VA awards $26.6M contract for boiler replacement at Leavenworth, Kansas facility

Contract Overview

Contract Amount: $26,570,282 ($26.6M)

Contractor: Dax/Gbab JV 3, LLC

Awarding Agency: Department of Veterans Affairs

Start Date: 2022-09-27

End Date: 2026-01-30

Contract Duration: 1,221 days

Daily Burn Rate: $21.8K/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: CONTRACTOR SHALL COMPLETELY PREP SITE FOR BUILDING OPERATIONS, INCLUDING DEMO AND REMOVAL OF EXISTING STRUCTURES, AND FURNISH LABOR AND MATERIALS AND PERFORM WORK FOR THE REPLACE BOILERS LEAVENWORTH PROJECT AS REQUIRED BY DRAWINGS AND SPECIFICATIONS.

Place of Performance

Location: LEAVENWORTH, LEAVENWORTH County, KANSAS, 66048

State: Kansas Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $26.6 million to DAX/GBAB JV 3, LLC for work described as: CONTRACTOR SHALL COMPLETELY PREP SITE FOR BUILDING OPERATIONS, INCLUDING DEMO AND REMOVAL OF EXISTING STRUCTURES, AND FURNISH LABOR AND MATERIALS AND PERFORM WORK FOR THE REPLACE BOILERS LEAVENWORTH PROJECT AS REQUIRED BY DRAWINGS AND SPECIFICATIONS. Key points: 1. Contract awarded to DAX/GBAB JV 3, LLC for site preparation, demolition, and boiler replacement. 2. Project duration is 1221 days, indicating a significant, long-term infrastructure undertaking. 3. The contract type is Firm Fixed Price, which shifts cost risk to the contractor. 4. Competition was conducted under 'Full and Open Competition after Exclusion of Sources', suggesting a potentially limited but documented competitive process. 5. The project is located in Kansas, impacting local construction workforce and material suppliers. 6. This contract represents a substantial investment in facility maintenance and modernization for the VA.

Value Assessment

Rating: good

The contract value of $26.6 million for a boiler replacement project of this scale appears reasonable. While specific benchmarks for boiler replacement projects are difficult to ascertain without detailed project scope, the duration of over three years suggests a complex undertaking involving significant demolition and construction. The firm fixed-price nature of the contract provides cost certainty for the government, assuming the contractor has accurately estimated all costs and risks.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under 'Full and Open Competition after Exclusion of Sources'. This indicates that while the competition was intended to be open, specific sources may have been excluded based on pre-defined criteria. The presence of 4 bids suggests a degree of competition, but the exclusion clause warrants further investigation into the rationale behind it to ensure fair market access.

Taxpayer Impact: The competitive process, even with exclusions, aimed to secure the best value for taxpayers. The fact that multiple bids were received suggests that the government received competitive pricing, although the specific exclusions could have limited the pool of potential bidders and thus the ultimate price competitiveness.

Public Impact

Veterans receiving services at the Leavenworth facility will benefit from improved infrastructure and potentially more reliable heating and cooling systems. The project will deliver essential site preparation, demolition, and boiler replacement services. The geographic impact is concentrated in Leavenworth, Kansas, potentially benefiting the local economy through job creation and material sourcing. The construction activities will likely involve a significant number of skilled tradespeople, impacting the local construction workforce.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if unforeseen site conditions are encountered during demolition and preparation.
Risk of delays due to the complexity of replacing major building systems.
Ensuring compliance with environmental regulations during demolition and waste disposal.

Positive Signals

Firm Fixed Price contract provides cost certainty for the government.
Long project duration allows for phased implementation and potentially less disruption.
Award to a joint venture may indicate specialized capabilities for complex projects.

Sector Analysis

This contract falls within the Commercial and Institutional Building Construction sector, a vital part of the broader construction industry. This sector involves the building of non-residential structures such as hospitals, government facilities, and educational institutions. The market size for such projects is substantial, driven by the need for infrastructure maintenance, upgrades, and new construction across government and private entities. This specific project addresses the critical need for facility modernization within the Department of Veterans Affairs.

Small Business Impact

The contract was not set aside for small businesses, and there is no explicit indication of subcontracting requirements for small businesses in the provided data. This suggests that the primary award went to a larger entity or joint venture. Further analysis would be needed to determine if small businesses are involved as subcontractors, which is common in large construction projects.

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 would be enhanced by public reporting of project milestones and any modifications. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

VA Facility Maintenance Contracts
Federal Building Construction Projects
Infrastructure Modernization Programs
Boiler and HVAC System Replacements

Risk Flags

Potential for unforeseen site conditions
Risk of project delays
Contractor performance risk
Ensuring compliance with environmental regulations

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $26.6 million to DAX/GBAB JV 3, LLC. CONTRACTOR SHALL COMPLETELY PREP SITE FOR BUILDING OPERATIONS, INCLUDING DEMO AND REMOVAL OF EXISTING STRUCTURES, AND FURNISH LABOR AND MATERIALS AND PERFORM WORK FOR THE REPLACE BOILERS LEAVENWORTH PROJECT AS REQUIRED BY DRAWINGS AND SPECIFICATIONS.

Who is the contractor on this award?

The obligated recipient is DAX/GBAB JV 3, 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 $26.6 million.

What is the period of performance?

Start: 2022-09-27. End: 2026-01-30.

What is the track record of DAX/GBAB JV 3, LLC in completing similar large-scale government construction projects?

A comprehensive review of DAX/GBAB JV 3, LLC's past performance would be necessary to assess their track record. This would involve examining their history with the Federal Procurement Data System (FPDS) and other contract databases for similar projects, particularly those involving demolition, site preparation, and major mechanical system replacements in institutional settings. Key metrics to evaluate would include on-time completion, adherence to budget, quality of work, and any history of disputes or contract terminations. Understanding the specific experience of the joint venture partners, DAX and GBAB, individually and as a combined entity, is crucial for a thorough assessment of their capability to execute this complex project successfully.

How does the awarded amount of $26.6 million compare to similar VA boiler replacement projects?

Benchmarking this $26.6 million contract against similar VA boiler replacement projects requires access to detailed cost data for comparable projects. Factors influencing cost include facility size, complexity of existing systems, scope of demolition, type of new boilers installed, and geographic location. Without specific comparable project data, it's challenging to definitively state if this amount is high or low. However, given the 1221-day duration, it suggests a project of significant scale and complexity, potentially involving extensive infrastructure work beyond just the boiler units themselves. A detailed cost breakdown from the contractor would be needed for a more granular comparison.

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

The primary risks associated with this contract include unforeseen site conditions during demolition and excavation, potential delays due to the complexity of integrating new boiler systems with existing infrastructure, and contractor performance issues. Mitigation strategies are likely embedded within the contract terms. The firm fixed-price structure shifts financial risk to the contractor. The long duration allows for phased work and potential adjustments. The 'Full and Open Competition after Exclusion of Sources' process, if properly executed, should have vetted bidders capable of managing these risks. The VA's project management and oversight will be critical in identifying and addressing risks as they arise.

What is the expected impact of this project on the operational effectiveness of the Leavenworth VA facility?

The successful completion of this boiler replacement project is expected to significantly enhance the operational effectiveness of the Leavenworth VA facility. Modern boiler systems are typically more energy-efficient, reliable, and easier to maintain than older units, leading to reduced utility costs and fewer disruptions due to system failures. Improved heating and cooling capabilities will contribute to a more comfortable and safe environment for patients, staff, and visitors. This modernization is crucial for ensuring the long-term viability and functionality of the facility's essential services.

How has VA's spending on facility maintenance and construction evolved over the past five years?

Analyzing the VA's spending trends on facility maintenance and construction over the past five years would reveal patterns in investment priorities and budget allocations. This would involve examining aggregate spending data for categories such as infrastructure upgrades, major repairs, and new construction across all VA facilities. Such an analysis could indicate whether spending has been increasing, decreasing, or remaining stable, and whether there's a particular focus on specific types of projects like HVAC modernization. Understanding these trends provides context for the significance and timing of individual contracts like the Leavenworth boiler replacement.

What does the 'Full and Open Competition after Exclusion of Sources' procurement method imply about the market for this type of construction service?

The 'Full and Open Competition after Exclusion of Sources' method suggests that the VA initially intended to solicit bids from all responsible sources but subsequently excluded certain ones based on specific, documented criteria. This could be due to requirements for specialized experience, security clearances, or geographic proximity that not all potential bidders met. While it aims for broad competition, the exclusion implies that the VA had a particular set of capabilities in mind. The fact that four bids were received indicates that a sufficient number of qualified contractors were available within the defined parameters, suggesting a moderately competitive market for these specialized construction services.

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: SEALED BID

Solicitation ID: 36C77622B0029

Offers Received: 4

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 2202 SPRING COVE RD, SUNRISE BEACH, MO, 65079

Business Categories: Category Business, Service Disabled Veteran Owned Business, Small Business, Special Designations, U.S.-Owned Business, Veteran Owned Business

Financial Breakdown

Contract Ceiling: $26,570,282

Exercised Options: $26,570,282

Current Obligation: $26,570,282

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline