FAA's $124M FAVES Contract with General Dynamics Faces Scrutiny Over Value and Competition

Contract Overview

Contract Amount: $123,931,670 ($123.9M)

Contractor: General Dynamics Information Technology, Inc.

Awarding Agency: Department of Transportation

Start Date: 2010-05-28

End Date: 2026-10-31

Contract Duration: 6,000 days

Daily Burn Rate: $20.7K/day

Competition Type: FULL AND OPEN COMPETITION

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: FAA ADMINISTRATIVE VOICE ENTERPRISE SERVICES (FAVES)

Place of Performance

Location: FALLS CHURCH, FAIRFAX County, VIRGINIA, 22042

State: Virginia Government Spending

Plain-Language Summary

Department of Transportation obligated $123.9 million to GENERAL DYNAMICS INFORMATION TECHNOLOGY, INC. for work described as: FAA ADMINISTRATIVE VOICE ENTERPRISE SERVICES (FAVES) Key points: 1. The contract's significant value raises questions about cost-effectiveness for communication equipment repair. 2. General Dynamics holds the contract, but the level of competition needs further examination. 3. Potential risks include vendor lock-in and the long duration impacting adaptability. 4. The IT services sector is highly competitive, suggesting potential for better pricing.

Value Assessment

Rating: fair

The $124 million contract value over its extended period suggests a substantial investment. Benchmarking against similar communication equipment repair and maintenance contracts is crucial to determine if the pricing is competitive and reflects fair market value.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, which is positive for price discovery. However, the specific details of the bidding process and the number of bidders are needed to fully assess the competitive landscape and its impact on the final price.

Taxpayer Impact: While competition was sought, the long-term nature and potential for follow-on work warrant ongoing scrutiny to ensure taxpayer funds are used efficiently.

Public Impact

Impacts FAA's ability to maintain critical communication systems. Affects operational efficiency and safety of air traffic control. Potential for cost savings or overspending directly impacts federal budget.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Long contract duration (10+ years)
Lack of specific performance metrics in provided data
Potential for scope creep over time

Positive Signals

Awarded under full and open competition
Firm Fixed Price contract type limits cost overruns

Sector Analysis

This contract falls within the IT services sector, specifically focusing on communication equipment repair and maintenance. Spending benchmarks in this area vary widely based on technology complexity and service level agreements, but large, long-term contracts require careful justification.

Small Business Impact

The provided data does not indicate any specific set-asides for small businesses. Analysis should determine if opportunities were missed for small business participation in this significant IT services contract.

Oversight & Accountability

Oversight is critical given the contract's duration and value. The FAA must ensure robust performance monitoring and regular reviews to maintain accountability and ensure the contractor meets all obligations.

Related Government Programs

Communication Equipment Repair and Maintenance
Department of Transportation Contracting
Federal Aviation Administration Programs

Risk Flags

Long contract duration may lead to technological obsolescence.
Potential for vendor lock-in despite initial competition.
Lack of specific performance metrics in summary data.
Extended period requires continuous oversight for value realization.

Frequently Asked Questions

What is this federal contract paying for?

Department of Transportation awarded $123.9 million to GENERAL DYNAMICS INFORMATION TECHNOLOGY, INC.. FAA ADMINISTRATIVE VOICE ENTERPRISE SERVICES (FAVES)

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 $123.9 million.

What is the period of performance?

Start: 2010-05-28. End: 2026-10-31.

What specific performance metrics are in place to ensure the value derived from this $124M contract aligns with the FAA's operational needs and budget?

Detailed performance metrics are essential for evaluating the value of the FAVES contract. These should include response times for repairs, equipment uptime percentages, and adherence to service level agreements. Without these, it's difficult to ascertain if the significant investment is yielding optimal results for the FAA's communication infrastructure.

Given the full and open competition, what was the competitive landscape like, and how did it influence the final pricing structure for General Dynamics?

While the contract was awarded under full and open competition, understanding the number of bids received and the evaluation criteria is key. A robust competitive process should drive down prices. If only a few bids were received, or if the evaluation heavily favored specific technical approaches, the price might not reflect the most cost-effective solution available in the market.

How does the long duration of this contract (potentially 10+ years) impact the FAA's ability to adopt newer communication technologies and maintain cost-effectiveness?

Long-term contracts can pose a risk of technological obsolescence and hinder agility. The FAA must have mechanisms within the contract to incorporate technological advancements and potentially re-evaluate pricing if the scope or technology significantly changes. This ensures the contract remains effective and cost-efficient throughout its extended term, rather than locking the agency into outdated solutions.

Industry Classification

NAICS: Other Services (except Public Administration) › Electronic and Precision Equipment Repair and Maintenance › Communication Equipment Repair and Maintenance

Product/Service Code: UTILITIES AND HOUSEKEEPING › UTILITIES

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: $123,931,670

Exercised Options: $123,931,670

Current Obligation: $123,931,670

Actual Outlays: $39,032,986

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: DTFAWA10D00003

IDV Type: IDC

Timeline