VA awards $16.3M for ED expansion to MSC Design Build LLC, a firm-fixed-price definitive contract

Contract Overview

Contract Amount: $16,289,315 ($16.3M)

Contractor: MSC Design Build LLC

Awarding Agency: Department of Veterans Affairs

Start Date: 2022-02-10

End Date: 2026-04-28

Contract Duration: 1,538 days

Daily Burn Rate: $10.6K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 8

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: EMERGENCY DEPARTMENT AND SUPPORT EXPANSION

Place of Performance

Location: SALT LAKE CITY, SALT LAKE County, UTAH, 84148

State: Utah Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $16.3 million to MSC DESIGN BUILD LLC for work described as: EMERGENCY DEPARTMENT AND SUPPORT EXPANSION Key points: 1. Contract value of $16.3M for emergency department expansion and support services. 2. Awarded to MSC Design Build LLC under a definitive contract structure. 3. Procurement utilized full and open competition after exclusion of sources. 4. Project duration spans from February 2022 to April 2026. 5. The contract is firm-fixed-price, indicating defined cost parameters. 6. The project is located in Utah (UT).

Value Assessment

Rating: good

The contract value of $16.3 million for an emergency department expansion appears reasonable for a project of this scope and duration. Benchmarking against similar VA or other federal healthcare construction projects would provide a more precise value-for-money assessment. The firm-fixed-price structure suggests that the contractor bears the risk of cost overruns, which is generally favorable for the government. However, without detailed cost breakdowns or comparisons to industry standards for similar construction projects, a definitive assessment of pricing efficiency is challenging.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

This contract was awarded under 'full and open competition after exclusion of sources.' This specific procurement method implies that while the competition was intended to be broad, certain sources were excluded for reasons not detailed in the provided data. The number of bidders (8) suggests a moderate level of competition. A moderate number of bidders can lead to competitive pricing, but the exclusion of sources might limit the full potential for price discovery compared to unrestricted full and open competition.

Taxpayer Impact: The moderate competition level, despite source exclusions, likely resulted in a fair price for taxpayers. However, a broader competition without exclusions could have potentially yielded even more competitive pricing.

Public Impact

Beneficiaries include veterans seeking care at the VA facility in Utah. Services delivered include expansion and support for emergency department facilities. Geographic impact is concentrated in Utah, serving the local veteran population. Workforce implications may include construction jobs and support roles during the project's execution.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if unforeseen construction challenges arise, despite fixed-price nature.
Risk of schedule delays impacting the timely availability of expanded ED services.
Dependency on a single contractor (MSC Design Build LLC) for project completion.

Positive Signals

Firm-fixed-price contract shifts cost overrun risk to the contractor.
Defined project scope and duration provide clear expectations.
Award to a single entity streamlines management and execution.

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 sector often supports critical infrastructure, including healthcare facilities. The market size for healthcare construction is substantial, driven by the need for modernization, expansion, and specialized facilities. This contract represents a specific investment in healthcare infrastructure for the Department of Veterans Affairs, contributing to the overall federal spending within this construction sub-sector.

Small Business Impact

The provided data indicates that small business participation (sb) was not a specific set-aside for this contract (sb: false). There is no explicit information on subcontracting plans for small businesses. Therefore, the direct impact on the small business ecosystem is not clearly defined by this award alone. Future analysis would require examining subcontracting reports to assess the extent to which small businesses are involved in fulfilling this contract.

Oversight & Accountability

Oversight for this contract would typically 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 delivery of specified services within the agreed-upon price and schedule. Transparency is facilitated through federal contract databases like FPDS. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse related to the contract.

Related Government Programs

VA Healthcare Construction Projects
Federal Building and Infrastructure Development
Emergency Department Modernization Programs
Definitive Contracts for Construction Services

Risk Flags

Potential for schedule delays
Risk of quality compromises
Justification for source exclusion requires scrutiny

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $16.3 million to MSC DESIGN BUILD LLC. EMERGENCY DEPARTMENT AND SUPPORT EXPANSION

Who is the contractor on this award?

The obligated recipient is MSC DESIGN BUILD 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 $16.3 million.

What is the period of performance?

Start: 2022-02-10. End: 2026-04-28.

What is the track record of MSC Design Build LLC with the Department of Veterans Affairs?

A review of federal procurement data would be necessary to fully assess MSC Design Build LLC's track record with the Department of Veterans Affairs. This would involve examining past contracts awarded to the company by the VA, including their performance history, any reported issues or disputes, and the types of projects undertaken. A strong history of successful project completion, adherence to timelines and budgets, and positive performance reviews would indicate a reliable contractor. Conversely, a history of significant delays, cost overruns, or contract disputes might raise concerns about their capacity to execute this current project effectively. Without specific historical data on this contractor's performance with the VA, it is difficult to provide a definitive assessment.

How does the $16.3 million contract value compare to similar VA emergency department expansion projects?

To benchmark the $16.3 million contract value, a comparative analysis with similar Department of Veterans Affairs (VA) emergency department (ED) expansion projects is required. This would involve identifying other VA ED construction or renovation contracts awarded within the last few years, considering factors such as square footage of expansion, complexity of services added, and geographic location, as costs can vary regionally. If comparable projects have been awarded for significantly less or more, it would indicate whether this contract is priced competitively. For instance, if similar-sized ED expansions in comparable regions have cost between $10-12 million, then $16.3 million might be on the higher end, warranting further investigation into the scope or specific requirements. Conversely, if other projects are in the $15-18 million range, this award would appear more aligned with market rates.

What are the primary risks associated with this firm-fixed-price contract for ED expansion?

While a firm-fixed-price (FFP) contract shifts cost overrun risk to the contractor, several risks remain for this $16.3 million emergency department expansion project. A primary risk is potential schedule delays. Unforeseen site conditions, labor shortages, or supply chain disruptions could impede progress, impacting the VA's ability to utilize the expanded facilities as planned. Another risk relates to the quality of work; while the price is fixed, the contractor might be tempted to cut corners to maintain profitability, potentially affecting the long-term durability and functionality of the expansion. Furthermore, scope creep, if not managed meticulously through change orders, could lead to disputes and necessitate adjustments to the fixed price, undermining the FFP benefit. Finally, the contractor's financial stability and capacity to manage a project of this magnitude are inherent risks that could impact completion.

How effective is the 'full and open competition after exclusion of sources' method in ensuring value for taxpayers?

The 'full and open competition after exclusion of sources' method aims to balance broad competition with specific needs, but its effectiveness for taxpayer value can be mixed. Ideally, it allows for a wide range of potential bidders, fostering price competition. However, the exclusion of certain sources, even if justified, inherently limits the pool of competitors. If the excluded sources represent significant market players or could have offered substantially lower prices, then the competition might be less robust than truly unrestricted full and open competition. The effectiveness hinges on the justification for exclusion; if exclusions are based on necessary specialized capabilities or past performance requirements, the value may be preserved by ensuring a qualified contractor. If exclusions are arbitrary or overly restrictive, it could lead to higher prices and reduced value for taxpayers.

What is the historical spending trend for emergency department construction by the VA?

Analyzing historical spending trends for emergency department (ED) construction by the VA is crucial for context. This would involve examining VA capital budgets and contract awards specifically for ED expansions, renovations, or new constructions over the past 5-10 years. Trends might reveal an increasing or decreasing investment in ED infrastructure, potentially influenced by factors like aging facilities, increased patient demand, or shifts in healthcare delivery models. Understanding this trend helps determine if the current $16.3 million award is consistent with past investment levels, represents a significant increase or decrease, or falls within a typical range for such projects. Without this historical data, it's difficult to ascertain if current spending aligns with strategic priorities or reflects market fluctuations.

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: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: 36C25920R0096

Offers Received: 8

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 2755 INDUSTRIAL DR # 1, OGDEN, UT, 84401

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Limited Liability Corporation, Service Disabled Veteran Owned Business, Small Business, Special Designations, U.S.-Owned Business, Veteran Owned Business

Financial Breakdown

Contract Ceiling: $16,289,315

Exercised Options: $16,289,315

Current Obligation: $16,289,315

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline