HHS awards $64.4M for IT services, with General Dynamics Information Technology securing a significant portion

Contract Overview

Contract Amount: $64,377,069 ($64.4M)

Contractor: General Dynamics Information Technology, Inc.

Awarding Agency: Department of Health and Human Services

Start Date: 2016-09-28

End Date: 2019-10-31

Contract Duration: 1,128 days

Daily Burn Rate: $57.1K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 6

Pricing Type: TIME AND MATERIALS

Sector: IT

Official Description: IGF::CT::IGF DEFENSIVE CYBER OPERATIONS INTERNAL DEFENSE MEASURES

Place of Performance

Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20301

State: District of Columbia Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $64.4 million to GENERAL DYNAMICS INFORMATION TECHNOLOGY, INC. for work described as: IGF::CT::IGF DEFENSIVE CYBER OPERATIONS INTERNAL DEFENSE MEASURES Key points: 1. Value for money appears fair, given the 6-year duration and Time and Materials contract type, which can lead to cost overruns if not managed closely. 2. Competition dynamics show a full and open competition, indicating a healthy market for these services. 3. Risk indicators include the Time and Materials contract type, which carries inherent cost uncertainty. 4. Performance context is limited without specific details on deliverables and outcomes. 5. Sector positioning is within IT services, specifically computer systems design, a common area for federal contracting.

Value Assessment

Rating: fair

The contract value of $64.4 million over approximately 3 years (2016-2019) for computer systems design services is within a typical range for federal IT contracts of this scope. However, the Time and Materials (T&M) pricing structure warrants careful monitoring to ensure cost efficiency. Benchmarking against similar T&M contracts for comparable services would provide a clearer picture of value, but without specific performance metrics, a definitive assessment is challenging.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, suggesting that multiple vendors had the opportunity to bid. The presence of 6 bidders indicates a competitive landscape for these computer systems design services. A competitive process generally leads to better price discovery and potentially more favorable terms for the government.

Taxpayer Impact: The full and open competition process is beneficial for taxpayers as it encourages a wider range of vendors to offer competitive pricing, potentially driving down costs and improving service quality.

Public Impact

The Department of Health and Human Services (HHS) benefits from enhanced IT infrastructure and support. Services delivered include computer systems design, crucial for the operational efficiency of administrative and support functions within HHS. The geographic impact is primarily within the District of Columbia, where the contractor is located. Workforce implications include employment opportunities for IT professionals within General Dynamics Information Technology.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Time and Materials contract type can lead to cost escalation if not closely managed.
Lack of specific performance metrics makes it difficult to fully assess value for money.
Contract duration of over 3 years requires ongoing oversight to ensure continued relevance and efficiency.

Positive Signals

Awarded under full and open competition, indicating a robust bidding process.
Multiple bidders (6) suggest a competitive market for these services.
Contract supports critical IT functions within a major federal agency.

Sector Analysis

This contract falls within the broader IT services sector, specifically focusing on computer systems design. The federal IT services market is substantial, with agencies consistently investing in maintaining and upgrading their technological infrastructure. This contract represents a typical expenditure for an agency like HHS to procure specialized design and integration services, aligning with industry trends of outsourcing complex IT functions.

Small Business Impact

The contract was not set aside for small businesses, and there is no indication of specific subcontracting requirements for small businesses in the provided data. This suggests that the primary award went to a large business, and the direct impact on the small business ecosystem through this specific contract may be limited unless General Dynamics Information Technology engages small businesses as subcontractors.

Oversight & Accountability

Oversight mechanisms would typically involve contract officers, program managers, and potentially an Inspector General's office within HHS. Accountability measures are usually tied to contract deliverables and performance standards. Transparency is facilitated through contract databases like FPDS, where basic award information is publicly available, though detailed performance data may be less accessible.

Related Government Programs

HHS IT Modernization Initiatives
Federal Civilian Agency IT Services
Computer Systems Design and Related Services

Risk Flags

Time and Materials contract type carries inherent cost risk.
Lack of detailed performance data limits comprehensive value assessment.
Contract duration requires sustained oversight.

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $64.4 million to GENERAL DYNAMICS INFORMATION TECHNOLOGY, INC.. IGF::CT::IGF DEFENSIVE CYBER OPERATIONS INTERNAL DEFENSE MEASURES

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 $64.4 million.

What is the period of performance?

Start: 2016-09-28. End: 2019-10-31.

What is the track record of General Dynamics Information Technology (GDIT) with federal IT contracts, particularly with HHS?

General Dynamics Information Technology (GDIT) has a long and extensive history of performing IT services for various federal agencies, including the Department of Health and Human Services (HHS). They are a major federal contractor with a broad portfolio encompassing IT infrastructure, cybersecurity, cloud services, and application development. Their track record with HHS likely includes numerous contracts of varying sizes and scopes, supporting different administrations and operational needs. While this specific $64.4 million contract for computer systems design services is a notable award, GDIT's overall performance history with HHS would need to be assessed by examining past contract performance evaluations (e.g., CPARS reports) and any documented issues or successes across their broader engagement with the agency. Their size and experience suggest a capacity to handle complex federal IT requirements, but individual contract performance can vary.

How does the $64.4 million award compare to other federal IT services contracts awarded around the same period (2016-2019)?

The $64.4 million award for computer systems design services over approximately three years (2016-2019) is a substantial but not extraordinary figure within the federal IT contracting landscape. Federal agencies, particularly large departments like HHS, frequently award contracts in the tens to hundreds of millions of dollars for IT support, system integration, and modernization efforts. Contracts of this magnitude are common for comprehensive IT services that may include system design, development, implementation, and ongoing support. When compared to other contracts for similar services (e.g., NAICS code 541512), this award falls within a typical range. However, the value is also influenced by factors such as contract type (Time and Materials in this case), specific deliverables, duration, and the competitive environment. Larger, more complex multi-year IT transformation projects can reach billions of dollars, while smaller, more focused tasks might be in the single-digit millions.

What are the primary risks associated with a Time and Materials (T&M) contract of this size and duration?

The primary risk associated with a Time and Materials (T&M) contract of this $64.4 million size and over three-year duration is cost control. T&M contracts pay the contractor for the actual labor hours expended and the cost of materials used, plus a fixed fee or நிர்ணயிக்கப்பட்ட rate. This structure provides flexibility but lacks a defined ceiling on total cost, making it susceptible to cost overruns if project scope creeps, inefficiencies arise, or labor rates are not carefully managed. For the government, this means the final cost can exceed initial estimates, potentially leading to less value for money compared to fixed-price contracts. Effective oversight, detailed work breakdown structures, and vigilant monitoring of labor hours and rates are crucial to mitigate these risks and ensure the contract remains within budget expectations.

How effective is 'full and open competition' in ensuring competitive pricing for IT services like those provided under this contract?

Full and open competition is generally considered the most effective method for ensuring competitive pricing for federal IT services. By allowing all responsible sources to submit offers, it maximizes the pool of potential bidders, fostering a robust marketplace. This increased competition typically drives down prices as vendors vie for the contract. The fact that this contract had 6 bidders suggests that the market for computer systems design services is sufficiently competitive. While full and open competition provides the best opportunity for price discovery, the actual pricing achieved also depends on the clarity of the government's requirements, the realism of the solicitation, and the specific cost structures of the competing firms. For IT services, where innovation and specialized skills are key, competition also extends beyond just price to include technical approach and past performance.

What are the implications of this contract for small businesses within the federal IT contracting ecosystem?

This specific contract, awarded under full and open competition to General Dynamics Information Technology, does not appear to have included a small business set-aside. This means the primary award did not directly benefit a small business. However, the implications for the broader small business ecosystem are not entirely negative. Large prime contractors like GDIT are often required to meet small business subcontracting goals as part of their overall federal contracting obligations. Therefore, it is possible that GDIT may utilize small businesses as subcontractors to fulfill certain aspects of the computer systems design services required under this contract. The extent to which small businesses benefit would depend on GDIT's subcontracting plan and their success in identifying and engaging qualified small business partners.

What are the typical performance metrics used to evaluate IT services contracts of this nature?

Evaluating IT services contracts like this one typically involves a range of performance metrics focused on technical execution, timeliness, cost control, and customer satisfaction. For computer systems design services, key metrics might include adherence to design specifications, successful integration of new systems, achievement of performance benchmarks (e.g., system speed, uptime), timely completion of milestones, and accuracy of cost reporting. For Time and Materials contracts, metrics related to labor hour utilization efficiency and adherence to approved labor categories and rates are critical. Customer satisfaction surveys or formal Contractor Performance Assessment Reporting System (CPARS) evaluations are also standard tools used by agencies to gauge the contractor's overall performance and identify areas for improvement or commendation.

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: 6

Pricing Type: TIME AND MATERIALS (Y)

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: $114,920,272

Exercised Options: $86,539,260

Current Obligation: $64,377,069

Subaward Activity

Number of Subawards: 3

Total Subaward Amount: $464,569

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Parent Contract

Parent Award PIID: HHSN316201200050W

IDV Type: GWAC

Timeline