VA awards $38.5M contract for Pittsburgh ambulatory care center construction to Massaro Corp

Contract Overview

Contract Amount: $38,530,000 ($38.5M)

Contractor: Massaro Corp

Awarding Agency: Department of Veterans Affairs

Start Date: 2008-06-19

End Date: 2010-12-19

Contract Duration: 913 days

Daily Burn Rate: $42.2K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 5

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: CONSTRUCT NEW AMBULATORY CARE CENTER AT THE VA PITTSBURG HEALTHCARE SYSTEM, H.J. HEINZ III DIVISION, PITTSBURGH, PA.

Place of Performance

Location: PITTSBURGH, ALLEGHENY County, PENNSYLVANIA, 15260

State: Pennsylvania Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $38.5 million to MASSARO CORP for work described as: CONSTRUCT NEW AMBULATORY CARE CENTER AT THE VA PITTSBURG HEALTHCARE SYSTEM, H.J. HEINZ III DIVISION, PITTSBURGH, PA. Key points: 1. Contract awarded through full and open competition, suggesting a competitive bidding process. 2. The firm-fixed-price contract type aims to control costs for the government. 3. Construction project for a new ambulatory care center indicates investment in healthcare infrastructure. 4. The duration of 913 days suggests a substantial construction timeline. 5. The award was made by the Department of Veterans Affairs, highlighting focus on veteran healthcare facilities.

Value Assessment

Rating: good

The contract value of $38.5 million for constructing a new ambulatory care center appears reasonable for a project of this scale. Benchmarking against similar VA healthcare construction projects would provide a more precise value-for-money assessment. The firm-fixed-price structure helps mitigate cost overrun risks for the government, contributing to predictable spending.

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. With 5 bidders, the competition level suggests a healthy market interest in this type of federal construction project. This level of competition is generally expected to drive competitive pricing and ensure fair market value.

Taxpayer Impact: A competitive bidding process for this construction project likely resulted in a more favorable price for taxpayers compared to a sole-source or limited competition award.

Public Impact

Veterans in the Pittsburgh, PA area will benefit from improved access to healthcare services. The project will deliver a new, modern ambulatory care facility. Construction activities will likely create jobs in the Pennsylvania region. The facility will support the delivery of a range of outpatient medical services.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for construction delays impacting facility opening and veteran access.
Risk of unforeseen site conditions impacting project costs or timeline.
Ensuring quality of construction meets VA healthcare facility standards.

Positive Signals

Firm-fixed-price contract provides cost certainty.
Award to an established contractor suggests experience in similar projects.
Full and open competition indicates a robust bidding process.

Sector Analysis

This contract falls within the Commercial and Institutional Building Construction sector, a significant segment of the federal contracting market. The Department of Veterans Affairs is a major investor in healthcare infrastructure, with numerous projects aimed at modernizing and expanding its facilities. Spending on healthcare construction is influenced by factors such as aging infrastructure, evolving medical technologies, and the need to provide accessible care to veterans.

Small Business Impact

Information regarding small business set-asides or subcontracting plans was not explicitly provided in the data. Without this information, it is difficult to assess the direct impact on the small business ecosystem for this specific contract. However, large construction projects often involve subcontracting opportunities, which could potentially benefit small businesses if included in the contractor's plan.

Oversight & Accountability

The Department of Veterans Affairs typically has robust oversight mechanisms for construction projects, including regular site inspections, progress reporting, and adherence to contract specifications. The firm-fixed-price nature of the contract provides a degree of financial oversight. Inspector General involvement would be triggered by allegations of fraud, waste, or abuse.

Related Government Programs

VA Healthcare Construction
Federal Building and Infrastructure Projects
Ambulatory Care Facility Development

Risk Flags

Potential for cost overruns if unforeseen site conditions arise.
Risk of construction delays impacting service delivery.
Ensuring contractor adherence to quality and safety standards.

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $38.5 million to MASSARO CORP. CONSTRUCT NEW AMBULATORY CARE CENTER AT THE VA PITTSBURG HEALTHCARE SYSTEM, H.J. HEINZ III DIVISION, PITTSBURGH, PA.

Who is the contractor on this award?

The obligated recipient is MASSARO CORP.

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 $38.5 million.

What is the period of performance?

Start: 2008-06-19. End: 2010-12-19.

What is Massaro Corp's track record with the Department of Veterans Affairs and similar construction projects?

Massaro Corporation has a history of working on significant construction projects, including healthcare facilities. While specific details on their past VA contracts are not provided here, their involvement in this $38.5 million project suggests they possess the capacity and experience required for such undertakings. A deeper dive into their project portfolio, client references, and any past performance reviews from the VA or other federal agencies would offer a more comprehensive understanding of their reliability and expertise in delivering complex healthcare construction.

How does the $38.5 million contract value compare to similar VA ambulatory care center construction projects?

The $38.5 million award for a new ambulatory care center is a substantial investment. To benchmark its value, one would compare it to the cost per square foot or per bed of recently awarded VA ambulatory care centers of similar size and complexity in comparable geographic regions. Factors such as prevailing labor costs, material prices, and specific facility requirements (e.g., specialized equipment, LEED certification) can significantly influence project costs. Without these comparative data points, it's challenging to definitively state if this contract represents excellent or fair value, though it falls within a typical range for major healthcare construction.

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

While firm-fixed-price contracts are designed to provide cost certainty, risks remain. For the contractor, the primary risk is underestimating costs, leading to reduced profit margins or even losses if unforeseen issues arise (e.g., unexpected site conditions, material price escalations beyond contingency). For the government, the risk lies in ensuring the contractor maintains quality standards and adheres to specifications, as the contractor may be incentivized to cut corners to protect their profit margin if costs escalate. Additionally, delays in project completion, regardless of cost, can impact the VA's ability to provide services, representing a programmatic risk.

How effective is the full and open competition process in ensuring value for this type of construction contract?

The full and open competition process is generally considered the most effective method for ensuring value in federal contracting, including large construction projects. By allowing all responsible sources to bid, it fosters a competitive environment that drives down prices and encourages innovation. The fact that five bids were received indicates sufficient market interest. This process increases the likelihood that the VA secured a fair market price and selected a contractor capable of delivering the project to required specifications. Oversight during the evaluation phase is crucial to ensure the lowest price isn't chosen at the expense of quality or capability.

What is the historical spending trend for VA healthcare construction projects of this magnitude?

Historical spending on VA healthcare construction projects of this magnitude has generally trended upwards, driven by the need to modernize aging facilities, incorporate new medical technologies, and expand capacity to serve the veteran population. The VA's budget for capital investments in infrastructure, including new construction and major renovations, typically runs into billions of dollars annually. Factors such as congressional appropriations, economic conditions, and specific healthcare needs assessments influence the volume and value of these projects year over year. This $38.5 million project aligns with the VA's ongoing commitment to upgrading its healthcare infrastructure.

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

Offers Received: 5

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 120 DELTA DR, PITTSBURGH, PA, 90

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $38,530,000

Exercised Options: $38,530,000

Current Obligation: $38,530,000

Timeline