General Dynamics IT's $380M contract for IT services shows a competitive landscape with 3 bidders

Contract Overview

Contract Amount: $379,995,062 ($380.0M)

Contractor: General Dynamics Information Technology, Inc.

Awarding Agency: General Services Administration

Start Date: 2004-09-20

End Date: 2009-09-30

Contract Duration: 1,836 days

Daily Burn Rate: $207.0K/day

Competition Type: COMPETITIVE DELIVERY ORDER

Number of Offers Received: 3

Pricing Type: COST PLUS AWARD FEE

Sector: IT

Official Description: OTHER ADP & TELECOMMUNICATIONS SERVICES

Place of Performance

Location: FAIRFAX, FAIRFAX County, VIRGINIA, 22033

State: Virginia Government Spending

Plain-Language Summary

General Services Administration obligated $380.0 million to GENERAL DYNAMICS INFORMATION TECHNOLOGY, INC. for work described as: OTHER ADP & TELECOMMUNICATIONS SERVICES Key points: 1. The contract's Cost Plus Award Fee structure incentivizes performance but requires careful monitoring of costs. 2. With a duration of 1836 days, this represents a significant, long-term commitment to IT support. 3. The competitive delivery order suggests a dynamic market for these services, potentially driving better pricing. 4. The contract's value places it within a substantial spending category for IT systems design. 5. Performance context is key, as award fees are tied to achieving specific objectives. 6. The absence of small business set-asides may limit opportunities for smaller firms in this specific award.

Value Assessment

Rating: good

Benchmarking the Cost Plus Award Fee structure against similar IT services contracts is crucial. While this structure can drive performance, it necessitates robust oversight to ensure costs remain reasonable and aligned with awarded objectives. The total award value of $380 million over approximately five years suggests a significant investment, and value for money will depend heavily on the successful delivery of services and the achievement of performance metrics that justify the award fees.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded as a competitive delivery order, indicating that multiple vendors were likely considered or competed for this specific task order. The presence of 3 bidders suggests a healthy level of competition for this particular requirement within the broader IT services market. This level of competition is generally positive for price discovery and ensures that the government is likely receiving competitive pricing for the services rendered.

Taxpayer Impact: A competitive award process means taxpayer dollars are being used efficiently, as multiple vendors vied for the contract, driving down costs and ensuring the best value is sought.

Public Impact

Federal agencies requiring computer systems design and integration services benefit from this contract. The contract supports the delivery of essential IT infrastructure and operational support. The geographic impact is likely nationwide, supporting federal operations across various locations. This contract supports a workforce skilled in IT systems design, development, and maintenance.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns inherent in Cost Plus Award Fee contracts if not managed diligently.
Long contract duration could lead to technology obsolescence if not actively managed and updated.
Dependence on a single large contractor for critical IT services could pose a risk if performance falters.

Positive Signals

Competitive award process indicates potential for good value and market responsiveness.
Award fee structure incentivizes contractor performance and achievement of specific objectives.
Contractor's established presence suggests experience in delivering complex IT solutions.

Sector Analysis

This contract falls within the broader Information Technology (IT) sector, specifically in computer systems design services. The federal IT market is vast, with agencies consistently investing in modernizing infrastructure, cybersecurity, and data management. Contracts like this, often awarded through large indefinite-delivery/indefinite-quantity (IDIQ) vehicles or competitive task orders, are crucial for maintaining government operations. Comparable spending benchmarks would involve looking at other large-scale IT services contracts awarded by agencies like the GSA, DoD, or civilian departments for similar system design and integration work.

Small Business Impact

The data indicates this contract was not set aside for small businesses (ss: false, sb: false). This suggests that the primary competition was likely among large, established IT service providers. While this doesn't preclude small businesses from subcontracting opportunities, the direct award was not specifically targeted to them. The impact on the small business ecosystem depends on whether General Dynamics Information Technology, Inc. utilizes small business subcontractors to fulfill portions of this contract, which is not explicitly detailed in the provided data.

Oversight & Accountability

Oversight for this contract would primarily fall under the General Services Administration (GSA), specifically the Federal Acquisition Service. The contract type (Cost Plus Award Fee) necessitates rigorous oversight of costs and performance metrics. Accountability measures are built into the award fee structure, incentivizing the contractor to meet defined objectives. Transparency is generally maintained through federal procurement databases, though specific performance details and cost breakdowns may be less public. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

IT Services
Computer Systems Design
General Services Administration Contracts
Information Technology Support
Federal IT Modernization

Risk Flags

Cost Overruns
Performance Risk
Technology Obsolescence
Contractor Dependence

Frequently Asked Questions

What is this federal contract paying for?

General Services Administration awarded $380.0 million to GENERAL DYNAMICS INFORMATION TECHNOLOGY, INC.. OTHER ADP & TELECOMMUNICATIONS SERVICES

Who is the contractor on this award?

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

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $380.0 million.

What is the period of performance?

Start: 2004-09-20. End: 2009-09-30.

What is the historical spending trend for General Dynamics Information Technology, Inc. with the General Services Administration for similar IT services?

Analyzing historical spending trends for General Dynamics Information Technology, Inc. (GDIT) with the GSA requires accessing detailed federal procurement data over multiple fiscal years. GDIT is a major federal contractor, and their spending with GSA for IT services would likely show a consistent pattern of significant awards, reflecting their established position in the market. To provide a precise trend, one would need to query databases like FPDS or USASpending.gov for contracts categorized under NAICS code 541512 (Computer Systems Design Services) awarded to GDIT by GSA. This analysis would reveal if spending has increased, decreased, or remained stable, and identify any major shifts in contract types or values, offering context to the $380 million award.

How does the Cost Plus Award Fee (CPAF) structure of this contract compare to other IT services contracts awarded by GSA in terms of risk and potential value?

The Cost Plus Award Fee (CPAF) structure is common for complex IT services where performance outcomes are critical but difficult to define precisely upfront. Compared to fixed-price contracts, CPAF carries higher cost risk for the government, as the final price is not fixed and includes allowable costs plus an award fee based on performance. However, it offers greater potential value by incentivizing the contractor to exceed minimum performance standards, potentially leading to better service quality and innovation. GSA often uses CPAF for IT services to balance cost control with performance maximization, especially in areas like system design and integration where quality is paramount. The risk is mitigated through robust performance metrics and oversight.

What specific IT systems or services does this $380 million contract primarily cover, and how critical are they to the agency's mission?

The provided data indicates the contract falls under NAICS code 541512 (Computer Systems Design Services), with the description 'OTHER ADP & TELECOMMUNICATIONS SERVICES'. This suggests the contract covers a broad range of IT support, potentially including the design, development, integration, and maintenance of various automated data processing (ADP) systems and telecommunications infrastructure. The criticality to the agency's mission would depend on which specific agency or agencies utilize these services under the GSA's Federal Acquisition Service. If this contract supports core operational systems, mission-critical applications, or essential communication networks for a significant federal entity, its importance would be very high, impacting daily government functions and service delivery to the public.

Given the 3 bidders in the competitive delivery order, what was the estimated value or range of proposals submitted by the other two bidders?

The provided data confirms that this was a competitive delivery order with 3 bidders, but it does not include the specific proposal values of the unsuccessful bidders. To ascertain the range of proposals, one would need to access more detailed procurement records, such as the contract award justification or debriefing information requested by the losing bidders. Typically, in a competitive environment, the proposals would vary based on technical approach, management plan, and price. The fact that this was a Cost Plus Award Fee contract means the final price could fluctuate based on performance, making direct price comparisons complex. However, the existence of multiple bidders suggests a competitive pricing environment was likely achieved.

What is the track record of General Dynamics Information Technology, Inc. in delivering similar large-scale IT systems design contracts for the federal government?

General Dynamics Information Technology, Inc. (GDIT) has a long and extensive track record as a major federal IT contractor. They have consistently been awarded large, complex contracts across various agencies, including the Department of Defense, civilian agencies, and intelligence community. Their experience spans IT modernization, cloud migration, cybersecurity, enterprise IT services, and systems integration. For contracts specifically in computer systems design (NAICS 541512) and telecommunications services, GDIT has demonstrated capability in managing significant budgets and delivering solutions for large-scale federal requirements. Their history includes numerous prime contract awards, indicating a strong performance record, though like any large contractor, specific contract performance can vary and is subject to agency evaluation.

How does the $380 million total award value compare to the average annual spending on IT services by the General Services Administration?

The $380 million total award value for this specific contract represents a significant portion of GSA's IT spending, but it needs to be contextualized within GSA's overall IT budget. GSA manages a vast portfolio of IT services and infrastructure for the federal government, often acting as a central procurement agency. Annual IT spending by GSA can run into billions of dollars, encompassing everything from cloud services and cybersecurity to telecommunications and end-user support. Therefore, while $380 million is a substantial amount for a single contract, it is likely one of many large awards GSA makes annually to support federal agencies. A precise comparison would require analyzing GSA's total IT budget and the distribution of funds across various contract vehicles and service categories.

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: COMPETITIVE DELIVERY ORDER

Offers Received: 3

Pricing Type: COST PLUS AWARD FEE (R)

Contractor Details

Parent Company: Sterling Parent Inc. (UEI: 968838909)

Address: 4300 FAIR LAKES CT, FAIRFAX, VA, 11

Business Categories: Category Business, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $387,155,062

Exercised Options: $387,155,062

Current Obligation: $379,995,062

Parent Contract

Parent Award PIID: GS00T99ALD0211

IDV Type: GWAC

Timeline