VA awards $17M construction contract for EHR modernization infrastructure at Lexington-Cooper VA Medical Center

Contract Overview

Contract Amount: $17,084,635 ($17.1M)

Contractor: Sigo Valiant JV LLC

Awarding Agency: Department of Veterans Affairs

Start Date: 2024-04-11

End Date: 2026-01-09

Contract Duration: 638 days

Daily Burn Rate: $26.8K/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: CONTRACTOR IS TO PROVIDE ALL CONSTRUCTION SERVICES TO COMPLETE THE ELECTRONIC HEALTH RECORD MODERNIZATION INFRASTRUCTURE UPGRADES CONSTRUCTION PROJECT AT THE LEXINGTON-COOPER VA MEDICAL CENTER.

Place of Performance

Location: LEXINGTON, FAYETTE County, KENTUCKY, 40502

State: Kentucky Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $17.1 million to SIGO VALIANT JV LLC for work described as: CONTRACTOR IS TO PROVIDE ALL CONSTRUCTION SERVICES TO COMPLETE THE ELECTRONIC HEALTH RECORD MODERNIZATION INFRASTRUCTURE UPGRADES CONSTRUCTION PROJECT AT THE LEXINGTON-COOPER VA MEDICAL CENTER. Key points: 1. Contract focuses on essential infrastructure upgrades to support the Electronic Health Record modernization. 2. The award was made under full and open competition, suggesting a competitive bidding process. 3. The contract type is a Firm Fixed Price, which provides cost certainty for the government. 4. The project duration is 638 days, indicating a significant construction timeline. 5. The contractor, SIGO VALIANT JV LLC, will be responsible for all construction services. 6. The project is located in Kentucky, potentially impacting local construction workforce and businesses.

Value Assessment

Rating: good

The contract value of $17.08 million for construction services appears reasonable for a project of this scope, involving infrastructure upgrades for a major medical center's EHR modernization. Benchmarking against similar large-scale construction projects for federal facilities, particularly those with specialized requirements like healthcare IT infrastructure, would provide a more precise value assessment. The firm fixed-price nature of the contract helps mitigate cost overrun risks for the government, assuming the scope is well-defined.

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. The presence of 3 bidders indicates a moderate level of competition for this specific project. While more bidders could potentially drive prices lower, a competitive process was still employed, allowing for price discovery and selection of the most advantageous offer.

Taxpayer Impact: The use of full and open competition ensures that taxpayer dollars are likely being used efficiently by fostering a competitive environment that encourages lower bids and better value.

Public Impact

Veterans receiving care at the Lexington-Cooper VA Medical Center will benefit from improved healthcare services through the modernized EHR system. The project delivers critical construction services to upgrade the physical infrastructure supporting advanced medical technology. The geographic impact is concentrated in Lexington, Kentucky, potentially creating local jobs and economic activity. The construction services will likely involve a skilled workforce, including various trades and project management professionals.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for scope creep if EHR modernization requirements evolve during the construction phase.
Dependency on timely delivery of specialized IT components for the EHR system.
Risk of construction delays due to unforeseen site conditions or material shortages.

Positive Signals

Firm fixed-price contract provides cost predictability.
Award to a joint venture may indicate specialized capabilities for complex projects.
Clear definition of construction services required for infrastructure upgrades.

Sector Analysis

This contract falls within the Commercial and Institutional Building Construction sector, specifically supporting critical infrastructure for healthcare facilities. The federal government is a significant investor in healthcare construction, with spending often driven by modernization efforts, capacity expansion, and technological integration like Electronic Health Records. Comparable spending benchmarks would involve analyzing other large-scale construction projects awarded to federal agencies for medical centers or similar institutional buildings, considering factors like square footage, complexity, and specific technological requirements.

Small Business Impact

The contract data indicates that small business participation (ss: false, sb: false) was not a primary set-aside criterion for this specific award. Therefore, there are no direct small business set-aside implications. However, the prime contractor, SIGO VALIANT JV LLC, may engage small businesses as subcontractors to fulfill portions of the construction work, contributing to the broader small business ecosystem. Further analysis of subcontracting plans would be needed to assess the direct impact on small businesses.

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 in the firm fixed-price contract terms, requiring completion of specified construction services. Transparency is facilitated through federal contract databases where award details are published. While no specific Inspector General jurisdiction is mentioned, the VA Office of Inspector General typically oversees VA contracts for fraud, waste, and abuse.

Related Government Programs

Veterans Health Administration IT Modernization
VA Medical Center Construction Projects
Federal Healthcare Infrastructure Development
Electronic Health Record Systems Implementation

Risk Flags

Potential for cost overruns if scope is not tightly managed.
Risk of project delays impacting EHR implementation timeline.
Dependency on coordination between construction and IT teams.
Adequacy of contractor's past performance on similar projects.

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $17.1 million to SIGO VALIANT JV LLC. CONTRACTOR IS TO PROVIDE ALL CONSTRUCTION SERVICES TO COMPLETE THE ELECTRONIC HEALTH RECORD MODERNIZATION INFRASTRUCTURE UPGRADES CONSTRUCTION PROJECT AT THE LEXINGTON-COOPER VA MEDICAL CENTER.

Who is the contractor on this award?

The obligated recipient is SIGO VALIANT JV 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 $17.1 million.

What is the period of performance?

Start: 2024-04-11. End: 2026-01-09.

What is the track record of SIGO VALIANT JV LLC in completing similar federal construction projects, particularly those involving healthcare infrastructure?

Assessing the track record of SIGO VALIANT JV LLC requires a review of their past performance on federal contracts. Specifically, it would be beneficial to examine previous projects of similar scale and complexity, especially those related to healthcare facilities or IT infrastructure upgrades. Information on project completion timeliness, adherence to budget, and quality of work would be crucial. A joint venture structure might indicate a combination of expertise, but understanding the individual entities' histories within the JV is also important. Publicly available contract databases and performance evaluations (if accessible) would be the primary sources for this analysis.

How does the awarded amount of $17.08 million compare to the estimated cost or budget for this EHR modernization infrastructure project?

The provided data does not include the government's estimated cost or budget for this project. Therefore, a direct comparison to determine if the $17.08 million award represents a favorable price is not possible with the current information. To assess value for money, one would need to compare this award amount against the initial cost estimates, any pre-solicitation budget announcements, or benchmark it against similar construction projects for VA medical centers. The fact that it was awarded under full and open competition suggests the price was deemed acceptable and represented the best value among the bids received.

What are the primary risks associated with the construction phase of this EHR modernization project, and how are they being mitigated?

Key risks for this construction project include potential delays due to unforeseen site conditions, material procurement challenges, or labor shortages. Given the project's connection to EHR modernization, there's also a risk of scope misalignment if the IT system's requirements evolve during construction. Mitigation strategies likely include detailed site assessments prior to construction, robust project management by the VA, contingency planning within the contract, and the firm fixed-price structure which incentivizes the contractor to manage costs and timelines effectively. The contractor's experience and the joint venture nature may also indicate a capacity to handle complex risks.

What is the expected impact of these infrastructure upgrades on the operational efficiency and effectiveness of the EHR system at the Lexington-Cooper VA Medical Center?

These infrastructure upgrades are foundational for the successful implementation and operation of the Electronic Health Record (EHR) modernization. Reliable power, cooling, network cabling, and secure physical spaces are essential for the performance, stability, and security of advanced IT systems like a modern EHR. Without adequate infrastructure, the EHR system could suffer from slow performance, frequent outages, or data integrity issues, hindering clinical workflows and patient care. Therefore, these construction services are critical to ensuring the EHR system can operate efficiently and effectively, ultimately supporting better patient care delivery.

How has federal spending on healthcare construction, particularly for IT infrastructure support, trended in recent years, and does this contract align with those trends?

Federal spending on healthcare construction, especially for facilities supporting IT infrastructure, has generally trended upwards in recent years, driven by the push for digital transformation in healthcare, including EHR modernization. Agencies like the VA are continuously investing in upgrading aging facilities to accommodate new technologies and improve service delivery. This $17.08 million contract for EHR modernization infrastructure aligns with this trend, reflecting the government's commitment to modernizing its healthcare IT backbone. Analyzing historical VA construction spending and IT infrastructure investments would provide a clearer picture of whether this award is consistent with established patterns or represents a significant shift.

What specific construction services are included in this contract, and how do they directly support the EHR modernization goals?

The contract specifies 'all construction services to complete the Electronic Health Record Modernization Infrastructure Upgrades Construction Project.' This broadly encompasses physical modifications and enhancements to the medical center's facilities necessary to support the new EHR system. Examples could include upgrading electrical systems to handle increased power demands, enhancing network cabling infrastructure for higher bandwidth, improving HVAC systems for server room cooling, reinforcing physical security measures for data centers, or potentially reconfiguring spaces to accommodate new IT hardware. These services are direct enablers for the successful deployment and reliable operation of the modernized EHR.

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: 36C77623B0069

Offers Received: 3

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 4122 WAHL STREET BLVD UNIT 3, LOUISVILLE, KY, 40218

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Limited Liability Corporation, 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: $17,084,635

Exercised Options: $17,084,635

Current Obligation: $17,084,635

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline