DOT's $13.16M OpenShift contract to GDIT shows strong competition and potential for cost savings

Contract Overview

Contract Amount: $13,164,480 ($13.2M)

Contractor: General Dynamics Information Technology, Inc.

Awarding Agency: Department of Transportation

Start Date: 2019-07-15

End Date: 2026-08-31

Contract Duration: 2,604 days

Daily Burn Rate: $5.1K/day

Competition Type: FULL AND OPEN COMPETITION

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: FCS TAG 0067 - ADE OPENSHIFT

Place of Performance

Location: HANOVER, ANNE ARUNDEL County, MARYLAND, 21076

State: Maryland Government Spending

Plain-Language Summary

Department of Transportation obligated $13.2 million to GENERAL DYNAMICS INFORMATION TECHNOLOGY, INC. for work described as: FCS TAG 0067 - ADE OPENSHIFT Key points: 1. Value for money appears favorable given the firm-fixed-price structure and competitive award. 2. Strong competition was present, suggesting effective price discovery and potential for taxpayer savings. 3. Risk indicators are low due to a firm-fixed-price contract and established vendor. 4. Performance context is within IT infrastructure services, a critical area for agency operations. 5. Sector positioning is within IT services, specifically cloud and data processing infrastructure. 6. The contract duration of over 6 years suggests a long-term need for these services.

Value Assessment

Rating: good

The firm-fixed-price contract structure provides cost certainty. While specific benchmarking data is limited without more granular service details, the competitive award process suggests a reasonable price was achieved. Comparing this to similar cloud infrastructure contracts would be beneficial, but the overall structure indicates a good value proposition for the government.

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 offers. This level of competition is ideal for ensuring the government receives the best possible pricing and services. The specific number of bidders is not provided, but the 'full and open' designation implies a robust bidding environment.

Taxpayer Impact: Full and open competition generally leads to lower prices for taxpayers by fostering a competitive marketplace where vendors vie for the contract based on price and quality.

Public Impact

The Federal Aviation Administration (FAA) benefits from reliable computing infrastructure. Services delivered include computing infrastructure, data processing, and web hosting. The geographic impact is primarily within the agency's operational centers, likely nationwide. Workforce implications are minimal for direct government staff, with the vendor managing infrastructure.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Positive Signals

Awarded under full and open competition.
Firm-fixed-price contract type provides cost certainty.
Long contract duration suggests a stable, ongoing need.
Vendor is a large, established IT services provider.

Sector Analysis

This contract falls within the IT services sector, specifically focusing on cloud computing and data processing infrastructure. The market for these services is highly competitive and rapidly evolving. Comparable spending benchmarks would involve looking at other government agencies' procurements for similar cloud hosting and managed services, which often run into millions of dollars annually.

Small Business Impact

There is no indication of a small business set-aside for this contract, nor are there specific subcontracting requirements mentioned. As a large contract awarded to a major IT provider, the primary focus is on the prime contractor's capabilities. This may limit direct opportunities for small businesses unless they are part of the prime contractor's supply chain.

Oversight & Accountability

Oversight is typically managed by the contracting officer's representative (COR) within the FAA, who monitors performance and ensures compliance with contract terms. Accountability measures are embedded in the firm-fixed-price structure, incentivizing the contractor to meet performance standards to receive payment. Transparency is facilitated through contract award databases, though detailed performance metrics are often internal.

Related Government Programs

Cloud Computing Services
Data Center Services
IT Infrastructure Management
Managed IT Services
Federal Aviation Administration IT Modernization

Risk Flags

Long contract duration may increase risk of vendor lock-in.
Lack of specific performance metrics makes value assessment challenging.
Potential for cost overruns if scope significantly changes.

Frequently Asked Questions

What is this federal contract paying for?

Department of Transportation awarded $13.2 million to GENERAL DYNAMICS INFORMATION TECHNOLOGY, INC.. FCS TAG 0067 - ADE OPENSHIFT

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 Transportation (Federal Aviation Administration).

What is the total obligated amount?

The obligated amount is $13.2 million.

What is the period of performance?

Start: 2019-07-15. End: 2026-08-31.

What is the track record of General Dynamics Information Technology, Inc. with the Department of Transportation and similar cloud infrastructure contracts?

General Dynamics Information Technology, Inc. (GDIT) is a major federal IT contractor with a significant history of serving various government agencies, including the Department of Transportation (DOT). They have extensive experience in providing a wide range of IT services, including cloud computing, data processing, and infrastructure management. While specific details on past DOT contracts for OpenShift or similar platforms are not provided here, GDIT's overall profile suggests a strong capability in managing complex IT environments. Their track record generally indicates a capacity to deliver on large-scale, mission-critical IT projects, often involving firm-fixed-price arrangements. Further analysis would require examining their performance history on specific, comparable contracts within the DOT or other agencies to assess reliability and past success rates in delivering similar services.

How does the awarded price compare to market rates for similar cloud infrastructure and data processing services?

The total contract value of approximately $13.16 million over its duration (July 2019 to August 2026) translates to an average annual value of roughly $1.88 million. Benchmarking this against market rates for cloud infrastructure, data processing, and web hosting services requires detailed understanding of the specific service levels, capacity, and support included. However, given that this was awarded under full and open competition to a large provider like GDIT, it suggests the pricing is likely competitive within the federal IT landscape. Without specific metrics on compute, storage, bandwidth, and support tiers, a precise comparison is difficult. Generally, government contracts for such services can be cost-effective due to bulk purchasing power and competitive bidding, but they can also sometimes exceed commercial rates depending on customization and support requirements.

What are the primary risks associated with this contract, and how are they mitigated?

The primary risks associated with this contract are related to performance, security, and vendor lock-in. Performance risk involves the possibility that GDIT may not deliver the expected level of service, leading to disruptions in FAA operations. This is mitigated by the firm-fixed-price contract, which incentivizes GDIT to meet performance standards to ensure payment, and by the FAA's oversight mechanisms (e.g., COR). Security risk pertains to protecting sensitive government data hosted on the OpenShift platform. Mitigation involves adherence to stringent government security protocols (e.g., FedRAMP, NIST standards) and GDIT's own cybersecurity practices. Vendor lock-in is a potential risk with specialized platforms like OpenShift, where switching providers could be complex and costly. This is mitigated by ensuring clear data portability clauses and exit strategies are considered during contract planning, though the long-term nature of the contract implies a strategic commitment.

How effective is the 'full and open competition' approach in ensuring value for money for this specific contract?

The 'full and open competition' approach is generally considered the most effective method for ensuring value for money in government contracting. For this contract, it means that multiple vendors had the opportunity to bid, creating a competitive environment that pressures bidders to offer their best pricing and technical solutions. This process helps the FAA identify the most cost-effective option that meets their requirements. The fact that the contract was awarded suggests that the competition yielded a satisfactory outcome. However, the true measure of effectiveness also depends on the number of bids received and the specific evaluation criteria used. A robust competition with several qualified bidders typically leads to better price discovery and taxpayer savings compared to sole-source or limited competition scenarios.

What are the historical spending patterns for similar IT infrastructure services within the Federal Aviation Administration?

Historical spending patterns for IT infrastructure services within the FAA have generally shown a consistent and significant investment in maintaining and modernizing its technological backbone. Agencies like the FAA rely heavily on robust IT systems for air traffic control, data management, and operational support, necessitating substantial budgets for hardware, software, cloud services, and related support. Over the years, there has been a trend across the federal government, including the FAA, to shift towards cloud-based solutions to enhance scalability, flexibility, and cost-efficiency compared to traditional on-premises data centers. This contract for OpenShift services aligns with that broader trend. Analyzing FAA's past five to ten years of IT spending would reveal increasing allocations towards cloud services and managed IT infrastructure, reflecting evolving technological needs and procurement strategies.

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: IT AND TELECOM - INFORMATION TECHNOLOGY AND TELECOMMUNICATIONS › ADP AND TELECOMMUNICATIONS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: General Dynamics Corp

Address: 3150 FAIRVIEW PARK DR STE 100, 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: $13,164,480

Exercised Options: $13,164,480

Current Obligation: $13,164,480

Actual Outlays: $12,024,952

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: DTFACT15D00003

IDV Type: IDC

Timeline