DoD's $16.8M IT contract to General Dynamics shows mixed value and limited competition

Contract Overview

Contract Amount: $16,775,824 ($16.8M)

Contractor: General Dynamics Information Technology, Inc.

Awarding Agency: Department of Defense

Start Date: 2009-12-01

End Date: 2011-10-15

Contract Duration: 683 days

Daily Burn Rate: $24.6K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: TIME AND MATERIALS

Sector: IT

Official Description: MDA INFORMATION TECHNOLOGY MGT. SERVICES

Place of Performance

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

State: District of Columbia Government Spending

Plain-Language Summary

Department of Defense obligated $16.8 million to GENERAL DYNAMICS INFORMATION TECHNOLOGY, INC. for work described as: MDA INFORMATION TECHNOLOGY MGT. SERVICES Key points: 1. Contract value appears reasonable given the duration and scope of IT management services. 2. Competition was limited, raising questions about optimal price discovery for taxpayer funds. 3. The contract's Time and Materials pricing structure can introduce cost uncertainty. 4. Performance context is within the critical Missile Defense Agency, highlighting strategic importance. 5. Sector positioning is within IT management services for a major defense agency. 6. Risk indicators include potential for cost overruns due to T&M pricing and limited competition.

Value Assessment

Rating: fair

The contract's total value of approximately $16.8 million over nearly two years for IT management services is within a plausible range for a defense agency. However, without specific benchmarks for similar IT management contracts within the Missile Defense Agency or comparable entities, a definitive value-for-money assessment is challenging. The Time and Materials (T&M) pricing model, while offering flexibility, can lead to higher costs compared to fixed-price contracts if not managed diligently, potentially impacting overall value.

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 bids. While the data specifies 'full and open competition,' the number of bidders is not provided. A single award suggests that General Dynamics Information Technology, Inc. was selected as the most advantageous offer. The level of competition, if robust with multiple bidders, would typically drive down prices and improve value.

Taxpayer Impact: Full and open competition is generally beneficial for taxpayers as it fosters a competitive environment that can lead to better pricing and innovation. However, the ultimate benefit depends on the number of actual bids received and the effectiveness of the evaluation process.

Public Impact

The primary beneficiaries are the Department of Defense and the Missile Defense Agency, receiving essential IT management support. Services delivered include computer and software store management, crucial for maintaining operational readiness. The geographic impact is centered in the District of Columbia, where the agency is located. Workforce implications involve the employment of IT professionals by General Dynamics to fulfill the contract requirements.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost escalation due to Time and Materials pricing structure.
Limited insight into the number of bidders restricts a full assessment of competitive pressure.
The strategic nature of the Missile Defense Agency could imply unique cost drivers not easily benchmarked.

Positive Signals

Awarded under full and open competition, suggesting a fair process.
General Dynamics Information Technology is a large, established contractor with significant experience in government IT services.
The contract supports a critical national security mission within the Missile Defense Agency.

Sector Analysis

This contract falls within the Information Technology (IT) sector, specifically focusing on IT management services. The IT services market for the federal government is substantial, with significant spending allocated to software, hardware, and related support. Contracts like this are common as agencies rely on external expertise for complex IT operations. Benchmarking IT management contracts can be difficult due to the wide variation in scope, complexity, and specific services required.

Small Business Impact

The data indicates that this contract was not specifically set aside for small businesses, nor does it explicitly mention subcontracting requirements for small businesses. Therefore, the direct impact on the small business ecosystem is likely minimal unless General Dynamics voluntarily engages small business subcontractors. Further analysis would be needed to determine if small business participation was encouraged or mandated.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and the technical points of contact within the Missile Defense Agency. Accountability measures are embedded in the contract terms, including performance standards and payment schedules. Transparency is generally facilitated through contract databases like FPDS, which provide public access to contract awards. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

Missile Defense Agency IT Support Contracts
Department of Defense Information Technology Services
Federal Civilian IT Management Contracts
Time and Materials IT Contracts
General Dynamics IT Contracts

Risk Flags

Time and Materials Pricing
Limited Competition Data
Potential for Cost Overruns

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $16.8 million to GENERAL DYNAMICS INFORMATION TECHNOLOGY, INC.. MDA INFORMATION TECHNOLOGY MGT. 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 Defense (Missile Defense Agency).

What is the total obligated amount?

The obligated amount is $16.8 million.

What is the period of performance?

Start: 2009-12-01. End: 2011-10-15.

What is the track record of General Dynamics Information Technology, Inc. with the Department of Defense for similar IT management contracts?

General Dynamics Information Technology, Inc. (GDIT) has a long and extensive history of contracting with the Department of Defense (DoD) across a wide array of IT services. They are a major federal IT contractor, frequently awarded large-scale contracts for systems integration, network management, cybersecurity, and software development. Their track record with the DoD includes numerous prime contracts and subcontracts, often supporting critical defense missions. While specific performance metrics for individual contracts are not always publicly available, GDIT's continued success in winning competitive bids suggests a generally satisfactory performance history and a strong understanding of DoD requirements. However, like any large contractor, they may have faced past performance issues or disputes on specific projects, which would be detailed in past performance evaluations during the procurement process.

How does the $16.8 million contract value compare to other IT management contracts awarded by the Missile Defense Agency or similar defense agencies?

Comparing the $16.8 million contract value requires context regarding its duration and scope. This contract, awarded in late 2009 and ending in late 2011 (approximately 23 months), averages around $730,000 per month. For IT management services within a major defense agency like the Missile Defense Agency (MDA), this figure is plausible, especially considering the specialized nature of supporting missile defense systems. However, without detailed breakdowns of the specific services rendered (e.g., number of personnel, types of systems managed, level of support), direct comparisons are difficult. Larger, more complex IT modernization or enterprise-wide system support contracts for the DoD can easily run into hundreds of millions or even billions of dollars. Conversely, smaller, more focused IT support tasks might be valued significantly less. The 'Computer and Software Stores' NAICS code suggests a focus on inventory, procurement, and management of IT assets, which could be a component of broader IT management.

What are the primary risks associated with the Time and Materials (T&M) pricing structure used in this contract?

The primary risk associated with the Time and Materials (T&M) pricing structure is the potential for cost overruns and a lack of definitive cost control. In a T&M contract, the government pays the contractor for the actual labor hours expended at specified hourly rates, plus the actual cost of materials. This shifts much of the cost risk to the government. If the contractor's labor hours are not efficiently managed, or if the scope of work expands without clear definition, costs can escalate beyond initial estimates. For the government, this means less predictability in budgeting and a potential for paying more than anticipated. Effective oversight, detailed tracking of hours and materials, and strong contract administration are crucial to mitigate these risks and ensure fair pricing.

How effective is 'full and open competition' in ensuring optimal value for taxpayer money in defense IT contracts?

Full and open competition is designed to be the most effective method for ensuring optimal value for taxpayer money in defense IT contracts. By allowing all responsible sources to compete, it theoretically maximizes the pool of potential offerors, fostering robust price competition and encouraging innovation. This competitive pressure should drive down prices and improve the quality of services or products. However, the effectiveness is contingent on several factors: the clarity and realism of the solicitation requirements, the number of capable bidders that actually participate, and the rigor of the evaluation process. If requirements are poorly defined, or if only a few companies possess the necessary specialized skills, the 'full and open' aspect may not translate into significant price advantages. Nonetheless, it remains the preferred method due to its inherent potential for achieving best value.

What is the historical spending trend for IT management services within the Missile Defense Agency?

Analyzing the historical spending trend for IT management services specifically within the Missile Defense Agency (MDA) requires access to comprehensive historical contract data. This single $16.8 million contract from 2009-2011 provides a snapshot but does not reveal a trend. Generally, spending on IT services within defense agencies like the MDA has been substantial and often increasing over the past two decades, driven by technological advancements, modernization efforts, and the increasing reliance on sophisticated IT systems for mission execution. Factors influencing MDA's IT spending would include the lifecycle of its various missile defense systems, cybersecurity requirements, data management needs, and the transition to cloud computing or other advanced architectures. Without longitudinal data, it's impossible to determine if this specific contract represents a typical expenditure or an outlier.

Industry Classification

NAICS: Retail Trade › Electronics and Appliance Stores › Computer and Software Stores

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

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 1

Pricing Type: TIME AND MATERIALS (Y)

Evaluated Preference: NONE

Contractor Details

Parent Company: General Dynamics Corp

Address: 3211 JERMANTOWN RD, FAIRFAX, VA, 22030

Business Categories: Category Business, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $26,564,876

Exercised Options: $26,564,876

Current Obligation: $16,775,824

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Parent Contract

Parent Award PIID: GS35F4357D

IDV Type: FSS

Timeline