VA awards $94M contract for medical center tower design, with a 5-year performance period

Contract Overview

Contract Amount: $93,938,604 ($93.9M)

Contractor: LEO a. Daly LLC

Awarding Agency: Department of Veterans Affairs

Start Date: 2013-07-25

End Date: 2029-12-31

Contract Duration: 6,003 days

Daily Burn Rate: $15.6K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Healthcare

Official Description: IGF::OT::IGF PRE-DESIGN OF A NEW MEDICAL CENTER TOWER, VA GREATER LOS ANGELES HEALTHCARE SYSTEM, WEST LOS ANGELES MEDICAL CENTER, LOS ANGELES, CA

Place of Performance

Location: LOS ANGELES, LOS ANGELES County, CALIFORNIA, 90073

State: California Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $93.9 million to LEO A. DALY LLC for work described as: IGF::OT::IGF PRE-DESIGN OF A NEW MEDICAL CENTER TOWER, VA GREATER LOS ANGELES HEALTHCARE SYSTEM, WEST LOS ANGELES MEDICAL CENTER, LOS ANGELES, CA Key points: 1. Contract value of $94M for architectural services indicates a significant investment in healthcare infrastructure. 2. The contract was awarded using full and open competition, suggesting a robust bidding process. 3. A firm-fixed-price contract type aims to control costs and provide predictability for the government. 4. The long performance period of over 5 years suggests a complex and multi-phased project. 5. The award to LEO A. DALY LLC positions them as a key player in healthcare facility design. 6. The project's focus on a new medical center tower highlights the VA's commitment to modernizing facilities.

Value Assessment

Rating: good

The contract value of approximately $94 million for architectural design services for a new medical center tower appears reasonable given the scale and complexity of such a project. Benchmarking against similar large-scale healthcare facility design contracts would provide further context, but the firm-fixed-price structure suggests an effort to manage costs effectively. The duration of the contract, spanning over five years, aligns with the typical timeline for major construction design phases.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded through full and open competition, indicating that multiple qualified bidders had the opportunity to submit proposals. The specific number of bidders is not provided, but this method generally fosters a competitive environment, which can lead to better pricing and service offerings for the government. The open competition suggests that the VA sought the best value from the widest possible pool of architectural firms.

Taxpayer Impact: Full and open competition is beneficial for taxpayers as it increases the likelihood of obtaining competitive pricing and ensures that the government is not limited to a single provider, potentially leading to cost savings.

Public Impact

Veterans in the Los Angeles area will benefit from improved and potentially expanded medical facilities. The contract will deliver essential architectural and design services for a new medical center tower. The geographic impact is focused on the West Los Angeles Medical Center. The project will likely involve a significant number of architects, engineers, and support staff, impacting the design and construction workforce.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for scope creep given the long performance period and complexity of designing a medical tower.
Reliance on a single contractor for a multi-year, critical design phase could pose risks if performance issues arise.
Ensuring the design meets evolving healthcare needs and technological advancements over the contract duration.

Positive Signals

Firm-fixed-price contract helps mitigate cost overruns for the government.
Full and open competition suggests a strong initial selection process and potential for competitive pricing.
The long performance period allows for thorough planning and design development, potentially leading to a higher quality outcome.

Sector Analysis

This contract falls within the Architectural Services sector (NAICS code 541310), a critical component of the construction and healthcare infrastructure industries. The market for large-scale healthcare facility design is specialized, requiring firms with expertise in medical planning, building codes, and healthcare technology integration. The VA's spending in this area reflects ongoing efforts to modernize and expand its healthcare network, a significant undertaking within the broader federal construction and facilities management landscape.

Small Business Impact

The data indicates this contract was awarded using full and open competition and does not specify any small business set-asides. Therefore, there is no direct indication of small business participation through set-asides for this specific award. However, the prime contractor, LEO A. DALY LLC, may engage small businesses as subcontractors for specialized services, which would be detailed in their subcontracting plan, if applicable.

Oversight & Accountability

Oversight for this contract will likely be managed by the Department of Veterans Affairs, specifically the VA Greater Los Angeles Healthcare System. Accountability measures are inherent in the firm-fixed-price contract type, which obligates the contractor to deliver the specified design services within the agreed-upon price. Transparency is generally facilitated through contract award databases and reporting requirements. The VA's Office of Inspector General may provide oversight if any issues of fraud, waste, or abuse arise.

Related Government Programs

VA Medical Facility Construction
Architectural and Engineering Services
Healthcare Infrastructure Projects
Federal Building Design Contracts

Risk Flags

Long contract duration may increase risk of scope creep or design obsolescence.
Firm-fixed-price requires clear scope definition to avoid disputes.
Complexity of medical facility design necessitates specialized expertise.

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $93.9 million to LEO A. DALY LLC. IGF::OT::IGF PRE-DESIGN OF A NEW MEDICAL CENTER TOWER, VA GREATER LOS ANGELES HEALTHCARE SYSTEM, WEST LOS ANGELES MEDICAL CENTER, LOS ANGELES, CA

Who is the contractor on this award?

The obligated recipient is LEO A. DALY LLC.

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 $93.9 million.

What is the period of performance?

Start: 2013-07-25. End: 2029-12-31.

What is the track record of LEO A. DALY LLC with the Department of Veterans Affairs?

LEO A. DALY LLC has a history of working with the Department of Veterans Affairs on various projects. While specific details on past VA contracts are not provided in this data snippet, their selection for a significant project like the medical center tower design suggests prior experience and a demonstrated capability to meet VA requirements. A deeper dive into federal procurement databases would reveal the scope, value, and performance history of their previous engagements with the VA, including any awards, past performance reviews, or potential disputes.

How does the $94 million contract value compare to similar medical center tower design projects?

The $94 million contract value for the design of a new medical center tower is substantial and aligns with the significant investment required for large-scale healthcare infrastructure projects. Comparable projects, such as the design phase for new hospital wings or major medical facility expansions at other federal agencies or large private healthcare systems, often involve tens of millions of dollars. Factors influencing this cost include the size of the facility, the complexity of medical services to be housed, technological requirements, and the specific architectural and engineering services procured. Without specific benchmarks for similar VA projects, it's difficult to definitively state if this is high or low, but it reflects the scale of the undertaking.

What are the primary risks associated with a multi-year design contract for a medical facility?

Key risks for a multi-year design contract of this nature include potential scope creep, where project requirements expand beyond the initial agreement, leading to cost overruns or schedule delays. Technological obsolescence is another concern; medical technology evolves rapidly, and a design finalized years before construction could become outdated. Furthermore, changes in healthcare regulations or VA policy during the design phase could necessitate costly revisions. Contractor performance risk is also present; ensuring the firm maintains quality and meets deadlines over an extended period requires diligent oversight. Finally, unforeseen site conditions or environmental factors could impact the design and require adjustments.

How effective is a firm-fixed-price contract in managing costs for complex design projects?

A firm-fixed-price (FFP) contract is generally considered effective in managing costs for complex design projects because it shifts the risk of cost overruns to the contractor. The contractor agrees to a set price for the defined scope of work, and any costs incurred above that price are their responsibility. This incentivizes the contractor to be efficient and control their expenses. However, for highly complex or uncertain projects, an FFP contract can sometimes lead to contractors being overly conservative in their bids or potentially cutting corners if they underestimate costs. For design services, it's crucial that the scope of work is very clearly defined upfront to minimize disputes and ensure the government receives the intended design.

What is the historical spending trend for architectural services by the Department of Veterans Affairs?

Historical spending data for architectural services by the Department of Veterans Affairs typically shows significant and consistent investment, reflecting the ongoing need to maintain, upgrade, and expand its vast network of healthcare facilities. Annual expenditures can fluctuate based on major construction initiatives, modernization programs, and the lifecycle of existing infrastructure. The VA's budget often allocates substantial funds towards capital investments, including design and planning services, to ensure its facilities meet the healthcare needs of veterans. Analyzing trends over several fiscal years would reveal patterns related to specific regions, types of facilities, and the overall scale of design contracts awarded.

What are the implications of the 2029 end date for the contract's design phase?

The contract's end date of December 31, 2029, signifies that the design phase for the new medical center tower is expected to extend for over six years from the award date. This extended timeline suggests a highly complex project involving multiple stages of design development, review, and potential revisions. It also implies that the subsequent construction phase will likely commence after this design period concludes. For taxpayers, this long duration means that funding commitments extend over several fiscal years, and it underscores the importance of rigorous oversight to ensure the design remains relevant and cost-effective throughout its development.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Architectural, Engineering, and Related Services › Architectural Services

Product/Service Code: ARCHITECT/ENGINEER SERVICES › ARCH-ENG SVCS - CONSTRUCTION

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 550 S HOPE ST STE 2700, LOS ANGELES, CA, 90071

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

Financial Breakdown

Contract Ceiling: $98,725,530

Exercised Options: $98,685,918

Current Obligation: $93,938,604

Actual Outlays: $51,541,570

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Timeline