Jaynes Corporation awarded $172M contract for New Mexico healthcare facility construction by Indian Health Service

Contract Overview

Contract Amount: $172,026,426 ($172.0M)

Contractor: Jaynes Corporation

Awarding Agency: Department of Health and Human Services

Start Date: 2025-09-24

End Date: 2028-03-20

Contract Duration: 908 days

Daily Burn Rate: $189.5K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 3

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: CONTRACTOR SHALL PROVIDE A FIRM-FIXED-PRICE FOR ALL LABOR, PERSONNEL, EQUIPMENT, MATERIALS, TOOLS, PERSONAL PROTECTIVE EQUIPMENT (PPE), PERMITS, INSURANCE, SUPERVISION, TRANSPORTATION, COORDINATION WITH AUTHORITIES HAVING JURISDICTION (AHJ), INTERNAL

Place of Performance

Location: CROWNPOINT, MCKINLEY County, NEW MEXICO, 87313

State: New Mexico Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $172.0 million to JAYNES CORPORATION for work described as: CONTRACTOR SHALL PROVIDE A FIRM-FIXED-PRICE FOR ALL LABOR, PERSONNEL, EQUIPMENT, MATERIALS, TOOLS, PERSONAL PROTECTIVE EQUIPMENT (PPE), PERMITS, INSURANCE, SUPERVISION, TRANSPORTATION, COORDINATION WITH AUTHORITIES HAVING JURISDICTION (AHJ), INTERNAL Key points: 1. Contract value of $172 million represents a significant investment in healthcare infrastructure. 2. Full and open competition suggests a potentially competitive bidding process. 3. The firm-fixed-price structure shifts cost risk to the contractor. 4. Project duration of approximately 3 years indicates a substantial construction undertaking. 5. Geographic focus on New Mexico highlights regional healthcare development priorities. 6. The contract falls under commercial and institutional building construction, a vital sector.

Value Assessment

Rating: good

The contract value of $172 million for a healthcare facility in New Mexico appears to be within a reasonable range for a project of this scale and complexity. Benchmarking against similar large-scale construction projects for federal healthcare facilities would provide a more precise assessment, but the firm-fixed-price nature suggests the government has secured a ceiling cost. The number of bids received (3) is moderate, which could indicate a competitive but not overly saturated market for this type of specialized construction.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit a bid. Three bids were received, suggesting a moderate level of competition for this significant construction project. While three bidders can lead to price discovery, a higher number of bidders typically drives prices down further. The specific requirements and complexity of the project likely influenced the number of interested parties.

Taxpayer Impact: Full and open competition is generally favorable for taxpayers as it aims to secure the best value through a wide range of offers. The moderate number of bidders in this instance suggests a reasonable, though not maximal, competitive pressure on pricing.

Public Impact

The primary beneficiaries are the patients and communities in New Mexico who will gain access to improved healthcare facilities. The contract will deliver essential construction services for a new or renovated healthcare building. The geographic impact is concentrated in New Mexico, addressing specific regional healthcare needs. The project will likely create numerous jobs in the construction sector, including skilled trades and support staff in New Mexico.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if unforeseen site conditions or material price escalations occur, despite the firm-fixed-price structure.
Ensuring timely completion within the specified timeframe is crucial to avoid impacting healthcare service delivery.
Quality control and adherence to healthcare facility construction standards must be rigorously monitored.

Positive Signals

The firm-fixed-price contract shifts significant cost risk to the contractor, Jaynes Corporation.
Full and open competition suggests a robust process for selecting the most qualified and cost-effective bidder.
The contractor's experience in commercial and institutional building construction is a positive indicator for project execution.

Sector Analysis

The construction sector, particularly for institutional and healthcare facilities, is a significant part of the federal contracting landscape. This contract falls within the Commercial and Institutional Building Construction NAICS code (236220). Federal spending in this area is driven by the need to maintain, modernize, and expand government-owned or operated facilities, including critical healthcare infrastructure managed by agencies like the Indian Health Service. Comparable spending benchmarks would involve analyzing the cost per square foot or per bed for similar healthcare construction projects awarded by federal or state entities.

Small Business Impact

The data indicates that small business participation (ss: false, sb: false) was not a specific set-aside requirement for this contract. Therefore, the primary impact on small businesses would be through potential subcontracting opportunities offered by the prime contractor, Jaynes Corporation. The extent of small business subcontracting will depend on the prime contractor's strategy and the availability of qualified small businesses for specific trades or services required for the project.

Oversight & Accountability

Oversight for this contract will likely be managed by the Indian Health Service contracting office and potentially involve project managers or contracting officers' representatives (CORs) to monitor progress, quality, and compliance. Transparency is facilitated through contract award databases. Accountability measures are embedded in the firm-fixed-price contract terms, with penalties or incentives potentially tied to performance and completion. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Indian Health Service Capital Improvement Projects
Federal Healthcare Facility Construction
Department of Health and Human Services Construction Contracts
General Services Administration (GSA) Public Buildings Service Projects

Risk Flags

Potential for cost overruns despite fixed-price contract due to unforeseen site conditions or material price fluctuations.
Risk of project delays impacting the delivery of essential healthcare services.
Ensuring adherence to stringent healthcare construction codes and quality standards.
Moderate competition level may indicate potential challenges in securing the lowest possible price.

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $172.0 million to JAYNES CORPORATION. CONTRACTOR SHALL PROVIDE A FIRM-FIXED-PRICE FOR ALL LABOR, PERSONNEL, EQUIPMENT, MATERIALS, TOOLS, PERSONAL PROTECTIVE EQUIPMENT (PPE), PERMITS, INSURANCE, SUPERVISION, TRANSPORTATION, COORDINATION WITH AUTHORITIES HAVING JURISDICTION (AHJ), INTERNAL

Who is the contractor on this award?

The obligated recipient is JAYNES CORPORATION.

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 $172.0 million.

What is the period of performance?

Start: 2025-09-24. End: 2028-03-20.

What is Jaynes Corporation's track record with large federal construction contracts, particularly healthcare facilities?

A thorough review of Jaynes Corporation's past performance would be necessary to assess their track record. This would involve examining their history with federal agencies, specifically the Department of Health and Human Services and the Indian Health Service, if applicable. Key metrics to analyze include on-time completion rates, adherence to budget (especially for fixed-price contracts), quality of work, and any past performance issues or disputes. Information from sources like the Federal Procurement Data System (FPDS) and contractor performance assessment reporting (CPARS) would be crucial in evaluating their experience with similar-sized and complex healthcare construction projects.

How does the $172 million contract value compare to similar healthcare construction projects awarded by the Indian Health Service or other federal agencies?

To benchmark the $172 million contract value, one would compare it against recently awarded federal healthcare construction projects of similar scope, size (square footage), and complexity. This comparison should ideally focus on projects managed by the Indian Health Service or other agencies with similar construction needs, such as the Department of Veterans Affairs. Factors like location (cost of labor and materials vary regionally), specific facility type (e.g., hospital, clinic, research lab), and the level of specialized equipment installation will influence cost. Analyzing cost per square foot or cost per bed for comparable projects would provide a more granular understanding of whether this contract represents good value for money.

What are the primary risk indicators associated with this firm-fixed-price construction contract?

The primary risk indicator for a firm-fixed-price contract is the potential for contractor default or significant delays if the contractor underestimates costs or encounters unforeseen challenges. While the price is fixed, quality issues can arise if the contractor attempts to cut corners to maintain profitability. For this specific project, risks could include the complexity of healthcare facility construction standards, potential labor shortages in New Mexico, material price volatility, and site-specific challenges. The moderate number of bidders (3) could also indicate that the project is perceived as having higher risks or requires specialized expertise, potentially limiting the pool of highly competitive bidders.

How effective is the 'full and open competition' strategy likely to be in ensuring the best value for this healthcare construction project?

The 'full and open competition' strategy is designed to maximize the number of potential bidders, thereby increasing the likelihood of receiving competitive pricing and innovative solutions. For this $172 million healthcare construction project, its effectiveness hinges on whether the project's specifications and requirements were clear and accessible enough to attract a wide range of qualified contractors. While three bids were received, which is a moderate level of competition, the true measure of effectiveness will be in the final price achieved relative to the scope of work and the contractor's demonstrated capability to deliver high-quality results. A higher number of bids often correlates with better price discovery for the government.

What are the historical spending patterns for healthcare facility construction by the Indian Health Service, and how does this contract fit within them?

Analyzing historical spending patterns for the Indian Health Service (IHS) in healthcare facility construction would reveal trends in contract values, types of projects (new construction vs. renovation), geographic distribution, and average contract durations. This $172 million contract for a New Mexico facility represents a substantial single investment. Understanding whether IHS typically awards fewer, larger contracts or more numerous, smaller ones is key. This contract's value might be higher than average if it's for a major new facility, or it could be in line with recent large-scale modernization efforts. Examining IHS's budget allocations and capital improvement plans over the past 5-10 years would provide context for this award's significance and alignment with agency priorities.

What are the potential workforce implications of this $172 million construction contract in New Mexico?

A contract of this magnitude ($172 million) is expected to have significant positive workforce implications in New Mexico. It will likely generate a substantial number of direct jobs in various construction trades, including electricians, plumbers, carpenters, masons, and heavy equipment operators. Indirect job creation is also probable in supporting industries such as material supply, equipment rental, transportation, and professional services (engineering, architecture). The duration of the project (approximately 3 years) suggests sustained employment opportunities. The specific skills required will depend on the nature of the healthcare facility being built, potentially including specialized technicians for medical equipment installation.

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

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: 75H70125R00026

Offers Received: 3

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 2906 BROADWAY BLVD NE, ALBUQUERQUE, NM, 87107

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

Financial Breakdown

Contract Ceiling: $172,026,426

Exercised Options: $172,026,426

Current Obligation: $172,026,426

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline