GSA awards $63.3M contract for VBA and DFAS facility renovations, highlighting fixed-price incentive structure

Contract Overview

Contract Amount: $63,329,624 ($63.3M)

Contractor: Whiting-Turner Contracting Company, the

Awarding Agency: General Services Administration

Start Date: 2021-02-18

End Date: 2026-12-15

Contract Duration: 2,126 days

Daily Burn Rate: $29.8K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 4

Pricing Type: FIXED PRICE INCENTIVE

Sector: Construction

Official Description: AWARD # 47PF0021C0020, CONSTRUCTION MANAGER AS CONSTRUCTOR (CMC) FOR THE ANTHONY J. CELEBREZZE - VETERANS BENEFITS ADMINISTRATION (VBA) RENOVATION AND BACKFILL PROJECT, & DEFENSE FINANCE AND ACCOUNTING SERVICE (DFAS) CONSOLIDATION PROJECT.

Place of Performance

Location: CLEVELAND, CUYAHOGA County, OHIO, 44199

State: Ohio Government Spending

Plain-Language Summary

General Services Administration obligated $63.3 million to WHITING-TURNER CONTRACTING COMPANY, THE for work described as: AWARD # 47PF0021C0020, CONSTRUCTION MANAGER AS CONSTRUCTOR (CMC) FOR THE ANTHONY J. CELEBREZZE - VETERANS BENEFITS ADMINISTRATION (VBA) RENOVATION AND BACKFILL PROJECT, & DEFENSE FINANCE AND ACCOUNTING SERVICE (DFAS) CONSOLIDATION PROJECT. Key points: 1. The contract utilizes a fixed-price incentive (FPI) structure, aiming to align contractor performance with government objectives while managing costs. 2. Competition was full and open, suggesting a robust bidding process that could lead to competitive pricing. 3. The project involves significant renovation and backfill for both the Veterans Benefits Administration and Defense Finance and Accounting Service, indicating a substantial scope of work. 4. The contract duration extends over five years, requiring sustained oversight and performance management. 5. The award to Whiting-Turner Contracting Company represents a significant investment in federal infrastructure modernization. 6. The North American Industry Classification System (NAICS) code 236220 points to commercial and institutional building construction, a specialized sector.

Value Assessment

Rating: good

The award amount of $63.3 million for a multi-year renovation project appears within a reasonable range for large-scale federal construction. Benchmarking against similar GSA renovation projects would provide a more precise value-for-money assessment. The fixed-price incentive (FPI) contract type suggests an effort to control costs, but the final price will depend on performance against established targets. Without specific performance data or detailed cost breakdowns, a definitive value assessment is challenging, but the competitive nature of the award is a positive indicator.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit bids. This approach generally fosters a competitive environment, which can lead to better pricing and innovation. The presence of four bidders (no) suggests a healthy level of interest in this significant federal construction project. The open competition is a strong indicator that the government sought the best value through a transparent process.

Taxpayer Impact: Taxpayers benefit from full and open competition through potentially lower prices due to contractor rivalry and a wider selection of qualified firms. This process increases the likelihood of obtaining services at a fair market value.

Public Impact

Federal employees within the Veterans Benefits Administration (VBA) and the Defense Finance and Accounting Service (DFAS) will benefit from modernized and consolidated workspaces. The project delivers essential renovation and backfill services, improving the functionality and efficiency of critical federal agency facilities. The primary geographic impact is in Ohio (OH, SN), where the facilities are located. The construction work will likely involve a significant number of skilled tradespeople and construction professionals, impacting the local workforce in Ohio.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

The fixed-price incentive (FPI) contract type, while designed to control costs, can lead to cost overruns if target costs are not met or if incentives are structured unfavorably.
Long contract duration (over 5 years) increases the risk of scope creep, unforeseen site conditions, or changes in agency needs that may require contract modifications.
Reliance on a single prime contractor for a large-scale renovation project concentrates risk; effective subcontracting oversight is crucial.
The project involves renovations to existing facilities, which inherently carries risks related to asbestos, lead paint, structural issues, and disruption to ongoing operations.

Positive Signals

Awarding under full and open competition suggests a thorough vetting process and potential for competitive pricing.
The fixed-price incentive structure, if well-defined, can incentivize the contractor to achieve cost savings and performance targets.
The contractor, Whiting-Turner Contracting Company, is a well-established firm with experience in large-scale construction projects, potentially mitigating execution risks.
The project addresses critical needs for two major federal agencies (VBA and DFAS), indicating strong program support and likely clear objectives.

Sector Analysis

This contract falls within the commercial and institutional building construction sector, a vital part of the broader construction industry. This sector encompasses the building of non-residential structures like government facilities, offices, and public institutions. Federal spending in this area is often driven by the need to modernize aging infrastructure, consolidate operations, or meet evolving space requirements for government agencies. Comparable spending benchmarks would involve analyzing other large-scale federal building renovation or construction contracts awarded by agencies like GSA, DoD, or other civilian departments.

Small Business Impact

This contract was not set aside for small businesses (ss: false, sb: false). The prime contractor, Whiting-Turner Contracting Company, is a large business. While there is no explicit small business set-aside, the contract's nature as a large construction project may involve significant subcontracting opportunities. The government's policies often encourage prime contractors to utilize small businesses for a portion of the work, and the extent of this subcontracting will be a key factor in assessing the impact on the small business ecosystem.

Oversight & Accountability

Oversight for this contract will primarily be managed by the General Services Administration (GSA), specifically its Public Buildings Service. GSA typically employs contract officers, project managers, and technical representatives to monitor performance, cost, and schedule. The fixed-price incentive (FPI) nature of the contract requires careful tracking of cost targets and performance incentives. Transparency is facilitated through contract award databases and reporting requirements. While no specific Inspector General (IG) jurisdiction is mentioned, the GSA OIG would have oversight authority over potential fraud, waste, or abuse related to this contract.

Related Government Programs

Federal Building Renovations
Veterans Affairs Facility Modernization
Defense Agency Infrastructure
GSA Construction Contracts
Public Buildings Service Projects

Risk Flags

Potential for cost overruns due to FPI structure and long duration.
Risk of unforeseen conditions in existing building renovations.
Need for robust oversight of contractor performance and subcontracting.
Dependency on accurate initial cost estimates and target setting.

Frequently Asked Questions

What is this federal contract paying for?

General Services Administration awarded $63.3 million to WHITING-TURNER CONTRACTING COMPANY, THE. AWARD # 47PF0021C0020, CONSTRUCTION MANAGER AS CONSTRUCTOR (CMC) FOR THE ANTHONY J. CELEBREZZE - VETERANS BENEFITS ADMINISTRATION (VBA) RENOVATION AND BACKFILL PROJECT, & DEFENSE FINANCE AND ACCOUNTING SERVICE (DFAS) CONSOLIDATION PROJECT.

Who is the contractor on this award?

The obligated recipient is WHITING-TURNER CONTRACTING COMPANY, THE.

Which agency awarded this contract?

Awarding agency: General Services Administration (Public Buildings Service).

What is the total obligated amount?

The obligated amount is $63.3 million.

What is the period of performance?

Start: 2021-02-18. End: 2026-12-15.

What is Whiting-Turner Contracting Company's track record with federal construction projects, particularly with GSA?

Whiting-Turner Contracting Company has a substantial history of performing large-scale construction projects for various federal agencies, including the General Services Administration (GSA). Their portfolio often includes complex renovations, new construction, and specialized facilities. Reviewing their past performance ratings, any past performance issues or awards on similar GSA projects would provide insight into their reliability and capability. Federal procurement data often includes past performance information, which can be used to assess their suitability for this significant renovation and consolidation project. Their experience with fixed-price incentive contracts would also be a relevant factor in evaluating their suitability.

How does the $63.3 million award compare to similar GSA renovation projects for federal agencies?

The $63.3 million award for the VBA and DFAS renovation and backfill project is a substantial sum, indicative of a large-scale undertaking. To benchmark its value, it should be compared against other GSA contracts for similar scope and complexity, such as major renovations or consolidations of office spaces for federal agencies. Factors like geographic location, age and condition of the existing facilities, and specific renovation requirements (e.g., IT infrastructure upgrades, security enhancements) influence costs. A comparison with projects of similar square footage and renovation intensity would reveal if the price per square foot or per functional area is competitive. The fixed-price incentive structure also means the final cost could deviate from the initial award, making direct comparisons challenging without understanding the incentive clauses and potential outcomes.

What are the primary risks associated with a five-year fixed-price incentive contract for facility renovation?

A five-year fixed-price incentive (FPI) contract for facility renovation presents several risks. Firstly, the extended duration increases the likelihood of unforeseen conditions in existing buildings (e.g., hazardous materials, structural issues) and potential changes in agency needs or project scope, which can lead to costly modifications. Secondly, the FPI structure, while aiming for cost control, relies heavily on accurate initial cost estimations and well-defined performance targets. If these are flawed, or if the contractor incurs significant cost overruns beyond the target, the government could end up paying more than anticipated, albeit with shared risk. Effective project management, rigorous change control, and continuous monitoring of cost and performance metrics are crucial to mitigate these risks.

How effective is full and open competition in ensuring value for money for large federal construction projects?

Full and open competition is generally considered the most effective method for ensuring value for money in large federal construction projects. By allowing all responsible sources to bid, it maximizes the pool of potential contractors, fostering a competitive environment that drives down prices and encourages innovation. The presence of multiple bidders, as indicated by the four bids received for this GSA contract, suggests that the competition was robust. This competitive pressure incentivizes contractors to submit their best possible pricing and technical proposals. While the lowest bid doesn't always guarantee the best value, a competitive process allows the government to evaluate proposals based on a combination of price, technical merit, past performance, and other factors, ultimately leading to a more favorable outcome for taxpayers.

What are the potential implications of this contract on the small business construction ecosystem in Ohio?

Although this contract was not specifically set aside for small businesses and was awarded to a large prime contractor (Whiting-Turner), it could still have implications for the small business construction ecosystem in Ohio. Large federal construction projects often require specialized subcontractors for various trades (e.g., electrical, plumbing, HVAC, demolition, finishing). The prime contractor may engage small businesses in Ohio to fulfill these subcontracting roles. The extent to which Whiting-Turner actively seeks out and utilizes qualified small businesses, including those owned by women, minorities, or veterans, will determine the direct impact. GSA often has goals for small business subcontracting, and monitoring compliance with these goals is essential to ensure opportunities are created for local small businesses.

Industry Classification

NAICS: Construction › Nonresidential Building Construction › Commercial and Institutional Building Construction

Product/Service Code: MAINT, REPAIR, ALTER REAL PROPERTY › MAINT, ALTER, REPAIR NONBUILDINGS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: 47PF0020R0063

Offers Received: 4

Pricing Type: FIXED PRICE INCENTIVE (L)

Evaluated Preference: NONE

Contractor Details

Address: 300 E JOPPA RD, BALTIMORE, MD, 21286

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $63,329,624

Exercised Options: $63,329,624

Current Obligation: $63,329,624

Actual Outlays: $27,209,045

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline