VA awards $33.3M Miramar Cemetery Expansion contract to SGC SERVICES 2, LLC for heavy civil engineering

Contract Overview

Contract Amount: $33,342,187 ($33.3M)

Contractor: SGC Services 2, LLC

Awarding Agency: Department of Veterans Affairs

Start Date: 2021-10-15

End Date: 2024-08-29

Contract Duration: 1,049 days

Daily Burn Rate: $31.8K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 2

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: MIRAMAR NATIONAL CEMETERY EXPANSION PHASE 2

Place of Performance

Location: SAN DIEGO, SAN DIEGO County, CALIFORNIA, 92122

State: California Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $33.3 million to SGC SERVICES 2, LLC for work described as: MIRAMAR NATIONAL CEMETERY EXPANSION PHASE 2 Key points: 1. Contract awarded through full and open competition, suggesting a competitive bidding process. 2. The contract's duration of 1049 days indicates a significant, long-term project. 3. Fixed-price contract type aims to control costs for the government. 4. The project is located in California, a state with substantial infrastructure needs. 5. The North American Industry Classification System (NAICS) code 237990 points to specialized heavy construction services. 6. The award amount of $33.3 million represents a substantial investment in veterans' affairs infrastructure.

Value Assessment

Rating: good

The contract value of $33.3 million for cemetery expansion appears reasonable given the scope of heavy civil engineering work. Benchmarking against similar large-scale construction projects for federal agencies would provide a more precise value-for-money assessment. The firm fixed-price structure is a positive indicator for cost control, assuming the initial scope was well-defined.

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,' which implies that while the competition was open, specific sources may have been excluded for defined reasons. The presence of two bidders suggests a moderate level of competition. A higher number of bidders typically leads to more competitive pricing and a wider range of technical solutions.

Taxpayer Impact: The competitive nature of this award, even with two bidders, is beneficial for taxpayers as it likely drove down the final price compared to a sole-source procurement. It ensures that the selected contractor must offer a competitive bid to win the work.

Public Impact

The primary beneficiaries are veterans and their families who will have expanded burial space at Miramar National Cemetery. The project delivers essential infrastructure development for national cemeteries. The geographic impact is concentrated in Southern California, serving the needs of veterans in that region. The contract supports jobs in the heavy civil engineering and construction sectors.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for scope creep in large, multi-year construction projects, which could increase costs if not managed effectively.
Reliance on a single contractor for the entirety of Phase 2 could pose risks if the contractor faces financial or operational difficulties.

Positive Signals

The firm fixed-price contract type helps mitigate cost overruns for the government.
The award was made through a competitive process, indicating that multiple firms were considered.
The project addresses a critical need for expanded burial space, ensuring long-term service to veterans.

Sector Analysis

The heavy and civil engineering construction sector is vital for developing and maintaining public infrastructure. This contract falls within the broader construction industry, specifically focusing on large-scale earthmoving, site preparation, and infrastructure development. Comparable spending benchmarks for national cemetery expansions or similar government civil works projects would provide context for the $33.3 million award.

Small Business Impact

The data indicates that small business participation was not a primary set-aside criterion for this contract (ss: false, sb: false). While SGC SERVICES 2, LLC may engage small businesses as subcontractors, there is no explicit requirement for it in the contract details provided. Further analysis of subcontracting plans would be needed to assess the impact on the small business ecosystem.

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. Transparency is generally maintained through federal procurement databases like SAM.gov. Inspector General jurisdiction would apply if any fraud, waste, or abuse is suspected.

Related Government Programs

National Cemetery Administration Capital Improvements
Department of Veterans Affairs Construction Projects
Federal Heavy Civil Engineering Contracts

Risk Flags

Potential for unforeseen site conditions impacting cost and schedule.
Risk associated with limited competition (two bidders) potentially affecting price discovery.
Contract duration increases complexity of project management and oversight.

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $33.3 million to SGC SERVICES 2, LLC. MIRAMAR NATIONAL CEMETERY EXPANSION PHASE 2

Who is the contractor on this award?

The obligated recipient is SGC SERVICES 2, LLC.

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 $33.3 million.

What is the period of performance?

Start: 2021-10-15. End: 2024-08-29.

What is the track record of SGC SERVICES 2, LLC with federal contracts, particularly with the Department of Veterans Affairs?

A review of federal procurement data would be necessary to fully assess SGC SERVICES 2, LLC's track record. This would involve examining past contract awards, performance evaluations (e.g., Contractor Performance Assessment Reporting System - CPARS), and any history of disputes or terminations. Understanding their experience with similar-sized heavy civil engineering projects, especially for the VA or other agencies with similar requirements, is crucial for evaluating their capability to successfully execute the Miramar National Cemetery Expansion Phase 2.

How does the awarded price of $33.3 million compare to similar cemetery expansion projects or heavy civil engineering contracts?

Benchmarking this $33.3 million contract requires identifying comparable projects in terms of scope, scale, and complexity. This includes looking at other national cemetery expansions, large-scale earthmoving projects, or infrastructure development contracts awarded by federal agencies. Factors such as geographic location (labor and material costs vary significantly), specific site conditions, and the exact services included (e.g., grading, drainage, utility installation, landscaping) must be considered. Without specific comparable data, it's difficult to definitively state if the price represents excellent or fair value, but it appears substantial for a single phase of expansion.

What are the primary risks associated with this specific contract, and how are they being mitigated?

Key risks for this contract include potential cost overruns due to unforeseen site conditions (common in heavy civil engineering), delays in schedule, and contractor performance issues. The firm fixed-price contract type mitigates cost overrun risk for the government, shifting much of that burden to the contractor. Mitigation strategies likely involve robust project management by the VA, detailed site investigations prior to award, clear performance metrics, and potentially liquidated damages clauses for delays. The limited competition (two bidders) could also be a risk if the chosen contractor underperforms, as re-competing may be time-consuming and costly.

How effective is the 'Full and Open Competition After Exclusion of Sources' method in ensuring fair pricing and quality for this project?

This procurement method aims to balance the benefits of full and open competition with specific, justifiable reasons for excluding certain sources. It suggests that the agency identified a need that could be met by a limited pool of qualified contractors, perhaps due to specialized capabilities or prior performance. While it's more competitive than a sole-source award, having only two bidders means the price discovery mechanism is less robust than if there were numerous competitors. The effectiveness hinges on whether the exclusions were valid and if the two bidders were sufficiently motivated to offer competitive terms. The VA must ensure the selected bid represents fair and reasonable pricing.

What is the historical spending pattern for Miramar National Cemetery expansion or similar VA infrastructure projects?

Analyzing historical spending for Miramar National Cemetery expansion and comparable VA infrastructure projects is crucial for context. This involves examining previous phases of the Miramar expansion, if any, and other cemetery development or renovation projects undertaken by the VA. Understanding the total investment over time, the number and value of contracts awarded, and the types of services procured provides insight into the agency's long-term capital planning and budgeting for such facilities. Significant year-over-year increases or decreases in spending could indicate shifts in priorities, funding availability, or project phasing.

What are the implications of the contract duration (1049 days) on project management and potential for cost escalation?

A contract duration of 1049 days (approximately 2.87 years) for Phase 2 of the Miramar National Cemetery expansion signifies a substantial, long-term construction undertaking. This extended timeline necessitates rigorous project management to ensure adherence to schedule and budget. While a firm fixed-price contract aims to cap costs, prolonged projects inherently carry a higher risk of economic price adjustments for certain materials or labor, depending on contract clauses. Effective oversight is critical to monitor progress, manage potential delays, and ensure the contractor maintains performance standards throughout the project lifecycle.

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: 36C10F21R0018

Offers Received: 2

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 2213 SE COCHRAN DR, GRESHAM, OR, 97080

Business Categories: Category Business, Limited Liability Corporation, Partnership or Limited Liability Partnership, Self-Certified Small Disadvantaged Business, Service Disabled Veteran Owned Business, Small Business, Special Designations, U.S.-Owned Business, Veteran Owned Business

Financial Breakdown

Contract Ceiling: $33,342,187

Exercised Options: $33,342,187

Current Obligation: $33,342,187

Actual Outlays: $8,036,469

Contract Characteristics

Multi-Year Contract: Yes

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline