DoD's $61.4M IT labor support contract awarded to General Dynamics Information Technology, Inc. without competition

Contract Overview

Contract Amount: $61,390,967 ($61.4M)

Contractor: General Dynamics Information Technology, Inc.

Awarding Agency: Department of Defense

Start Date: 2014-08-29

End Date: 2016-02-28

Contract Duration: 548 days

Daily Burn Rate: $112.0K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: COST PLUS FIXED FEE

Sector: IT

Official Description: IGF::OT::IGF TSO BRIDGE 3 FOR LABOR SUPPORT

Place of Performance

Location: KANSAS CITY, JACKSON County, MISSOURI, 64131

State: Missouri Government Spending

Plain-Language Summary

Department of Defense obligated $61.4 million to GENERAL DYNAMICS INFORMATION TECHNOLOGY, INC. for work described as: IGF::OT::IGF TSO BRIDGE 3 FOR LABOR SUPPORT Key points: 1. Contract awarded on a cost-plus-fixed-fee basis, which can lead to higher costs if not managed effectively. 2. Lack of competition raises concerns about potential overpayment and reduced value for taxpayer dollars. 3. Contract duration of 548 days suggests a focused, short-term need for labor support. 4. Awarded by the Department of the Navy, indicating a specific IT service requirement within the naval branch. 5. The 'Custom Computer Programming Services' NAICS code points to specialized IT development or maintenance. 6. No small business set-aside was applied, potentially limiting opportunities for smaller IT firms.

Value Assessment

Rating: questionable

Benchmarking the value of this contract is challenging due to the lack of competitive bids and the cost-plus-fixed-fee structure. Without a competitive process, it's difficult to ascertain if the pricing reflects fair market value. The fixed fee component provides some cost control, but the overall cost-reimbursement nature necessitates robust oversight to ensure efficiency and prevent cost overruns. Compared to similar IT labor support contracts, the absence of competition suggests a potential for higher per-unit costs.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning it was not competed. This indicates that the Department of the Navy likely identified a specific contractor, General Dynamics Information Technology, Inc., as the only viable source for the required services. The lack of competition limits the government's ability to leverage market forces to drive down prices and ensure the best possible value.

Taxpayer Impact: Sole-source awards mean taxpayers may not receive the most cost-effective solution, as the benefits of competitive bidding are forgone.

Public Impact

The primary beneficiaries are the Department of the Navy, which receives essential IT labor support services. The contract delivers custom computer programming services, likely supporting critical naval IT systems and operations. The geographic impact is centered in Missouri (SN: MISSOURI), where the contractor's services are presumably delivered. Workforce implications include the employment of personnel by General Dynamics Information Technology, Inc. to fulfill the contract's requirements.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may lead to inflated costs for taxpayers.
Cost-plus-fixed-fee structure requires diligent oversight to prevent cost creep.
Sole-source award limits transparency in pricing and service delivery benchmarks.

Positive Signals

Contract awarded to a large, established IT provider (General Dynamics Information Technology, Inc.) which may indicate reliability.
Fixed fee component provides a degree of cost predictability for the government.
Specific NAICS code suggests a targeted and potentially necessary IT service.

Sector Analysis

This contract falls within the Information Technology sector, specifically under Custom Computer Programming Services. The IT services market is highly competitive, with numerous large and small businesses offering specialized skills. Contracts for IT labor support are common across federal agencies, often involving software development, system maintenance, and technical assistance. Benchmarking this contract's value is difficult without competitive data, but IT services represent a significant portion of federal spending.

Small Business Impact

This contract was not set aside for small businesses, nor does it appear to have subcontracting requirements for small businesses indicated by the 'sb' field being false. This means that opportunities for small businesses to participate in this specific contract were likely minimal. The award to a large prime contractor like General Dynamics Information Technology, Inc. suggests a focus on established capabilities rather than fostering small business growth through this particular procurement.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of the Navy's contracting and program management offices. As a cost-plus-fixed-fee contract, rigorous financial oversight is crucial to monitor expenditures and ensure the fixed fee remains appropriate. Transparency is limited due to the sole-source nature. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

Department of Defense IT Services
Custom Computer Programming Services
IT Labor Support Contracts
Naval IT Modernization Programs

Risk Flags

Sole-source award
Cost-plus-fixed-fee contract type
Lack of competitive bidding

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $61.4 million to GENERAL DYNAMICS INFORMATION TECHNOLOGY, INC.. IGF::OT::IGF TSO BRIDGE 3 FOR LABOR SUPPORT

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 (Department of the Navy).

What is the total obligated amount?

The obligated amount is $61.4 million.

What is the period of performance?

Start: 2014-08-29. End: 2016-02-28.

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

General Dynamics Information Technology, Inc. (GDIT) is a major federal IT contractor with a long history of serving the Department of Defense (DoD) and other government agencies. They have been awarded numerous contracts across various IT service areas, including custom computer programming, cloud services, cybersecurity, and enterprise IT management. Their track record with the DoD is extensive, encompassing a wide range of complex projects. However, like many large contractors, GDIT has also faced scrutiny and reviews on specific contracts regarding performance, cost, and compliance. A detailed analysis would require examining specific contract performance reports, past performance evaluations, and any documented disputes or corrective actions related to their work with the Navy and other DoD components.

How does the awarded amount of $61.4 million compare to similar IT labor support contracts within the DoD?

Directly comparing the $61.4 million award to similar IT labor support contracts is challenging without knowing the specific scope, duration, and complexity of services rendered. However, given the NAICS code 541511 (Custom Computer Programming Services) and the contract type (Cost Plus Fixed Fee), this represents a substantial investment. Federal IT contracts can range from a few million to hundreds of millions of dollars. The lack of competition for this specific contract makes a direct value-for-money comparison difficult. Typically, competitive bidding allows agencies to benchmark pricing against market rates and other proposals. Without this, it's hard to definitively say if $61.4 million is high or low relative to what could have been achieved through a competitive process.

What are the primary risks associated with a sole-source, cost-plus-fixed-fee IT contract of this magnitude?

The primary risks associated with a sole-source, cost-plus-fixed-fee (CPFF) IT contract of this magnitude are significant. Firstly, the sole-source nature eliminates competition, which is the government's primary tool for ensuring fair pricing and optimal value. This can lead to the contractor charging higher rates than might be possible in a competitive environment. Secondly, the CPFF structure means the government reimburses the contractor for allowable costs plus a fixed fee. While the fixed fee provides some cost certainty for the contractor's profit, the overall cost to the government can escalate if costs are not meticulously managed and controlled. This structure incentivizes the contractor to incur costs, and robust government oversight is essential to prevent unnecessary spending and ensure efficiency. Without strong oversight, there's a risk of cost overruns and reduced overall value for taxpayer money.

What does the contract duration of 548 days (approximately 1.5 years) imply about the nature of the IT services required?

A contract duration of 548 days, roughly 1.5 years, suggests that the IT labor support services required were likely for a defined project or a specific period of need, rather than ongoing, indefinite operational support. This timeframe is typical for projects involving system development, implementation, or a significant upgrade phase where specialized programming expertise is temporarily required. It implies that the Department of the Navy anticipated a need for these services for a substantial but finite period. The relatively short duration, compared to multi-year sustainment contracts, might also indicate that the services were intended to bridge a gap, support a transition, or fulfill a specific, time-bound requirement before alternative solutions or internal capabilities were established.

How does the 'Custom Computer Programming Services' NAICS code (541511) differentiate this contract from general IT support or software licensing?

The NAICS code 541511, 'Custom Computer Programming Services,' specifically identifies the core nature of the work as the creation of new, original software or the modification of existing software to meet unique client needs. This is distinct from general IT support, which might encompass help desk services, network administration, or hardware maintenance (often falling under different NAICS codes like 541512 or 541513). It also differs from software licensing, where the government purchases the right to use pre-existing software products (often categorized under wholesale trade or information services). This contract implies that General Dynamics Information Technology, Inc. was engaged in activities such as designing, developing, testing, and implementing software tailored to the specific requirements of the Department of the Navy, rather than providing off-the-shelf solutions or routine technical assistance.

Industry Classification

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

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

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: M0026414R0018

Offers Received: 1

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Parent Company: Computer Sciences Corporation (UEI: 009581091)

Address: 4045 HANCOCK ST, SAN DIEGO, CA, 92110

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

Financial Breakdown

Contract Ceiling: $80,031,871

Exercised Options: $80,031,871

Current Obligation: $61,390,967

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: YES

Timeline