VA awards $78.4M contract for mental health facility construction, highlighting firm fixed-price structure

Contract Overview

Contract Amount: $78,412,168 ($78.4M)

Contractor: P.J. Dick Incorporated

Awarding Agency: Department of Veterans Affairs

Start Date: 2008-11-12

End Date: 2011-08-12

Contract Duration: 1,003 days

Daily Burn Rate: $78.2K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 3

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: CARES CONSOLIDATION PHASE 2 MENTAL HEALTH BUILDING

Place of Performance

Location: PITTSBURGH, ALLEGHENY County, PENNSYLVANIA, 15240

State: Pennsylvania Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $78.4 million to P.J. DICK INCORPORATED for work described as: CARES CONSOLIDATION PHASE 2 MENTAL HEALTH BUILDING Key points: 1. Contract awarded via full and open competition, suggesting a competitive bidding process. 2. The firm fixed-price contract type shifts risk to the contractor, potentially stabilizing costs. 3. Construction services for a mental health facility indicate a focus on healthcare infrastructure. 4. The contract duration of approximately 3 years suggests a significant project scope. 5. Awarded by the Department of Veterans Affairs, aligning with healthcare services for veterans. 6. The North American Industry Classification System (NAICS) code 236220 points to commercial building construction.

Value Assessment

Rating: good

The contract value of $78.4 million for a mental health facility construction project appears within a reasonable range for large-scale institutional building. Benchmarking against similar VA construction projects or large healthcare facility builds would provide a more precise value-for-money assessment. The firm fixed-price nature of the contract is a positive indicator for cost control, assuming the initial bid was competitive.

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 bids. With three bidders, the competition level suggests a reasonable degree of market interest. This process is designed to foster price discovery and encourage competitive pricing, potentially leading to a better outcome for the government.

Taxpayer Impact: Full and open competition generally benefits taxpayers by driving down prices through multiple bids. The presence of three bidders suggests that the government likely received a competitive price for the construction services.

Public Impact

Veterans will benefit from improved mental health facilities, enhancing the quality of care provided. The project delivers essential construction services for a critical healthcare infrastructure component. The geographic impact is centered in Pennsylvania, where the facility will be located. The construction project will likely create jobs in the building trades and related industries in the local area.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if unforeseen construction challenges arise, despite fixed-price contract.
Delays in construction could impact the timely delivery of much-needed mental health services.
Ensuring the quality of construction meets the specific needs of a mental health facility.

Positive Signals

Firm fixed-price contract provides cost certainty for the government.
Awarded through full and open competition, indicating a competitive bidding process.
Contract awarded to P.J. Dick Incorporated, a known entity in the construction sector.

Sector Analysis

This contract falls within the Commercial and Institutional Building Construction sector, specifically for healthcare-related facilities. The market for such construction is driven by government and private sector demand for new or renovated healthcare infrastructure. The $78.4 million award is substantial, indicative of a significant construction undertaking. Comparable spending benchmarks would involve analyzing other large-scale hospital, clinic, or specialized facility construction projects.

Small Business Impact

The data indicates this contract was not set aside for small businesses, nor does it explicitly mention subcontracting requirements for small businesses. This suggests that the primary award went to a larger firm, and the direct impact on the small business ecosystem may be limited unless P.J. Dick Incorporated actively engages small businesses as subcontractors.

Oversight & Accountability

Oversight for this construction contract would typically be managed by the Department of Veterans Affairs' contracting officers and project managers. Accountability measures would include adherence to the contract terms, construction timelines, and quality standards. Transparency is generally maintained through contract award databases and public reporting, though specific oversight details are not provided in this data.

Related Government Programs

Department of Veterans Affairs Healthcare Construction
Federal Building and Construction Contracts
Mental Health Infrastructure Projects
Firm Fixed-Price Construction Awards

Risk Flags

Potential for construction delays
Risk of cost overruns for contractor
Ensuring specialized mental health facility requirements are met

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $78.4 million to P.J. DICK INCORPORATED. CARES CONSOLIDATION PHASE 2 MENTAL HEALTH BUILDING

Who is the contractor on this award?

The obligated recipient is P.J. DICK INCORPORATED.

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 $78.4 million.

What is the period of performance?

Start: 2008-11-12. End: 2011-08-12.

What is the track record of P.J. Dick Incorporated with the Department of Veterans Affairs?

Information regarding P.J. Dick Incorporated's specific track record with the Department of Veterans Affairs (VA) is not detailed in the provided data. However, the award of a significant $78.4 million contract suggests a level of confidence from the VA in the contractor's capabilities. To fully assess their track record, one would need to examine past performance reviews, any history of contract disputes or successful project completions with the VA, and their overall experience in constructing healthcare facilities. A deeper dive into federal procurement databases and contractor performance systems would be necessary for a comprehensive understanding.

How does the $78.4 million contract value compare to similar VA mental health facility construction projects?

The $78.4 million contract value for the CARES CONSOLIDATION PHASE 2 MENTAL HEALTH BUILDING project is a substantial investment. To benchmark this value effectively, it would be necessary to compare it against other VA mental health facility construction projects awarded over a similar period and in comparable geographic regions. Factors such as facility size, scope of services, complexity of design, and prevailing construction costs at the time of award would influence these comparisons. Without access to a database of similar projects and their associated costs, it is difficult to definitively state whether this represents a high, low, or average expenditure. However, for a project of this nature, the amount suggests a significant undertaking.

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

The primary risks associated with this firm fixed-price construction contract, despite its cost certainty for the government, lie with the contractor, P.J. Dick Incorporated. These risks include potential cost overruns if unforeseen site conditions, material price escalations, or labor shortages occur beyond what was anticipated in their bid. There is also a risk of schedule delays if the contractor encounters difficulties in managing the project timeline or subcontractors. Furthermore, ensuring the final construction meets the specific, potentially sensitive, requirements of a mental health facility presents a quality risk. The government's risk is primarily mitigated by the fixed price, but potential impacts from contractor failure could include project delays and the need to re-procure services.

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 highly effective in ensuring value for construction contracts like this one. By allowing all qualified contractors to bid, it fosters a competitive environment that encourages bidders to offer their most competitive pricing and innovative solutions to win the contract. The presence of three bidders in this case suggests that the market was sufficiently engaged. This level of competition helps the government achieve price discovery, meaning they can ascertain a fair market price for the services. While the ultimate value is realized through the contractor's performance, the competitive bidding process lays the foundation for obtaining a good price and selecting a capable contractor.

What is the historical spending pattern for mental health facility construction by the Department of Veterans Affairs?

Historical spending patterns for mental health facility construction by the Department of Veterans Affairs (VA) are not detailed in the provided data. However, it is widely understood that the VA has a significant and ongoing need to upgrade and expand its healthcare infrastructure, including facilities dedicated to mental health services. This need is driven by an increasing veteran population, evolving treatment modalities, and the recognition of the critical importance of mental healthcare. Analyzing historical VA budget allocations, specific construction project awards, and overall capital investment trends would be necessary to identify detailed spending patterns. This particular $78.4 million award represents a single data point within potentially much larger, multi-year investment strategies.

What are the implications of the firm fixed-price (FFP) contract type for project management and oversight?

The firm fixed-price (FFP) contract type significantly influences project management and oversight by clearly defining the contractor's responsibility for all costs incurred to complete the work. For the government, this means greater cost certainty, as the final price is established upfront. Oversight efforts should therefore focus heavily on ensuring the contractor adheres to the contract's scope of work, quality standards, and schedule. While the financial risk is largely transferred to the contractor, government oversight must remain vigilant in monitoring progress, verifying deliverables, and managing any potential changes through formal modification processes. The focus shifts from cost control (as in cost-reimbursement contracts) to performance monitoring and ensuring compliance with the agreed-upon terms.

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: VA-101-08-RP-0082

Offers Received: 3

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 1020 LEBANON RD, WEST MIFFLIN, PA, 12

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

Financial Breakdown

Contract Ceiling: $78,412,208

Exercised Options: $78,412,208

Current Obligation: $78,412,168

Timeline