General Dynamics IT awarded $79.9M for IT services to HHS, highlighting a significant investment in IT infrastructure

Contract Overview

Contract Amount: $79,936,088 ($79.9M)

Contractor: General Dynamics Information Technology, Inc.

Awarding Agency: Department of Health and Human Services

Start Date: 2010-08-09

End Date: 2015-08-08

Contract Duration: 1,825 days

Daily Burn Rate: $43.8K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: TIME AND MATERIALS

Sector: IT

Official Description: FEDERAL PARENT LOCATER SERVICE, AWARDED THROUGH NIH NITAAC CIOSP2 CONTRACT TAS::75 1553::TAS

Place of Performance

Location: FAIRFAX, FAIRFAX County, VIRGINIA, 22033

State: Virginia Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $79.9 million to GENERAL DYNAMICS INFORMATION TECHNOLOGY, INC. for work described as: FEDERAL PARENT LOCATER SERVICE, AWARDED THROUGH NIH NITAAC CIOSP2 CONTRACT TAS::75 1553::TAS Key points: 1. The contract represents a substantial investment in IT services, indicating a need for robust technological support within the agency. 2. Competition dynamics suggest a full and open process, which typically fosters competitive pricing and broader market engagement. 3. The Time and Materials pricing model introduces potential cost escalation risks if not managed diligently. 4. Performance context is crucial, as the duration and value suggest a long-term, critical IT support role. 5. This contract positions General Dynamics Information Technology as a key IT service provider for the Department of Health and Human Services. 6. The award falls under the NIH NITAAC CIOSP2 contract, indicating a strategic sourcing approach for IT solutions.

Value Assessment

Rating: good

The award value of $79.9 million over five years for IT services is substantial. Benchmarking against similar large-scale IT support contracts within federal agencies suggests this is within a reasonable range, though specific service details are needed for precise comparison. The Time and Materials (T&M) pricing structure, while flexible, can lead to higher costs if not carefully managed and monitored for efficiency. Without detailed breakdowns of labor categories and rates, a definitive value-for-money assessment is challenging, but the competitive award process offers some assurance.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded through a full and open competition under the NIH NITAAC CIOSP2 contract vehicle. This indicates that multiple vendors were likely invited to bid, and the selection was based on a comprehensive evaluation of technical capabilities and price. The full and open nature of the competition is a positive indicator for price discovery and ensures a broad range of potential contractors had the opportunity to compete for this significant IT services requirement.

Taxpayer Impact: A full and open competition generally benefits taxpayers by driving down prices through robust market engagement and encouraging innovative solutions from a wider pool of vendors, leading to better value for public funds.

Public Impact

The primary beneficiaries are the various offices within the Department of Health and Human Services (HHS) that rely on IT infrastructure and services. The contract delivers essential IT support, including potentially network management, system maintenance, software development, and other computer-related services. The geographic impact is likely nationwide, supporting HHS operations across its various facilities and remote workforces. Workforce implications include the potential for job creation within General Dynamics Information Technology and its subcontractors, as well as ensuring federal employees have the necessary technological tools to perform their duties.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

The Time and Materials (T&M) contract type can lead to cost overruns if not closely monitored for scope creep and labor hour efficiency.
The long duration of the contract (5 years) necessitates ongoing vigilance to ensure continued relevance and cost-effectiveness of services.
Reliance on a single large contractor for critical IT services could pose a risk if the contractor's performance falters or if there are significant changes in technology.

Positive Signals

Awarded through a full and open competition, suggesting a competitive bidding process that likely secured favorable pricing.
The contract is managed under the NIH NITAAC CIOSP2 contract vehicle, a pre-competed and established procurement mechanism known for IT solutions.
The significant value and duration indicate a strategic commitment by HHS to robust IT infrastructure, suggesting a well-defined and important need.

Sector Analysis

This contract falls within the Information Technology sector, specifically 'Other Computer Related Services' (NAICS 541519). The federal IT services market is vast, with agencies consistently investing heavily in maintaining and upgrading their technological capabilities. Contracts like this are crucial for supporting agency operations, data management, and digital transformation initiatives. Comparable spending benchmarks for large-scale IT support contracts within federal agencies often run into tens or hundreds of millions of dollars over several years, reflecting the complexity and criticality of these services.

Small Business Impact

The data indicates this contract was not set aside for small businesses (ss: false, sb: false). While General Dynamics Information Technology is a large business, the contract's structure under a large IDIQ like NITAAC CIOSP2 may allow for subcontracting opportunities. However, without specific subcontracting plans or goals detailed in the award, the direct impact on the small business ecosystem is unclear. Large prime contractors are often encouraged or required to meet small business subcontracting goals on such awards, but this information is not explicitly provided here.

Oversight & Accountability

Oversight for this contract would primarily reside within the Department of Health and Human Services, likely managed by the Office of the Assistant Secretary for Administration (ASA) or a designated IT program office. The contract's performance would be monitored against defined deliverables and service level agreements. Transparency is facilitated through contract award databases like FPDS. Inspector General oversight is possible, particularly concerning potential fraud, waste, or abuse, although specific IG involvement would depend on agency priorities and audit plans.

Related Government Programs

HHS IT Modernization Initiatives
NIH NITAAC CIOSP2 Contract
Federal Civilian IT Services
Department of Health and Human Services IT Procurement
General Dynamics Information Technology Contracts

Risk Flags

Potential for cost overruns due to Time and Materials pricing
Risk of technological obsolescence over the 5-year contract duration
Need for robust contract management to ensure performance and value
Limited visibility into small business subcontracting participation

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $79.9 million to GENERAL DYNAMICS INFORMATION TECHNOLOGY, INC.. FEDERAL PARENT LOCATER SERVICE, AWARDED THROUGH NIH NITAAC CIOSP2 CONTRACT TAS::75 1553::TAS

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 (Office of the Assistant Secretary for Administration).

What is the total obligated amount?

The obligated amount is $79.9 million.

What is the period of performance?

Start: 2010-08-09. End: 2015-08-08.

What is the specific breakdown of services provided under this contract?

The provided data indicates the contract is for 'Other Computer Related Services' (NAICS 541519) awarded through the NIH NITAAC CIOSP2 contract. While the specific service details are not enumerated in the provided data snippet, this category typically encompasses a wide range of IT functions. These can include IT management consulting, computer systems design, network administration, data processing services, IT support, and potentially custom software development or integration. The exact scope would be detailed in the contract's Statement of Work (SOW), which is not included here. Given the awardee (General Dynamics Information Technology) and the agency (HHS), it's likely the services support critical health IT infrastructure, data management, or administrative systems crucial for the department's mission.

How does the Time and Materials (T&M) pricing structure compare to other contract types for similar IT services?

Time and Materials (T&M) contracts are often used when the scope of work is not clearly defined or is expected to change frequently, offering flexibility. However, they carry a higher risk of cost overruns compared to fixed-price contracts because the government pays for the actual labor hours and materials used. For IT services where requirements are well-defined, fixed-price or cost-plus-fixed-fee contracts might offer better cost control. The T&M structure here suggests that HHS anticipated a need for flexibility in IT support, possibly for evolving requirements or emergent tasks. Effective management, including labor hour ceilings and detailed monitoring, is crucial to mitigate the inherent cost risks associated with T&M contracts and ensure value for taxpayers.

What is General Dynamics Information Technology's track record with federal IT contracts of this size and scope?

General Dynamics Information Technology (GDIT), now part of General Dynamics, has a long and extensive history of performing large-scale IT services contracts for various U.S. federal agencies. They are a major federal IT contractor with a portfolio that includes significant work in areas such as cloud computing, cybersecurity, data center modernization, enterprise IT, and mission-critical systems support. GDIT has held numerous prime contracts with departments like Defense, Health and Human Services, Homeland Security, and others, often valued in the hundreds of millions or even billions of dollars. Their track record generally indicates a capacity to manage complex IT programs, though like any large contractor, specific contract performance can vary. This $79.9 million award aligns with their typical contract profile and capabilities.

What are the potential risks associated with a 5-year IT services contract awarded through an IDIQ vehicle?

A significant risk with a 5-year IT services contract, even one awarded through a large IDIQ like NITAAC CIOSP2, is technological obsolescence. IT evolves rapidly, and services or systems that are cutting-edge at the start of a 5-year period may be outdated by the end. Another risk is vendor lock-in, where the agency becomes heavily reliant on the incumbent contractor, making transitions difficult or costly. Cost control is also a concern, especially with T&M pricing, as requirements and labor needs can fluctuate over five years. Furthermore, ensuring consistent performance quality and adapting to changing agency needs or priorities over such a long duration requires diligent contract management and proactive communication between the agency and the contractor.

How does the NIH NITAAC CIOSP2 contract vehicle influence the competition and pricing for this award?

The NIH NITAAC CIOSP2 (Chief Information Officer Solutions and Partners 2) contract vehicle is a multiple-award IDIQ (Indefinite Delivery, Indefinite Quantity) contract specifically designed to provide IT solutions to federal agencies. Using such a vehicle streamlines the procurement process, as the underlying contract has already undergone full and open competition. For this specific award, it means that HHS could quickly solicit proposals from pre-vetted vendors on the CIOSP2 contract. This structure generally promotes competition among the IDIQ holders and can lead to more competitive pricing because vendors are aware they are competing against other capable firms on a pre-established contract. It also offers agencies access to a wide range of IT services and solutions.

Industry Classification

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

Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › PROFESSIONAL SERVICES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Offers Received: 1

Pricing Type: TIME AND MATERIALS (Y)

Contractor Details

Parent Company: General Dynamics Corp (UEI: 001381284)

Address: 4300 FAIR LAKES COURT, FAIRFAX, VA, 22033

Business Categories: Category Business, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $80,559,562

Exercised Options: $79,936,088

Current Obligation: $79,936,088

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Parent Contract

Parent Award PIID: 26301D0050

IDV Type: IDC

Timeline