VA awards $15.6M construction contract for Providence VAMC mental health facility, highlighting full and open competition

Contract Overview

Contract Amount: $15,573,839 ($15.6M)

Contractor: Billy W. Jarrett Construction Company, Inc.

Awarding Agency: Department of Veterans Affairs

Start Date: 2023-08-11

End Date: 2026-04-03

Contract Duration: 966 days

Daily Burn Rate: $16.1K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 3

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: MINOR CONSTRUCTION PROJECT AT PROVIDENCE VAMC - MENTAL HEALTH

Place of Performance

Location: MONTGOMERY, MONTGOMERY County, ALABAMA, 36104

State: Alabama Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $15.6 million to BILLY W. JARRETT CONSTRUCTION COMPANY, INC. for work described as: MINOR CONSTRUCTION PROJECT AT PROVIDENCE VAMC - MENTAL HEALTH Key points: 1. Contract awarded to Billy W. Jarrett Construction Company, Inc. for a firm-fixed-price definitive contract. 2. Project scope includes minor construction for a mental health facility at the Providence VA Medical Center. 3. The contract was awarded under full and open competition after exclusion of sources, indicating a competitive process. 4. The duration of the contract is 966 days, spanning from August 2023 to April 2026. 5. The contract value of $15.6 million is for commercial and institutional building construction. 6. The project is located in Alabama, with the specific facility being the Providence VAMC. 7. The contract type is a definitive contract, typically used for specific requirements over a period. 8. The award was made by the Department of Veterans Affairs, with the VA also serving as the servicing agency.

Value Assessment

Rating: good

The contract value of $15.6 million for a minor construction project at a VA medical center appears reasonable within the context of healthcare facility upgrades. Benchmarking against similar construction projects for institutional buildings, especially those within the federal sector, 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 specific details on the scope of work and materials, a direct comparison to market rates for per-unit costs is not feasible.

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.' This solicitation method indicates that the agency initially considered excluding certain sources but ultimately opened the competition to all responsible prospective contractors. The presence of 3 bidders suggests a moderate level of competition for this specific project. While not a completely unrestricted open competition, it still allowed multiple firms to bid, which generally aids in price discovery and achieving a fair market price.

Taxpayer Impact: The competitive nature of this award, even with initial source exclusions, is beneficial for taxpayers as it likely drove down the final contract price compared to a sole-source or limited competition scenario.

Public Impact

The primary beneficiaries are veterans receiving care at the Providence VA Medical Center, who will gain access to improved mental health facilities. The project delivers essential construction services to enhance the healthcare infrastructure of the Department of Veterans Affairs. The geographic impact is focused on Alabama, specifically serving the veteran population in the vicinity of the Providence VAMC. The contract supports the construction workforce, likely employing skilled tradespeople and laborers in the Alabama region.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for scope creep in minor construction projects if not tightly managed, leading to cost increases.
Reliance on a single contractor for the duration of the project could pose risks if performance issues arise.
The 'after exclusion of sources' clause warrants scrutiny to ensure the initial exclusion was justified and did not unduly limit competition.

Positive Signals

Firm-fixed-price contract structure shifts cost overrun risk to the contractor, protecting the government's budget.
Award to a single entity for a defined scope simplifies project management and accountability.
The contract duration is clearly defined, providing a predictable timeline for project completion.

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 area often supports the modernization and expansion of government facilities, including healthcare infrastructure. Comparable spending benchmarks would involve analyzing other VA construction projects or similar federal building initiatives. The market for such specialized construction services is competitive, with numerous firms capable of undertaking projects of this scale.

Small Business Impact

The data indicates that small business participation (ss and sb fields) was not a specific set-aside requirement for this contract. Therefore, there are no direct subcontracting implications mandated by small business set-asides. However, the prime contractor may still engage small businesses as subcontractors, contributing to the broader small business ecosystem. Further analysis would be needed to determine if any subcontracting plans were part of the award.

Oversight & Accountability

Oversight for this contract will primarily 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 the specified construction within the agreed-upon budget and timeline. Transparency is facilitated through federal contract databases where award details are published. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse related to the contract.

Related Government Programs

VA Medical Facility Construction
Federal Building and Infrastructure Projects
Commercial Construction Contracts
Mental Health Service Infrastructure

Risk Flags

Potential for cost overruns if scope is not precisely defined.
Contractor performance risk.
Justification for initial source exclusion requires review.
Dependence on VA's operational capacity to utilize the facility effectively.

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $15.6 million to BILLY W. JARRETT CONSTRUCTION COMPANY, INC.. MINOR CONSTRUCTION PROJECT AT PROVIDENCE VAMC - MENTAL HEALTH

Who is the contractor on this award?

The obligated recipient is BILLY W. JARRETT CONSTRUCTION COMPANY, 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 $15.6 million.

What is the period of performance?

Start: 2023-08-11. End: 2026-04-03.

What is the track record of Billy W. Jarrett Construction Company, Inc. with federal contracts, particularly with the Department of Veterans Affairs?

A thorough review of federal contract databases (e.g., FPDS, SAM.gov) would be necessary to assess Billy W. Jarrett Construction Company, Inc.'s past performance. This would involve examining the number of previous federal awards, their values, the agencies involved, and any performance ratings or past performance questionnaires. Specific attention should be paid to their experience with VA projects and construction of healthcare or institutional facilities. Any history of contract disputes, terminations, or significant performance issues would be critical risk indicators. Without this specific data, it's difficult to definitively assess their track record beyond the current award.

How does the $15.6 million cost compare to similar minor construction projects for VA mental health facilities?

To benchmark the $15.6 million cost, one would need to identify comparable VA mental health facility construction or renovation projects awarded within the last 1-3 years. Key comparison points would include project size (square footage), complexity of work (e.g., specialized medical equipment integration, structural modifications), geographic location (as construction costs vary regionally), and the specific scope of services included. Analyzing the cost per square foot or cost per bed for similar facilities would provide a more granular comparison. The 'minor construction' designation suggests a scope that might not involve extensive new builds but rather upgrades or modifications, which should be factored into the comparison.

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

The primary risk for the VA with a firm-fixed-price (FFP) contract is ensuring the contractor has accurately estimated all costs and included sufficient contingency. If the contractor's estimate was too low, they might face financial difficulties, potentially leading to quality compromises or even project abandonment, though FFP generally shifts this risk to the contractor. Another risk is ensuring the defined scope of work is comprehensive enough to cover all necessary aspects of the mental health facility construction. Inadequate scope definition can lead to change orders, which, while managed, can increase the overall cost and timeline. The VA must maintain diligent oversight to ensure the contractor adheres to the specifications and quality standards.

What is the expected effectiveness of this new mental health facility in improving veteran care?

The effectiveness of the new mental health facility hinges on several factors beyond the construction itself. Its success will be measured by its ability to provide a therapeutic environment, accommodate the required patient volume, integrate necessary medical technologies, and be easily accessible to veterans. The design and layout, informed by mental health best practices, will play a crucial role. Furthermore, the facility's effectiveness is intertwined with the operational capacity of the VA to staff it adequately with mental health professionals and to manage patient flow efficiently. The construction project itself is a foundational step; the true measure of effectiveness will come from its utilization and impact on veteran mental well-being.

How has federal spending on VA construction projects, particularly for healthcare facilities, trended in recent years?

Federal spending on VA construction projects, especially for healthcare facilities, has generally seen fluctuations driven by infrastructure needs, modernization efforts, and budget appropriations. In recent years, there has been a sustained focus on upgrading aging VA facilities and expanding capacity to meet the growing demand for veteran healthcare services. This includes investments in new medical centers, specialized clinics, and renovations to existing structures. Factors such as congressional appropriations, the backlog of maintenance and repair needs, and specific legislative mandates (like the MISSION Act) influence the overall spending trends. Analyzing historical spending data would reveal patterns in capital investments and the types of construction projects prioritized by the VA.

What does the 'after exclusion of sources' clause imply about the initial procurement strategy?

The 'after exclusion of sources' clause in a 'Full and Open Competition' award suggests that the agency may have initially considered limiting the pool of potential bidders based on specific criteria or pre-qualification. However, the subsequent decision to proceed with 'Full and Open Competition' indicates that the agency ultimately determined that opening the solicitation to all responsible sources was feasible and potentially more advantageous. This could occur if initial market research identified a broader range of capable contractors than anticipated, or if regulatory requirements mandated a wider competition. It implies a deliberate procurement strategy that balanced initial considerations with the principle of maximizing competition.

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: 36C77623R0039

Offers Received: 3

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 905 SOUTH PERRY STREET SUITE 101, MONTGOMERY, AL, 36104

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

Financial Breakdown

Contract Ceiling: $15,573,839

Exercised Options: $15,573,839

Current Obligation: $15,573,839

Subaward Activity

Number of Subawards: 4

Total Subaward Amount: $386,890

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline