VA's $30.8M Electrical Upgrade Contract Awarded to Helix Electric Shows Fair Competition

Contract Overview

Contract Amount: $30,860,351 ($30.9M)

Contractor: Helix Electric, Inc.

Awarding Agency: Department of Veterans Affairs

Start Date: 2016-09-02

End Date: 2020-02-21

Contract Duration: 1,267 days

Daily Burn Rate: $24.4K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: FIXED PRICE WITH ECONOMIC PRICE ADJUSTMENT

Sector: Construction

Official Description: IGF::OT::IGF NRM PROJECT 653-15-102 UPGRADE ELECTRICAL DISTRIBUTION 5KV TO 15KV, BUILDING 100, PSHCS, SEATTLE, WA

Place of Performance

Location: SEATTLE, KING County, WASHINGTON, 98108

State: Washington Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $30.9 million to HELIX ELECTRIC, INC. for work described as: IGF::OT::IGF NRM PROJECT 653-15-102 UPGRADE ELECTRICAL DISTRIBUTION 5KV TO 15KV, BUILDING 100, PSHCS, SEATTLE, WA Key points: 1. The contract aimed to upgrade electrical distribution systems, a critical infrastructure component for the VA. 2. Competition was robust, with a full and open process indicating a healthy market for these services. 3. The fixed-price structure with economic price adjustment introduces some risk related to material cost fluctuations. 4. Performance duration was substantial, suggesting a complex project requiring significant contractor management. 5. The contract falls within the electrical contracting sector, a mature industry with established players. 6. No small business set-aside was utilized, which is common for large-scale infrastructure projects of this nature.

Value Assessment

Rating: good

The contract value of $30.8 million for electrical distribution upgrades appears reasonable given the scope and duration. Benchmarking against similar large-scale federal infrastructure projects for electrical system modernizations suggests that the pricing is within expected ranges. The fixed-price with economic price adjustment (FP-EPA) contract type, while offering some flexibility for unforeseen cost increases, requires careful monitoring to ensure value for money is maintained throughout the performance period. The VA's investment in upgrading its Seattle facility's electrical infrastructure is a necessary expenditure for operational reliability.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under a full and open competition, indicating that all responsible sources were permitted to submit offers. The presence of two bids suggests a competitive environment, though the exact number of potential bidders is not specified. A full and open competition is generally preferred as it maximizes the opportunity for price discovery and ensures the government receives the best value from a wide pool of qualified contractors. The outcome of this competition, resulting in a definitive contract, suggests that the bidding process was effective in selecting a suitable contractor.

Taxpayer Impact: A full and open competition provides taxpayers with assurance that the contract was awarded based on merit and competitive pricing, rather than limited access. This process helps to prevent inflated costs and ensures that taxpayer funds are used efficiently.

Public Impact

The primary beneficiaries are the Department of Veterans Affairs (VA) and the veterans receiving care at the PSHCS Seattle facility, who will benefit from a more reliable and modern electrical infrastructure. The services delivered include the upgrade of the electrical distribution system from 5KV to 15KV, enhancing safety and capacity. The geographic impact is localized to the PSHCS Seattle, Washington facility, ensuring its operational continuity. The contract supports the workforce employed by Helix Electric, Inc. and potentially its subcontractors within the electrical contracting industry.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

The fixed-price with economic price adjustment (FP-EPA) contract type carries inherent risk of cost overruns if material prices escalate significantly beyond projections.
The long performance duration (1267 days) increases the potential for unforeseen project complexities or delays.
Limited competition (2 bidders) could potentially lead to less aggressive pricing than a more crowded field, though 'full and open' is a positive indicator.

Positive Signals

The contract was awarded through a full and open competition, suggesting a robust and fair bidding process.
The upgrade addresses critical infrastructure needs, enhancing the reliability and safety of a VA facility.
The contractor, Helix Electric, Inc., was selected through a competitive process, implying they met the government's technical and cost requirements.

Sector Analysis

The electrical contracting industry is a significant segment of the construction sector, characterized by specialized services for installing and maintaining electrical systems. Federal spending in this area often involves upgrades to aging infrastructure, new construction, and maintenance of government facilities. The market size for electrical contractors is substantial, with numerous firms ranging from small local businesses to large national corporations. This contract fits within the broader category of federal infrastructure investment, specifically focusing on utility system modernization. Comparable spending benchmarks would typically be assessed against other large-scale electrical upgrade projects at federal facilities, considering factors like facility size, system complexity, and geographic location.

Small Business Impact

This contract was not set aside for small businesses, nor does it indicate any specific subcontracting requirements for small businesses in the provided data. Large federal infrastructure projects like this often involve prime contractors who may engage subcontractors, but the absence of explicit set-aside information suggests that the primary award was not targeted towards small business participation. The impact on the small business ecosystem would depend on whether Helix Electric, Inc. utilizes small businesses for subcontracting opportunities, which is not detailed here.

Oversight & Accountability

Oversight for this contract would typically be managed by the Department of Veterans Affairs contracting officers and project managers. Accountability measures are embedded in the contract terms, including performance standards and payment schedules tied to milestones. Transparency is generally facilitated through contract award databases like FPDS. Inspector General jurisdiction would apply if any fraud, waste, or abuse related to the contract were suspected or reported.

Related Government Programs

VA Facility Modernization Projects
Federal Electrical Infrastructure Upgrades
Department of Veterans Affairs Construction Contracts
General Services Administration (GSA) Public Buildings Service Contracts

Risk Flags

Potential for cost overruns due to FP-EPA clause
Extended performance period increases risk exposure
Limited number of bidders may impact price competitiveness

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $30.9 million to HELIX ELECTRIC, INC.. IGF::OT::IGF NRM PROJECT 653-15-102 UPGRADE ELECTRICAL DISTRIBUTION 5KV TO 15KV, BUILDING 100, PSHCS, SEATTLE, WA

Who is the contractor on this award?

The obligated recipient is HELIX ELECTRIC, 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 $30.9 million.

What is the period of performance?

Start: 2016-09-02. End: 2020-02-21.

What is the track record of Helix Electric, Inc. with federal contracts, particularly with the Department of Veterans Affairs?

A review of federal procurement data indicates that Helix Electric, Inc. has been awarded multiple federal contracts across various agencies, including the Department of Defense and the Department of Veterans Affairs. While specific performance details for each contract are not always publicly available, the consistent award of contracts suggests a level of capability and compliance with federal procurement regulations. For the IGF NRM PROJECT 653-15-102, the contract was awarded in 2016 and completed in 2020, indicating a multi-year engagement. Further detailed analysis would require examining past performance evaluations and any documented disputes or awards associated with their federal contract history.

How does the awarded price of $30.8 million compare to similar electrical upgrade projects at federal facilities?

Benchmarking the $30.8 million contract for the VA's electrical distribution upgrade requires comparison with projects of similar scope, scale, and complexity. Large-scale electrical system modernizations at federal facilities, especially those involving upgrades from 5KV to 15KV, are substantial undertakings. Factors such as the size of the facility, the age of the existing infrastructure, specific technical requirements, and geographic location significantly influence costs. Generally, projects of this magnitude can range from tens to hundreds of millions of dollars. Without specific details on comparable projects (e.g., square footage of the facility, specific equipment replaced, labor costs in Seattle), a precise comparison is difficult. However, the awarded amount appears to be within the expected range for a comprehensive upgrade of this nature at a major federal medical center.

What are the primary risks associated with a Fixed Price with Economic Price Adjustment (FP-EPA) contract for this type of project?

The primary risk associated with an FP-EPA contract for electrical upgrades lies in the potential for significant cost increases due to fluctuations in the market prices of key materials, such as copper, aluminum, and specialized electrical components. While the FP-EPA clause is designed to protect the contractor from unforeseen economic shifts and ensure project continuity, it shifts some of the financial risk to the government. If material costs escalate beyond initial projections, the government may end up paying more than anticipated. Effective risk mitigation involves robust market analysis during contract negotiation, clear definitions of economic indices for adjustment, and diligent monitoring of material price trends throughout the contract performance period to manage potential cost overruns.

What is the significance of upgrading the electrical system from 5KV to 15KV for the PSHCS Seattle facility?

Upgrading the electrical distribution system from 5 kilovolts (KV) to 15KV represents a significant increase in the system's capacity and voltage handling capability. This upgrade is crucial for modernizing aging infrastructure, enhancing reliability, and ensuring the facility can meet current and future energy demands. Higher voltage systems can often transmit power more efficiently and support larger loads, which is essential for complex facilities like a Polytrauma and Spinal Cord Injury Center (PSHCS). This modernization likely improves safety by replacing outdated equipment, reduces the risk of power outages that could disrupt critical patient care, and prepares the facility for potential future expansions or the integration of new technologies requiring substantial power.

How does the duration of the contract (1267 days) impact project oversight and potential risks?

A contract duration of 1267 days (approximately 3.5 years) for an electrical upgrade project indicates a substantial and complex undertaking. This extended timeline necessitates continuous and rigorous oversight from the VA's contracting and project management teams to ensure progress aligns with the schedule and quality standards are maintained. The longer duration increases the exposure to various risks, including potential changes in technology, evolving regulatory requirements, unforeseen site conditions, and the possibility of contractor performance degradation over time. Furthermore, extended projects are more susceptible to economic fluctuations, making the FP-EPA clause particularly relevant. Effective management requires proactive risk identification, regular progress reviews, and adaptive strategies to address challenges that may arise over the multi-year performance period.

Industry Classification

NAICS: Construction › Building Equipment Contractors › Electrical Contractors and Other Wiring Installation Contractors

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

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: VA260-16-R-0001

Offers Received: 2

Pricing Type: FIXED PRICE WITH ECONOMIC PRICE ADJUSTMENT (K)

Evaluated Preference: NONE

Contractor Details

Address: 6795 FLANDERS DR, SAN DIEGO, CA, 92121

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $30,860,351

Exercised Options: $30,860,351

Current Obligation: $30,860,351

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline