for taxpayers by encouraging multiple firms to offer their best terms.

Public Impact

Patients and staff at VA Caribbean Healthcare System facilities benefit from maintained sanitary conditions. Services include janitorial support for the San Juan Medical Center, South Bed Tower, and Mayaguez and Ponce Outpatient Clinics. The geographic impact is concentrated in Puerto Rico, serving key healthcare infrastructure. The contract supports jobs within the janitorial services industry in Puerto Rico.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for service quality variations across different sites within the large contract.
Ensuring consistent adherence to VA sanitation standards across all locations.
Managing contractor performance over a multi-year period requires ongoing oversight.

Positive Signals

Awarded through full and open competition, indicating a competitive market.
Fixed-price contract type helps manage budget and prevent cost overruns.
Long-term contract suggests contractor reliability and VA satisfaction with services.

Sector Analysis

Janitorial services represent a significant segment of the facilities management industry. Federal contracts for these services are often large due to the scale of government buildings and healthcare facilities. This contract fits within the broader 'Commercial and Institutional Building Cleaning' sector, which is characterized by numerous service providers ranging from small local businesses to large national corporations. The VA's extensive network of healthcare facilities necessitates substantial and ongoing investment in maintenance and cleaning.

Small Business Impact

The contract data indicates that this was not specifically set aside for small businesses (sb=false). While the primary award went to Design Build, LLC, there is no explicit information on subcontracting plans for small businesses. Large federal contracts can sometimes offer subcontracting opportunities for small businesses, but this would depend on the prime contractor's strategy and the specific requirements outlined in the contract.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of Veterans Affairs' contracting officer and program managers. They are responsible for monitoring performance, ensuring compliance with contract terms, and addressing any issues that arise. The contract's fixed-price nature simplifies some aspects of financial oversight, but performance quality remains a key area of focus. Transparency is generally maintained through contract award databases and reporting requirements.

Related Government Programs

VA Healthcare Facility Maintenance Contracts
Federal Janitorial Services
Government Building Cleaning Contracts
Puerto Rico Federal Contracts

Risk Flags

Potential for performance variability over a long contract duration.
Need for robust oversight to ensure consistent quality across multiple sites.
Dependence on contractor's ability to maintain staffing and operational standards.

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $43.6 million to DESIGN BUILD, LLC.. IGF::CT::IGF JANITORIAL SERVICES AT VA CARIBBEAN HEALTHCARE SYSTEM TO INCLUDE: SAN JUAN MEDICAL CENTER, SOUTH BED TOWER AND MAYAGUEZ AND PONCE OUTPATIENT CLINICS.

Who is the contractor on this award?

The obligated recipient is DESIGN BUILD, 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 $43.6 million.

What is the period of performance?

Start: 2015-03-01. End: 2020-08-31.

What is the historical spending pattern for janitorial services at the VA Caribbean Healthcare System prior to this contract?

Detailed historical spending data for janitorial services specifically at the VA Caribbean Healthcare System before March 2015 is not directly available in the provided data snippet. However, the award of a $43.6 million contract over five years suggests a substantial and ongoing need for these services. Federal agencies typically maintain records of past expenditures, which would allow for a comparison of spending trends. Analyzing previous contract values, durations, and the number of bidders for similar services at this or comparable VA facilities would provide context on whether this award represents an increase, decrease, or stable level of investment in janitorial services.

How does the per-square-foot cost of janitorial services under this contract compare to industry benchmarks for healthcare facilities?

Calculating a precise per-square-foot cost requires detailed information on the total square footage of all facilities covered by the contract (San Juan Medical Center, South Bed Tower, Mayaguez and Ponce Outpatient Clinics) and the specific scope of services provided. Without this granular data, a direct comparison to industry benchmarks is not feasible. However, the contract's total value of $43.6 million over approximately five years, divided by the number of facilities and their likely size, suggests a significant operational cost. Industry benchmarks for healthcare janitorial services vary widely based on facility type (hospital vs. clinic), geographic location, and the level of cleaning required (e.g., standard cleaning vs. specialized infection control). A thorough analysis would necessitate obtaining the facility square footage and service level agreements.

What is the track record of Design Build, LLC in performing similar large-scale federal janitorial contracts?

Information regarding the specific track record of Design Build, LLC in performing large-scale federal janitorial contracts is not detailed in the provided data. The data confirms they were awarded this $43.6 million contract by the Department of Veterans Affairs. To assess their track record, one would typically look at past performance evaluations on similar government contracts, including their history with the VA or other federal agencies. Key factors to consider would include on-time delivery, quality of service, adherence to budget, and any past disputes or contract terminations. A review of federal procurement databases and contractor performance systems would be necessary to gain a comprehensive understanding of their past performance.

What are the key performance indicators (KPIs) used to measure the success of this janitorial contract?

The provided data does not specify the Key Performance Indicators (KPIs) for this contract. However, for federal janitorial service contracts, common KPIs typically include adherence to cleaning schedules, quality of cleaning (e.g., cleanliness scores, absence of visible dirt/grime), response times to unscheduled cleaning requests, proper waste management and disposal, compliance with health and safety regulations (especially critical in healthcare settings), and customer satisfaction surveys from facility staff and management. The contract likely outlines specific metrics and standards that Design Build, LLC must meet, with potential financial incentives or penalties tied to performance against these KPIs.

How does the competition level (8 bidders) for this contract potentially impact the final price and service quality compared to contracts with fewer bidders?

A competition level involving 8 bidders generally suggests a healthy and active market for janitorial services in the region. This level of competition typically benefits the government by driving down prices as contractors vie for the award. It also encourages higher service quality, as firms aim to differentiate themselves based on performance. Compared to a contract with significantly fewer bidders (e.g., 1-3), 8 bidders increase the likelihood that the VA secured a competitive price and that the chosen contractor is motivated to maintain high standards to secure future work and positive past performance reviews. Conversely, extremely high numbers of bidders could sometimes indicate a fragmented market or low barriers to entry.

Industry Classification

NAICS: Administrative and Support and Waste Management and Remediation Services › Services to Buildings and Dwellings › Janitorial Services

Product/Service Code: UTILITIES AND HOUSEKEEPING › HOUSEKEEPING SERVICES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: VA248-13-R-2430

Offers Received: 8

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: ROAD 865 KM 3.3, TOA BAJA, PR, 00949

Business Categories: Category Business, Hispanic American Owned Business, HUBZone Firm, Limited Liability Corporation, Minority Owned Business, Partnership or Limited Liability Partnership, Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $43,598,134

Exercised Options: $43,598,134

Current Obligation: $43,598,134

Contract Characteristics

Commercial Item: COMMERCIAL ITEM

Cost or Pricing Data: NO

Timeline