Madigan Army Medical Center Tower Repair Project Awarded to Herman Construction Group for $27M

Contract Overview

Contract Amount: $27,012,198 ($27.0M)

Contractor: Herman Construction Group, Inc.

Awarding Agency: Department of Defense

Start Date: 2022-09-01

End Date: 2025-05-09

Contract Duration: 981 days

Daily Burn Rate: $27.5K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 5

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: REPAIR TOWER INTERSTITIAL DECKS PROJECT, MADIGAN ARMY MEDICAL CENTER, JOINT BASE LEWIS MCCHORD, TACOMA WA 98431

Place of Performance

Location: JOINT BASE LEWIS MCCHORD, PIERCE County, WASHINGTON, 98433

State: Washington Government Spending

Plain-Language Summary

Department of Defense obligated $27.0 million to HERMAN CONSTRUCTION GROUP, INC. for work described as: REPAIR TOWER INTERSTITIAL DECKS PROJECT, MADIGAN ARMY MEDICAL CENTER, JOINT BASE LEWIS MCCHORD, TACOMA WA 98431 Key points: 1. Project aims to repair interstitial decks at a major Army medical facility. 2. Contract awarded through full and open competition, suggesting a competitive bidding process. 3. The contract duration of 981 days indicates a significant, multi-year undertaking. 4. Fixed-price contract type shifts performance risk to the contractor. 5. The project is located at Joint Base Lewis-McChord, a key military installation. 6. The value of the contract is substantial for a construction project of this nature.

Value Assessment

Rating: good

The contract value of approximately $27 million for the repair of tower interstitial decks at Madigan Army Medical Center appears reasonable given the scope and duration. Benchmarking against similar large-scale construction and repair projects within federal facilities suggests that this price falls within expected ranges. The firm fixed-price structure also implies that the contractor has assessed the risks and costs associated with the project, and the government is paying a set amount for the completed work. Without specific details on the extent of the repairs, a precise value-for-money assessment is challenging, but the initial award amount does not raise immediate red flags.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit bids. The presence of 5 bidders suggests a healthy level of competition for this project. A competitive bidding process generally leads to better price discovery and can result in more favorable pricing for the government compared to sole-source or limited competition awards. The number of bidders provides some assurance that the government received a competitive offer.

Taxpayer Impact: Taxpayers benefit from a competitive process that aims to secure the best possible price for the required construction services, minimizing the risk of overpayment.

Public Impact

The primary beneficiaries are the Department of the Army and the personnel who utilize Madigan Army Medical Center, ensuring the facility's structural integrity. The project delivers essential repair services to critical infrastructure within a major military medical complex. The geographic impact is concentrated at Joint Base Lewis-McChord in Tacoma, Washington. The project will likely involve a workforce of construction professionals and tradespeople, contributing to local employment.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if unforeseen structural issues are discovered during the extensive repair work.
Risk of project delays due to the long duration and potential for weather or logistical challenges at a busy military installation.
Ensuring the quality of repairs meets stringent military healthcare facility standards requires robust oversight.

Positive Signals

Awarded through full and open competition, indicating a robust bidding process.
Firm fixed-price contract shifts cost risk to the contractor.
The project addresses critical infrastructure maintenance for a vital medical facility.
The contractor, Herman Construction Group, Inc., has experience in construction projects.

Sector Analysis

This contract falls within the Commercial and Institutional Building Construction sector, a broad category encompassing the building, alteration, and repair of non-residential structures. The federal government is a significant consumer of construction services, particularly for maintaining and upgrading its vast portfolio of facilities, including military bases and medical centers. The market for such services is competitive, with numerous firms capable of undertaking large-scale projects. The value of this contract, approximately $27 million, positions it as a significant project within this sector, requiring specialized expertise and project management capabilities.

Small Business Impact

The data indicates that this contract was not set aside for small businesses (ss: false) and there is no indication of specific small business subcontracting requirements being a primary driver (sb: false). This suggests that the primary focus was on securing the best offer through full and open competition, likely favoring larger, established construction firms with the capacity to handle a project of this magnitude. While small businesses may participate as subcontractors, their direct role as prime contractors appears limited in this instance.

Oversight & Accountability

Oversight for this contract will likely be managed by the Department of the Army contracting and engineering personnel at Madigan Army Medical Center and Joint Base Lewis-McChord. Accountability measures are embedded in the firm fixed-price contract terms, requiring the contractor to deliver the specified repairs within the agreed-upon price and schedule. Transparency is generally maintained through contract award databases and reporting requirements. Inspector General jurisdiction would apply if any fraud, waste, or abuse is suspected.

Related Government Programs

Military Construction
Healthcare Facility Maintenance
Base Realignment and Closure (BRAC) related infrastructure projects
Department of Defense Facilities Management
Repair and Alteration of Buildings

Risk Flags

Potential for unforeseen conditions impacting schedule and cost.
Risk of disruption to ongoing medical operations.
Ensuring compliance with stringent healthcare facility construction standards.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $27.0 million to HERMAN CONSTRUCTION GROUP, INC.. REPAIR TOWER INTERSTITIAL DECKS PROJECT, MADIGAN ARMY MEDICAL CENTER, JOINT BASE LEWIS MCCHORD, TACOMA WA 98431

Who is the contractor on this award?

The obligated recipient is HERMAN CONSTRUCTION GROUP, INC..

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Army).

What is the total obligated amount?

The obligated amount is $27.0 million.

What is the period of performance?

Start: 2022-09-01. End: 2025-05-09.

What is the track record of Herman Construction Group, Inc. on federal contracts, particularly those involving healthcare facilities?

Herman Construction Group, Inc. has a history of performing construction services for the federal government. While specific details on their past performance on healthcare facilities require deeper database analysis, their award on this significant project at Madigan Army Medical Center suggests they possess the requisite experience and qualifications. A review of their contract history would reveal the types of projects completed, their performance ratings, and any past issues or successes. Understanding their prior experience with similar complex repair projects, especially within active medical environments, is crucial for assessing their capability to successfully execute this contract and manage potential risks effectively.

How does the $27 million contract value compare to similar interstitial deck repair projects at other federal medical facilities?

Benchmarking the $27 million contract value against similar interstitial deck repair projects at other federal medical facilities is essential for a comprehensive value-for-money assessment. Factors such as the square footage of the area being repaired, the complexity of the existing infrastructure, the specific materials required, and the prevailing labor costs in the region all influence project pricing. Without access to a detailed breakdown of the scope of work and specific repair methodologies, a precise comparison is difficult. However, preliminary analysis suggests the award is within a reasonable range for a project of this scale at a major medical installation, assuming standard repair requirements.

What are the primary risks associated with repairing interstitial decks in a functioning hospital environment?

Repairing interstitial decks in a functioning hospital environment presents several unique risks. Foremost is the potential disruption to ongoing medical operations, requiring meticulous scheduling and containment measures to prevent dust, noise, and vibration from impacting patient care and sensitive medical equipment. There's also a risk of encountering unforeseen structural issues or hazardous materials (like asbestos or lead paint) within the existing interstitial spaces, which could lead to scope changes, delays, and increased costs. Maintaining sterile environments or infection control protocols during construction is paramount to prevent hospital-acquired infections. Furthermore, ensuring the safety of construction workers operating in confined and potentially hazardous spaces requires stringent safety protocols.

What is the projected impact of this contract on the operational capacity and patient care at Madigan Army Medical Center?

The projected impact of this contract on operational capacity and patient care at Madigan Army Medical Center is intended to be minimal disruption with long-term benefits. The repairs to the interstitial decks are crucial for maintaining the building's structural integrity and ensuring the reliable functioning of essential building systems (like HVAC, plumbing, and electrical) that are housed within these spaces. By addressing these repairs proactively, the contract aims to prevent future failures that could lead to significant service interruptions or compromises in patient care. The project's success should ultimately enhance the reliability and safety of the medical facility, supporting its mission to provide high-quality healthcare to service members and their families.

How has federal spending on construction and repair projects at military medical facilities trended over the past five years?

Federal spending on construction and repair projects at military medical facilities has generally seen consistent investment over the past five years, driven by the need to maintain aging infrastructure and modernize healthcare capabilities. While specific figures fluctuate annually based on budget allocations and emerging needs, there has been a sustained focus on ensuring these critical facilities are safe, functional, and equipped to meet the healthcare demands of the military community. Factors such as readiness requirements, technological advancements in medical equipment, and the ongoing need for facility upgrades contribute to this consistent spending pattern. This particular contract aligns with that broader trend of investing in the upkeep and improvement of military healthcare infrastructure.

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

Key performance indicators (KPIs) for this contract will likely focus on adherence to schedule, budget, and quality standards. Specific KPIs could include: completion of repair milestones by designated dates, adherence to the firm fixed-price budget with minimal change orders, and meeting all specified technical requirements and building codes for structural integrity and safety. Quality control inspections and post-completion assessments will be critical. Additionally, minimizing disruption to hospital operations, maintaining infection control standards, and ensuring worker safety throughout the project duration will be vital performance metrics. The final acceptance of the work by the government contracting officer will be the ultimate measure of success.

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: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 5

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 2060 WINERIDGE PL STE A, ESCONDIDO, CA, 92029

Business Categories: 8(a) Program Participant, Category Business, Corporate Entity Not Tax Exempt, Hispanic American Owned Business, Minority Owned Business, Self-Certified Small Disadvantaged Business, Service Disabled Veteran Owned Business, Small Business, Special Designations, Subchapter S Corporation, U.S.-Owned Business, Veteran Owned Business

Financial Breakdown

Contract Ceiling: $27,012,198

Exercised Options: $27,012,198

Current Obligation: $27,012,198

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: W912DY17D0024

IDV Type: IDC

Timeline