VA awards $19.4M contract for air handling units at Bay Pines, FL hospital

Contract Overview

Contract Amount: $19,355,175 ($19.4M)

Contractor: Homeland Security Construction Corp

Awarding Agency: Department of Veterans Affairs

Start Date: 2008-05-02

End Date: 2011-06-30

Contract Duration: 1,154 days

Daily Burn Rate: $16.8K/day

Competition Type: NOT AVAILABLE FOR COMPETITION

Number of Offers Received: 3

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: REPLACE 27 AIR HANDLING UNITS AND PROVIDE 2 TEMPORARY AIR HANDLING UNITS FOR THE MAIN HOSPITAL AT BAY PINES, FL

Place of Performance

Location: BAY PINES, PINELLAS County, FLORIDA, 33744

State: Florida Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $19.4 million to HOMELAND SECURITY CONSTRUCTION CORP for work described as: REPLACE 27 AIR HANDLING UNITS AND PROVIDE 2 TEMPORARY AIR HANDLING UNITS FOR THE MAIN HOSPITAL AT BAY PINES, FL Key points: 1. Contract value appears reasonable for the scope of replacing 27 air handling units and providing temporary units. 2. Limited competition may have impacted pricing, as the contract was not open for full competition. 3. Contract duration of over three years suggests a complex and potentially lengthy installation process. 4. The award to Homeland Security Construction Corp indicates a focus on established contractors for critical infrastructure. 5. This contract falls within the broader category of facilities maintenance and upgrade spending for federal healthcare infrastructure.

Value Assessment

Rating: fair

The contract value of $19.4 million for replacing 27 air handling units and providing temporary units seems within a reasonable range for a large hospital facility. However, without specific details on the complexity of the units, installation challenges, or the age and condition of the existing infrastructure, a precise value-for-money assessment is difficult. Benchmarking against similar HVAC replacement projects in federal healthcare settings would provide a clearer picture of whether this price represents a competitive outcome.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

The contract was awarded under 'NOT AVAILABLE FOR COMPETITION,' indicating a limited competition scenario. This suggests that only a select number of contractors were solicited or that specific circumstances justified bypassing a full and open solicitation. The limited nature of the competition means that the Department of Veterans Affairs may not have benefited from the full range of pricing and innovation that a broader competition could have offered.

Taxpayer Impact: Taxpayers may have paid a higher price due to the restricted competition, as the government did not leverage the full market to drive down costs.

Public Impact

Patients and staff at the Bay Pines, FL VA hospital will benefit from improved air quality and HVAC system reliability. The services delivered include the replacement of critical air handling units, ensuring operational continuity for the hospital. The geographic impact is localized to the Bay Pines, Florida area, specifically the VA hospital facility. The contract supports the healthcare infrastructure workforce, likely involving skilled trades in HVAC installation and maintenance.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Limited competition raises concerns about potential overpricing and lack of innovation.
The long contract duration could indicate potential for cost overruns or delays if not managed effectively.
Reliance on a single award without broader market engagement might miss opportunities for better value.

Positive Signals

The contract addresses critical infrastructure needs for a VA hospital, ensuring patient care continuity.
The award to a specific contractor suggests a known entity capable of handling complex projects.
Fixed-price contract type can provide cost certainty if the scope is well-defined.

Sector Analysis

This contract falls within the construction and facilities maintenance sector, specifically focusing on HVAC systems for healthcare facilities. The market for such services is substantial, driven by the ongoing need to maintain and upgrade aging infrastructure in government buildings. Comparable spending benchmarks for large-scale HVAC replacements in institutional settings would typically range from several hundred thousand to millions of dollars per building, depending on size and complexity.

Small Business Impact

The data indicates this contract was not set aside for small businesses (ss: false, sb: false). Therefore, there are no direct subcontracting implications for small businesses stemming from a set-aside provision. The prime contractor, Homeland Security Construction Corp, is likely a larger entity, and opportunities for small businesses would depend on their subcontracting decisions outside of any formal set-aside requirements.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of Veterans Affairs' contracting and facilities management divisions. Accountability measures would be tied to the terms of the Firm Fixed Price contract, including performance milestones and quality standards. Transparency is generally facilitated through contract award databases, though detailed project management and oversight specifics are typically internal. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

VA Facilities Maintenance Contracts
Federal HVAC System Upgrades
Hospital Infrastructure Modernization
Construction Services for Healthcare Facilities

Risk Flags

Limited competition may lead to suboptimal pricing.
Contract duration exceeds typical project timelines, raising concerns about potential delays or cost escalation.
Lack of small business set-aside may limit opportunities for smaller contractors.

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $19.4 million to HOMELAND SECURITY CONSTRUCTION CORP. REPLACE 27 AIR HANDLING UNITS AND PROVIDE 2 TEMPORARY AIR HANDLING UNITS FOR THE MAIN HOSPITAL AT BAY PINES, FL

Who is the contractor on this award?

The obligated recipient is HOMELAND SECURITY CONSTRUCTION CORP.

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 $19.4 million.

What is the period of performance?

Start: 2008-05-02. End: 2011-06-30.

What is the track record of Homeland Security Construction Corp in performing similar large-scale HVAC replacement projects for federal agencies, particularly within healthcare settings?

Assessing the track record of Homeland Security Construction Corp requires a review of their past performance on federal contracts. Specifically, one would look for prior awards for similar HVAC replacement projects, especially those in hospital environments. Key indicators include on-time and on-budget completion rates, customer satisfaction ratings (if available through past performance evaluations), and any history of disputes or contract modifications. A strong track record in similar projects would increase confidence in their ability to execute this $19.4 million contract successfully. Conversely, a history of performance issues could signal potential risks for the Department of Veterans Affairs.

How does the awarded price of $19.4 million compare to market rates for similar HVAC replacement projects in large healthcare facilities in Florida?

To benchmark the $19.4 million award, one would compare it against recent, comparable contracts for HVAC system replacements in large healthcare facilities, ideally within Florida or similar geographic and economic regions. This comparison should account for the scale (27 units plus temporary units), complexity, and specific types of air handling units. Market research reports, industry cost estimating databases, and publicly available data on similar government or private sector projects can provide benchmarks. If this contract's price per unit or per square foot significantly deviates from established benchmarks, it could indicate either an exceptional deal or potential overpricing, warranting further investigation into the specific project requirements and market conditions.

What specific risks are associated with a 'limited competition' award for critical hospital infrastructure, and how were these mitigated?

A 'limited competition' award, as indicated by 'NOT AVAILABLE FOR COMPETITION,' carries inherent risks, primarily the potential for higher costs due to reduced market pressure and a narrower pool of potential solutions. It can also limit opportunities for innovation. Mitigation strategies employed by the agency might include rigorous negotiation of terms, detailed scope definition to prevent scope creep, and strong project management to ensure adherence to the agreed-upon price. The agency might also have justified the limited competition based on specific technical requirements, urgency, or the availability of only one or a few sources capable of meeting those needs. Documenting this justification thoroughly is crucial for accountability.

What is the expected impact of these new air handling units on the operational effectiveness and patient environment of the Bay Pines VA hospital?

The replacement of 27 aging air handling units with new ones is expected to significantly improve the operational effectiveness and patient environment at the Bay Pines VA hospital. New units typically offer enhanced energy efficiency, better air filtration (crucial for infection control in healthcare settings), improved temperature and humidity control, and greater reliability, reducing the risk of system failures. This leads to a more comfortable and safer environment for patients, visitors, and staff, while also potentially lowering utility costs for the facility. The provision of temporary units ensures that critical HVAC functions are maintained during the replacement process, minimizing disruption to hospital operations.

How has the Department of Veterans Affairs' spending on HVAC and facilities maintenance contracts trended over the past five years, and does this award align with that trend?

Analyzing the Department of Veterans Affairs' (VA) spending on HVAC and facilities maintenance contracts over the past five years would reveal trends in investment in infrastructure upkeep. This involves examining total obligated amounts, the number of contracts awarded, and the average contract values within this category. Comparing this specific $19.4 million award to those historical trends helps determine if it represents a typical investment, an increase, or a decrease in spending for such services. Alignment with trends suggests consistent strategic priorities, while significant deviations might warrant an explanation related to specific infrastructure needs or budget allocations.

Industry Classification

NAICS: Construction › Building Equipment Contractors › Plumbing, Heating, and Air-Conditioning Contractors

Product/Service Code: MAINT, REPAIR, ALTER REAL PROPERTY › MAINT, ALTER, REPAIR BUILDINGS

Competition & Pricing

Extent Competed: NOT AVAILABLE FOR COMPETITION

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: VA-248-08-RP-0117

Offers Received: 3

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 2501 51ST AVE, HYATTSVILLE, MD, 04

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Service Disabled Veteran Owned Business, Small Business, Special Designations, U.S.-Owned Business, Veteran Owned Business

Financial Breakdown

Contract Ceiling: $19,355,175

Exercised Options: $19,355,175

Current Obligation: $19,355,175

Timeline