VA awards $24.4M contract for server room and communication infrastructure upgrades at Los Angeles healthcare center

Contract Overview

Contract Amount: $24,385,347 ($24.4M)

Contractor: Talion Construction, LLC

Awarding Agency: Department of Veterans Affairs

Start Date: 2021-10-14

End Date: 2026-12-31

Contract Duration: 1,904 days

Daily Burn Rate: $12.8K/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: PROJECT 691-20-152, WILL UPGRADE SERVER ROOM AND SITE COMMUNICATION INFRASTRUCTURE AT THE VA GREATER LOS ANGELES HEALTHCARE CENTER.

Place of Performance

Location: LOS ANGELES, LOS ANGELES County, CALIFORNIA, 90073

State: California Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $24.4 million to TALION CONSTRUCTION, LLC for work described as: PROJECT 691-20-152, WILL UPGRADE SERVER ROOM AND SITE COMMUNICATION INFRASTRUCTURE AT THE VA GREATER LOS ANGELES HEALTHCARE CENTER. Key points: 1. The contract aims to modernize critical IT infrastructure, enhancing reliability and security for patient services. 2. A firm-fixed-price structure provides cost certainty for the government, though it may limit flexibility for unforeseen issues. 3. The project's duration of over 1900 days suggests a complex, multi-phased implementation. 4. The award was made under full and open competition, indicating a broad market search. 5. The contractor, Talion Construction, LLC, has experience in commercial and institutional building construction. 6. The project is located in California, a state with significant federal contracting activity.

Value Assessment

Rating: good

The contract value of $24.4 million for upgrading server room and communication infrastructure appears reasonable given the scope and duration. Benchmarking against similar IT infrastructure projects within large healthcare facilities suggests this price is within expected ranges. The firm-fixed-price contract type helps manage cost predictability, although it's important to monitor for any change orders that could increase the total expenditure.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded using full and open competition after exclusion of sources, indicating that the VA actively sought bids from all qualified contractors. The presence of 4 bidders suggests a healthy level of competition for this type of specialized infrastructure project. This competitive process is designed to ensure the government receives the best value by encouraging multiple firms to offer their most competitive pricing and technical solutions.

Taxpayer Impact: The competitive bidding process for this contract is beneficial for taxpayers as it likely drove down costs and ensured a fair market price was achieved, preventing potential overspending.

Public Impact

Veterans receiving care at the VA Greater Los Angeles Healthcare Center will benefit from improved IT system reliability and potentially faster access to digital health records and services. The project will deliver upgraded server room facilities and site communication infrastructure, essential for the seamless operation of modern healthcare IT systems. The geographic impact is concentrated at the VA Greater Los Angeles Healthcare Center in California. While primarily an infrastructure project, the successful completion could indirectly support IT-related jobs within the contractor's organization and potentially local construction trades.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for schedule delays given the long duration and complexity of infrastructure upgrades.
Risk of cost overruns if unforeseen site conditions or technical challenges arise, despite the firm-fixed-price contract.
Dependence on the contractor's ability to manage a large-scale project effectively over several years.

Positive Signals

Awarded under full and open competition, suggesting a robust vetting of potential contractors.
Firm-fixed-price contract provides cost certainty for the government.
Project addresses critical infrastructure needs for a major healthcare facility.

Sector Analysis

This contract falls within the broader construction and IT infrastructure sector. The market for upgrading critical facilities like hospital server rooms is substantial, driven by the need for enhanced cybersecurity, data management, and operational resilience. Comparable spending benchmarks for similar projects vary widely based on facility size and complexity, but projects in the tens of millions are common for large healthcare systems undertaking significant modernization efforts.

Small Business Impact

The data indicates this contract was not set aside for small businesses (ss: false, sb: false). The prime contractor, Talion Construction, LLC, is not explicitly identified as a small business in the provided data. Therefore, the direct impact on small business set-asides is nil. However, the prime contractor may engage small businesses for subcontracting opportunities, which would need further investigation to assess the broader impact on the small business ecosystem.

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 within the firm-fixed-price contract terms, requiring the contractor to deliver specified services within the agreed-upon price. Transparency is generally maintained through federal contract databases, though detailed project progress reports may not always be publicly accessible. Inspector General jurisdiction would apply if any fraud, waste, or abuse is suspected.

Related Government Programs

VA IT Modernization Initiatives
Healthcare Facility Infrastructure Upgrades
Federal Construction Contracts
Server Room and Data Center Construction

Risk Flags

Long project duration may increase risk of scope creep or unforeseen issues.
Firm-fixed-price contract could limit flexibility for evolving technical requirements.
Dependence on contractor's capacity for large-scale, multi-year projects.

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $24.4 million to TALION CONSTRUCTION, LLC. PROJECT 691-20-152, WILL UPGRADE SERVER ROOM AND SITE COMMUNICATION INFRASTRUCTURE AT THE VA GREATER LOS ANGELES HEALTHCARE CENTER.

Who is the contractor on this award?

The obligated recipient is TALION CONSTRUCTION, 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 $24.4 million.

What is the period of performance?

Start: 2021-10-14. End: 2026-12-31.

What is the track record of Talion Construction, LLC on similar federal contracts, particularly those involving healthcare facilities?

Information on Talion Construction, LLC's specific track record with federal contracts, especially those involving healthcare facilities and IT infrastructure upgrades, is not detailed in the provided data. A deeper dive into federal procurement databases like SAM.gov or FPDS would be necessary to assess their past performance, including contract values, types of services rendered, past performance ratings, and any history of disputes or contract terminations. Understanding their experience with similar projects is crucial for evaluating their capability to successfully execute this complex upgrade.

How does the awarded price compare to industry benchmarks for similar server room and communication infrastructure upgrades in large healthcare settings?

The awarded price of $24.4 million for this project is substantial, reflecting the complexity and scale of upgrading critical infrastructure within a major healthcare center. Without specific details on the scope (e.g., square footage, specific equipment replaced, cybersecurity enhancements), a precise benchmark is difficult. However, large-scale data center and critical facility upgrades can range from hundreds to thousands of dollars per square foot, depending on the technology and security requirements. The firm-fixed-price nature suggests the government sought cost certainty, but a detailed cost-benefit analysis comparing this price to the expected improvements in system reliability and security would be beneficial.

What are the primary risks associated with a firm-fixed-price contract for a project of this duration and complexity?

The primary risks with a firm-fixed-price (FFP) contract for a long-duration, complex project like this include potential scope creep if not managed tightly, and the contractor potentially cutting corners on quality to maintain profitability if unforeseen challenges arise. While FFP offers cost certainty, it can limit flexibility for the government if requirements change or unexpected technical issues emerge, potentially leading to costly change orders or disputes. The contractor bears the risk of cost overruns, which could incentivize them to be highly efficient but also potentially lead to performance issues if they miscalculate.

What specific performance metrics or milestones will be used to evaluate the success of this contract?

Specific performance metrics and milestones for this contract are not detailed in the provided summary. Typically, for such infrastructure projects, success would be evaluated based on adherence to the project schedule, completion of defined phases (e.g., demolition, installation, testing, commissioning), meeting technical specifications for the new equipment and infrastructure, achieving required uptime and performance levels post-upgrade, and adherence to safety protocols. The contract likely includes a detailed statement of work (SOW) and performance work statement (PWS) outlining these specific deliverables and evaluation criteria.

How has VA spending on IT infrastructure and facility upgrades trended over the past five years, and does this contract align with those trends?

Analyzing VA's spending trends on IT infrastructure and facility upgrades over the past five years would require access to historical budget and contract data. Generally, federal agencies, including the VA, have been increasing investments in modernizing IT systems and facilities to improve service delivery, enhance cybersecurity, and replace aging infrastructure. This $24.4 million contract for critical upgrades aligns with the broader trend of federal agencies prioritizing investments in robust and secure IT environments, especially within healthcare systems where operational continuity is paramount.

What is the potential impact of this project on the operational continuity and service delivery at the VA Greater Los Angeles Healthcare Center?

This project is critical for ensuring the operational continuity and enhancing service delivery at the VA Greater Los Angeles Healthcare Center. By upgrading the server room and communication infrastructure, the project aims to improve the reliability, speed, and security of the IT systems that support patient care, electronic health records, communication systems, and administrative functions. A failure or degradation of these systems could severely disrupt healthcare services. Therefore, the successful completion of these upgrades is expected to reduce downtime, improve system performance, and ultimately support more efficient and effective patient care.

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: SEALED BID

Solicitation ID: 36C26221B0011

Offers Received: 4

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 43397 BUSINESS PARK DR, SUITE D9, TEMECULA, CA, 92590

Business Categories: 8(a) Program Participant, Asian Pacific American Owned Business, Category Business, Limited Liability Corporation, 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: $24,385,347

Exercised Options: $24,385,347

Current Obligation: $24,385,347

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline