VA awards $237.8M for file conversion, with General Dynamics IT leading the effort

Contract Overview

Contract Amount: $237,870,201 ($237.9M)

Contractor: General Dynamics Information Technology, Inc.

Awarding Agency: Department of Veterans Affairs

Start Date: 2024-05-15

End Date: 2027-01-15

Contract Duration: 975 days

Daily Burn Rate: $244.0K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: FILE CONVERSION SERVICES

Place of Performance

Location: FALLS CHURCH, FAIRFAX County, VIRGINIA, 22042

State: Virginia Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $237.9 million to GENERAL DYNAMICS INFORMATION TECHNOLOGY, INC. for work described as: FILE CONVERSION SERVICES Key points: 1. Contract value represents a significant investment in digital transformation for the VA. 2. Competition dynamics suggest a robust market for IT infrastructure and data processing services. 3. Performance period spans over two years, indicating a need for sustained service delivery. 4. The contract is positioned within the broader IT services sector, focusing on data management. 5. Fixed-price contract type aims to control costs and provide budget certainty.

Value Assessment

Rating: good

The contract value of $237.8 million for file conversion services appears reasonable given the scope and duration. Benchmarking against similar large-scale data management and IT infrastructure contracts within federal agencies suggests this pricing is within expected ranges. The firm fixed-price structure provides cost predictability for the VA, although it places the risk of cost overruns on the contractor. Further analysis would involve comparing the specific services and deliverables to market rates for comparable IT services.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that multiple vendors had the opportunity to bid. The presence of two bids suggests a competitive environment, though the exact number of bidders can influence price discovery. A higher number of bidders typically leads to more competitive pricing for the government. The VA's approach to full and open competition is generally favorable for ensuring fair market value.

Taxpayer Impact: Taxpayers benefit from the competitive bidding process, which is designed to secure the best possible price and quality for the services rendered. Full and open competition helps prevent inflated costs and ensures that public funds are used efficiently.

Public Impact

Veterans will benefit from improved access to their records through efficient digital conversion. The contract ensures the delivery of essential file conversion and data processing services for the VA. Services are likely to have a nationwide impact, supporting VA operations across all facilities. The contract may support IT professionals and data management specialists within the contractor's workforce.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for vendor lock-in if transition planning is inadequate.
Dependence on a single contractor for critical data infrastructure.
Risk of scope creep if requirements are not clearly defined and managed.

Positive Signals

Firm fixed-price contract provides cost certainty.
Full and open competition suggests a competitive market.
Long-term contract allows for sustained service delivery and potential for efficiency gains.

Sector Analysis

This contract falls within the broader IT services sector, specifically focusing on data processing and infrastructure. The market for these services is large and highly competitive, with numerous federal and commercial entities seeking solutions for digital transformation and data management. Comparable spending benchmarks for large-scale data migration and IT hosting services often run into hundreds of millions of dollars, making this contract size typical for significant government IT modernization efforts.

Small Business Impact

The data indicates 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 prime contractor. The absence of specific small business set-aside provisions means that opportunities for small businesses may be limited to potential subcontracting roles, the extent of which is not detailed in this award summary. Further investigation into subcontracting plans would be needed to assess the impact on the small business ecosystem.

Oversight & Accountability

Oversight for this contract will likely be managed by the Department of Veterans Affairs contracting officers and program managers. Accountability measures are embedded within the firm fixed-price contract terms, requiring the contractor to meet defined deliverables and performance standards. Transparency is facilitated through federal procurement databases where contract awards are published. Inspector General jurisdiction may apply if issues of fraud, waste, or abuse arise.

Related Government Programs

VA Electronic Health Record Modernization
Federal Data Center Consolidation Initiative
IT Infrastructure Modernization Programs
Digital Services Transformation

Risk Flags

Data integrity during conversion
Cybersecurity of sensitive veteran data
Potential for technical obsolescence
Contractor performance and delivery timelines
Vendor lock-in risk

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $237.9 million to GENERAL DYNAMICS INFORMATION TECHNOLOGY, INC.. FILE CONVERSION SERVICES

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 Veterans Affairs (Department of Veterans Affairs).

What is the total obligated amount?

The obligated amount is $237.9 million.

What is the period of performance?

Start: 2024-05-15. End: 2027-01-15.

What is the track record of General Dynamics Information Technology, Inc. with similar large-scale data conversion and IT infrastructure contracts for federal agencies?

General Dynamics Information Technology, Inc. (GDIT) has a substantial track record with federal agencies, including the Department of Veterans Affairs, for providing a wide range of IT services. They have been involved in large-scale projects related to electronic health records, cloud migration, cybersecurity, and data management. For instance, GDIT has held significant contracts with the Department of Defense and other civilian agencies for IT modernization and support. Their experience in handling complex data conversion and infrastructure projects suggests a capability to manage the scope and technical requirements of this VA contract. However, specific performance metrics and past issues on similar contracts would require a deeper dive into contract performance reports and agency evaluations.

How does the awarded amount of $237.8 million compare to the estimated value or previous spending on file conversion services by the VA?

Without specific historical data on VA's prior spending solely on file conversion services, a direct comparison is challenging. However, the $237.8 million award over approximately 2.5 years (from May 2024 to January 2027) suggests an average annual spend of roughly $95 million. This figure should be contextualized within the VA's overall IT budget, which is substantial, often in the billions of dollars annually. Large-scale digital transformation initiatives, including data migration and conversion, are typically multi-year, high-value endeavors. If this contract represents a consolidation or a new phase of a larger digital records initiative, the amount could be consistent with market trends for such critical infrastructure projects. A more precise comparison would require identifying predecessor contracts or specific line items for file conversion in past VA IT budgets.

What are the primary risks associated with a contract of this magnitude and duration for file conversion services?

Several risks are associated with a contract of this magnitude and duration. Data integrity and security are paramount; any errors or breaches during conversion could have severe consequences for veteran records. Technical obsolescence is another risk, as file formats and conversion technologies can evolve rapidly over the contract period, potentially requiring costly updates or workarounds. Performance risk exists if the contractor fails to meet service level agreements or deadlines, impacting the VA's operational efficiency. Furthermore, vendor lock-in can become a concern, making future transitions to different providers or technologies difficult and expensive. Finally, the sheer size of the contract increases the financial exposure for both the government and the contractor, making cost overruns or contractor financial instability significant risks.

What is the expected impact of this contract on the VA's ability to access and manage veteran data effectively?

This contract is expected to significantly enhance the VA's ability to access and manage veteran data effectively. By converting legacy files into modern, standardized digital formats, the VA can improve data accessibility, reduce storage costs associated with physical records, and streamline data retrieval processes. This modernization is crucial for supporting various VA initiatives, including healthcare delivery, benefits administration, and research. Improved data management can lead to better-informed decision-making, faster service provision to veterans, and a more integrated view of veteran information across different VA systems. Ultimately, it contributes to the VA's broader goal of providing seamless and efficient services to its beneficiaries.

How does the 'full and open competition' award type influence the potential for cost savings and innovation compared to other contracting methods?

Awarding a contract through 'full and open competition' generally maximizes the potential for cost savings and innovation. By allowing all responsible sources to submit bids, the government broadens the pool of potential offerors, increasing the likelihood of receiving competitive pricing. This competitive pressure incentivizes bidders to propose efficient solutions and cost-effective approaches to meet the government's requirements. Furthermore, a diverse range of bidders can bring varied perspectives and innovative technologies to the table, potentially leading to more advanced or efficient service delivery methods than might be achieved through sole-source or limited competition. The VA's choice of this method suggests a priority on achieving best value through market forces.

Industry Classification

NAICS: Information › Computing Infrastructure Providers, Data Processing, Web Hosting, and Related Services › Computing Infrastructure Providers, Data Processing, Web Hosting, and Related 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

Offers Received: 2

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: General Dynamics Corp

Address: 3150 FAIRVIEW PARK DR, FALLS CHURCH, VA, 22042

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

Financial Breakdown

Contract Ceiling: $356,877,183

Exercised Options: $237,870,201

Current Obligation: $237,870,201

Actual Outlays: $117,274,138

Subaward Activity

Number of Subawards: 19

Total Subaward Amount: $319,908,570

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: 36C10E19D0015

IDV Type: IDC

Timeline