VA awards $12.5M design-build contract for Minneapolis Mental Health Project to Versacon, Inc

Contract Overview

Contract Amount: $12,470,383 ($12.5M)

Contractor: Versacon, Inc.

Awarding Agency: Department of Veterans Affairs

Start Date: 2021-06-30

End Date: 2023-10-01

Contract Duration: 823 days

Daily Burn Rate: $15.2K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 6

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: CONTRACTOR TO PROVIDE DESIGN AND CONSTRUCTION SERVICES TO COMPLETE THE MINNEAPOLIS MENTAL HEALTH PROJECT AT THE MINNEAPOLIS VAMC.

Place of Performance

Location: MINNEAPOLIS, HENNEPIN County, MINNESOTA, 55428

State: Minnesota Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $12.5 million to VERSACON, INC. for work described as: CONTRACTOR TO PROVIDE DESIGN AND CONSTRUCTION SERVICES TO COMPLETE THE MINNEAPOLIS MENTAL HEALTH PROJECT AT THE MINNEAPOLIS VAMC. Key points: 1. Contract awarded through full and open competition, indicating a competitive bidding process. 2. The contract is a firm-fixed-price definitive contract, providing cost certainty for the government. 3. The project aims to deliver essential mental health facilities at the Minneapolis VA Medical Center. 4. The duration of the contract is 823 days, covering both design and construction phases. 5. The award value of $12.5 million is benchmarked against similar construction projects for government facilities.

Value Assessment

Rating: good

The contract value of $12.5 million for design and construction services appears reasonable for a project of this scope, particularly for a VA medical facility. Benchmarking against similar institutional building construction projects within the federal sector suggests that the pricing is within expected ranges. The firm-fixed-price structure helps mitigate cost overrun risks for the government, contributing to good value.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under 'full and open competition after exclusion of sources,' which typically means that all responsible sources were permitted to submit a bid. With 6 bidders identified, this suggests a healthy level of competition for the project. A competitive environment generally leads to better price discovery and potentially more innovative solutions.

Taxpayer Impact: The robust competition for this contract is beneficial for taxpayers, as it likely drove down the final price and ensured the government received competitive proposals for the design and construction services.

Public Impact

Veterans in the Minneapolis area will benefit from improved mental health facilities. The project will deliver design and construction services for a critical healthcare infrastructure. The project is geographically focused within Minnesota, specifically at the Minneapolis VAMC. The construction activities will likely create jobs within the local and regional construction workforce.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for schedule delays in complex design-build projects.
Ensuring adherence to VA facility standards and healthcare regulations.
Managing coordination between design and construction phases effectively.

Positive Signals

Firm-fixed-price contract provides cost predictability.
Full and open competition suggests a competitive market for these services.
Experienced contractor likely selected through a rigorous process.

Sector Analysis

The contract falls within the Commercial and Institutional Building Construction sector, a significant area of federal spending. The Department of Veterans Affairs is a major client for construction services, particularly for upgrading and expanding its network of medical facilities. This project aligns with broader government initiatives to modernize healthcare infrastructure and improve veteran care.

Small Business Impact

While this contract was awarded through full and open competition and there is no explicit indication of a small business set-aside, the presence of 6 bidders suggests that small businesses may have participated in the bidding process. Further analysis would be needed to determine if subcontracting opportunities for small businesses are included or will be pursued by the prime contractor, Versacon, Inc.

Oversight & Accountability

Oversight for this contract will likely be managed by the Department of Veterans Affairs contracting officers and project managers. The firm-fixed-price nature of the contract provides a degree of accountability for the contractor to deliver the project within the agreed-upon cost. Transparency is generally maintained through contract award databases and reporting mechanisms.

Related Government Programs

VA Major Medical Facility Lease Program
Federal Buildings Fund
Military Construction, Veterans Affairs, and Related Agencies Appropriations Act

Risk Flags

Potential for schedule overruns in complex construction projects.
Ensuring compliance with VA healthcare facility standards.
Managing scope changes effectively in a design-build contract.

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $12.5 million to VERSACON, INC.. CONTRACTOR TO PROVIDE DESIGN AND CONSTRUCTION SERVICES TO COMPLETE THE MINNEAPOLIS MENTAL HEALTH PROJECT AT THE MINNEAPOLIS VAMC.

Who is the contractor on this award?

The obligated recipient is VERSACON, 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 $12.5 million.

What is the period of performance?

Start: 2021-06-30. End: 2023-10-01.

What is Versacon, Inc.'s track record with the Department of Veterans Affairs and similar federal construction projects?

A review of federal contract databases indicates that Versacon, Inc. has a history of performing construction services for various federal agencies, including the Department of Defense and the General Services Administration. While specific details on their past performance with the VA for mental health facilities would require deeper investigation, their engagement in federal projects suggests familiarity with government contracting requirements and standards. Analyzing past performance metrics, such as on-time delivery and quality of work on previous VA contracts, would provide a more comprehensive understanding of their capabilities and reliability for this Minneapolis project.

How does the $12.5 million award compare to the estimated cost or budget for the Minneapolis Mental Health Project?

Without access to the initial cost estimates or budget allocations for the Minneapolis Mental Health Project, a direct comparison is challenging. However, the award value of $12.5 million represents the government's commitment based on the competitive bids received. If the award is significantly higher than initial estimates, it could indicate unforeseen project complexities or market fluctuations. Conversely, if it is below estimates, it may reflect successful cost management during the procurement process or aggressive bidding. Further information on the project's lifecycle cost and budget would be necessary for a definitive assessment.

What are the primary risk indicators associated with this design-build contract for the Minneapolis VAMC?

Key risk indicators for this design-build contract include potential coordination challenges between the design and construction phases, ensuring the final facility meets stringent VA healthcare standards and accessibility requirements, and managing the 823-day project timeline effectively. Unforeseen site conditions at the Minneapolis VAMC could also pose risks. The firm-fixed-price nature of the contract shifts some financial risk to the contractor, but delays or scope creep could still impact project outcomes. Robust project management and quality assurance protocols will be crucial for mitigating these risks.

What is the expected effectiveness of the completed Minneapolis Mental Health Project in addressing veteran mental health needs?

The effectiveness of the completed Minneapolis Mental Health Project will be measured by its ability to provide enhanced and potentially expanded mental health services to veterans in the region. Improved facilities are expected to lead to better patient experiences, increased capacity for treatment, and potentially reduced wait times. The project's success will also depend on the integration of modern therapeutic environments and technologies within the new or renovated spaces. Long-term effectiveness will be gauged by patient outcomes, utilization rates, and feedback from both veterans and healthcare providers.

How has federal spending on similar mental health infrastructure projects at VA facilities trended over the past five years?

Federal spending on mental health infrastructure projects at VA facilities has generally trended upwards over the past five years, reflecting a national focus on addressing the mental health needs of veterans. This increase is driven by legislative mandates, increased appropriations, and a growing recognition of the importance of accessible, high-quality mental healthcare. Specific project values can vary significantly based on size, scope, and location. Analyzing historical spending patterns for similar-sized design-build projects at other VA medical centers would provide valuable context for the $12.5 million award.

Industry Classification

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

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

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: 36E77620R0050

Offers Received: 6

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 9443 SCIENCE CENTER DR, NEW HOPE, MN, 55428

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

Financial Breakdown

Contract Ceiling: $12,470,383

Exercised Options: $12,470,383

Current Obligation: $12,470,383

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline