DoD's $94.3M IT support contract to General Dynamics Information Technology shows fair value but limited competition

Contract Overview

Contract Amount: $94,327,679 ($94.3M)

Contractor: General Dynamics Information Technology, Inc.

Awarding Agency: Department of Defense

Start Date: 2014-04-01

End Date: 2016-11-30

Contract Duration: 974 days

Daily Burn Rate: $96.8K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: IGF::CT::IGF THIS ACTION IS TO ESTABLISH TASK ORDER BF07 UNDER THE SINGLE AWARD IDIQ FSXXI SERVICE CONTRACT. PRS# ARE 10478720 AND 10475818

Place of Performance

Location: DALEVILLE, DALE County, ALABAMA, 36322

State: Alabama Government Spending

Plain-Language Summary

Department of Defense obligated $94.3 million to GENERAL DYNAMICS INFORMATION TECHNOLOGY, INC. for work described as: IGF::CT::IGF THIS ACTION IS TO ESTABLISH TASK ORDER BF07 UNDER THE SINGLE AWARD IDIQ FSXXI SERVICE CONTRACT. PRS# ARE 10478720 AND 10475818 Key points: 1. The contract's value appears reasonable when benchmarked against similar IT support services. 2. Full and open competition was utilized, but only two bids were received, suggesting potential for improved price discovery. 3. The fixed-price contract type mitigates cost overrun risks for the government. 4. Performance occurred over a 2.6-year period, indicating a moderate duration for this type of service. 5. This contract falls within the broad 'All Other Support Services' NAICS code, lacking specific sector detail. 6. The contract was awarded to a large, established IT services provider with a significant federal footprint.

Value Assessment

Rating: good

The total award amount of $94.3 million for approximately 2.6 years of IT support services appears to be within a reasonable range for similar federal contracts. The firm fixed-price structure helps control costs. Benchmarking against other large-scale IT support contracts awarded by the Department of Defense suggests that the pricing, while substantial, is not outliers. However, without detailed breakdowns of labor categories and hours, a precise 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, which is a positive indicator for taxpayer value. However, only two bids were submitted. While two bidders still represent competition, it is on the lower end and may not have driven the most aggressive pricing. A higher number of bidders typically leads to more robust price discovery and potentially lower costs for the government. The limited number of bidders could suggest high barriers to entry or a specialized market.

Taxpayer Impact: While the contract was competed openly, the low number of bidders means taxpayers may not have benefited from the most competitive pricing possible. This could translate to a higher overall cost than if more firms had vied for the work.

Public Impact

The Department of Defense benefits from essential IT support services, ensuring operational readiness. The contract supports the Army's information technology infrastructure and operational needs. Services were delivered in Alabama, indicating a specific geographic impact within the state. The contract likely supported a workforce of IT professionals, contributing to employment in the sector.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Limited competition (2 bidders) may have resulted in a higher price than a more robustly competed contract.
Lack of specific performance metrics in the provided data makes it difficult to assess service quality and effectiveness.
The broad NAICS code (561990) obscures the specific nature of the IT services provided, hindering detailed analysis.

Positive Signals

Awarded under full and open competition, adhering to federal procurement principles.
Firm fixed-price contract type provides cost certainty and reduces government risk.
Contract awarded to a large, established contractor (General Dynamics Information Technology) with a proven track record in federal IT services.

Sector Analysis

This contract falls under the broad 'All Other Support Services' category (NAICS 561990), which encompasses a wide range of non-professional services. Within the federal IT services market, which is substantial, this contract represents a significant investment. General Dynamics Information Technology is a major player in this sector, competing with other large system integrators and IT service providers. Comparable spending benchmarks for large-scale IT support contracts within the Department of Defense often run into the tens or hundreds of millions of dollars.

Small Business Impact

This contract was not set aside for small businesses, and the awardee, General Dynamics Information Technology, is a large corporation. There is no explicit information provided regarding subcontracting plans for small businesses. Without this data, it's difficult to assess the impact on the small business ecosystem. Large prime contractors often utilize small businesses for specialized services, but the extent of this contract's subcontracting is unknown.

Oversight & Accountability

The contract was awarded under full and open competition, suggesting adherence to standard procurement processes. As a delivery order under an IDIQ, oversight would typically involve the contracting officer's representative (COR) monitoring performance and adherence to the contract terms. The Department of Defense's Inspector General would have jurisdiction for audits and investigations if any issues of fraud, waste, or abuse arose. Transparency is generally maintained through contract databases like FPDS, where basic award information is published.

Related Government Programs

Information Technology Support Services
Department of Defense IT Contracts
Army IT Services
General Dynamics IT Contracts
IDIQ Task Orders

Risk Flags

Limited competition (2 bidders)
Broad NAICS code obscures specific services

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $94.3 million to GENERAL DYNAMICS INFORMATION TECHNOLOGY, INC.. IGF::CT::IGF THIS ACTION IS TO ESTABLISH TASK ORDER BF07 UNDER THE SINGLE AWARD IDIQ FSXXI SERVICE CONTRACT. PRS# ARE 10478720 AND 10475818

Who is the contractor on this award?

The obligated recipient is GENERAL DYNAMICS INFORMATION TECHNOLOGY, INC..

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $94.3 million.

What is the period of performance?

Start: 2014-04-01. End: 2016-11-30.

What was the specific nature of the IT support services provided under this contract?

The provided data indicates the contract falls under NAICS code 561990, 'All Other Support Services.' While the awardee is General Dynamics Information Technology, a major IT services provider, the specific services are not detailed. Typically, such contracts could encompass a wide range of IT functions including help desk support, network management, system administration, cybersecurity services, software maintenance, and IT infrastructure support. Without access to the specific task order details (BF07) or the parent IDIQ (FSXXI), the precise scope of work remains unspecified in the summary data.

How does the $94.3 million award compare to other similar IT support contracts awarded by the Department of the Army?

The $94.3 million award for approximately 2.6 years of service is a substantial amount, consistent with large-scale IT support contracts within the Department of Defense. Benchmarking requires comparing this value against contracts with similar scope, duration, and service requirements. While specific comparable contracts are not provided, the Department of the Army frequently awards multi-million dollar IT support contracts to large system integrators. This award appears to be within the typical range for comprehensive IT support, though a more precise comparison would necessitate detailed analysis of contract line item numbers (CLINs) and service descriptions for other awards.

What are the potential risks associated with a contract having only two bidders?

A contract with only two bidders, even under full and open competition, presents several potential risks. Primarily, it can lead to reduced price competition, potentially resulting in the government paying a higher price than if more bidders had participated. This lack of robust competition might also indicate high barriers to entry in the market, such as specialized expertise, significant resources, or existing relationships, which could stifle innovation. Furthermore, it concentrates the risk of contractor performance or default on a smaller pool of potential providers. If one of the two bidders withdraws or fails to perform, the government has very limited options.

What is the significance of the 'Firm Fixed Price' contract type for this IT support service?

The 'Firm Fixed Price' (FFP) contract type is generally advantageous for the government when the scope of work is well-defined and unlikely to change significantly. For IT support services, an FFP contract establishes a set price for the defined services, transferring most of the risk of cost overruns to the contractor (General Dynamics Information Technology). This provides the government with cost certainty and predictability, making budgeting easier. It incentivizes the contractor to manage its costs efficiently to maximize profit. However, if unforeseen technical challenges or scope creep occur, the contractor may be less willing to accommodate changes without additional cost, potentially leading to disputes if not managed carefully.

What does the contract's duration of 974 days (approx. 2.6 years) imply about the nature of the IT services?

A duration of approximately 2.6 years for an IT support services contract suggests a need for sustained, ongoing operational support rather than a short-term project. This timeframe is typical for maintaining critical IT infrastructure, providing help desk services, or managing systems that require continuous attention and updates. It implies that the services are integral to the daily operations of the Department of the Army unit being supported. Such durations allow for the development of institutional knowledge by the contractor and provide stability for the supported agency, but also necessitate careful performance monitoring throughout the contract period.

How does the award to General Dynamics Information Technology align with historical federal IT spending patterns?

The award to General Dynamics Information Technology (GDIT) aligns with historical federal IT spending patterns, as GDIT is a long-standing and significant provider of IT services to the U.S. government, particularly the Department of Defense. Large system integrators like GDIT consistently receive substantial portions of federal IT budgets due to their capacity to handle complex, large-scale requirements. Their extensive experience, established infrastructure, and broad range of capabilities make them frequent recipients of major IT contracts. This specific $94.3 million award is consistent with the trend of the federal government relying on a relatively small number of large contractors for its most critical and extensive IT needs.

Industry Classification

NAICS: Administrative and Support and Waste Management and Remediation Services › Other Support Services › All Other Support Services

Product/Service Code: MAINT, REPAIR, REBUILD EQUIPMENT › MAINT, REPAIR, REBUILD OF EQUIPMENT

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 2

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Csra LLC (UEI: 080011988)

Address: 15000 CONFERENCE CENTER DR, CHANTILLY, VA, 20151

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

Financial Breakdown

Contract Ceiling: $94,327,679

Exercised Options: $94,327,679

Current Obligation: $94,327,679

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: N6133903D0014

IDV Type: IDC

Timeline