VA awards $18M contract for Montrose VAMC building renovation to AC JV ONE LLC

Contract Overview

Contract Amount: $17,991,871 ($18.0M)

Contractor: AC JV ONE LLC

Awarding Agency: Department of Veterans Affairs

Start Date: 2023-03-10

End Date: 2026-04-28

Contract Duration: 1,145 days

Daily Burn Rate: $15.7K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 3

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: RENOVATE BUILDING 13 FLOOR CD AT THE MONTROSE VAMC

Place of Performance

Location: MONTROSE, WESTCHESTER County, NEW YORK, 10548

State: New York Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $18.0 million to AC JV ONE LLC for work described as: RENOVATE BUILDING 13 FLOOR CD AT THE MONTROSE VAMC Key points: 1. Contract awarded via full and open competition, suggesting a competitive bidding process. 2. The contract type is a definitive contract with a firm fixed price, indicating cost certainty. 3. The project duration is 1145 days, spanning over three years, requiring sustained oversight. 4. The awardee, AC JV ONE LLC, is a relatively new entity, raising questions about track record. 5. The North American Industry Classification System (NAICS) code 236220 points to commercial and institutional building construction. 6. The contract is not set aside for small businesses, implying larger firms participated. 7. The contract is being administered by the Department of Veterans Affairs, aligning with its mission.

Value Assessment

Rating: fair

The contract value of approximately $18 million for building renovation appears within a reasonable range for a project of this scope and duration. However, without specific details on the scope of work, it is difficult to benchmark against similar contracts precisely. The firm fixed-price nature provides cost predictability for the government. Further analysis would require comparing the cost per square foot or per major renovation task against industry standards and similar VA projects.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES.' This indicates that the solicitation was broadly advertised, and multiple responsible sources were permitted to submit offers. The presence of 3 bids suggests a moderate level of competition for this specific project. While full and open competition is generally preferred, the number of bidders can influence price discovery.

Taxpayer Impact: A competitive bidding process helps ensure that taxpayer dollars are used efficiently by driving down costs through market forces. A moderate number of bidders suggests that the government likely received competitive pricing, though a higher number of bids could potentially yield even better value.

Public Impact

Veterans receiving care at the Montrose VA Medical Center will benefit from improved facilities. The renovation project will enhance the operational capacity and patient experience at the facility. The project is geographically focused on Montrose, New York, impacting the local construction economy. The construction activities will likely create temporary employment opportunities for skilled trades and laborers in the region.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

The awardee, AC JV ONE LLC, may have limited prior performance history on large federal contracts, necessitating close monitoring of project execution.
The firm fixed-price contract type places cost risk on the contractor; any unforeseen issues could lead to claims or performance challenges if not managed effectively.
The duration of the contract (over three years) requires sustained government oversight to ensure compliance and quality throughout the project lifecycle.

Positive Signals

The contract was awarded through full and open competition, indicating a robust and transparent procurement process.
The firm fixed-price contract structure provides budget certainty for the Department of Veterans Affairs.
The project directly supports the VA's mission to provide quality healthcare facilities for veterans.

Sector Analysis

This contract falls within the Commercial and Institutional Building Construction sector, a significant segment of the construction industry. The market for federal building construction and renovation is substantial, with agencies like the VA consistently investing in maintaining and upgrading their facilities. Benchmarking would involve comparing the cost per square foot or per major renovation task against similar projects undertaken by other federal agencies or large private institutions.

Small Business Impact

The contract was not awarded as a small business set-aside, and there is no explicit indication of subcontracting requirements for small businesses in the provided data. This suggests that the primary award went to a larger entity or a joint venture capable of handling the project's scale. The absence of set-aside provisions may limit direct opportunities for small businesses to participate as prime contractors on this specific award, though they could potentially be involved as subcontractors if the prime contractor opts to engage them.

Oversight & Accountability

Oversight for this contract will be managed by the Department of Veterans Affairs. As a definitive contract with a firm fixed price, accountability will focus on adherence to the contract scope, schedule, and quality standards. Transparency is expected through contract award data and potentially through public reporting on project milestones. The VA's internal Inspector General's office would have jurisdiction to investigate any potential fraud, waste, or abuse related to this contract.

Related Government Programs

VA Medical Facility Renovations
Federal Building Construction Contracts
Department of Veterans Affairs Capital Investments
Construction Services for Government Facilities

Risk Flags

Potential for contractor claims due to unforeseen site conditions.
Risk of cost escalation for materials and labor over the multi-year project.
Need for sustained government oversight due to long project duration.
Limited public information on the awardee's prior performance history.

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $18.0 million to AC JV ONE LLC. RENOVATE BUILDING 13 FLOOR CD AT THE MONTROSE VAMC

Who is the contractor on this award?

The obligated recipient is AC JV ONE 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 $18.0 million.

What is the period of performance?

Start: 2023-03-10. End: 2026-04-28.

What is the specific scope of work for renovating Building 13 Floor CD at the Montrose VAMC?

The provided data does not detail the specific scope of work for the renovation of Building 13 Floor CD at the Montrose VAMC. However, based on the NAICS code 236220 (Commercial and Institutional Building Construction), the project likely involves significant structural, mechanical, electrical, or interior upgrades. This could include anything from updating HVAC systems, electrical wiring, plumbing, interior finishes, accessibility improvements, or even reconfiguring spaces to meet modern healthcare standards. A detailed review of the contract's Statement of Work (SOW) would be necessary to understand the precise nature and extent of the renovation activities.

What is the track record of AC JV ONE LLC on federal contracts?

Information regarding the specific track record of AC JV ONE LLC on federal contracts is limited based on the provided data. The 'JV' in the name suggests it might be a joint venture, which could be formed for this specific project or have a broader operational history. As a definitive contract awarded in March 2023, it is relatively new. A deeper dive into federal procurement databases (like SAM.gov or FPDS) would be required to ascertain if AC JV ONE LLC or its constituent members have a history of performance, past performance evaluations, and any potential issues on previous government contracts. This is crucial for assessing their capability to successfully execute this renovation.

How does the $18 million cost compare to similar VA building renovation projects?

Benchmarking the $18 million cost requires more specific project details, such as the square footage being renovated, the extent of the work (e.g., gut renovation vs. cosmetic updates), and the specific systems being upgraded. However, for a multi-year renovation of a significant portion of a medical facility, $18 million is a substantial but not necessarily excessive amount. The Department of Veterans Affairs undertakes numerous capital improvement projects, and costs can vary widely based on location, building age, and complexity. Comparing this contract's cost per square foot or per major system upgrade against similar VA projects awarded in recent years would provide a more accurate value assessment.

What are the potential risks associated with a firm fixed-price contract for a long-duration construction project?

Firm fixed-price (FFP) contracts offer cost certainty to the government but place the financial risk on the contractor. For a long-duration construction project like this (1145 days), potential risks include contractor claims for unforeseen conditions (e.g., discovering hazardous materials, unexpected structural issues), escalation of material and labor costs beyond what was anticipated, or contractor default if they mismanage their costs. Effective risk mitigation requires a well-defined scope of work, robust contingency planning by the contractor, and diligent government oversight to manage changes and address issues promptly to prevent disputes and cost overruns.

What is the significance of the 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES' award type?

The award type 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES' signifies a procurement process where the solicitation was made available to all responsible sources, but certain sources were initially excluded (perhaps due to pre-qualification requirements or specific solicitations). However, the final award was made after a period where all interested and qualified parties could compete. This suggests a deliberate effort to ensure broad competition while potentially managing the bidder pool. It aims to balance maximizing competition for best value with ensuring that only capable contractors participate, ultimately benefiting taxpayers through competitive pricing.

What is the historical spending pattern for building renovations at the Montrose VAMC?

The provided data does not include historical spending patterns for building renovations specifically at the Montrose VAMC. To analyze this, one would need to access historical contract databases (like FPDS) and filter for contracts awarded to the Montrose VAMC for construction and renovation services over previous fiscal years. This would reveal the frequency, value, and types of renovation projects undertaken, as well as the contractors typically engaged. Understanding past spending can help contextualize the current $18 million award and identify any significant changes in investment levels or procurement strategies.

Industry Classification

NAICS: Construction › Nonresidential Building Construction › Commercial and Institutional Building Construction

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

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: SEALED BID

Solicitation ID: 36C24223B0004

Offers Received: 3

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 837 OAKTON ST, ELK GROVE VILLAGE, IL, 60007

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

Financial Breakdown

Contract Ceiling: $17,991,871

Exercised Options: $17,991,871

Current Obligation: $17,991,871

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline