VA Awards $36.9M Contract for Wichita VAMC Boiler Replacement to SGJV2, LLC

Contract Overview

Contract Amount: $36,933,071 ($36.9M)

Contractor: Sgjv2, LLC

Awarding Agency: Department of Veterans Affairs

Start Date: 2022-09-27

End Date: 2026-05-30

Contract Duration: 1,341 days

Daily Burn Rate: $27.5K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: 589A7-18-302 - INSTALL NEW BOILERS AT THE WICHITA VAMC

Place of Performance

Location: WICHITA, SEDGWICK County, KANSAS, 67218

State: Kansas Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $36.9 million to SGJV2, LLC for work described as: 589A7-18-302 - INSTALL NEW BOILERS AT THE WICHITA VAMC Key points: 1. Contract awarded for essential infrastructure upgrade at Wichita VAMC. 2. SGJV2, LLC, a new entity, secured the contract. 3. The project aims to improve facility operations and patient care. 4. Construction sector spending is significant for facility maintenance.

Value Assessment

Rating: fair

The contract value of $36.9M for boiler replacement appears substantial. Benchmarking against similar VA or large-scale institutional boiler projects would be necessary to definitively assess pricing.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

The contract was awarded under 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES,' indicating a limited competition. This method may impact price discovery compared to unrestricted full and open competition.

Taxpayer Impact: Taxpayer funds are being used for a critical infrastructure upgrade, aiming for long-term operational efficiency and cost savings through improved boiler systems.

Public Impact

Ensures reliable heating and hot water for veterans at the Wichita VAMC. Modernized boilers are expected to improve energy efficiency and reduce operational costs. Supports local construction jobs and economic activity in Kansas.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Limited competition raises questions about optimal price.
New contractor entity may present execution risks.
Long project duration could lead to cost overruns.

Positive Signals

Addresses critical infrastructure need.
Potential for long-term operational cost savings.
Supports veteran healthcare services.

Sector Analysis

This contract falls within the Commercial and Institutional Building Construction sector. Spending in this sector is crucial for maintaining federal facilities and infrastructure, with costs varying widely based on project scope and location.

Small Business Impact

The contract was awarded to SGJV2, LLC, and there is no indication of small business participation or subcontracting requirements in the provided data. Further review would be needed to confirm small business involvement.

Oversight & Accountability

The Department of Veterans Affairs is responsible for overseeing this contract. Standard oversight mechanisms for construction projects, including progress monitoring and quality assurance, should be in place.

Related Government Programs

Commercial and Institutional Building Construction
Department of Veterans Affairs Contracting
Department of Veterans Affairs Programs

Risk Flags

Limited competition
Potential execution risk with new contractor
Long project duration
Lack of detailed cost breakdown
Unclear energy savings verification

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $36.9 million to SGJV2, LLC. 589A7-18-302 - INSTALL NEW BOILERS AT THE WICHITA VAMC

Who is the contractor on this award?

The obligated recipient is SGJV2, 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 $36.9 million.

What is the period of performance?

Start: 2022-09-27. End: 2026-05-30.

What is the specific justification for excluding other sources in the competition?

The justification for excluding other sources needs to be thoroughly examined. While the award states 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES,' the specific reasons for this exclusion are not detailed. Understanding this rationale is crucial for assessing whether the limited competition truly served the government's best interest and achieved optimal value.

What are the potential risks associated with SGJV2, LLC as a new entity?

As a potentially new or less established entity, SGJV2, LLC might present execution risks. This could include challenges in managing large-scale construction projects, potential financial instability, or a lack of proven track record. The VA should implement robust monitoring and performance management to mitigate these risks.

How will the energy efficiency improvements from the new boilers be measured and verified?

The contract should include clear metrics and a verification process for measuring the energy efficiency improvements expected from the new boilers. This ensures that the anticipated long-term operational cost savings are realized and that taxpayer investment yields tangible environmental and financial benefits.

Industry Classification

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

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

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: 36C25522R0079

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 2876 GUARDIAN LN STE. 200, VIRGINIA BEACH, VA, 23452

Business Categories: Asian Pacific American Owned Business, Category Business, Corporate Entity Not Tax Exempt, Minority Owned Business, 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: $36,933,139

Exercised Options: $36,933,139

Current Obligation: $36,933,071

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Timeline