HHS awards $103M for enterprise application development, with General Dynamics IT leading

Contract Overview

Contract Amount: $103,170,147 ($103.2M)

Contractor: General Dynamics Information Technology, Inc.

Awarding Agency: Department of Health and Human Services

Start Date: 2016-09-14

End Date: 2020-07-02

Contract Duration: 1,387 days

Daily Burn Rate: $74.4K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: IGF::OT::IGF DOJ/OJP ENTERPRISE APPLICATION DEVELOPMENT

Place of Performance

Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20001

State: District of Columbia Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $103.2 million to GENERAL DYNAMICS INFORMATION TECHNOLOGY, INC. for work described as: IGF::OT::IGF DOJ/OJP ENTERPRISE APPLICATION DEVELOPMENT Key points: 1. Value for money appears fair given the scope of enterprise application development. 2. Competition was robust, suggesting potential for competitive pricing. 3. Risk indicators are moderate, typical for large-scale IT development projects. 4. Performance context is tied to NIH's need for robust application infrastructure. 5. Sector positioning is within the IT services domain, specifically application development.

Value Assessment

Rating: fair

The contract value of $103 million over approximately 3.8 years for enterprise application development is within a reasonable range for a project of this scale. Benchmarking against similar large-scale IT development contracts suggests that the overall price is competitive, though specific per-unit costs for services rendered would require more granular data. The firm-fixed-price structure provides cost certainty for the government.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit offers. The data shows 2 bids were received, which is a moderate level of competition for a contract of this size. While more bidders could potentially drive prices lower, two bids suggest that the opportunity was attractive enough to elicit interest from qualified vendors.

Taxpayer Impact: A full and open competition, even with two bidders, generally provides a better opportunity for price discovery and ensures taxpayers are not overpaying due to a lack of market engagement.

Public Impact

The primary beneficiaries are the National Institutes of Health (NIH) and its researchers, who will gain access to improved enterprise applications. Services delivered include computer systems design and related services for application development. The geographic impact is primarily within the District of Columbia, where NIH is located. Workforce implications include the employment of IT professionals by General Dynamics Information Technology to fulfill the contract.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for scope creep in large enterprise application development projects.
Dependence on a single contractor for critical enterprise systems.
Ensuring adequate knowledge transfer and documentation for future maintenance.

Positive Signals

Firm-fixed-price contract provides cost predictability.
Full and open competition suggests a competitive bidding process.
General Dynamics Information Technology is a large, established IT services provider.

Sector Analysis

This contract falls within the IT services sector, specifically focusing on computer systems design and application development. The market for enterprise application development is substantial, driven by government and commercial entities seeking to modernize their IT infrastructure and improve operational efficiency. Comparable spending benchmarks for large-scale federal IT development projects often run into tens or hundreds of millions of dollars, depending on the complexity and duration.

Small Business Impact

The data indicates that this contract was not set aside for small businesses, nor does it appear to have specific subcontracting requirements for small businesses mentioned. This means that the primary award went to a large business, and the direct impact on the small business ecosystem is likely minimal unless General Dynamics Information Technology voluntarily engages small businesses as subcontractors.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and program managers within the National Institutes of Health. Accountability measures are embedded in the firm-fixed-price contract terms, requiring delivery of specified services. Transparency is generally maintained through contract award databases, though detailed performance metrics are often internal.

Related Government Programs

NIH IT Modernization Programs
Federal Enterprise Architecture Initiatives
Health IT Development Contracts
General Services Administration (GSA) IT Schedule Contracts

Risk Flags

Potential for cost overruns if scope is not tightly managed.
Risk of vendor lock-in for critical enterprise systems.
Ensuring alignment with evolving technological standards and agency needs.

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $103.2 million to GENERAL DYNAMICS INFORMATION TECHNOLOGY, INC.. IGF::OT::IGF DOJ/OJP ENTERPRISE APPLICATION DEVELOPMENT

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 $103.2 million.

What is the period of performance?

Start: 2016-09-14. End: 2020-07-02.

What is the track record of General Dynamics Information Technology (GDIT) in delivering large-scale federal IT development projects?

General Dynamics Information Technology (GDIT) has a long and extensive track record of delivering complex IT solutions and services to various U.S. federal agencies. They are a major government contractor with significant experience in areas such as cloud computing, cybersecurity, data analytics, and application development. GDIT has been involved in numerous large-scale enterprise IT projects, including those for the Department of Defense, Department of Veterans Affairs, and civilian agencies like HHS. Their history includes both successful large-scale implementations and, like many large contractors, occasional challenges or controversies related to project execution, cost overruns, or performance issues on specific contracts. However, their overall presence and continued awards suggest a generally accepted capability to handle substantial federal IT requirements.

How does the $103 million contract value compare to similar enterprise application development contracts awarded by NIH or other agencies?

The $103 million contract value for enterprise application development over approximately 3.8 years is substantial but not unusual for large federal IT projects. NIH, as a major research institution, requires significant IT infrastructure and application support. Comparing this to other large federal IT development contracts, such as those for electronic health records modernization, large data management systems, or agency-wide application suites, reveals that this figure is within the expected range. For instance, similar contracts for developing or modernizing core enterprise resource planning (ERP) systems or large-scale data analytics platforms can easily reach or exceed this amount. The firm-fixed-price nature also suggests a defined scope, which helps in cost management compared to cost-plus contracts.

What are the primary risks associated with a contract of this nature and value?

The primary risks associated with a $103 million enterprise application development contract include technical risks (e.g., integration challenges with existing systems, unforeseen technical complexities, cybersecurity vulnerabilities), schedule risks (e.g., project delays due to scope changes, resource constraints, or vendor performance issues), and cost risks (though mitigated by FFP, scope creep can still impact overall value). There's also a risk of vendor lock-in, dependence on a single provider for critical systems, and potential challenges in knowledge transfer if the contractor's personnel turnover is high. Ensuring the developed applications meet evolving user needs and regulatory requirements throughout the project lifecycle is also a significant risk.

How effective is the firm-fixed-price (FFP) contract type in managing costs for complex IT development?

The firm-fixed-price (FFP) contract type is generally considered effective for managing costs in IT development when the scope of work is well-defined and unlikely to change significantly. It shifts the risk of cost overruns to the contractor, providing the government with cost certainty. For this $103 million contract, FFP incentivizes GDIT to control costs and manage resources efficiently to maximize profit. However, if unforeseen technical challenges arise or the government requires significant changes to the scope, the FFP structure can sometimes lead to disputes or requests for contract modifications, potentially increasing the overall cost or leading to schedule delays if not managed carefully. Clear initial requirements and robust change control processes are crucial for FFP success in development projects.

What is the historical spending pattern for similar computer systems design services at NIH?

Historical spending patterns for computer systems design services at NIH, and indeed across the federal government, show a consistent and significant investment in IT infrastructure and application development. Agencies like NIH rely heavily on sophisticated IT systems to manage research data, facilitate collaboration, and support administrative functions. Spending in this category typically fluctuates based on major modernization initiatives, new research demands, or the lifecycle of existing systems. While specific historical figures for NIH's computer systems design services would require detailed analysis of past contract awards, it's evident that such services represent a substantial portion of agency IT budgets, often awarded through large, multi-year contracts to major IT service providers.

Industry Classification

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

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

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: NIHJT2010001

Offers Received: 2

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: General Dynamics Corp (UEI: 001381284)

Address: 15036 CONFERENCE CENTER DR, CHANTILLY, VA, 20151

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

Financial Breakdown

Contract Ceiling: $112,162,511

Exercised Options: $103,170,147

Current Obligation: $103,170,147

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Parent Contract

Parent Award PIID: HHSN316201200050W

IDV Type: GWAC

Timeline