Naval Sea Systems Command contract for engineering services awarded to General Dynamics Information Technology, Inc. for over $212 million

Contract Overview

Contract Amount: $212,670,378 ($212.7M)

Contractor: General Dynamics Information Technology, Inc.

Awarding Agency: Department of Defense

Start Date: 2003-03-04

End Date: 2015-03-03

Contract Duration: 4,382 days

Daily Burn Rate: $48.5K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 6

Pricing Type: COST PLUS FIXED FEE

Sector: Defense

Official Description: 200306!033807!1700!BZ005 !NAVAL SEA SYSTEMS COMMAND !N0002401D7017 !A!N! !N!0017 !20030304!20050303!040546988!040546988!009581091!N!ADVANCED MARINE ENTERPRISES, I!3160 FAIRVIEW PARK DRIVE !FALLS CHURCH !DC!22042!50000!001!11!WASHINGTON !DISTRICT OF COLUMBIA !D.C. !+000002620970!N!N!000000000000!R499!OTHER PROFESSIONAL SERVICES !S1 !SERVICES !2000!NOT DISCERNABLE OR CLASSIFIED !541330!E! !5!B!M! !A!D!20060331!B! ! !A! !A!N!U!2!021!B! !Z!N!Z! ! !N!C!N! ! ! !C!C!A!A!000!A!C!N! ! ! ! ! ! !0001! !

Place of Performance

Location: FALLS CHURCH, FAIRFAX County, VIRGINIA, 22042

State: Virginia Government Spending

Plain-Language Summary

Department of Defense obligated $212.7 million to GENERAL DYNAMICS INFORMATION TECHNOLOGY, INC. for work described as: 200306!033807!1700!BZ005 !NAVAL SEA SYSTEMS COMMAND !N0002401D7017 !A!N! !N!0017 !20030304!20050303!040546988!040546988!009581091!N!ADVANCED MARINE ENTERPRISES, I!3160 FAIRVIEW PARK DRIVE !FALLS CHURCH !DC!22042!50000!001!11!WASHINGTON !DISTR… Key points: 1. Contract value exceeds $212 million, indicating a significant investment in engineering services. 2. The contract was awarded through full and open competition, suggesting a robust bidding process. 3. The duration of the contract is substantial, spanning over 12 years, which may imply long-term project needs. 4. The primary service category is engineering, crucial for naval system development and maintenance. 5. The contract's performance period suggests a sustained need for specialized technical expertise. 6. The awardee, General Dynamics Information Technology, Inc., is a major defense contractor, implying experience in complex projects.

Value Assessment

Rating: good

The total award amount of over $212 million for engineering services is substantial. Benchmarking this against similar large-scale defense engineering contracts is challenging without more specific service details. However, the duration of over 12 years suggests that the pricing, while high in absolute terms, may reflect a long-term commitment to complex naval system development or sustainment. The cost-plus-fixed-fee (CPFF) contract type indicates that costs are reimbursed, plus a fixed fee, which can offer flexibility but requires careful oversight to manage expenditures.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded through full and open competition, meaning all responsible sources were permitted to submit a bid. The presence of 6 bids indicates a competitive environment for these engineering services. A higher number of bidders generally suggests that the government is likely to receive more competitive pricing and a wider range of technical solutions. The competition level here appears healthy for a contract of this nature.

Taxpayer Impact: Full and open competition is beneficial for taxpayers as it drives down prices through market forces, ensuring that the government obtains the best value for its investment in critical naval engineering services.

Public Impact

The primary beneficiaries are the U.S. Navy, receiving advanced engineering and technical support for its vessels and systems. Services delivered likely include system design, integration, testing, and lifecycle support for naval platforms. The geographic impact is national, supporting naval operations and readiness across various fleet commands. Workforce implications include employment for engineers, technicians, and support staff within the prime contractor and its subcontractors.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

The long contract duration (over 12 years) could lead to cost overruns if not managed tightly.
Cost-plus-fixed-fee contracts can incentivize contractors to incur costs, requiring robust government oversight.
Reliance on a single large prime contractor may limit opportunities for smaller, specialized firms.
The specific nature of 'engineering services' is broad and could encompass a wide range of activities, making precise value assessment difficult without further detail.

Positive Signals

Awarded through full and open competition, suggesting a competitive pricing environment.
The contract has a significant number of bidders (6), indicating broad market interest and potential for innovation.
The prime contractor, General Dynamics Information Technology, Inc., is a well-established entity with a track record in defense contracting.
The contract supports critical naval capabilities, contributing to national security.

Sector Analysis

This contract falls within the broader defense sector, specifically focusing on engineering services. The market for defense engineering services is substantial, driven by the continuous need for modernization, maintenance, and development of military platforms. Companies like General Dynamics Information Technology, Inc. are key players in this market, providing specialized expertise. Comparable spending benchmarks would typically involve other large-scale system engineering and technical assistance (SETA) contracts within the Department of Defense, often running into hundreds of millions or billions of dollars over their lifecycle.

Small Business Impact

This contract does not appear to have a specific small business set-aside component, as indicated by 'ss: false'. While the prime contractor is a large entity, there may be opportunities for small businesses to participate as subcontractors. The extent of subcontracting to small businesses would depend on the prime contractor's strategy and the specific technical requirements of the engineering services provided. Further analysis of subcontracting plans would be needed to assess the full impact on the small business ecosystem.

Oversight & Accountability

Oversight for this contract would primarily reside with the Naval Sea Systems Command (NAVSEA) and the Defense Contract Management Agency (DCMA). These entities are responsible for monitoring contract performance, ensuring compliance with terms and conditions, and managing financial expenditures. The cost-plus-fixed-fee structure necessitates rigorous financial oversight to validate costs and ensure the fixed fee remains appropriate. Transparency is generally maintained through contract reporting requirements, though specific details of technical progress and financial breakdowns may be sensitive.

Related Government Programs

Naval Sea Systems Command (NAVSEA) Contracts
Department of Defense Engineering Services
Cost Plus Fixed Fee Contracts
Defense Information Technology Services
Naval Ship Modernization Programs
Systems Engineering and Technical Assistance (SETA)

Risk Flags

Long contract duration may increase risk of cost escalation.
Cost-plus-fixed-fee contract type requires diligent oversight to manage expenditures.
Scope of 'engineering services' is broad and requires detailed performance monitoring.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $212.7 million to GENERAL DYNAMICS INFORMATION TECHNOLOGY, INC.. 200306!033807!1700!BZ005 !NAVAL SEA SYSTEMS COMMAND !N0002401D7017 !A!N! !N!0017 !20030304!20050303!040546988!040546988!009581091!N!ADVANCED MARINE ENTERPRISES, I!3160 FAIRVIEW PARK DRIVE !FALLS CHURCH !DC!22042!50000!001!11!WASHINGTON !DISTRICT OF COLUMBIA !D.C. !+000002620970!N!N!000000000000!R499!OTHER PROFESSIONAL SERVICES !S1 !SERVICES !2000!NOT DISCERNABLE OR CLASSIFIED !541330!E! !5!B!M! !A!D!20060331!B

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 (Defense Contract Management Agency).

What is the total obligated amount?

The obligated amount is $212.7 million.

What is the period of performance?

Start: 2003-03-04. End: 2015-03-03.

What is the specific breakdown of engineering services provided under this contract?

The provided data indicates the North American Industry Classification System (NAICS) code as 541330, which corresponds to 'Engineering Services'. However, the specific nature of these services for the Naval Sea Systems Command (NAVSEA) is not detailed. Typically, such contracts could encompass a wide range of activities including preliminary design, detailed design, systems integration, testing and evaluation, technical support, lifecycle management, and research and development for naval platforms and systems. Without further documentation, it's difficult to ascertain the precise scope, but it likely involves complex technical challenges related to naval warfare systems, ship design, or related technologies.

How does the total contract value of over $212 million compare to similar engineering service contracts within the Navy or DoD?

A total contract value exceeding $212 million over a period of more than 12 years places this contract among significant investments in engineering support for naval systems. Large-scale engineering and technical support contracts within the Department of Defense frequently reach these figures, and sometimes much higher, especially for major platform development or sustainment programs. For instance, contracts for aircraft carrier maintenance, submarine development, or advanced weapons system integration can easily surpass this amount. The value is substantial but not extraordinary within the context of major defense procurements, reflecting the complexity and long-term nature of supporting naval technology.

What are the key performance indicators (KPIs) used to assess the performance of General Dynamics Information Technology, Inc. on this contract?

Specific Key Performance Indicators (KPIs) for this contract are not detailed in the provided data. However, for engineering service contracts of this nature, common KPIs typically revolve around technical performance (e.g., meeting design specifications, successful system integration), schedule adherence (e.g., timely completion of milestones), cost control (especially relevant for CPFF contracts), quality of deliverables, and responsiveness to government requirements. The Defense Contract Management Agency (DCMA) and NAVSEA would establish and monitor these KPIs throughout the contract's lifecycle to ensure successful execution and value for money.

What is the historical spending pattern for engineering services by the Naval Sea Systems Command (NAVSEA)?

Historical spending patterns for engineering services by NAVSEA are substantial, reflecting its role in developing, acquiring, and maintaining naval platforms and systems. NAVSEA consistently awards billions of dollars annually across various contract types for engineering, research, development, and technical support. This specific contract, valued at over $212 million over more than 12 years, represents a portion of that broader spending. Trends in NAVSEA's spending on engineering services are influenced by modernization priorities, fleet readiness requirements, and the introduction of new technologies, often showing a consistent demand for specialized technical expertise.

What are the potential risks associated with a Cost Plus Fixed Fee (CPFF) contract of this magnitude and duration?

The primary risks associated with a Cost Plus Fixed Fee (CPFF) contract of this magnitude and duration include potential cost overruns and contractor inefficiency. In a CPFF structure, the contractor is reimbursed for allowable costs plus a fixed fee, which is negotiated upfront. While the fixed fee incentivizes the contractor to control costs to maximize profit, there's a risk that costs could escalate beyond initial projections, especially over a long period. The government bears the risk of cost increases, necessitating robust oversight to ensure costs are reasonable, allocable, and allowable. Contractor performance and efficiency are critical; if the contractor is inefficient, costs rise without a direct proportional increase in the contractor's fee, but the government still pays the higher costs.

How does the competition level (6 bidders) impact the value proposition for the taxpayer?

A competition level involving six bidders for this engineering services contract is generally considered healthy and beneficial for taxpayers. A larger pool of bidders typically intensifies competition, driving down proposed prices and encouraging innovative solutions. It provides the government with a stronger negotiating position and a wider array of technical approaches to choose from, increasing the likelihood of selecting the best value. For taxpayers, this means that the significant investment of over $212 million is more likely to be spent efficiently, securing high-quality engineering services at a competitive market rate, rather than at a potentially inflated price that might result from limited competition.

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: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: N0002403R7005

Offers Received: 6

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Parent Company: General Dynamics Corp (UEI: 001381284)

Address: 1201 M ST SE 400, WASHINGTON, DC, 20003

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: N0002401D7017

IDV Type: IDC

Timeline