HHS awards $18.4M for logistics management, raising concerns over non-competitive contract
Contract Overview
Contract Amount: $18,420,324 ($18.4M)
Contractor: General Dynamics Information Technology, Inc.
Awarding Agency: Department of Health and Human Services
Start Date: 2008-02-19
End Date: 2013-08-25
Contract Duration: 2,014 days
Daily Burn Rate: $9.1K/day
Competition Type: NON-COMPETITIVE DELIVERY ORDER
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: Healthcare
Official Description: TAS::75 4554::TAS- INVENTORY SERVICES. OPERATIONS/ADMINISTRATIVE MANAGEMENT LOGISTICS MANAGEMENT&SUPPORT SERVICES.
Place of Performance
Location: FAIRFAX, FAIRFAX County, VIRGINIA, 22030
State: Virginia Government Spending
Plain-Language Summary
Department of Health and Human Services obligated $18.4 million to GENERAL DYNAMICS INFORMATION TECHNOLOGY, INC. for work described as: TAS::75 4554::TAS- INVENTORY SERVICES. OPERATIONS/ADMINISTRATIVE MANAGEMENT LOGISTICS MANAGEMENT&SUPPORT SERVICES. Key points: 1. Significant contract value ($18.4M) for logistics and inventory services. 2. Sole-source award to General Dynamics Information Technology, limiting competition. 3. Long contract duration (5 years) with potential for price escalation. 4. Sector: Healthcare administrative support services.
Value Assessment
Rating: questionable
The contract's fixed price structure is standard, but the lack of competition makes a true value assessment difficult. Without competitive bids, it's hard to determine if $18.4M represents a fair market price for these services.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This was a non-competitive delivery order, meaning only one vendor was considered. This significantly limits price discovery and potentially leads to higher costs for taxpayers compared to an open competition.
Taxpayer Impact: The lack of competition in this sole-source award means taxpayers may have paid a premium for these logistics management services.
Public Impact
Taxpayers may have overpaid due to the absence of competitive bidding. Potential for reduced service quality or innovation without market pressure. Government reliance on a single contractor for critical logistics functions.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Long contract duration
- Lack of transparency in pricing
Positive Signals
- Established contractor with experience
Sector Analysis
This contract falls within the healthcare administrative and support services sector, specifically focusing on logistics and inventory management. Benchmarks for similar services are difficult to establish due to the sole-source nature of this award.
Small Business Impact
The data indicates no specific set-aside for small businesses. The award went to a large corporation, General Dynamics Information Technology, Inc., suggesting limited direct benefit to small businesses in this particular contract.
Oversight & Accountability
The non-competitive nature of this award warrants closer oversight to ensure the government received fair value. Accountability for the justification of a sole-source award should be rigorously examined.
Related Government Programs
- Process, Physical Distribution, and Logistics Consulting Services
- Department of Health and Human Services Contracting
- National Institutes of Health Programs
Risk Flags
- Sole-source award limits competition and price discovery.
- Potential for inflated costs due to lack of competitive pressure.
- Long contract duration may not reflect evolving needs or technology.
- Limited transparency on the justification for sole-sourcing.
- No clear indication of small business participation.
Tags
process-physical-distribution-and-logist, department-of-health-and-human-services, va, delivery-order, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Health and Human Services awarded $18.4 million to GENERAL DYNAMICS INFORMATION TECHNOLOGY, INC.. TAS::75 4554::TAS- INVENTORY SERVICES. OPERATIONS/ADMINISTRATIVE MANAGEMENT LOGISTICS MANAGEMENT&SUPPORT 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 Health and Human Services (National Institutes of Health).
What is the total obligated amount?
The obligated amount is $18.4 million.
What is the period of performance?
Start: 2008-02-19. End: 2013-08-25.
What was the justification for awarding this contract on a sole-source basis?
The justification for a sole-source award typically involves situations where only one responsible source can provide the required supplies or services. This could be due to unique capabilities, urgent needs, or specific technical requirements. Without the detailed justification document, it's impossible to confirm the specific reasons, but it's a critical area for oversight.
How does the $18.4M cost compare to similar logistics contracts awarded competitively?
Direct comparison is challenging due to the sole-source nature of this contract. However, a review of competitively awarded contracts for similar logistics and inventory management services within the federal government or private sector could provide a benchmark. If this contract's per-unit costs or overall price significantly exceed competitive benchmarks, it indicates potential overpayment.
What measures were in place to ensure effective service delivery despite the lack of competition?
Even in sole-source contracts, robust performance metrics, clear deliverables, and regular progress reviews are essential. The government should have established key performance indicators (KPIs) and a strong contract management team to monitor General Dynamics' performance. The effectiveness of these measures would be evident in the quality and timeliness of the logistics services provided.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Management, Scientific, and Technical Consulting Services › Process, Physical Distribution, and Logistics Consulting Services
Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › PROFESSIONAL SERVICES
Competition & Pricing
Extent Competed: NON-COMPETITIVE DELIVERY ORDER
Solicitation Procedures: SIMPLIFIED ACQUISITION
Offers Received: 1
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: General Dynamics Corp (UEI: 001381284)
Address: 3211 JERMANTOWN RD # 700, FAIRFAX, VA, 22030
Business Categories: Category Business, Not Designated a Small Business
Financial Breakdown
Contract Ceiling: $18,420,324
Exercised Options: $18,420,324
Current Obligation: $18,420,324
Contract Characteristics
Commercial Item: COMMERCIAL ITEM
Parent Contract
Parent Award PIID: GS10F0382K
IDV Type: FSS
Timeline
Start Date: 2008-02-19
Current End Date: 2013-08-25
Potential End Date: 2013-08-31 00:00:00
Last Modified: 2018-06-14
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