VA awards $7.6M contract for air handler upgrades, with 5 bidders competing

Contract Overview

Contract Amount: $7,644,551 ($7.6M)

Contractor: Johnsondanforth, Inc

Awarding Agency: Department of Veterans Affairs

Start Date: 2022-02-10

End Date: 2026-10-13

Contract Duration: 1,706 days

Daily Burn Rate: $4.5K/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: UPGRADE AIR HANDLER UNITS - 539-21-104

Place of Performance

Location: CINCINNATI, HAMILTON County, OHIO, 45220

State: Ohio Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $7.6 million to JOHNSONDANFORTH, INC for work described as: UPGRADE AIR HANDLER UNITS - 539-21-104 Key points: 1. Contract value of $7.6M for air handler unit upgrades appears reasonable given the scope and duration. 2. Full and open competition after exclusion of sources indicates a deliberate effort to solicit broad interest. 3. The presence of 5 bidders suggests a healthy level of competition for this HVAC service. 4. Fixed-price contract type helps mitigate cost overrun risks for the government. 5. Contract duration of over 4 years allows for sustained performance and potential for long-term facility improvements. 6. Geographic focus on Ohio (OH) targets specific facility needs within the VA system.

Value Assessment

Rating: good

The contract value of $7.6 million for upgrading air handler units over approximately four years seems within a reasonable range for such infrastructure projects. Benchmarking against similar VA or other federal agency contracts for HVAC system overhauls would provide a more precise value-for-money assessment. The fixed-price nature of the contract is a positive indicator, as it shifts cost risk to the contractor. Without specific per-unit cost data or detailed scope breakdowns, a definitive assessment of pricing efficiency is challenging, but the overall award amount does not immediately raise red flags.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

The contract was awarded under 'Full and Open Competition After Exclusion of Sources,' which implies that while the competition was intended to be broad, specific sources may have been excluded for defined reasons. The fact that five bidders participated indicates a competitive environment, suggesting that the exclusion criteria did not unduly limit the pool of qualified contractors. This level of competition is generally sufficient to promote price discovery and encourage competitive pricing.

Taxpayer Impact: The competition level suggests that taxpayers likely benefited from competitive pricing, as multiple firms vied for the contract. While not a completely unrestricted open competition, the exclusion of sources was likely justified, preventing unnecessary costs associated with unqualified bidders.

Public Impact

Veterans receiving services at VA facilities in Ohio will benefit from improved indoor air quality and more reliable HVAC systems. The contract supports the maintenance and modernization of critical healthcare infrastructure for the Department of Veterans Affairs. The geographic impact is concentrated in Ohio, addressing specific needs at VA facilities within that state. The contract supports jobs within the HVAC contracting sector, including skilled trades and project management.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

The 'exclusion of sources' clause requires careful review to ensure it was justified and did not unnecessarily restrict competition.
Performance monitoring will be crucial to ensure the contractor meets all specifications for air handler unit upgrades within the fixed-price structure.
Potential for scope creep exists if unforeseen issues arise with existing HVAC systems, requiring diligent contract management.

Positive Signals

The use of a firm-fixed-price contract type provides cost certainty for the government.
The participation of five bidders indicates a competitive marketplace for these services.
The contract duration allows for a sustained focus on improving facility infrastructure.

Sector Analysis

This contract falls within the broader construction and facilities maintenance sector, specifically focusing on HVAC systems. The market for upgrading and maintaining critical building systems in federal facilities is substantial, driven by aging infrastructure and the need for energy efficiency and improved occupant comfort. Comparable spending benchmarks would involve analyzing other federal contracts for similar HVAC modernization projects across different agencies and geographic locations. The $7.6 million award is a significant but not extraordinary amount for a project of this scope and duration.

Small Business Impact

The data indicates that this contract was not set aside for small businesses (ss: false, sb: false). Therefore, there are no direct subcontracting implications specifically mandated for small businesses through a set-aside program. However, the prime contractor, JOHNSONDANFORTH, INC, may choose to subcontract portions of the work to small businesses as part of their overall business strategy. The impact on the small business ecosystem would depend on the prime contractor's subcontracting practices and the availability of small businesses capable of performing specialized HVAC work.

Oversight & Accountability

Oversight for this contract will primarily reside with the Department of Veterans Affairs contracting officers and project managers. They are responsible for monitoring contractor performance, ensuring compliance with contract terms, and approving payments. The fixed-price nature of the contract provides a degree of accountability by linking payment to deliverables. Transparency is facilitated through contract databases like FPDS. Inspector General jurisdiction would apply if any fraud, waste, or abuse is suspected or identified during the contract's performance.

Related Government Programs

VA Facilities Maintenance Contracts
Federal HVAC Modernization Projects
Department of Veterans Affairs Infrastructure Spending
General Services Administration (GSA) Building Operations

Risk Flags

Justification for exclusion of sources needs verification.
Potential for cost overruns if scope changes are not managed tightly.
Contractor performance history requires detailed review.

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $7.6 million to JOHNSONDANFORTH, INC. UPGRADE AIR HANDLER UNITS - 539-21-104

Who is the contractor on this award?

The obligated recipient is JOHNSONDANFORTH, 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 $7.6 million.

What is the period of performance?

Start: 2022-02-10. End: 2026-10-13.

What is the specific track record of JOHNSONDANFORTH, INC. with the Department of Veterans Affairs and similar federal contracts?

A review of federal contract databases would be necessary to fully assess JOHNSONDANFORTH, INC.'s track record. This would involve examining past performance on VA contracts and other federal awards, looking at factors such as timeliness of delivery, quality of work, and any history of disputes or contract modifications. Understanding their experience with similar air handler unit upgrades or large-scale HVAC projects is crucial for evaluating their capability to successfully execute this $7.6 million contract. Without specific historical data on this contractor's performance, it's difficult to provide a detailed assessment beyond the general information available.

How does the awarded price of $7.6 million compare to the estimated cost or budget for this air handler unit upgrade project?

The provided data does not include the government's estimated cost or budget for this project. Therefore, a direct comparison to determine if the $7.6 million award represents good value or a potential overspend is not possible. Typically, agencies establish an independent government cost estimate (IGCE) before soliciting bids. Analyzing the relationship between the IGCE and the final award price, as well as the number of bids received, can offer insights into the competitiveness and fairness of the pricing. Further investigation into the VA's internal documentation for this procurement would be needed to access budget information.

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

Key risks for this contract include potential performance issues with the contractor (JOHNSONDANFORTH, INC.), unforeseen complexities in the existing HVAC infrastructure requiring scope changes, and potential delays impacting facility operations. Mitigation strategies include the firm-fixed-price contract type, which shifts cost risk to the contractor, and the requirement for multiple bidders (5), suggesting a competitive pool of capable firms. The VA's oversight mechanisms, including contract management and inspection, are designed to monitor performance and address issues proactively. However, the specific risk mitigation plans detailed in the contract or procurement file are not provided in the summary data.

What is the expected impact of these air handler unit upgrades on the operational efficiency and energy consumption of the VA facilities in Ohio?

The primary expected impact of upgrading air handler units is improved operational efficiency and potentially reduced energy consumption for the targeted VA facilities in Ohio. Modern air handlers are typically designed with more energy-efficient components, better insulation, and advanced controls that can lead to significant savings on electricity and heating/cooling costs. Furthermore, reliable and efficient HVAC systems are critical for maintaining optimal indoor environmental conditions, which directly impacts patient care, staff comfort, and the overall functionality of healthcare facilities. Quantifying the exact energy savings would require post-upgrade performance data and energy audits.

How does the 'Full and Open Competition After Exclusion of Sources' procurement method differ from standard full and open competition, and what are its implications?

Standard 'Full and Open Competition' allows all responsible sources to submit offers without restriction. 'Full and Open Competition After Exclusion of Sources' implies that the agency initially intended to compete the requirement broadly but then excluded specific sources based on defined criteria, such as national security, specific technical capabilities, or prior performance issues. The implication is that while competition was sought, the pool of potential bidders was intentionally narrowed. This method requires a documented justification for the exclusion. The key difference lies in the deliberate removal of certain entities from the bidding process, which could potentially limit the breadth of competition compared to an unrestricted solicitation.

What is the historical spending pattern for air handler unit upgrades or similar HVAC services by the Department of Veterans Affairs?

Analyzing the historical spending patterns of the Department of Veterans Affairs for air handler unit upgrades and similar HVAC services would require a comprehensive review of past contract awards over several fiscal years. This would involve identifying trends in contract values, the number of bidders, types of contracts used (e.g., fixed-price vs. cost-plus), and the geographic distribution of these awards. Understanding these patterns can help benchmark current spending, identify potential cost efficiencies or inefficiencies over time, and forecast future needs. Without access to detailed historical spending data, it is difficult to provide specific insights into VA's past procurement behavior in this area.

Industry Classification

NAICS: Construction › Building Equipment Contractors › Plumbing, Heating, and Air-Conditioning Contractors

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: 36C25021B0059

Offers Received: 5

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 2200 N. RODNEY PARHAM RD SUITE 210, LITTLE ROCK, AR, 72212

Business Categories: Category Business, Corporate Entity Not Tax Exempt, 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: $7,644,551

Exercised Options: $7,644,551

Current Obligation: $7,644,551

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Timeline