VA Denver Replacement Hospital Contract Exceeds $225M, Awarded to Kiewit-Turner

Contract Overview

Contract Amount: $225,606,735 ($225.6M)

Contractor: Kiewit-Turner a Joint Venture

Awarding Agency: Department of Veterans Affairs

Start Date: 2014-12-19

End Date: 2018-06-30

Contract Duration: 1,289 days

Daily Burn Rate: $175.0K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: COST PLUS FIXED FEE

Sector: Construction

Official Description: IGF::OT::IGF DENVER REPLACEMENT VA HOSPITAL, AURORA COLORADO INTERIM CONTRACT

Place of Performance

Location: AURORA, ADAMS County, COLORADO, 80045

State: Colorado Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $225.6 million to KIEWIT-TURNER A JOINT VENTURE for work described as: IGF::OT::IGF DENVER REPLACEMENT VA HOSPITAL, AURORA COLORADO INTERIM CONTRACT Key points: 1. Contract value of $225.6M for a major hospital construction project. 2. Kiewit-Turner, a joint venture, is the primary contractor. 3. The contract was not competed, raising questions about price discovery. 4. Construction sector spending is significant, with this project contributing to the total.

Value Assessment

Rating: questionable

The contract type is Cost Plus Fixed Fee, which can lead to cost overruns if not managed tightly. Without competitive bidding, it's difficult to assess if the pricing is optimal compared to market rates for similar large-scale construction projects.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

The contract was not competed, indicating a sole-source award. This limits price discovery and potentially leads to higher costs for taxpayers as there was no market pressure to offer the best price.

Taxpayer Impact: The lack of competition for a contract of this magnitude suggests taxpayers may have paid a premium for the construction services.

Public Impact

Veterans will benefit from a new, modern hospital facility. The significant investment in infrastructure highlights the government's commitment to veteran healthcare. Job creation is likely associated with this large-scale construction project.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition
Cost Plus Fixed Fee contract type
Potential for cost overruns

Positive Signals

Addresses critical need for veteran healthcare facility
Significant investment in infrastructure

Sector Analysis

This contract falls within the Commercial and Institutional Building Construction sector. Large federal construction projects often involve significant taxpayer investment and can be subject to cost overruns if not properly managed and competed.

Small Business Impact

There is no indication in the provided data whether small businesses were involved as subcontractors on this project. Further analysis would be needed to determine their participation.

Oversight & Accountability

The Department of Veterans Affairs awarded this contract. Oversight would be crucial to ensure the project stays within budget and meets quality standards, especially given the non-competitive nature of the award.

Related Government Programs

Commercial and Institutional Building Construction
Department of Veterans Affairs Contracting
Department of Veterans Affairs Programs

Risk Flags

Lack of competitive bidding
Cost Plus Fixed Fee contract type
Potential for cost overruns
Limited transparency on justification for sole-source award

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $225.6 million to KIEWIT-TURNER A JOINT VENTURE. IGF::OT::IGF DENVER REPLACEMENT VA HOSPITAL, AURORA COLORADO INTERIM CONTRACT

Who is the contractor on this award?

The obligated recipient is KIEWIT-TURNER A JOINT VENTURE.

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 $225.6 million.

What is the period of performance?

Start: 2014-12-19. End: 2018-06-30.

What was the justification for not competing this large hospital construction contract?

The provided data does not specify the justification for not competing the contract. Typically, sole-source awards are made when only one responsible source is available or in cases of urgent and compelling need. Further investigation into the contract file would be required to understand the specific rationale.

How does the final cost compare to the initial estimated cost for this project?

The provided data only shows the awarded amount of $225,606,734.52. It does not include initial estimates or any information about potential cost changes or overruns during the contract performance period. A comparison would require access to the contract's full financial history.

What mechanisms were in place to control costs given the Cost Plus Fixed Fee structure?

While the contract type is Cost Plus Fixed Fee, the data does not detail the specific cost control mechanisms implemented by the Department of Veterans Affairs. Effective oversight, regular audits, and clear performance metrics are typically employed to manage such contracts and mitigate risks of uncontrolled spending.

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: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Offers Received: 1

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Address: 13611 E COLFAX AVENUE, 2ND FL, AURORA, CO, 80045

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

Financial Breakdown

Contract Ceiling: $226,047,071

Exercised Options: $226,047,071

Current Obligation: $225,606,735

Subaward Activity

Number of Subawards: 569

Total Subaward Amount: $2,458,949,468

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: YES

Timeline