VA awards $32.2M construction contract for EHRM infrastructure upgrades at Salt Lake City VAMC

Contract Overview

Contract Amount: $32,240,378 ($32.2M)

Contractor: AC JV ONE LLC

Awarding Agency: Department of Veterans Affairs

Start Date: 2024-07-19

End Date: 2026-08-06

Contract Duration: 748 days

Daily Burn Rate: $43.1K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 2

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: THE CONTRACTOR SHALL PROVIDE ALL TOOLS, EQUIPMENT, MATERIALS, LABOR, SUPERVISION, PERSONNEL, AND SHALL DO ALL THINGS NECESSARY THAT WILL RESULT IN THE COMPLETION OF THE EHRM INFRASTRUCTURE UPGRADES CONSTRUCTION PROJECT AT THE SALT LAKE CITY VAMC

Place of Performance

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

State: Utah Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $32.2 million to AC JV ONE LLC for work described as: THE CONTRACTOR SHALL PROVIDE ALL TOOLS, EQUIPMENT, MATERIALS, LABOR, SUPERVISION, PERSONNEL, AND SHALL DO ALL THINGS NECESSARY THAT WILL RESULT IN THE COMPLETION OF THE EHRM INFRASTRUCTURE UPGRADES CONSTRUCTION PROJECT AT THE SALT LAKE CITY VAMC Key points: 1. Contract focuses on essential infrastructure upgrades for the Electronic Health Record Modernization (EHRM) program. 2. The project involves construction services for institutional buildings, indicating a significant physical footprint. 3. Awarded under full and open competition, suggesting a robust bidding process. 4. The definitive contract type implies a clear scope and fixed pricing. 5. Project duration of 748 days points to a substantial, multi-year undertaking. 6. The contractor, AC JV ONE LLC, will be responsible for all aspects of the construction project.

Value Assessment

Rating: good

The contract value of $32.2 million for a large-scale construction project at a VA medical center appears reasonable, especially considering the scope of infrastructure upgrades for the EHRM program. Benchmarking against similar large-scale construction projects within the federal sector, particularly those involving healthcare facilities and IT infrastructure integration, would provide a more precise value-for-money assessment. The firm-fixed-price structure helps control costs, but the final cost will depend on the contractor's execution and any unforeseen site conditions.

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 is a standard competitive procedure. While the specific number of bidders is not provided, this method generally ensures a wide range of potential contractors can participate, fostering price discovery and potentially leading to more competitive pricing. The VA's approach here suggests they sought the best value through a broad solicitation.

Taxpayer Impact: Taxpayers benefit from a competitive bidding process that aims to secure the most cost-effective solution for essential infrastructure upgrades, preventing potential overspending associated with less competitive solicitations.

Public Impact

Veterans receiving care at the Salt Lake City VAMC will benefit from improved healthcare infrastructure supporting the EHRM system. The project delivers critical construction services necessary for modernizing healthcare IT systems. The geographic impact is localized to Salt Lake City, Utah, enhancing local VA facility capabilities. The construction project will likely involve a workforce of skilled tradespeople and construction professionals in the Utah region.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if unforeseen construction challenges arise during the 748-day project duration.
Dependence on the contractor's ability to manage complex infrastructure upgrades within a healthcare setting.
Risk of delays impacting the broader EHRM modernization timeline if construction milestones are missed.

Positive Signals

Clear scope defined by a definitive contract type.
Firm-fixed-price structure provides cost certainty for the base contract.
Awarded through full and open competition, indicating a potentially strong pool of qualified bidders.

Sector Analysis

This contract falls within the Commercial and Institutional Building Construction sector, a significant segment of the federal contracting market. The project's focus on healthcare infrastructure and IT system support places it at the intersection of construction and technology modernization. Comparable spending benchmarks would involve other large-scale construction projects at federal facilities, particularly those involving upgrades to critical operational systems like electronic health records.

Small Business Impact

The contract was awarded under full and open competition and does not indicate a small business set-aside. There is no explicit information on subcontracting plans for small businesses. The scale of this project might lend itself to larger construction firms, but opportunities for small businesses could exist in specialized subcontracting roles if pursued by the prime contractor.

Oversight & Accountability

Oversight will likely be managed by the Department of Veterans Affairs contracting officers and project managers. Accountability measures are inherent in the firm-fixed-price contract, requiring the contractor to deliver the specified construction within the agreed-upon terms. Transparency is facilitated by the public nature of federal contract awards, though detailed project progress reports may not be publicly available. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Electronic Health Record Modernization (EHRM) Program
VA Medical Facility Construction Projects
Infrastructure Upgrades
Commercial and Institutional Building Construction

Risk Flags

Potential for construction delays impacting EHRM rollout.
Risk of cost overruns if unforeseen site conditions are encountered.
Dependence on contractor's specialized construction expertise for healthcare IT infrastructure.

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $32.2 million to AC JV ONE LLC. THE CONTRACTOR SHALL PROVIDE ALL TOOLS, EQUIPMENT, MATERIALS, LABOR, SUPERVISION, PERSONNEL, AND SHALL DO ALL THINGS NECESSARY THAT WILL RESULT IN THE COMPLETION OF THE EHRM INFRASTRUCTURE UPGRADES CONSTRUCTION PROJECT AT THE SALT LAKE CITY VAMC

Who is the contractor on this award?

The obligated recipient is AC JV ONE 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 $32.2 million.

What is the period of performance?

Start: 2024-07-19. End: 2026-08-06.

What is the track record of AC JV ONE LLC in completing similar large-scale federal construction projects, particularly within healthcare facilities?

Information regarding AC JV ONE LLC's specific track record on similar large-scale federal construction projects, especially within healthcare facilities, is not detailed in the provided data. A comprehensive assessment would require reviewing past performance evaluations, contract completion history, and any reported issues or successes on previous government contracts. Understanding their experience with complex infrastructure upgrades and adherence to timelines and budgets on comparable projects is crucial for evaluating their capability to successfully execute this EHRM infrastructure project.

How does the awarded amount of $32.2 million compare to the estimated cost or benchmark for similar EHRM infrastructure upgrade construction projects at VA medical centers?

Without specific benchmark data for EHRM infrastructure upgrade construction projects at VA medical centers, a direct comparison of the $32.2 million award is challenging. However, the value appears substantial, reflecting the complexity and scale of modernizing infrastructure for a critical IT system like EHRM within a healthcare environment. A thorough analysis would involve comparing this contract's cost per square foot, cost per bed, or cost per system component against similar projects, considering factors like geographic location, specific upgrade requirements, and the age and condition of the existing facility.

What are the primary risks associated with this construction project, and what mitigation strategies are in place?

Primary risks for this construction project include potential delays due to unforeseen site conditions, material shortages, labor availability, or integration challenges with existing hospital operations. Scope creep, if not managed tightly, could also lead to cost increases. Mitigation strategies typically involve detailed site assessments prior to award, robust project management plans, contingency planning for unexpected issues, clear communication protocols between the VA and the contractor, and potentially performance bonds. The firm-fixed-price contract incentivizes the contractor to manage these risks effectively to avoid cost overruns.

How will the successful completion of this construction project impact the functionality and efficiency of the EHRM system at the Salt Lake City VAMC?

The successful completion of this construction project is critical for the optimal functioning and efficiency of the EHRM system at the Salt Lake City VAMC. Infrastructure upgrades, such as enhanced power, cooling, network cabling, and secure spaces for IT equipment, are foundational requirements for reliable and high-performance electronic health records. Improved infrastructure will reduce the risk of system downtime, support faster data access for clinicians, enhance data security, and enable the full capabilities of the EHRM system, ultimately contributing to better patient care and operational efficiency within the facility.

What has been the historical spending trend for construction and infrastructure upgrades related to IT systems at VA facilities over the past five years?

Historical spending trends for construction and infrastructure upgrades related to IT systems at VA facilities over the past five years would likely show a significant increase, driven by the national push for EHR modernization and the need to update aging infrastructure. The EHRM program itself represents a substantial investment across multiple facilities. Analyzing VA budget allocations and contract awards for construction, IT infrastructure, and related services would reveal a pattern of growing expenditure aimed at modernizing healthcare IT capabilities and ensuring the reliability and security of patient data systems.

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: 36C77623B0041

Offers Received: 2

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 837 OAKTON ST, ELK GROVE VILLAGE, IL, 60007

Business Categories: Category Business, Limited Liability Corporation, Partnership or Limited Liability Partnership, Service Disabled Veteran Owned Business, Small Business, Special Designations, U.S.-Owned Business, Veteran Owned Business

Financial Breakdown

Contract Ceiling: $32,240,378

Exercised Options: $32,240,378

Current Obligation: $32,240,378

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline