VA awards $4.36M contract for building HVAC replacement, signaling infrastructure investment

Contract Overview

Contract Amount: $4,362,390 ($4.4M)

Contractor: Sigo Valiant JV LLC

Awarding Agency: Department of Veterans Affairs

Start Date: 2025-04-14

End Date: 2026-08-31

Contract Duration: 504 days

Daily Burn Rate: $8.7K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 4

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: 589A5-22-106, REPLACE BLDG 4 HVAC

Place of Performance

Location: TOPEKA, SHAWNEE County, KANSAS, 66622

State: Kansas Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $4.4 million to SIGO VALIANT JV LLC for work described as: 589A5-22-106, REPLACE BLDG 4 HVAC Key points: 1. Contract value represents a significant investment in facility modernization. 2. Competition dynamics suggest a potentially competitive bidding environment. 3. Contract duration indicates a medium-term project for infrastructure upgrades. 4. Fixed-price contract type offers cost certainty for the government. 5. Geographic location in Kansas may point to regional infrastructure needs.

Value Assessment

Rating: good

The contract value of $4.36 million for HVAC replacement appears reasonable for a project of this scope and duration (504 days). Benchmarking against similar VA or other federal building modernization projects would provide a more precise value-for-money assessment. The firm fixed-price structure helps control costs, but the absence of detailed cost breakdowns limits a deeper price analysis. Without specific comparable contract data, it's difficult to definitively state if this is an exceptional deal, but it falls within expected ranges for such infrastructure work.

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, certain sources were excluded. This could be due to specific pre-qualification requirements or other factors. With 4 bidders, the competition level appears moderate, suggesting that while multiple firms were interested, the pool might have been narrowed. This level of competition can still lead to price discovery, but it may not be as robust as a truly unrestricted full and open competition.

Taxpayer Impact: The moderate competition suggests that taxpayers likely received a fair price, but there might have been opportunities for even greater savings if a wider range of bidders had been included.

Public Impact

Veterans and staff at the VA facility in Kansas will benefit from improved environmental controls and operational efficiency. The project will deliver essential upgrades to critical building infrastructure, ensuring a safer and more comfortable environment. The geographic impact is localized to the specific VA facility in Kansas. The contract supports jobs in the construction sector, particularly in commercial and institutional building. The successful completion of this project contributes to the VA's broader mission of providing healthcare services.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if unforeseen issues arise during construction, despite fixed-price contract.
Risk of project delays impacting facility operations and veteran services.
Dependence on the performance and capacity of the selected contractor.
Limited competition may have resulted in a higher-than-optimal price.

Positive Signals

Firm fixed-price contract provides cost certainty for the government.
Defined contract duration (504 days) sets clear expectations for project completion.
Award to a joint venture (SIGO VALIANT JV LLC) may indicate capacity for complex projects.
Award by the Department of Veterans Affairs highlights focus on essential facility maintenance.

Sector Analysis

This contract falls within the Commercial and Institutional Building Construction sector, a vital part of the broader construction industry. This sector encompasses the building, alteration, and repair of non-residential structures. The market size for federal construction projects is substantial, driven by the need to maintain and modernize government facilities across various agencies. This specific HVAC replacement project is a common type of infrastructure upgrade, essential for ensuring the operational efficiency and safety of public buildings. Comparable spending benchmarks would typically involve analyzing other federal contracts for similar HVAC system replacements in institutional settings.

Small Business Impact

The contract data indicates that small business participation was not a specific set-aside (ss: false, sb: false). This means the contract was not exclusively reserved for small businesses. While the prime contractor is a joint venture, it's unclear if this entity itself qualifies as a small business or if it has specific subcontracting plans for small businesses. Further analysis would be needed to determine the extent of small business involvement through subcontracting opportunities, which could be significant in the construction sector.

Oversight & Accountability

Oversight for this contract will likely be managed by the Department of Veterans Affairs contracting officers and project managers. Accountability measures are embedded in the firm fixed-price contract terms, requiring the contractor to deliver specified work within the agreed-upon price and timeline. Transparency is facilitated by the public nature of federal contract awards, allowing for public scrutiny. The Inspector General for the Department of Veterans Affairs would have jurisdiction to investigate any potential fraud, waste, or abuse related to this contract.

Related Government Programs

VA Facility Maintenance and Repair
Federal Building Modernization Programs
HVAC System Upgrades in Government Buildings
Construction Services for Public Institutions

Risk Flags

Potential for cost overruns
Risk of project delays
Limited competition impact on price
Contractor performance risk

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $4.4 million to SIGO VALIANT JV LLC. 589A5-22-106, REPLACE BLDG 4 HVAC

Who is the contractor on this award?

The obligated recipient is SIGO VALIANT JV 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 $4.4 million.

What is the period of performance?

Start: 2025-04-14. End: 2026-08-31.

What is the track record of SIGO VALIANT JV LLC in performing similar federal construction contracts?

A review of SIGO VALIANT JV LLC's contract history reveals they have been awarded federal contracts primarily within the construction domain. As a joint venture, their specific experience may be a composite of their member companies' capabilities. To assess their track record thoroughly for this HVAC replacement project, one would examine past performance on similar-sized projects, their history with firm fixed-price contracts, and any reported issues related to schedule adherence or quality of work. Data from contract databases like SAM.gov or FPDS would be essential for this analysis, looking for performance evaluations and any contract disputes or terminations.

How does the awarded price of $4.36 million compare to market rates for similar HVAC replacement projects?

Benchmarking the $4.36 million contract against market rates requires detailed comparison data. Factors influencing market rates include project complexity, square footage, type of HVAC system, geographic location, and prevailing labor costs. Without specific project details (e.g., building size, system specifications), a precise comparison is challenging. However, for a medium-sized institutional building, a multi-million dollar HVAC overhaul is not uncommon. A thorough analysis would involve querying construction cost databases or reviewing recent bids for comparable projects in the Kansas region to determine if this award represents a competitive market price or deviates significantly.

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

The primary risks for this contract include potential construction delays due to unforeseen site conditions or supply chain disruptions, and the possibility of cost overruns if the fixed-price contract doesn't adequately account for all contingencies. Mitigation strategies typically involve robust project management by the VA, clear contract terms defining responsibilities, and the contractor's own risk management processes. The firm fixed-price nature shifts much of the cost risk to the contractor, incentivizing efficient completion. The moderate competition level might also imply that bidders factored in potential risks when setting their prices. Regular progress reviews and adherence to a detailed project schedule are key mitigation tactics.

What is the expected effectiveness of the new HVAC system in improving the facility's performance and occupant comfort?

The effectiveness of the new HVAC system is expected to be high, assuming the system is designed and installed according to modern standards and the specific needs of the VA facility. Improvements typically include enhanced energy efficiency, better air quality control (filtration, humidity), more reliable temperature regulation, and reduced maintenance requirements compared to older systems. This directly translates to improved occupant comfort for staff and veterans, potentially leading to better health outcomes and increased productivity. The contract's duration and value suggest a comprehensive replacement, aiming for significant long-term operational benefits and energy savings.

How does current spending on facility maintenance and upgrades compare to historical patterns for this VA facility or similar facilities?

Analyzing historical spending patterns for this specific VA facility or comparable ones is crucial for context. If this $4.36 million contract represents a significant increase or decrease compared to previous years' maintenance budgets, it could indicate a shift in funding priorities or a backlog of deferred maintenance. Federal agencies often face cycles of underfunding followed by large capital investments for infrastructure renewal. Understanding these patterns helps assess whether this contract is part of a strategic, long-term facility management plan or a reactive measure to address critical failures. Accessing historical VA budget data and capital investment reports would be necessary for this comparison.

What is the potential impact of excluding certain sources on the final price and quality of the HVAC system?

The exclusion of certain sources, even under a 'full and open competition after exclusion of sources' award, can influence the final price and quality. If the excluded sources were highly competitive or specialized, their absence might reduce the overall competitive pressure, potentially leading to a higher price than if they had participated. Similarly, if the excluded sources possessed unique expertise or innovative technologies relevant to HVAC systems, their exclusion could limit the range of solutions considered, potentially impacting the ultimate quality or efficiency of the installed system. The rationale behind the exclusion is key to understanding its specific impact.

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: 36C25524R0114

Offers Received: 4

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 4122 WAHL STREET BLVD UNIT 3, LOUISVILLE, KY, 40218

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Limited Liability Corporation, 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: $4,362,390

Exercised Options: $4,362,390

Current Obligation: $4,362,390

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline