General Dynamics awarded $225M for IT services, with a significant portion allocated to computer systems design

Contract Overview

Contract Amount: $225,187,453 ($225.2M)

Contractor: General Dynamics ONE Source LLC

Awarding Agency: General Services Administration

Start Date: 2017-12-20

End Date: 2024-01-07

Contract Duration: 2,209 days

Daily Burn Rate: $101.9K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: COST PLUS AWARD FEE

Sector: IT

Official Description: IGF::OT::IGF SETS AWARD

Place of Performance

Location: SOUTH BURLINGTON, CHITTENDEN County, VERMONT, 05403

State: Vermont Government Spending

Plain-Language Summary

General Services Administration obligated $225.2 million to GENERAL DYNAMICS ONE SOURCE LLC for work described as: IGF::OT::IGF SETS AWARD Key points: 1. Value for money appears fair given the contract's duration and scope, though detailed cost breakdowns are needed for precise assessment. 2. Competition dynamics indicate a full and open process, suggesting potential for competitive pricing. 3. Risk indicators are moderate, with the Cost Plus Award Fee structure requiring careful monitoring of performance and costs. 4. Performance context is set against a long contract duration, necessitating ongoing evaluation of service delivery. 5. Sector positioning is within IT services, specifically computer systems design, a critical area for federal operations.

Value Assessment

Rating: fair

The contract's total award value of $225,187,452.78 over its lifespan suggests a substantial investment in IT services. Benchmarking against similar large-scale IT service contracts managed by GSA would provide a clearer picture of value. The Cost Plus Award Fee (CPAF) structure allows for performance-based incentives, but requires diligent oversight to ensure costs remain reasonable and aligned with achieved outcomes. Without specific performance metrics and cost data, a definitive value assessment is challenging.

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 offers. The presence of two bidders suggests a competitive environment, which typically drives better pricing and service offerings for the government. The specific details of the bidding process and the number of proposals received would further illuminate the strength of the competition.

Taxpayer Impact: A full and open competition generally benefits taxpayers by fostering a competitive marketplace that can lead to more cost-effective solutions and potentially lower prices.

Public Impact

Federal agencies requiring computer systems design and related IT support services are the primary beneficiaries. The contract facilitates the delivery of essential IT infrastructure and operational support across various federal programs. The geographic impact is likely nationwide, supporting federal operations wherever General Dynamics' services are deployed. Workforce implications include the potential for job creation and utilization of skilled IT professionals within General Dynamics and its potential subcontractors.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost overruns are a potential concern with Cost Plus Award Fee contracts if not managed stringently.
Scope creep could increase costs and extend timelines beyond initial projections.
Dependency on a single large contractor for critical IT services may pose a risk.
Ensuring consistent service quality over the long contract duration requires robust performance monitoring.

Positive Signals

Full and open competition suggests a robust selection process and potential for competitive pricing.
The long contract duration allows for sustained support and development of specialized IT capabilities.
The award to a large, established contractor like General Dynamics may indicate a level of trust in their ability to deliver complex services.
The Cost Plus Award Fee structure incentivizes performance, potentially leading to higher quality service delivery.

Sector Analysis

This contract falls within the Information Technology (IT) sector, specifically focusing on Computer Systems Design Services. This is a critical and large market within the federal government, encompassing a wide range of services from software development to IT infrastructure management. Federal spending in this area is consistently high, driven by the need for modern, secure, and efficient IT systems to support agency missions. Comparable spending benchmarks would involve analyzing other large IT service contracts awarded by the General Services Administration (GSA) and other federal agencies for similar types of services.

Small Business Impact

The data indicates that small business participation (sb: false) was not a specific set-aside requirement for this contract. Therefore, there are no direct set-aside implications for small businesses. However, the prime contractor, General Dynamics, may engage small businesses as subcontractors to fulfill portions of the contract requirements. The extent of subcontracting to small businesses would need to be assessed through contract reporting mechanisms to understand the impact on the small business ecosystem.

Oversight & Accountability

Oversight for this contract is primarily managed by the General Services Administration (GSA), which awarded the contract through its Federal Acquisition Service. The Cost Plus Award Fee (CPAF) structure necessitates rigorous performance monitoring and financial oversight to ensure that costs are reasonable and that award fees are justified by performance. Transparency is facilitated through federal procurement databases, but detailed performance reports and cost breakdowns may not be publicly available. Inspector General jurisdiction would typically fall under the GSA's IG for any investigations into fraud, waste, or abuse.

Related Government Programs

IT Services
Computer Systems Design
General Services Administration Contracts
Large IT Procurements
Cost Plus Award Fee Contracts

Risk Flags

Long contract duration requires sustained oversight.
Cost Plus Award Fee structure necessitates careful performance monitoring.
Potential for scope creep over the contract's lifespan.
Ensuring technological relevance over a 6-year period.

Frequently Asked Questions

What is this federal contract paying for?

General Services Administration awarded $225.2 million to GENERAL DYNAMICS ONE SOURCE LLC. IGF::OT::IGF SETS AWARD

Who is the contractor on this award?

The obligated recipient is GENERAL DYNAMICS ONE SOURCE LLC.

Which agency awarded this contract?

Awarding agency: General Services Administration (Federal Acquisition Service).

What is the total obligated amount?

The obligated amount is $225.2 million.

What is the period of performance?

Start: 2017-12-20. End: 2024-01-07.

What is the historical spending pattern for General Dynamics One Source LLC with the General Services Administration?

Analyzing historical spending patterns for General Dynamics One Source LLC with the General Services Administration (GSA) requires accessing detailed contract award databases. Based on the provided data, this specific contract represents a significant award of over $225 million. To understand the broader pattern, one would need to query databases like FPDS or USASpending.gov for all contracts awarded to this entity by GSA over several fiscal years. This would reveal trends in contract types (e.g., IT services, professional services), award values, and the specific GSA sub-agencies or programs they have supported. A high volume of awards or consistently large contract values would indicate a strong, ongoing relationship and significant reliance by GSA on this contractor's capabilities.

How does the Cost Plus Award Fee (CPAF) structure impact the value proposition for this contract?

The Cost Plus Award Fee (CPAF) structure is designed to incentivize contractor performance by allowing for a base fee plus an additional award fee based on achieving specific performance objectives. For this contract, it means that General Dynamics' ultimate profit is tied to meeting or exceeding defined performance standards. From a value perspective, this can be beneficial if the objectives are well-defined, measurable, and aligned with the government's needs, potentially leading to higher quality services. However, it also introduces complexity in oversight, as the government must diligently monitor performance to ensure award fees are justified. If performance is subpar, the value proposition diminishes, even if costs are controlled. Conversely, exceptional performance could yield greater value than a fixed-price contract, provided the costs remain reasonable.

What are the key performance indicators (KPIs) typically associated with Computer Systems Design Services contracts of this magnitude?

For Computer Systems Design Services contracts of this magnitude, Key Performance Indicators (KPIs) often revolve around system availability and uptime, response times for issue resolution, successful implementation of new systems or features, adherence to project timelines and budgets, security compliance, and user satisfaction. For a CPAF contract, these KPIs would be explicitly defined in the contract's Performance Work Statement (PWS). Examples might include achieving 99.9% system uptime, resolving critical incidents within 4 hours, delivering software modules on schedule with fewer than 5% defects, and maintaining compliance with relevant cybersecurity standards (e.g., NIST). The government's ability to effectively measure and evaluate these KPIs directly influences the fairness of the award fee determination and the overall value received.

What is the typical profit margin for IT service contracts awarded by GSA under full and open competition?

Determining a precise 'typical' profit margin for IT service contracts awarded by GSA under full and open competition is challenging without access to detailed cost and profit data for numerous contracts. Profit margins in government contracting, especially for IT services, can vary significantly based on contract type, complexity, competition level, and the specific services offered. Cost Plus Award Fee (CPAF) contracts, like this one, have a variable component (the award fee) that can influence the final profit. Generally, for IT services, profit margins might range from 5% to 15% or higher, depending on the risk and value added. Full and open competition tends to drive prices down, potentially compressing margins, but the CPAF structure allows for higher profits if exceptional performance is demonstrated. Specific data on General Dynamics' profit margins for this contract are not publicly available.

How does the duration of this contract (2209 days) influence risk assessment and oversight?

The extended duration of this contract, approximately 6 years (2209 days), significantly influences risk assessment and oversight. A longer contract term increases the potential for scope creep, technological obsolescence, changes in government requirements, and contractor performance degradation over time. Consequently, oversight mechanisms must be robust and continuous. The GSA must actively manage the contract, regularly review performance against evolving needs, and ensure that the contractor remains capable and compliant throughout the entire period. Risks associated with long-term contracts include potential price increases due to market fluctuations (if not adequately fixed) and the challenge of maintaining consistent service quality. Mitigation strategies often involve phased performance reviews, regular contract modifications to incorporate new requirements, and strong contract management personnel.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Computer Systems Design and Related Services › Computer Systems Design Services

Product/Service Code: IT AND TELECOM - INFORMATION TECHNOLOGY AND TELECOMMUNICATIONS › ADP AND TELECOMMUNICATIONS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 2

Pricing Type: COST PLUS AWARD FEE (R)

Evaluated Preference: NONE

Contractor Details

Parent Company: Wico Limited

Address: 3211 JERMANTOWN ROAD, FAIRFAX, VA, 22030

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

Financial Breakdown

Contract Ceiling: $616,859,400

Exercised Options: $225,225,145

Current Obligation: $225,187,453

Actual Outlays: $-60,376

Subaward Activity

Number of Subawards: 54

Total Subaward Amount: $14,770,981

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Parent Contract

Parent Award PIID: GS00Q09BGD0030

IDV Type: GWAC

Timeline