Treasury's $45.7M IT Services Contract with General Dynamics Faces Scrutiny for Value and Competition

Contract Overview

Contract Amount: $45,683,127 ($45.7M)

Contractor: General Dynamics Information Technology, Inc.

Awarding Agency: Department of the Treasury

Start Date: 2008-03-07

End Date: 2010-12-31

Contract Duration: 1,029 days

Daily Burn Rate: $44.4K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: COST PLUS FIXED FEE

Sector: IT

Official Description: PRIME SYSTEMS INTEGRATION SERVICES CONTR

Place of Performance

Location: LANHAM, PRINCE GEORGE'S County, MARYLAND, 20706

State: Maryland Government Spending

Plain-Language Summary

Department of the Treasury obligated $45.7 million to GENERAL DYNAMICS INFORMATION TECHNOLOGY, INC. for work described as: PRIME SYSTEMS INTEGRATION SERVICES CONTR Key points: 1. The contract awarded to General Dynamics Information Technology, Inc. for Prime Systems Integration Services totaled $45.7 million. 2. Competition was full and open, suggesting a potentially competitive pricing environment. 3. The contract type is Cost Plus Fixed Fee, which can sometimes lead to cost overruns if not managed tightly. 4. The sector is IT, specifically Computer Systems Design Services, a common area for federal spending.

Value Assessment

Rating: fair

The Cost Plus Fixed Fee structure, while allowing flexibility, carries inherent risk of exceeding initial estimates. Benchmarking against similar IT integration contracts is crucial to assess if the $45.7M represents fair value.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, which generally promotes competitive pricing. However, the specific pricing discovery mechanisms and the final negotiated price relative to market rates are key to determining true value.

Taxpayer Impact: While competition was present, the Cost Plus Fixed Fee structure necessitates careful oversight to ensure taxpayer funds are used efficiently and effectively, preventing unnecessary cost escalation.

Public Impact

Taxpayers may be impacted by the efficiency of IT service delivery and the ultimate cost of the contract. The IRS relies on these integration services, so performance directly affects agency operations and public service. Transparency in contract spending and performance is vital for public trust in government IT investments.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Positive Signals

Sector Analysis

This contract falls within the IT sector, specifically Computer Systems Design Services. Federal spending in this area is substantial, and benchmarks for similar integration projects are essential for evaluating cost-effectiveness and contractor performance.

Small Business Impact

The data does not indicate any specific provisions or awards made to small businesses under this prime contract. Further analysis would be needed to determine if subcontracting opportunities were provided to small businesses.

Oversight & Accountability

Oversight of this contract would involve monitoring the contractor's performance against defined objectives and ensuring adherence to the Cost Plus Fixed Fee terms. Regular audits and performance reviews are critical for accountability.

Related Government Programs

Risk Flags

Tags

computer-systems-design-services, department-of-the-treasury, md, do, 10m-plus

Frequently Asked Questions

What is this federal contract paying for?

Department of the Treasury awarded $45.7 million to GENERAL DYNAMICS INFORMATION TECHNOLOGY, INC.. PRIME SYSTEMS INTEGRATION SERVICES CONTR

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 the Treasury (Internal Revenue Service).

What is the total obligated amount?

The obligated amount is $45.7 million.

What is the period of performance?

Start: 2008-03-07. End: 2010-12-31.

How does the final cost of this contract compare to the initial bid and the benchmarked costs for similar IT system integration projects?

A comprehensive comparison of the final $45.7 million expenditure against initial bids and industry benchmarks for comparable IT system integration projects is necessary. This analysis should consider the scope of work, complexity, and duration. Deviations from benchmarks could indicate potential inefficiencies or unexpected challenges, requiring further investigation into cost drivers and contractor performance.

What specific performance metrics were established for this contract, and how effectively did General Dynamics meet them?

Performance metrics are crucial for assessing the effectiveness of IT integration services. Key metrics might include system uptime, successful data migration, integration success rates, and adherence to project timelines. Evaluating the contractor's performance against these predefined metrics provides insight into the value delivered and identifies areas where improvements might be needed for future contracts.

Given the Cost Plus Fixed Fee structure, what mechanisms were in place to control costs and prevent scope creep?

The Cost Plus Fixed Fee (CPFF) structure requires stringent cost controls and scope management. Mechanisms should include detailed cost tracking, regular financial reviews, and a robust change control process to prevent unauthorized scope creep. The government's oversight team plays a critical role in scrutinizing costs and ensuring that only allowable expenses are reimbursed, capped by the fixed fee.

Industry Classification

NAICS: Professional, Scientific, and Technical ServicesComputer Systems Design and Related ServicesComputer Systems Design Services

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

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 2

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Parent Company: Computer Sciences Corporation (UEI: 009581091)

Address: MARYLAND TECHNOLOGY CENTER, LANHAM, MD, 04

Business Categories: Category Business, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $46,119,484

Exercised Options: $46,119,484

Current Obligation: $45,683,127

Parent Contract

Parent Award PIID: TIRNO99D00001

IDV Type: IDC

Timeline

Start Date: 2008-03-07

Current End Date: 2010-12-31

Potential End Date: 2011-12-31 00:00:00

Last Modified: 2015-02-16

More Contracts from General Dynamics Information Technology, Inc.

View all General Dynamics Information Technology, Inc. federal contracts →

Other Department of the Treasury Contracts

View all Department of the Treasury contracts →

Explore Related Government Spending