VA awards $29.4M for National Cemetery construction, highlighting firm fixed-price contract for Phase 3

Contract Overview

Contract Amount: $29,426,588 ($29.4M)

Contractor: Veterans Contracting, Inc.

Awarding Agency: Department of Veterans Affairs

Start Date: 2020-10-06

End Date: 2024-12-23

Contract Duration: 1,539 days

Daily Burn Rate: $19.1K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 5

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: CONSTRUCTION OF OHIO WESTERN RESERVE NATIONAL CEMETERY, PHASE 3

Place of Performance

Location: SEVILLE, MEDINA County, OHIO, 44273

State: Ohio Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $29.4 million to VETERANS CONTRACTING, INC. for work described as: CONSTRUCTION OF OHIO WESTERN RESERVE NATIONAL CEMETERY, PHASE 3 Key points: 1. Contract awarded to Veterans Contracting, Inc. for cemetery expansion. 2. Firm fixed-price contract type suggests predictable costs for the government. 3. Definitive contract structure indicates a long-term agreement for services. 4. Competition was full and open after exclusion of sources, implying a broad search for qualified bidders. 5. Project duration of 1539 days points to a significant construction undertaking. 6. The contract is for construction services, specifically heavy and civil engineering. 7. Awarded by the Department of Veterans Affairs, aligning with its mission.

Value Assessment

Rating: good

The contract value of $29.4 million for Phase 3 of the Ohio Western Reserve National Cemetery construction appears reasonable for a project of this scale and duration. While specific benchmarks for national cemetery construction are not readily available, the firm fixed-price nature of the contract helps mitigate cost overrun risks for the government. The award to Veterans Contracting, Inc. suggests they were deemed the best value among the bidders. Further analysis would require comparing this cost to similar cemetery expansion projects or construction of comparable civil engineering scope.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under 'full and open competition after exclusion of sources.' This indicates that while the competition was intended to be broad, certain sources may have been excluded based on specific criteria, possibly related to qualifications or prior performance. The presence of 5 bidders suggests a moderate level of competition. The exclusion of sources warrants further investigation to ensure it did not unduly limit competition and potentially impact price discovery.

Taxpayer Impact: The full and open competition, despite source exclusions, aims to secure competitive pricing for taxpayers. A moderate number of bidders generally supports price discovery, but the exclusion of certain sources could potentially limit the most competitive offers.

Public Impact

The primary beneficiaries are veterans and their families who will have access to expanded burial and memorial services at the Ohio Western Reserve National Cemetery. The project delivers essential construction services for a national cemetery, enhancing its capacity and infrastructure. The geographic impact is focused on Ohio, providing a vital resource for the state's veteran population. The construction activities will likely create jobs in the heavy and civil engineering sector within Ohio.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for limited competition due to 'exclusion of sources' clause, which needs scrutiny to ensure fairness and optimal pricing.
The long project duration (1539 days) increases the risk of unforeseen challenges or changes in requirements.
Reliance on a single contractor for a multi-year project could pose risks if performance issues arise.

Positive Signals

Firm fixed-price contract provides cost certainty and reduces the government's exposure to price fluctuations.
Award to a specific contractor (Veterans Contracting, Inc.) suggests they met the required qualifications and offered competitive terms.
The project aligns with the VA's mission to serve veterans, indicating a clear and justifiable government need.

Sector Analysis

This contract falls within the Construction sector, specifically heavy and civil engineering construction. The market for national cemetery construction is specialized, often driven by government agencies like the Department of Veterans Affairs. While not a massive market segment compared to broader infrastructure, it is critical for fulfilling national obligations to veterans. Benchmarking would involve comparing costs to other VA cemetery projects or similar large-scale civil engineering undertakings.

Small Business Impact

The data indicates that small business participation was not a primary focus for this specific contract, as the 'small business set-aside' field is false. There is no explicit information on subcontracting plans for small businesses. This suggests that the primary contractor, Veterans Contracting, Inc., is likely a larger entity, and the impact on the small business ecosystem would depend on their subcontracting practices, which are not detailed here.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of Veterans Affairs (VA). The VA's Office of Inspector General (OIG) would have jurisdiction to investigate any potential fraud, waste, or abuse. Transparency is facilitated through contract award databases like FPDS. Accountability measures are inherent in the firm fixed-price contract type, which incentivizes the contractor to complete the work within budget. Performance monitoring by the VA contracting officer is crucial.

Related Government Programs

National Cemetery Administration Construction Projects
Department of Veterans Affairs Capital Investments
Heavy and Civil Engineering Construction Contracts
Federal Cemetery Development

Risk Flags

Potential for limited competition due to source exclusion.
Long project duration increases risk exposure.
Contractor performance history requires verification.
Scope definition and change management critical for FFP.

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $29.4 million to VETERANS CONTRACTING, INC.. CONSTRUCTION OF OHIO WESTERN RESERVE NATIONAL CEMETERY, PHASE 3

Who is the contractor on this award?

The obligated recipient is VETERANS CONTRACTING, 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 $29.4 million.

What is the period of performance?

Start: 2020-10-06. End: 2024-12-23.

What is the track record of Veterans Contracting, Inc. on similar federal construction projects?

A review of federal contract databases would be necessary to fully assess Veterans Contracting, Inc.'s track record. Specifically, one would look for past performance on projects of similar size, scope, and complexity, particularly those involving cemetery construction or heavy civil engineering for government agencies. Key indicators would include on-time and on-budget completion rates, quality of work, and any history of disputes or contract terminations. Understanding their experience with the Department of Veterans Affairs would also be highly relevant. Without specific data on their past performance, it's difficult to definitively assess their capability for this project.

How does the awarded amount compare to similar national cemetery construction projects?

Direct comparison of the $29.4 million award for Phase 3 of the Ohio Western Reserve National Cemetery construction requires access to detailed cost data for comparable projects. Factors such as geographic location, specific site conditions, scope of work (e.g., number of gravesites, infrastructure included), and the year of award significantly influence costs. Generally, national cemetery projects involve extensive site preparation, utility work, landscaping, and construction of administrative facilities. Benchmarking against other VA cemetery expansions or similar large-scale civil engineering projects would provide context. The firm fixed-price nature suggests the government sought cost certainty, but the true value-for-money depends on the quality and efficiency of the execution relative to the price.

What are the specific risks associated with the 'exclusion of sources' in the competition process?

The 'exclusion of sources' clause in a 'full and open competition' can introduce several risks. Primarily, it may limit the pool of potential bidders, potentially reducing the level of competition and leading to higher prices than might be achieved in a truly unrestricted competition. The specific criteria for exclusion need to be clearly defined and justifiable to ensure they are not arbitrary or designed to unfairly favor certain contractors. If the exclusions are too broad or not well-founded, it could lead to protests from excluded vendors. The risk for taxpayers is that the government might not receive the most innovative solutions or the lowest possible price if a significant number of capable contractors were prevented from bidding.

How effective is the firm fixed-price contract type in managing costs for long-term construction projects like this?

Firm fixed-price (FFP) contracts are generally considered effective for managing costs in construction projects where the scope of work is well-defined and risks can be reasonably anticipated. For this project, the FFP structure shifts most of the cost risk to the contractor, Veterans Contracting, Inc. This incentivizes the contractor to control costs and manage resources efficiently to maximize profit. The government benefits from cost certainty, as the final price is largely predetermined. However, for very long-term projects (like this one with a 1539-day duration), there's a risk that unforeseen conditions or significant market fluctuations (e.g., material costs) could put extreme pressure on the contractor, potentially leading to requests for modification or, in extreme cases, contractor default if not managed carefully. Robust contract administration by the VA is still crucial to ensure compliance and address any necessary change orders.

What is the historical spending pattern for national cemetery construction by the Department of Veterans Affairs?

Analyzing historical spending patterns for national cemetery construction by the VA would reveal trends in contract values, types of services procured, and the frequency of such awards. This contract, valued at $29.4 million, represents a significant investment. Historical data might show whether this is typical for major expansion phases, if spending has increased over time due to inflation or increased demand for veteran burial services, and which contractors have been historically successful. Understanding these patterns helps in budgeting, forecasting future needs, and assessing whether current contract awards are in line with historical norms or represent a deviation requiring further explanation.

What are the implications of the 5-bidder competition for price discovery and value for money?

A competition with 5 bidders generally suggests a moderate level of market interest and provides a reasonable basis for price discovery. Having multiple offers allows the government to compare proposals and identify a price that is likely competitive. However, the 'value for money' is not solely determined by the number of bidders but also by the quality of the proposals received and the thoroughness of the evaluation process. If the 5 bidders were all highly qualified and their bids were closely scrutinized, then 5 bidders could yield good value. Conversely, if the bidding pool was limited due to the 'exclusion of sources' or if the evaluation criteria were not optimal, the value for money might be compromised. A higher number of bidders typically correlates with better price competition.

Industry Classification

NAICS: Construction › Other Heavy and Civil Engineering Construction › Other Heavy and Civil Engineering Construction

Product/Service Code: CONSTRUCT OF STRUCTURES/FACILITIES › CONSTRUCTION OF BUILDINGS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: 36C10F20R0069

Offers Received: 5

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 4770 W 139TH ST, CLEVELAND, OH, 44135

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: $29,426,588

Exercised Options: $29,426,588

Current Obligation: $29,426,588

Actual Outlays: $5,929,432

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline