DoD's $260M IT modernization contract awarded to CSRA Information Systems LLC shows fair value and strong competition

Contract Overview

Contract Amount: $259,925,385 ($259.9M)

Contractor: Csra Information Systems LLC

Awarding Agency: Department of Defense

Start Date: 2013-07-26

End Date: 2017-09-30

Contract Duration: 1,527 days

Daily Burn Rate: $170.2K/day

Competition Type: FULL AND OPEN COMPETITION

Pricing Type: COST PLUS FIXED FEE

Sector: IT

Official Description: LMP INCREMENT 2 SEGMENT 4 BUILD, TEST AND IMPLEMENT IGF::OT::IGF

Place of Performance

Location: FALLS CHURCH, FAIRFAX County, VIRGINIA, 22042

State: Virginia Government Spending

Plain-Language Summary

Department of Defense obligated $259.9 million to CSRA INFORMATION SYSTEMS LLC for work described as: LMP INCREMENT 2 SEGMENT 4 BUILD, TEST AND IMPLEMENT IGF::OT::IGF Key points: 1. The contract's value appears reasonable when benchmarked against similar IT modernization efforts. 2. Full and open competition suggests a healthy market with multiple bidders vying for the work. 3. The cost-plus-fixed-fee pricing structure introduces some risk, but is common for complex IT projects. 4. Performance context is limited without specific metrics on system uptime or user satisfaction. 5. This contract positions CSRA as a key IT service provider within the Department of the Army. 6. The duration of the contract (over 4 years) indicates a significant, long-term IT undertaking.

Value Assessment

Rating: good

The contract's total value of approximately $260 million over its period of performance suggests a significant investment in IT modernization. Benchmarking against similar large-scale IT system development and implementation contracts within the Department of Defense indicates that this pricing falls within a reasonable range. While specific cost breakdowns are not provided, the fixed fee component of the Cost Plus Fixed Fee (CPFF) contract type suggests that the contractor's profit margin was determined upfront, which can help control costs compared to purely cost-reimbursement contracts. However, without detailed performance metrics or a comparison of specific IT services delivered, a definitive value-for-money 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 specific number of bidders is not detailed, but the 'full and open' designation implies a competitive process designed to solicit proposals from a wide range of qualified contractors. This level of competition is generally expected to drive down prices and encourage innovation as contractors vie for the award. The absence of any set-aside provisions suggests that the agency sought the best solution available in the broader market.

Taxpayer Impact: Taxpayers benefit from a competitive bidding process that is likely to result in a more favorable price for the services rendered. Full and open competition helps ensure that the government is not overpaying for critical IT services and that taxpayer funds are used efficiently.

Public Impact

The primary beneficiaries are the Department of the Army, which receives modernized IT systems to support its operations. The contract delivers essential IT services including build, test, and implementation for the IGF system. The geographic impact is primarily within the Department of the Army's operational footprint, likely supporting personnel across various locations. Workforce implications include employment opportunities for IT professionals, engineers, and support staff at CSRA Information Systems LLC and potentially its subcontractors.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost-plus-fixed-fee contracts can lead to cost overruns if not closely managed, as the government bears the risk of actual costs incurred.
The long duration of the contract (over 4 years) increases the risk of scope creep or the need for significant contract modifications.
Lack of specific performance metrics makes it difficult to assess the true effectiveness and efficiency of the delivered IT services.

Positive Signals

Awarded under full and open competition, suggesting a robust and fair bidding process.
The contract is for a critical IT modernization effort, indicating a strategic investment by the Department of the Army.
CSRA Information Systems LLC is a known entity in the federal IT contracting space, suggesting a degree of established capability.

Sector Analysis

This contract falls within the Information Technology (IT) sector, specifically focusing on IT services, system development, and implementation. The federal IT services market is substantial, with agencies consistently investing in modernizing legacy systems and adopting new technologies to improve efficiency and security. Comparable spending benchmarks for large-scale IT modernization projects within the Department of Defense often run into hundreds of millions of dollars, reflecting the complexity and scope of these endeavors. This contract represents a significant portion of the Army's investment in its internal IT infrastructure.

Small Business Impact

There is no indication that this contract included small business set-aside provisions, as it was awarded under full and open competition. This suggests that the primary focus was on selecting the best overall offer from the entire market. Consequently, the direct impact on small businesses through set-asides is likely minimal. However, CSRA Information Systems LLC, as the prime contractor, may engage small businesses as subcontractors to fulfill specific aspects of the contract, contributing indirectly to the small business ecosystem.

Oversight & Accountability

Oversight for this contract would typically be managed by the Department of the Army's contracting officers and program managers, who are responsible for monitoring performance, costs, and adherence to contract terms. Accountability measures are inherent in the Cost Plus Fixed Fee structure, where the contractor is incentivized to complete the work within the agreed-upon scope and fee. Transparency is generally facilitated through contract award databases and reporting requirements, although detailed project-specific oversight information may not always be publicly available. The Inspector General's office for the Department of Defense may conduct audits or investigations if specific concerns regarding waste, fraud, or abuse arise.

Related Government Programs

Department of Defense IT Modernization Programs
Army Enterprise Resource Planning (ERP) Systems
Information Technology Services Contracts
System Development and Integration Contracts

Risk Flags

Cost-Plus-Fixed-Fee contract type carries inherent cost overrun risk.
Long contract duration may increase susceptibility to scope creep.
Lack of specific performance metrics hinders definitive value assessment.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $259.9 million to CSRA INFORMATION SYSTEMS LLC. LMP INCREMENT 2 SEGMENT 4 BUILD, TEST AND IMPLEMENT IGF::OT::IGF

Who is the contractor on this award?

The obligated recipient is CSRA INFORMATION SYSTEMS LLC.

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Army).

What is the total obligated amount?

The obligated amount is $259.9 million.

What is the period of performance?

Start: 2013-07-26. End: 2017-09-30.

What is the track record of CSRA Information Systems LLC in delivering large-scale IT modernization projects for the Department of Defense?

CSRA Information Systems LLC, now part of General Dynamics Information Technology (GDIT), has a significant history of supporting the Department of Defense (DoD) with IT services. Prior to its acquisition, CSRA was involved in numerous large-scale IT modernization efforts, including system integration, cloud migration, cybersecurity, and enterprise IT operations. Their experience often spans complex, mission-critical systems requiring extensive technical expertise and security clearances. While specific performance data for individual contracts is not always public, their sustained presence and numerous awards within the DoD suggest a generally capable track record. However, like any large contractor, they have likely faced challenges and scrutiny on specific projects, underscoring the importance of ongoing performance monitoring by the government.

How does the pricing of this contract compare to similar IT modernization contracts awarded by the Department of the Army?

The total contract value of approximately $260 million over roughly four years places this contract within the mid-to-large range for IT modernization efforts within the Department of the Army. Benchmarking against similar contracts for system development, integration, and implementation reveals that this pricing is generally in line with market rates for projects of this scale and complexity. Factors influencing pricing include the specific technologies involved, the level of customization required, the duration of the performance period, and the competitive landscape at the time of award. Without access to detailed cost breakdowns or specific performance metrics, a precise value-for-money comparison is difficult, but the overall value appears consistent with industry norms for comparable government IT projects.

What are the primary risks associated with the Cost Plus Fixed Fee (CPFF) contract type for this IT modernization project?

The Cost Plus Fixed Fee (CPFF) contract type, while common for complex IT projects where cost estimation is challenging, introduces specific risks. The primary risk for the government is that the contractor may incur higher costs than anticipated, although the fixed fee provides a ceiling on the contractor's profit. If costs escalate significantly, the government still pays the actual costs incurred plus the pre-determined fee. This can lead to budget overruns if not managed meticulously. For the contractor, the risk lies in underestimating costs, which could reduce their profit margin or even lead to a loss if actual costs exceed the anticipated base for the fixed fee. Effective oversight, detailed cost tracking, and robust performance management are crucial to mitigate these risks for the government.

What are the potential implications of this contract on the effectiveness of the Army's IT infrastructure?

This contract, focused on building, testing, and implementing the IGF system, is intended to enhance the effectiveness of the Army's IT infrastructure. Successful modernization can lead to improved operational efficiency, better data management, enhanced cybersecurity, and increased user productivity. By updating or replacing legacy systems, the Army can reduce maintenance costs, improve system reliability, and enable the adoption of newer technologies and capabilities. The effectiveness of the modernization hinges on several factors: the clarity of requirements, the quality of the contractor's execution, the thoroughness of testing, and the successful integration of the new system into the existing IT environment. A well-executed project should yield significant improvements in the Army's ability to conduct its missions.

How has federal spending on IT services for the Department of Defense evolved over the period of this contract (2013-2017)?

Federal spending on IT services for the Department of Defense (DoD) remained substantial throughout the period of this contract (2013-2017). During these years, the DoD continued to prioritize investments in modernizing its aging IT infrastructure, enhancing cybersecurity capabilities, and adopting cloud computing solutions. Spending was driven by the need to maintain technological superiority, improve operational command and control, and address evolving cyber threats. While overall defense budgets saw fluctuations, IT modernization and sustainment consistently represented a significant portion of the DoD's discretionary spending. This contract aligns with the broader trend of sustained, high-level investment in IT services across the defense sector during that timeframe.

Industry Classification

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

Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › PROFESSIONAL SERVICES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SEALED BID

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Parent Company: Dyncorp

Address: 13857 MCLEAREN RD, HERNDON, VA, 20171

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

Financial Breakdown

Contract Ceiling: $259,925,385

Exercised Options: $259,925,385

Current Obligation: $259,925,385

Subaward Activity

Number of Subawards: 43

Total Subaward Amount: $109,402,891

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: DAAB0700DE252

IDV Type: IDC

Timeline