DoD Awards $617M Design-Build Contract for El Paso VA Health Care Center to Clark Construction Group
Contract Overview
Contract Amount: $617,097,701 ($617.1M)
Contractor: Clark Construction Group LLC
Awarding Agency: Department of Defense
Start Date: 2023-12-19
End Date: 2028-02-29
Contract Duration: 1,533 days
Daily Burn Rate: $402.5K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 2
Pricing Type: FIRM FIXED PRICE
Sector: Construction
Official Description: DESIGN-BUILD CONSTRUCTION OF THE VETERANS AFFAIRS HEALTH CARE CENTER, EL PASO, TX
Place of Performance
Location: FORT BLISS, EL PASO County, TEXAS, 79916
State: Texas Government Spending
Plain-Language Summary
Department of Defense obligated $617.1 million to CLARK CONSTRUCTION GROUP LLC for work described as: DESIGN-BUILD CONSTRUCTION OF THE VETERANS AFFAIRS HEALTH CARE CENTER, EL PASO, TX Key points: 1. Significant investment in healthcare infrastructure for veterans. 2. Large-scale design-build project indicates complex requirements. 3. Potential for cost overruns in long-term construction projects. 4. Construction sector faces material cost volatility and labor shortages.
Value Assessment
Rating: fair
The contract value of $617M is substantial for a single healthcare facility. Benchmarking against similar large-scale healthcare construction projects is difficult without more granular cost data, but the firm-fixed-price nature suggests an attempt to control costs.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
Full and open competition was utilized, which is ideal for price discovery and ensuring the best value. The award to a single entity, Clark Construction Group LLC, suggests they offered the most competitive proposal.
Taxpayer Impact: Taxpayer funds are being used for a critical veteran healthcare facility, representing a significant investment in public services.
Public Impact
Improved access to healthcare services for veterans in the El Paso region. Job creation during the construction phase and ongoing operational employment. Potential for long-term economic development in the surrounding community.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Long project duration (over 4 years) increases risk of cost escalation.
- Firm-fixed-price contracts can shift risk to the contractor, potentially leading to quality compromises if not managed well.
- Reliance on a single large contractor for a complex project.
Positive Signals
- Full and open competition should drive value.
- Design-build approach can streamline project delivery.
- Investment in critical veteran infrastructure.
Sector Analysis
The construction sector, particularly for large institutional buildings like healthcare facilities, is subject to market fluctuations in material costs and labor availability. This project falls within the commercial and institutional building construction NAICS code.
Small Business Impact
While the prime contractor is a large entity, opportunities for small businesses may exist as subcontractors for specialized services or material supply. Further analysis would be needed to determine the extent of small business participation.
Oversight & Accountability
The Department of the Army, under the DoD, is responsible for oversight. Robust project management and regular progress reviews will be crucial to ensure adherence to schedule, budget, and quality standards.
Related Government Programs
- Commercial and Institutional Building Construction
- Department of Defense Contracting
- Department of the Army Programs
Risk Flags
- Potential for schedule delays due to complexity and duration.
- Risk of cost overruns if unforeseen issues arise.
- Dependence on a single large contractor.
- Market volatility in construction materials and labor.
Tags
commercial-and-institutional-building-co, department-of-defense, tx, definitive-contract, 100m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $617.1 million to CLARK CONSTRUCTION GROUP LLC. DESIGN-BUILD CONSTRUCTION OF THE VETERANS AFFAIRS HEALTH CARE CENTER, EL PASO, TX
Who is the contractor on this award?
The obligated recipient is CLARK CONSTRUCTION GROUP LLC.
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Army).
What is the total obligated amount?
The obligated amount is $617.1 million.
What is the period of performance?
Start: 2023-12-19. End: 2028-02-29.
What is the estimated cost per square foot for this facility, and how does it compare to similar VA or healthcare construction projects?
Without detailed cost breakdowns or square footage information, a precise per-square-foot cost cannot be determined. However, given the $617M contract value and the nature of a modern healthcare center, the cost per square foot is likely to be within the upper range for institutional construction, reflecting specialized medical equipment and infrastructure requirements.
What are the key performance indicators (KPIs) being used to monitor contractor performance and mitigate risks associated with the long project duration?
Key performance indicators likely include adherence to the project schedule, quality control metrics for construction phases, budget variance tracking, and compliance with safety regulations. Regular site inspections, progress reports, and milestone reviews by the contracting officer's representative are essential for proactive risk management and ensuring project success.
How will the effectiveness of the new healthcare center be measured post-completion in terms of veteran access and quality of care?
Effectiveness will be measured through veteran satisfaction surveys, wait times for appointments, availability of specialized services, and patient health outcomes. Post-occupancy evaluations and ongoing operational data analysis will provide insights into the facility's performance and its impact on veteran healthcare delivery.
Industry Classification
NAICS: Construction › Nonresidential Building Construction › Commercial and Institutional Building Construction
Product/Service Code: CONSTRUCT OF STRUCTURES/FACILITIES › CONSTRUCTION OF BUILDINGS
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Solicitation ID: W518EA22R0097
Offers Received: 2
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: Clark Construction LLC
Address: 7500 OLD GEORGETOWN RD, BETHESDA, MD, 20814
Business Categories: Category Business, Limited Liability Corporation, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $623,954,701
Exercised Options: $617,097,701
Current Obligation: $617,097,701
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Timeline
Start Date: 2023-12-19
Current End Date: 2028-02-29
Potential End Date: 2028-02-29 00:00:00
Last Modified: 2026-04-15
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