VA awards $9.9M contract for Marion, IN VAMC building renovation to Armcorp Construction Inc

Contract Overview

Contract Amount: $9,922,358 ($9.9M)

Contractor: Armcorp Construction Inc

Awarding Agency: Department of Veterans Affairs

Start Date: 2025-07-18

End Date: 2027-01-12

Contract Duration: 543 days

Daily Burn Rate: $18.3K/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: RENOVATE BUILDING 16 (610-20-103) - MARION, IN VAMC

Place of Performance

Location: MARION, GRANT County, INDIANA, 46953

State: Indiana Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $9.9 million to ARMCORP CONSTRUCTION INC for work described as: RENOVATE BUILDING 16 (610-20-103) - MARION, IN VAMC Key points: 1. Contract value of $9.9M for building renovation. 2. Competition was full and open after exclusion of sources. 3. Contract type is Firm Fixed Price, indicating price certainty. 4. Performance period spans over 1.5 years. 5. Project located in Indiana, potentially impacting local workforce. 6. Contract awarded to Armcorp Construction Inc.

Value Assessment

Rating: fair

The contract value of $9.9M for renovating Building 16 at the Marion, IN VAMC appears to be within a reasonable range for a project of this scope, though specific benchmarking against similar VAMC renovations would provide a clearer picture of value for money. The firm fixed price structure suggests the government has locked in costs, but it's crucial to monitor for any change orders that could increase the final expenditure. Without detailed cost breakdowns or comparisons to similar projects, a definitive assessment of pricing efficiency is challenging.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

The 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 were excluded prior to the solicitation. The number of bidders is not specified, but the 'exclusion of sources' suggests a potentially narrower field than true full and open competition. This approach can sometimes lead to less aggressive pricing if the excluded sources represent significant market players.

Taxpayer Impact: Taxpayers benefit from a competitive process, but the exclusion of specific sources may limit the potential for the lowest possible price to be achieved.

Public Impact

Veterans receiving services at the Marion, IN VAMC will benefit from improved facilities. The renovation project will enhance the operational capacity and safety of Building 16. The project is geographically focused in Marion, Indiana, providing local economic stimulus. Construction activities will likely create temporary employment opportunities for the local workforce.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if change orders are extensive due to the fixed-price nature.
Limited competition due to source exclusion could impact final price.
Contract duration of over 1.5 years increases exposure to market fluctuations.

Positive Signals

Firm Fixed Price contract provides cost certainty.
Project addresses critical infrastructure needs for veteran healthcare.
Award to a single contractor streamlines project management.

Sector Analysis

This contract falls within the Commercial and Institutional Building Construction sector, a significant segment of the broader construction industry. Federal spending in this area often focuses on maintaining and upgrading government facilities, including healthcare infrastructure. Benchmarking this $9.9M renovation against similar projects for healthcare facilities or government buildings would provide context on its relative scale and cost-effectiveness. The construction industry is sensitive to economic cycles and material costs, which are factors to consider for a project of this duration.

Small Business Impact

The data indicates this contract was not set aside for small businesses (ss: false, sb: false). Therefore, there are no direct subcontracting implications for small businesses mandated by a set-aside. However, the prime contractor, Armcorp Construction Inc., may still engage small businesses as subcontractors, depending on their own procurement practices and the availability of qualified small business subcontractors in the Indiana region. The overall impact on the small business ecosystem would depend on whether Armcorp actively seeks to include them in its supply chain.

Oversight & Accountability

Oversight for this contract will likely be managed by the Department of Veterans Affairs' contracting officers and project managers. Accountability measures are inherent in the firm fixed-price contract type, which obligates the contractor to deliver the specified work within the agreed price. Transparency is typically facilitated through contract award databases and public reporting mechanisms. Inspector General jurisdiction would apply if any fraud, waste, or abuse is suspected during the performance of the contract.

Related Government Programs

VA Major Medical Facility Lease Program
VA Capital Asset and Business Process Realignment
Federal Buildings Fund
Military Construction Program

Risk Flags

Potential for cost increases via change orders despite fixed-price contract.
Limited competition due to source exclusion may impact final price.
Project duration increases exposure to market volatility (materials, labor).

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $9.9 million to ARMCORP CONSTRUCTION INC. RENOVATE BUILDING 16 (610-20-103) - MARION, IN VAMC

Who is the contractor on this award?

The obligated recipient is ARMCORP CONSTRUCTION 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 $9.9 million.

What is the period of performance?

Start: 2025-07-18. End: 2027-01-12.

What is Armcorp Construction Inc.'s track record with the Department of Veterans Affairs and similar federal agencies?

A thorough review of Armcorp Construction Inc.'s contract history with the Department of Veterans Affairs (VA) and other federal agencies is essential to assess their performance and reliability. This includes examining past project types, contract values, completion timeliness, and any history of disputes, claims, or contract terminations. Federal procurement databases like SAM.gov and FPDS can provide insights into their past performance ratings and any reported issues. Understanding their experience with healthcare facility construction or renovations specifically would be particularly relevant for this Marion VAMC project. A strong track record with the VA suggests a higher likelihood of successful project execution and adherence to quality standards, while a history of issues might indicate potential risks.

How does the $9.9M cost compare to similar VAMC building renovation projects?

To benchmark the $9.9M cost effectively, it's necessary to compare it against similar renovation projects undertaken at other VA Medical Centers or comparable healthcare facilities. Key comparison factors include the square footage being renovated, the scope of work (e.g., structural, MEP, finishes), the age and condition of the existing building, and the geographic location, which influences labor and material costs. Data from federal contract databases and industry reports on construction costs for healthcare facilities can provide benchmarks. If this project's cost per square foot or per major system upgrade significantly deviates from the norm without clear justification (e.g., unforeseen site conditions, highly specialized requirements), it could indicate potential issues with pricing or value for money.

What are the primary risks associated with a firm fixed-price contract for a multi-year construction project?

While a Firm Fixed Price (FFP) contract offers cost certainty for the government, it carries inherent risks, especially for a multi-year construction project like the Marion VAMC renovation. The primary risk is that the contractor may face unforeseen cost increases due to factors like material price escalation, labor shortages, or unexpected site conditions. If these costs exceed the contractor's initial estimates, they might seek to mitigate losses through scope reduction, quality compromises, or by submitting change order requests, which can drive up the total project cost. Conversely, if the contractor significantly overestimates costs to buffer against these risks, the government may end up paying a premium. Effective project management, clear contract scope, and robust oversight are crucial to manage these risks.

What is the expected impact of this renovation on the delivery of healthcare services to veterans?

The renovation of Building 16 at the Marion VAMC is expected to have a positive impact on the delivery of healthcare services by improving the infrastructure that supports these services. Upgrades to facilities can lead to enhanced patient safety, better accessibility, improved operational efficiency for medical staff, and potentially the introduction of new or expanded services if the renovation includes modernization or reconfiguration. A well-maintained and modern facility can also contribute to a better patient experience and attract and retain qualified healthcare professionals. The specific impact will depend on which areas of Building 16 are being renovated and the nature of the services provided within it.

How does the 'Full and Open Competition After Exclusion of Sources' procurement method affect price discovery and taxpayer value?

The 'Full and Open Competition After Exclusion of Sources' method aims to balance broad competition with specific needs or limitations. By excluding certain sources, the agency might be targeting specific capabilities or avoiding known issues with particular contractors. However, this exclusion inherently narrows the competitive pool. If the excluded sources represent significant market capacity or innovation, the remaining bidders may face less pressure to offer the most competitive pricing. This could potentially lead to a higher-than-optimal price for taxpayers compared to a scenario with truly unrestricted full and open competition. The effectiveness of this method hinges on whether the exclusions were justified and if sufficient competition remained among the eligible bidders to ensure fair market price discovery.

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 AFTER EXCLUSION OF SOURCES

Solicitation Procedures: SEALED BID

Solicitation ID: 36C25025B0005

Offers Received: 5

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 8511 STATE ROUTE 703, CELINA, OH, 45822

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: $9,922,358

Exercised Options: $9,922,358

Current Obligation: $9,922,358

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline