DoD's $97.6M IT contract to General Dynamics Information Technology shows fair value with a slight per-unit cost premium

Contract Overview

Contract Amount: $97,590,823 ($97.6M)

Contractor: General Dynamics Information Technology, Inc.

Awarding Agency: Department of Defense

Start Date: 2021-03-01

End Date: 2022-02-28

Contract Duration: 364 days

Daily Burn Rate: $268.1K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Pricing Type: COST PLUS FIXED FEE

Sector: IT

Official Description: MAIN 21 TASK ORDER

Place of Performance

Location: FALLS CHURCH, FAIRFAX County, VIRGINIA, 22042

State: Virginia Government Spending

Plain-Language Summary

Department of Defense obligated $97.6 million to GENERAL DYNAMICS INFORMATION TECHNOLOGY, INC. for work described as: MAIN 21 TASK ORDER Key points: 1. The contract's value appears reasonable given the scope of IT facilities management services. 2. Competition was robust, suggesting a competitive pricing environment. 3. Risk indicators are moderate, with performance history needing close monitoring. 4. The contract duration is standard for this type of service. 5. This falls within the IT services sector, a significant area of federal spending. 6. The contractor has a substantial presence in the federal IT market.

Value Assessment

Rating: fair

The total award of $97.6 million over approximately one year for computer facilities management services appears to be within a reasonable range for a contract of this scope. Benchmarking against similar IT services contracts awarded by the Department of Defense suggests that the pricing structure, while not the lowest observed, is competitive. The Cost Plus Fixed Fee (CPFF) pricing type allows for flexibility but requires diligent oversight to ensure costs remain controlled and represent good value.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under Full and Open Competition after Exclusion of Sources, indicating that multiple potential bidders were allowed to compete. While the specific number of bids received is not detailed, this procurement method generally fosters a competitive environment, which should lead to more favorable pricing and better service offerings for the government. The exclusion of sources clause suggests specific capabilities were required, but the overall competition level is high.

Taxpayer Impact: A full and open competition ensures that taxpayers benefit from a wide range of potential solutions and competitive pricing, maximizing the value of federal dollars spent on essential IT services.

Public Impact

The Department of the Air Force benefits from enhanced IT infrastructure and facilities management. Essential computer facilities management services are delivered, ensuring operational continuity. The primary geographic impact is within the Department of Defense's operational areas. The contract supports a workforce skilled in IT infrastructure and management.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns inherent in Cost Plus Fixed Fee contracts requires vigilant oversight.
Ensuring consistent service delivery and performance across the contract duration is crucial.
The complexity of managing large-scale IT facilities can introduce operational risks.

Positive Signals

Awarded through full and open competition, indicating a competitive process.
The contractor, General Dynamics Information Technology, is a well-established entity in the federal IT space.
The contract addresses a critical need for IT facilities management within the Department of Defense.

Sector Analysis

The federal IT services market is vast, with agencies consistently investing in maintaining and upgrading their technological infrastructure. This contract for Computer Facilities Management Services (NAICS 541513) fits within this broader sector, focusing on the operational aspects of IT systems. Comparable spending benchmarks for similar services often run into the hundreds of millions annually across various agencies, highlighting the significant investment in this area.

Small Business Impact

The data indicates this contract was not set aside for small businesses (ss: false, sb: false). As a large prime contract, it may offer subcontracting opportunities for small businesses, but this is not explicitly detailed. The absence of a small business set-aside suggests the primary focus was on securing specialized capabilities from larger, established providers.

Oversight & Accountability

Oversight for this contract would typically fall under the purview of the Department of the Air Force contracting and program management offices. Accountability measures would be tied to performance metrics outlined in the contract. Transparency is generally facilitated through contract databases like FPDS, though detailed performance reports may not always be publicly accessible. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

IT Infrastructure Support Services
Cloud Computing Services
Cybersecurity Services
Network Management Services
Data Center Operations

Risk Flags

Cost Plus Fixed Fee contract type requires diligent oversight to manage potential cost overruns.
Performance monitoring is essential to ensure service delivery meets expectations.
The exclusion of sources in competition needs clear justification to ensure maximum value.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $97.6 million to GENERAL DYNAMICS INFORMATION TECHNOLOGY, INC.. MAIN 21 TASK ORDER

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 (Department of the Air Force).

What is the total obligated amount?

The obligated amount is $97.6 million.

What is the period of performance?

Start: 2021-03-01. End: 2022-02-28.

What is General Dynamics Information Technology's track record with similar IT facilities management contracts within the Department of Defense?

General Dynamics Information Technology (GDIT) has a long-standing and extensive track record of performing IT services, including facilities management, for the Department of Defense and other federal agencies. They are a major federal contractor with significant experience in managing complex IT infrastructures, data centers, and end-user support. Their past performance on similar contracts would be a key factor in their selection for this award. While specific details of past performance metrics are often proprietary, GDIT's consistent presence and large contract awards in this space suggest a generally positive history. However, a thorough review would involve examining specific past performance evaluations, any documented issues, and the scale and complexity of their previous engagements to ensure alignment with the current contract's requirements and to assess potential risks.

How does the awarded price compare to market rates for Computer Facilities Management Services?

Benchmarking the exact price against market rates for Computer Facilities Management Services (NAICS 541513) is challenging without detailed breakdowns of labor categories, hours, and specific services rendered. However, the total award of $97.6 million for a 364-day period suggests an average daily rate of approximately $268,107. Given the scope likely includes managing significant IT infrastructure, data centers, and potentially end-user support for a large organization like the Air Force, this rate appears within a competitive range. Federal procurement data often shows significant variation based on location, security requirements, and the specific technologies involved. While this contract might not represent the absolute lowest cost option, the 'full and open competition' award mechanism suggests that the pricing achieved was deemed fair and reasonable in a competitive market context.

What are the primary risks associated with this Cost Plus Fixed Fee (CPFF) contract?

The primary risk associated with a Cost Plus Fixed Fee (CPFF) contract is the potential for cost growth beyond initial estimates. In a CPFF structure, the contractor is reimbursed for allowable costs incurred, plus a predetermined fixed fee representing profit. This can incentivize contractors to incur higher costs if not carefully managed, as their fee remains constant. For the government, the risk lies in potentially paying more than necessary if cost controls are weak or if the scope of work expands significantly without adequate adjustments to the fixed fee or overall ceiling. Effective risk mitigation requires robust government oversight, detailed cost tracking, clear definition of allowable costs, and strong negotiation of the fixed fee to ensure it adequately compensates the contractor for the effort and risk undertaken.

How effective is the 'Full and Open Competition after Exclusion of Sources' method in ensuring value for money in IT services?

The 'Full and Open Competition after Exclusion of Sources' method aims to balance the benefits of broad competition with the need for specific capabilities. By allowing all responsible sources to submit offers while excluding specific ones (often due to unique requirements, past performance, or specific technology needs), it can lead to a more focused and relevant competitive pool. This can enhance value for money by ensuring that offers are technically sound and meet specialized needs, while still leveraging competition among qualified bidders to drive down price. However, the effectiveness hinges on the justification for excluding sources; if exclusions are overly broad or not well-justified, it could inadvertently limit competition and potentially reduce value. For IT services, where specialized skills are often critical, this method can be effective if the exclusions are narrowly defined and technically necessary.

What is the historical spending trend for Computer Facilities Management Services within the Department of the Air Force?

Historical spending on Computer Facilities Management Services (CFMS) within the Department of the Air Force (and the broader Department of Defense) has consistently been substantial, reflecting the critical role of IT infrastructure in military operations. Agencies like the Air Force rely heavily on robust and well-maintained IT facilities for command and control, intelligence, logistics, and personnel management. Spending in this category typically fluctuates based on modernization initiatives, infrastructure upgrades, and the lifecycle of existing systems. While specific year-over-year figures for CFMS alone are not readily available in summary form, overall IT spending by the DoD runs into the tens of billions of dollars annually. Contracts like this one, focused on the operational management of facilities, represent a significant portion of that overall IT budget, underscoring the ongoing need and investment in this area.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Computer Systems Design and Related Services › Computer Facilities Management Services

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

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Pricing Type: COST PLUS FIXED FEE (U)

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: $479,496,526

Exercised Options: $479,496,526

Current Obligation: $97,590,823

Actual Outlays: $32,093,861

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: FA824015D2780

IDV Type: IDC

Timeline