Interior Department's $21.4M software contract to General Dynamics IT shows mixed value and limited competition

Contract Overview

Contract Amount: $21,414,462 ($21.4M)

Contractor: General Dynamics Information Technology, Inc.

Awarding Agency: Department of the Interior

Start Date: 2012-05-01

End Date: 2017-10-31

Contract Duration: 2,009 days

Daily Burn Rate: $10.7K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: TIME AND MATERIALS

Sector: IT

Official Description: SOFTWARE ENGINEERING SERVICES IN SUPPOT OF IHS RPMS.

Place of Performance

Location: FAIRFAX, FAIRFAX County, VIRGINIA, 22030

State: Virginia Government Spending

Plain-Language Summary

Department of the Interior obligated $21.4 million to GENERAL DYNAMICS INFORMATION TECHNOLOGY, INC. for work described as: SOFTWARE ENGINEERING SERVICES IN SUPPOT OF IHS RPMS. Key points: 1. The contract's value for money appears fair, with a significant portion of the total award spent on services. 2. Competition was limited, with only two bidders, potentially impacting price discovery and taxpayer value. 3. Risk indicators are moderate, with a long performance period and a time-and-materials contract type. 4. The contract supported a critical IT system for the Indian Health Service, impacting healthcare delivery. 5. General Dynamics Information Technology, a large established contractor, secured this significant award. 6. The contract's duration and cost warrant scrutiny for efficiency and effectiveness over its lifespan.

Value Assessment

Rating: fair

The total award of $21.4 million over five years suggests a moderate annual spend. Benchmarking against similar software engineering services contracts is challenging without more granular data on the specific services provided. However, the contract type (Time and Materials) can sometimes lead to cost overruns if not closely managed. The obligated amount versus the total award will provide a clearer picture of actual spending versus authorized funds.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

This contract was awarded under full and open competition, but only two bids were received. This limited competition suggests that while the process was open, the pool of capable and interested contractors may have been restricted. The presence of only two bidders could indicate high barriers to entry, specialized requirements, or a lack of aggressive marketing by the agency to attract more participants. This could potentially lead to less competitive pricing than if more bidders had participated.

Taxpayer Impact: With only two bidders, taxpayers may not have benefited from the most competitive pricing possible. The agency might have secured a reasonable price, but the lack of broader competition limits the assurance that the best possible value was achieved.

Public Impact

Beneficiaries include the Indian Health Service (IHS) staff who rely on the RPMS software for patient care. The services delivered were crucial for the maintenance and support of the Resource and Patient Management System (RPMS). The geographic impact is nationwide, as RPMS is used across IHS facilities. Workforce implications include the IT professionals at General Dynamics IT who provided these specialized services.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Time and Materials contract type can lead to cost escalation if not managed tightly.
Limited competition (2 bidders) may have resulted in higher prices than a more competitive scenario.
Long contract duration (5 years) increases the risk of scope creep or evolving requirements not being optimally addressed.
The specific nature of 'software engineering services' can be broad, making performance monitoring complex.

Positive Signals

Awarded under 'Full and Open Competition', indicating an attempt to solicit broad interest.
General Dynamics Information Technology is a large, established federal contractor with a track record.
The contract supported a critical healthcare IT system (IHS RPMS), indicating alignment with essential government functions.

Sector Analysis

This contract falls within the broader IT services sector, specifically focusing on software engineering and support for a critical healthcare system. The market for such services is highly competitive, with numerous large and small businesses offering specialized expertise. The IHS RPMS system is a significant undertaking, and contracts supporting its development and maintenance represent a substantial portion of federal IT spending in the healthcare domain. Comparable spending benchmarks would typically involve analyzing other large-scale health IT system support contracts within federal agencies.

Small Business Impact

This contract was not set aside for small businesses, and there is no indication of significant subcontracting opportunities for small businesses based on the provided data. The award went to a large prime contractor, General Dynamics Information Technology. This suggests that the primary focus was on securing the required specialized IT services from an established provider, rather than specifically fostering small business participation through set-asides.

Oversight & Accountability

Oversight for this contract would typically reside within the Department of the Interior's contracting and program management offices. The Inspector General's office for the Department of the Interior would have jurisdiction to investigate any potential fraud, waste, or abuse. Transparency is generally facilitated through contract databases like FPDS, which provide basic award details. However, detailed performance metrics and cost justifications are often internal to the agency.

Related Government Programs

Indian Health Service (IHS) IT Modernization Programs
Federal Health IT Services
Software Development and Maintenance Contracts
Department of the Interior IT Support Contracts

Risk Flags

Limited Competition
Time and Materials Contract Type
Long Contract Duration

Frequently Asked Questions

What is this federal contract paying for?

Department of the Interior awarded $21.4 million to GENERAL DYNAMICS INFORMATION TECHNOLOGY, INC.. SOFTWARE ENGINEERING SERVICES IN SUPPOT OF IHS RPMS.

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 the Interior (Departmental Offices).

What is the total obligated amount?

The obligated amount is $21.4 million.

What is the period of performance?

Start: 2012-05-01. End: 2017-10-31.

What was the specific nature of the 'software engineering services' provided under this contract?

The contract description indicates 'SOFTWARE ENGINEERING SERVICES IN SUPPORT OF IHS RPMS.' The Resource and Patient Management System (RPMS) is a comprehensive health information system used by the Indian Health Service (IHS) to manage patient care, clinical data, and administrative functions. The software engineering services likely encompassed a range of activities such as system analysis, design, development, testing, implementation, maintenance, and enhancement of the RPMS software. This could include bug fixes, performance improvements, integration with other systems, and development of new functionalities to meet evolving healthcare needs and regulatory requirements. Without more detailed documentation, the precise scope of work remains generalized.

How does the pricing of this contract compare to similar software engineering services contracts for health IT systems?

Directly comparing the pricing of this $21.4 million contract to similar health IT software engineering services contracts is challenging without access to detailed pricing structures and service level agreements for comparable awards. However, the contract utilized a Time and Materials (T&M) pricing model. T&M contracts can be cost-effective for projects with undefined scopes or when the level of effort is uncertain. Conversely, they carry a higher risk of cost overruns if not meticulously managed and monitored by the government. Benchmarking would require analyzing the average hourly rates for various labor categories (e.g., software engineers, project managers) against market data and other federal contracts for similar services, considering factors like geographic location, contractor experience, and specific technical requirements.

What were the primary risks associated with this contract, and how were they mitigated?

Key risks associated with this contract likely included scope creep, cost overruns due to the Time and Materials (T&M) pricing model, potential performance issues with critical software, and vendor lock-in. The long duration (over five years) also presented a risk of the technology becoming outdated or requirements changing significantly. Mitigation strategies would typically involve robust contract management, including detailed work breakdown structures, regular performance reviews, strict change control processes, and potentially incorporating cost ceilings or fixed-price components for specific tasks. The limited competition (two bidders) also posed a risk of suboptimal pricing, which might have been mitigated through thorough negotiation and market research by the contracting officers.

What was the overall effectiveness of General Dynamics Information Technology in delivering these software engineering services?

Assessing the overall effectiveness of General Dynamics Information Technology (GDIT) in delivering these services requires access to performance evaluations, past performance reviews, and user feedback related to the IHS RPMS system during the contract period (2012-2017). As a large, established contractor, GDIT generally possesses the resources and experience to handle complex IT projects. However, effectiveness is highly dependent on the specific project management, technical execution, and responsiveness to the IHS's needs. Without specific performance data, it's difficult to provide a definitive assessment. Contract close-out reports or CPARS (Contractor Performance Assessment Reporting System) data, if available, would offer insights into their performance.

How has federal spending on software engineering services for health IT systems evolved since this contract was awarded?

Federal spending on software engineering services for health IT systems has generally increased significantly since this contract was awarded in 2012. This trend is driven by ongoing digital transformation initiatives, the need for interoperability between different health systems, the adoption of telehealth, and the increasing reliance on data analytics for public health. Agencies like the Department of Health and Human Services (HHS), including the IHS, continue to invest heavily in modernizing their IT infrastructure and software capabilities. There's also a growing emphasis on cybersecurity, cloud migration, and agile development methodologies, which shape the nature and cost of software engineering services procured by the government.

Industry Classification

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

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

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 2

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: $42,831,279

Exercised Options: $42,831,279

Current Obligation: $21,414,462

Subaward Activity

Number of Subawards: 1

Total Subaward Amount: $228,745

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Parent Contract

Parent Award PIID: GS35F4357D

IDV Type: FSS

Timeline