VA Awards $10.6M Contract for Saginaw Medical Center Expansion to Coastal Construction Group

Contract Overview

Contract Amount: $10,682,400 ($10.7M)

Contractor: Coastal Construction Group, LLC

Awarding Agency: Department of Veterans Affairs

Start Date: 2025-06-02

End Date: 2027-05-10

Contract Duration: 707 days

Daily Burn Rate: $15.1K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 5

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: THE CONTRACTOR SHALL FURNISH ALL LABOR, MATERIALS, TOOLS, EQUIPMENT, AND SUPERVISION NECESSARY TO PERFORM AND COMPLETE THE WORK ASSOCIATED WITH PROJECT #655-401, "EXPAND MEDICAL CENTER - SAGINAW SITE", IN SUPPORT OF THE SAGINAW VA MEDICAL CENTER

Place of Performance

Location: SAGINAW, SAGINAW County, MICHIGAN, 48601

State: Michigan Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $10.7 million to COASTAL CONSTRUCTION GROUP, LLC for work described as: THE CONTRACTOR SHALL FURNISH ALL LABOR, MATERIALS, TOOLS, EQUIPMENT, AND SUPERVISION NECESSARY TO PERFORM AND COMPLETE THE WORK ASSOCIATED WITH PROJECT #655-401, "EXPAND MEDICAL CENTER - SAGINAW SITE", IN SUPPORT OF THE SAGINAW VA MEDICAL CENTER Key points: 1. The contract aims to expand the Saginaw VA Medical Center, a significant infrastructure project. 2. Coastal Construction Group, LLC, is the awarded contractor. 3. The project falls under 'Other Heavy and Civil Engineering Construction' with a significant duration. 4. The award method indicates competition after exclusion of sources, warranting further review.

Value Assessment

Rating: fair

The contract value of $10.6 million for a 707-day project appears reasonable for heavy civil engineering construction. Benchmarking against similar VA medical facility expansion projects would provide a more precise assessment of value.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

The contract was awarded under 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES'. This suggests that while some competition occurred, it was not fully open, potentially limiting price discovery and optimal value.

Taxpayer Impact: Taxpayer funds are being used for a critical infrastructure upgrade to a VA medical facility. The limited competition aspect raises questions about whether the best possible price was achieved.

Public Impact

Improved healthcare infrastructure for veterans in the Saginaw area. Potential for job creation during the construction phase. Ensures continued operation and potential expansion of medical services. Investment in aging federal medical facilities.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Limited competition method may impact price.
Contract duration is substantial, increasing risk of cost overruns.
No small business participation noted.

Positive Signals

Addresses critical VA infrastructure needs.
Firm fixed price contract provides cost certainty.
Project supports veteran healthcare services.

Sector Analysis

This contract falls within the 'Other Heavy and Civil Engineering Construction' sector. Spending in this sector for federal infrastructure projects can vary widely based on agency needs and project scope. The $10.6M value is moderate for a multi-year construction project.

Small Business Impact

The data indicates that small business participation was not a factor in this award (ss: false, sb: false). This suggests the prime contractor is likely a larger entity, and there's an opportunity missed for small business subcontracting.

Oversight & Accountability

The award method 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES' requires justification for excluding certain sources. Oversight should ensure this exclusion was appropriate and documented. The firm fixed price contract offers some cost control.

Related Government Programs

Other Heavy and Civil Engineering Construction
Department of Veterans Affairs Contracting
Department of Veterans Affairs Programs

Risk Flags

Limited competition may have resulted in a higher price.
Long contract duration increases risk of unforeseen issues.
No small business participation identified.
Potential for scope creep during a lengthy construction project.

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $10.7 million to COASTAL CONSTRUCTION GROUP, LLC. THE CONTRACTOR SHALL FURNISH ALL LABOR, MATERIALS, TOOLS, EQUIPMENT, AND SUPERVISION NECESSARY TO PERFORM AND COMPLETE THE WORK ASSOCIATED WITH PROJECT #655-401, "EXPAND MEDICAL CENTER - SAGINAW SITE", IN SUPPORT OF THE SAGINAW VA MEDICAL CENTER

Who is the contractor on this award?

The obligated recipient is COASTAL CONSTRUCTION GROUP, 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 $10.7 million.

What is the period of performance?

Start: 2025-06-02. End: 2027-05-10.

What was the specific justification for excluding sources in the 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES' award method, and how did this impact the final price?

The justification for excluding sources under this award method typically relates to specific technical requirements, existing infrastructure compatibility, or unique capabilities not widely available. Without the specific justification, it's difficult to definitively assess the price impact. However, limiting the pool of potential bidders generally reduces competitive pressure, potentially leading to a higher price than under full and open competition.

Given the 707-day duration and firm fixed price, what are the primary risks to the government regarding cost overruns or schedule delays?

The primary risks under a firm fixed price contract with a long duration include unforeseen site conditions, material price escalation, labor shortages, and scope creep. While the fixed price caps the contractor's profit, delays or cost increases beyond the contractor's control (force majeure) could lead to claims or contract modifications. The government bears the risk if the contractor cannot complete the work within the agreed price and timeline due to external factors.

How does this expansion project align with the VA's long-term strategic goals for healthcare delivery in the Saginaw region?

This expansion project directly supports the VA's strategic goal of providing modern, efficient healthcare facilities to veterans. By expanding the Saginaw VA Medical Center, the agency aims to increase capacity, potentially introduce new services, and improve the overall patient experience. This investment signals a commitment to serving the veteran population in that region and ensuring access to quality care.

Industry Classification

NAICS: Construction › Other Heavy and Civil Engineering Construction › Other Heavy and Civil Engineering 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: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: 36C77624R0154

Offers Received: 5

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 1000 E STATE ST, CHEBOYGAN, MI, 49721

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

Financial Breakdown

Contract Ceiling: $10,684,400

Exercised Options: $10,684,400

Current Obligation: $10,682,400

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline