Pension Benefit Guaranty Corporation awards $68M IT services contract to General Dynamics Information Technology

Contract Overview

Contract Amount: $67,997,427 ($68.0M)

Contractor: General Dynamics Information Technology, Inc.

Awarding Agency: Pension Benefit Guaranty Corporation

Start Date: 2007-12-07

End Date: 2012-01-01

Contract Duration: 1,486 days

Daily Burn Rate: $45.8K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 10

Pricing Type: COST PLUS AWARD FEE

Sector: IT

Official Description: CIO/OIT

Place of Performance

Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20005

State: District of Columbia Government Spending

Plain-Language Summary

Pension Benefit Guaranty Corporation obligated $68.0 million to GENERAL DYNAMICS INFORMATION TECHNOLOGY, INC. for work described as: CIO/OIT Key points: 1. Contract awarded for IT services, indicating a need for ongoing technological support. 2. The contract duration of 1486 days suggests a long-term strategic investment in IT infrastructure. 3. The 'Cost Plus Award Fee' contract type allows for flexibility but requires careful monitoring of costs and performance. 4. The 'Other Computer Related Services' NAICS code points to a broad scope of potential IT support. 5. The contract was awarded through full and open competition, suggesting a competitive bidding process. 6. The contract value of approximately $68 million over its term warrants scrutiny for value for money.

Value Assessment

Rating: fair

The contract value of $68 million over approximately four years averages to about $17 million annually. Benchmarking this against similar IT services contracts for federal agencies of comparable size and scope is necessary to fully assess value. The 'Cost Plus Award Fee' structure means that the final cost is dependent on performance, which can lead to cost overruns if not managed tightly. Without specific performance metrics and award fee criteria, it's difficult to definitively assess the value proposition.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under 'full and open competition,' indicating that all responsible sources were permitted to submit a bid. The presence of 10 bids suggests a healthy level of competition for this IT services requirement. A competitive process generally leads to better price discovery and potentially more favorable terms for the government.

Taxpayer Impact: A competitive award process helps ensure that taxpayer dollars are used efficiently by driving down costs and encouraging innovation among bidders.

Public Impact

Federal employees and retirees benefit from the reliable IT infrastructure supporting pension benefit administration. Essential IT services are delivered to ensure the smooth operation of the Pension Benefit Guaranty Corporation. The geographic impact is primarily within the District of Columbia, where the agency is headquartered. The contract supports a workforce of IT professionals, both within the contractor and potentially within the agency.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost Plus Award Fee contracts can incentivize spending if not rigorously overseen.
The broad NAICS code 'Other Computer Related Services' may obscure specific service costs.
Long contract durations can sometimes lead to vendor lock-in or reduced agility.

Positive Signals

Full and open competition suggests a robust bidding process.
Multiple bidders (10) indicate significant market interest and potential for competitive pricing.
The award to a large, established contractor like General Dynamics Information Technology may signal a focus on stability and proven capability.

Sector Analysis

The Information Technology sector is a critical component of federal operations, encompassing a wide range of services from infrastructure management to software development. This contract falls within the 'Other Computer Related Services' category, which is broad and can include consulting, system integration, and support. Federal IT spending is substantial, with agencies continually investing in modernizing systems and ensuring cybersecurity. This contract represents a portion of that overall IT investment, focused on supporting the specific needs of the Pension Benefit Guaranty Corporation.

Small Business Impact

The data indicates that this contract was not set aside for small businesses, nor does it explicitly mention subcontracting goals for small businesses. This suggests that the primary award went to a large business. Further analysis would be needed to determine if any subcontracting opportunities were made available to small businesses through the prime contractor.

Oversight & Accountability

Oversight for this contract would typically be managed by the Pension Benefit Guaranty Corporation's contracting officers and program managers. The 'Cost Plus Award Fee' structure necessitates close monitoring of performance against defined criteria to justify award fees. Inspector General involvement would depend on specific audit triggers or allegations of fraud, waste, or abuse. Transparency is generally facilitated through contract award databases, though detailed performance and cost data may be less accessible.

Related Government Programs

Federal IT Services Contracts
IT Support Services
Computer Systems Design Services
Pension Administration Systems

Risk Flags

Cost Plus Award Fee contract type requires diligent oversight to manage costs and ensure performance.
Broad NAICS code may require further breakdown to assess specific service costs and value.
Long contract duration necessitates monitoring for potential obsolescence or need for re-competition.

Frequently Asked Questions

What is this federal contract paying for?

Pension Benefit Guaranty Corporation awarded $68.0 million to GENERAL DYNAMICS INFORMATION TECHNOLOGY, INC.. CIO/OIT

Who is the contractor on this award?

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

Which agency awarded this contract?

Awarding agency: Pension Benefit Guaranty Corporation (Pension Benefit Guaranty Corporation).

What is the total obligated amount?

The obligated amount is $68.0 million.

What is the period of performance?

Start: 2007-12-07. End: 2012-01-01.

What is the track record of General Dynamics Information Technology with the Pension Benefit Guaranty Corporation and similar federal agencies?

General Dynamics Information Technology (GDIT) has a significant history of contracting with federal agencies, including the Pension Benefit Guaranty Corporation (PBGC). Their extensive experience spans various IT services, from infrastructure management and cybersecurity to application development and modernization. For PBGC, GDIT has previously been awarded contracts for IT support, indicating a continued relationship. Across the federal government, GDIT is a major player, holding numerous large-scale IT contracts with departments like Defense, Health and Human Services, and Homeland Security. Their track record generally reflects a capacity to handle complex IT requirements and manage large programs, though specific performance on individual contracts can vary and is subject to agency evaluation. Reviewing past performance evaluations and contract close-out reports for GDIT's work with PBGC and comparable agencies would provide a more granular understanding of their reliability and effectiveness.

How does the awarded amount of $68 million compare to other federal IT services contracts of similar scope?

The $68 million contract value for Pension Benefit Guaranty Corporation's IT services, spread over approximately four years (1486 days), translates to an average annual value of roughly $17 million. This figure is moderate within the landscape of federal IT services contracts. Large agencies often award IT contracts in the hundreds of millions or even billions of dollars for enterprise-wide solutions or major system overhauls. However, for an agency like PBGC, which has a specific mission focused on pension insurance, $17 million annually for comprehensive IT support is a substantial investment. When compared to IT support contracts for agencies of similar size and mission complexity, this award appears to be within a reasonable range. Factors such as the specific services required (e.g., help desk, network management, cybersecurity, application development), the number of users supported, and the criticality of the systems will influence the benchmark. A detailed comparison would involve analyzing contracts with similar NAICS codes (541519) and contract types (Cost Plus Award Fee) awarded to agencies with comparable budgets and employee counts.

What are the primary risks associated with a 'Cost Plus Award Fee' (CPAF) contract type for IT services?

The primary risks associated with a 'Cost Plus Award Fee' (CPAF) contract type, such as the one awarded to General Dynamics Information Technology by the Pension Benefit Guaranty Corporation, revolve around cost control and performance incentivization. For the government, the risk is that costs could escalate beyond initial projections if the contractor is not effectively managed or if the award fee criteria are not stringent enough. Contractors may be incentivized to incur costs to achieve higher award fees, potentially leading to less cost-consciousness than in fixed-price contracts. Conversely, if the award fee criteria are poorly defined or subjective, it can lead to disputes. For the contractor, the risk lies in not meeting the performance targets required to earn the maximum award fee, thus reducing their overall profit margin. Effective management of a CPAF contract requires robust oversight, clear and measurable performance metrics, and regular communication between the government and the contractor to ensure alignment and control.

What is the historical spending pattern for IT services by the Pension Benefit Guaranty Corporation?

Analyzing the historical spending patterns for IT services by the Pension Benefit Guaranty Corporation (PBGC) is crucial for understanding the context of this $68 million award. While specific historical dollar amounts are not provided in the summary data, the duration of this contract (over 4 years) suggests a consistent need for IT support. PBGC, like most federal agencies, relies heavily on IT systems to manage its core mission of insuring defined benefit pension plans. Past contracts would likely show a pattern of spending on IT infrastructure, software maintenance, cybersecurity, and potentially system modernization efforts. The agency's budget and operational needs would dictate the scale of this spending. Understanding if this $68 million award represents an increase, decrease, or continuation of previous spending levels would provide insight into PBGC's IT strategy and resource allocation over time. Examining prior contract awards and their values for IT services would reveal trends and potential shifts in focus or investment.

How does the competition level (10 bidders) impact the value and risk for taxpayers?

A competition level involving 10 bidders for this IT services contract is generally a positive indicator for taxpayers. A higher number of bidders typically signifies a more robust and competitive marketplace for the required services. This increased competition can drive down prices as contractors vie for the award, potentially leading to better value for money. It also increases the likelihood that the government will receive innovative solutions and favorable terms. From a risk perspective, a competitive process reduces the risk of vendor lock-in and ensures that the government is not overly reliant on a single provider. It provides a broader pool of potential contractors, making it easier to switch providers if performance issues arise. The presence of numerous bidders suggests that the contract requirements were well-defined and accessible to a wide range of qualified companies, further mitigating risks associated with unclear specifications or barriers to entry.

Industry Classification

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

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

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: PBGC01-RP-07-0017

Offers Received: 10

Pricing Type: COST PLUS AWARD FEE (R)

Evaluated Preference: NONE

Contractor Details

Parent Company: Computer Sciences Corporation (UEI: 009581091)

Address: 15000 CONFERENCE CENTER DR, CHANTILLY, VA, 90

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

Financial Breakdown

Contract Ceiling: $70,344,063

Exercised Options: $69,579,738

Current Obligation: $67,997,427

Contract Characteristics

Cost or Pricing Data: NO

Timeline