Mescalero Indian Hospital Renovation Contract Awarded for $15.75M to RED EAGLE JV

Contract Overview

Contract Amount: $15,749,729 ($15.7M)

Contractor: RED Eagle JV

Awarding Agency: Department of Health and Human Services

Start Date: 2024-09-06

End Date: 2026-08-25

Contract Duration: 718 days

Daily Burn Rate: $21.9K/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: RENOVATION AND EXPANSION OF THE MESCALERO INDIAN HOSPITAL

Place of Performance

Location: MESCALERO, OTERO County, NEW MEXICO, 88340

State: New Mexico Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $15.7 million to RED EAGLE JV for work described as: RENOVATION AND EXPANSION OF THE MESCALERO INDIAN HOSPITAL Key points: 1. Contract value of $15.75M for hospital renovation and expansion. 2. Awarded to RED EAGLE JV under a definitive contract. 3. Competition was full and open after exclusion of sources. 4. Project duration is 718 days, ending August 25, 2026. 5. The contract type is Firm Fixed Price, indicating cost certainty. 6. Located in New Mexico, serving the Mescalero Apache community.

Value Assessment

Rating: good

The contract value of $15.75M for the renovation and expansion of the Mescalero Indian Hospital appears reasonable given the scope of work. While direct comparisons are difficult without detailed project specifications, the firm fixed-price nature suggests a degree of cost control. Benchmarking against similar healthcare construction projects of this scale would provide further insight into value for money.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under 'Full and Open Competition After Exclusion of Sources,' indicating a competitive process was intended, though specific details on source exclusion are not provided. With 3 bidders, the competition level suggests a reasonable market interest, which typically aids in price discovery and achieving fair market value.

Taxpayer Impact: The competitive bidding process, even with source exclusions, is beneficial for taxpayers as it encourages multiple firms to offer their best pricing and technical solutions, potentially leading to cost savings.

Public Impact

The primary beneficiaries are the Mescalero Apache community and surrounding areas, who will gain access to improved healthcare facilities. The project will deliver renovated and expanded hospital infrastructure, enhancing the quality and capacity of medical services. The geographic impact is concentrated in New Mexico, specifically within the Mescalero Indian Reservation. Workforce implications may include job creation for construction workers and, upon completion, for healthcare professionals.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if unforeseen site conditions arise during renovation.
Dependence on timely delivery of materials and specialized labor for construction.
Risk of scope creep if additional facility needs are identified during the project.

Positive Signals

Firm Fixed Price contract structure mitigates cost uncertainty for the government.
Definitive contract provides a clear framework for project execution.
Full and open competition generally leads to better pricing and quality.

Sector Analysis

This contract falls within the Commercial and Institutional Building Construction sector, specifically for healthcare facilities. The market for hospital construction and renovation is significant, driven by the need for modernization, expansion, and compliance with evolving healthcare standards. This project represents a specific investment in critical infrastructure for a tribal community.

Small Business Impact

Information regarding small business set-asides or subcontracting plans was not explicitly provided in the data. Further analysis would be needed to determine if small businesses were specifically targeted or involved in this contract, either as prime contractors or subcontractors.

Oversight & Accountability

Oversight will likely be managed by the Indian Health Service (IHS) within the Department of Health and Human Services. Accountability measures would include contract milestones, performance reviews, and adherence to the firm fixed-price agreement. Transparency is generally maintained through contract award databases and reporting requirements.

Related Government Programs

Indian Health Service Facility Construction and Renovation Programs
Tribal Healthcare Infrastructure Development
Federal Contracts for Healthcare Facilities

Risk Flags

Potential for unforeseen conditions in existing building infrastructure.
Risk of construction delays impacting service availability.
Need for robust project management to ensure scope adherence.

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $15.7 million to RED EAGLE JV. RENOVATION AND EXPANSION OF THE MESCALERO INDIAN HOSPITAL

Who is the contractor on this award?

The obligated recipient is RED EAGLE JV.

Which agency awarded this contract?

Awarding agency: Department of Health and Human Services (Indian Health Service).

What is the total obligated amount?

The obligated amount is $15.7 million.

What is the period of performance?

Start: 2024-09-06. End: 2026-08-25.

What is the historical spending pattern for renovations and expansions at the Mescalero Indian Hospital?

Historical spending data for renovations and expansions specifically at the Mescalero Indian Hospital is not readily available in the provided contract details. To assess historical patterns, one would need to access prior contract awards, budget allocations, and project completion reports for this specific facility over an extended period. This would involve searching federal procurement databases (like FPDS or SAM.gov) for previous contracts awarded to the Mescalero Indian Hospital or the Indian Health Service for projects at that location. Understanding past investments, their costs, and outcomes would provide crucial context for evaluating the current $15.75M contract's scale and necessity.

How does the awarded amount compare to similar hospital renovation projects funded by the IHS or other federal agencies?

Benchmarking the $15.75M contract against similar projects requires access to a database of comparable federal healthcare construction contracts. Factors such as facility size, scope of renovation (e.g., structural, MEP, interior fit-out), geographic location, and prevailing construction costs at the time of award are critical for a fair comparison. Projects funded by the Indian Health Service (IHS) or other agencies like the Department of Veterans Affairs (VA) for hospital renovations would be the most relevant. Without specific data on comparable projects, it's challenging to definitively state if this contract represents a high, low, or average cost. However, the firm fixed-price nature suggests an effort to contain costs.

What specific risks are associated with renovating an existing hospital facility, particularly an Indian Health Service facility?

Renovating an existing hospital, especially an IHS facility, presents several risks. These include the potential for encountering unforeseen structural issues, hazardous materials (like asbestos or lead paint), or outdated utility systems (plumbing, electrical, HVAC) that require immediate and costly remediation. Operational continuity is another major risk; ensuring that essential medical services can continue uninterrupted during construction requires careful phasing and potentially temporary facilities. For IHS facilities, additional risks can involve unique regulatory compliance requirements, cultural considerations for the patient population, and potential logistical challenges in remote locations. The firm fixed-price contract aims to mitigate financial risk, but scope management and unforeseen conditions remain key concerns.

What is the track record of RED EAGLE JV in completing federal construction contracts, particularly healthcare-related ones?

Assessing the track record of RED EAGLE JV requires reviewing their past performance on federal contracts. This involves examining contract completion history, any past performance evaluations (e.g., Contractor Performance Assessment Reporting System - CPARS), and any instances of contract disputes, terminations, or claims. Specifically, their experience with healthcare construction projects, renovations, and projects of similar magnitude ($15.75M) would be highly relevant. A positive performance history with timely completion, adherence to budget, and quality standards would indicate a lower risk for this project. Conversely, a history of issues could raise concerns about project execution and value.

What are the long-term implications of this renovation for healthcare service delivery to the Mescalero Apache community?

The long-term implications of this renovation are expected to be significantly positive for healthcare service delivery to the Mescalero Apache community. By expanding and modernizing the Mescalero Indian Hospital, the project aims to enhance the capacity and quality of care provided. This could translate into reduced wait times, the ability to offer a wider range of medical services, improved patient comfort and safety, and better adherence to modern healthcare standards. Ultimately, a well-renovated and expanded facility should contribute to better health outcomes for the community and potentially reduce the need for patients to travel long distances for specialized medical care.

Industry Classification

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

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

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: 75H70122R00039

Offers Received: 3

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 29627 E STATE HIGHWAY 51, COWETA, OK, 74429

Business Categories: American Indian Owned Business, Category Business, Minority Owned Business, Native American Owned Business, 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: $15,749,729

Exercised Options: $15,749,729

Current Obligation: $15,749,729

Actual Outlays: $6,210,972

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline