VA awards $58.4M construction contract for Polytrauma facilities, highlighting significant investment in veteran care

Contract Overview

Contract Amount: $58,427,947 ($58.4M)

Contractor: Archer Western/Demaria Joint Venture III

Awarding Agency: Department of Veterans Affairs

Start Date: 2010-04-30

End Date: 2015-12-31

Contract Duration: 2,071 days

Daily Burn Rate: $28.2K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 6

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: POLYTRAUMA PHASE 2 AND PHASE 3

Place of Performance

Location: TAMPA, HILLSBOROUGH County, FLORIDA, 33612

State: Florida Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $58.4 million to ARCHER WESTERN/DEMARIA JOINT VENTURE III for work described as: POLYTRAUMA PHASE 2 AND PHASE 3 Key points: 1. Contract value of $58.4M represents a substantial investment in specialized healthcare infrastructure. 2. Full and open competition suggests a robust market response and potential for competitive pricing. 3. The definitive contract type indicates a long-term commitment to the project's scope. 4. Fixed-price structure offers cost certainty for the government, mitigating budget risks. 5. Project duration of 2071 days points to a complex and extensive construction undertaking. 6. Awarded by the Department of Veterans Affairs, this contract directly supports veteran healthcare services.

Value Assessment

Rating: good

The contract value of $58.4 million for Polytrauma Phase 2 and 3 construction is significant. Benchmarking against similar large-scale healthcare facility construction projects would be necessary for a precise value-for-money assessment. However, the fixed-price nature of the contract provides a degree of cost control for the VA. The number of bids received (6) suggests a competitive environment, which typically leads to more favorable pricing.

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. Six bids were received, suggesting a healthy level of interest and competition within the construction sector for this type of specialized project. This broad competition is generally favorable for price discovery and ensures the government can select from a wide range of qualified contractors.

Taxpayer Impact: The full and open competition likely resulted in a more competitive bid process, potentially leading to cost savings for taxpayers compared to a sole-source or limited competition award.

Public Impact

Veterans requiring specialized polytrauma care will benefit from improved and expanded medical facilities. The construction project will create jobs in the Florida region, supporting the local workforce. Enhanced facilities are expected to improve the quality and delivery of healthcare services for severely injured veterans. The project contributes to the VA's mission of providing comprehensive care to all eligible veterans.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Long project duration (2071 days) could introduce risks related to cost escalation or scope creep if not managed diligently.
The complexity of polytrauma facilities may require specialized expertise, potentially limiting the pool of highly qualified subcontractors.

Positive Signals

Awarding a definitive contract for a significant project demonstrates a clear commitment from the VA to veteran healthcare infrastructure.
The use of a firm fixed-price contract provides budget certainty and transfers some cost risk to the contractor.
Full and open competition suggests a well-managed procurement process that attracted multiple capable bidders.

Sector Analysis

This contract falls within the Commercial and Institutional Building Construction sector, specifically for specialized healthcare facilities. The construction market for healthcare infrastructure is substantial, driven by ongoing needs for modernization, expansion, and specialized treatment centers. The VA's investment in polytrauma facilities is a critical component of its healthcare strategy, addressing the complex needs of veterans with multiple traumatic injuries.

Small Business Impact

There is no indication of a small business set-aside for this contract, as it was awarded under full and open competition. The contract value and scope suggest that large construction firms or joint ventures are likely to be the primary awardees. Subcontracting opportunities may exist for small businesses, but their participation would depend on the prime contractor's strategy and the specific needs of the project.

Oversight & Accountability

The Department of Veterans Affairs is responsible for overseeing this contract. Oversight mechanisms would typically include regular progress reviews, site inspections, and financial audits to ensure compliance with contract terms and quality standards. The firm fixed-price nature of the contract provides a baseline for financial accountability. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse.

Related Government Programs

VA Medical Facility Construction
Polytrauma Rehabilitation Programs
Military Construction Projects
Healthcare Infrastructure Development

Risk Flags

Long project duration may increase risk of cost escalation or scope creep.
Complexity of specialized healthcare facilities requires careful management and oversight.

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $58.4 million to ARCHER WESTERN/DEMARIA JOINT VENTURE III. POLYTRAUMA PHASE 2 AND PHASE 3

Who is the contractor on this award?

The obligated recipient is ARCHER WESTERN/DEMARIA JOINT VENTURE III.

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 $58.4 million.

What is the period of performance?

Start: 2010-04-30. End: 2015-12-31.

What is the historical spending pattern for Polytrauma facility construction by the VA?

Analyzing historical spending for Polytrauma facility construction by the VA requires access to detailed contract databases and budget allocations over several fiscal years. Generally, the VA's spending in this area has been consistent, reflecting the ongoing need to provide specialized care for veterans, particularly those returning from recent conflicts with complex injuries. Spending can fluctuate based on specific facility upgrades, new construction initiatives, and the overall budget allocated to the VA's capital asset and healthcare infrastructure accounts. Without specific data points for comparable polytrauma projects, it's difficult to provide exact figures, but the trend indicates a sustained commitment to this critical area of veteran healthcare.

How does the awarded amount compare to similar VA construction projects?

The $58.4 million award for Polytrauma Phase 2 and 3 construction is a significant but not unprecedented figure for major healthcare facility projects within the VA system. Large-scale construction and renovation projects for VA medical centers, especially those involving specialized units like polytrauma, often range from tens to hundreds of millions of dollars. Factors influencing the cost include the size and complexity of the facility, the specific medical equipment to be integrated, and the geographic location. This contract appears to be within the expected range for a project of this scope and specialization, particularly given the firm fixed-price structure which aims to contain costs.

What are the key performance indicators (KPIs) for this construction contract?

Key performance indicators for this construction contract would likely focus on adherence to the project schedule, quality of workmanship, adherence to safety regulations, and final cost control within the firm fixed-price agreement. Specific KPIs might include milestones for design completion, foundation work, structural erection, interior fit-out, and final inspections. The VA would monitor progress against these milestones to ensure timely delivery of the facility. Quality assurance would involve regular inspections to verify compliance with building codes and specifications. Safety performance, measured by incident rates, would also be a critical KPI.

What is the contractor's track record with the VA for similar projects?

Archer Western/DeMaria Joint Venture III's track record with the VA for similar projects would need to be assessed through contract performance databases and past performance reviews. As a joint venture, their individual entities likely have experience with large-scale construction, including government contracts. For a project of this magnitude and specialization (polytrauma facilities), the VA would have scrutinized the joint venture's experience in healthcare construction, project management capabilities, financial stability, and past performance on similar definitive contracts. A review of their award history and any documented performance issues or commendations would provide insight into their reliability for this specific undertaking.

What are the potential risks associated with the long duration of this contract?

The 2071-day duration (approximately 5.7 years) for this construction contract presents several potential risks. Material and labor costs can fluctuate significantly over such a long period, potentially impacting the contractor's profitability if not adequately managed within the fixed-price structure, though the contract type aims to mitigate this for the government. Changes in technology, building codes, or VA healthcare requirements could necessitate design modifications, leading to change orders and potential delays or cost increases. Furthermore, long-term projects can face challenges in maintaining workforce continuity and managing site logistics over an extended period. The VA must maintain robust oversight to manage these risks effectively.

How does the firm fixed-price (FFP) contract type benefit the VA in this scenario?

The Firm Fixed-Price (FFP) contract type is highly beneficial for the VA in this scenario as it provides the most cost certainty. Under an FFP contract, the contractor assumes the majority of the risk for cost overruns. This means the VA agrees to pay a set price for the completed work, regardless of the contractor's actual costs. This structure is ideal for projects with well-defined scopes, like the construction of specialized facilities, where the requirements are unlikely to change substantially. It simplifies budgeting and financial planning for the VA, protecting taxpayer funds from unexpected increases in material, labor, or other direct costs incurred by the contractor.

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-101-101-RP-0026

Offers Received: 6

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 929 W ADAMS ST, CHICAGO, IL, 60607

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

Financial Breakdown

Contract Ceiling: $58,428,928

Exercised Options: $58,427,947

Current Obligation: $58,427,947

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline