DoD's $43.5M engineering support contract with General Dynamics awarded non-competitively

Contract Overview

Contract Amount: $43,515,785 ($43.5M)

Contractor: General Dynamics Mission Systems, Inc.

Awarding Agency: Department of Defense

Start Date: 2008-05-27

End Date: 2014-09-30

Contract Duration: 2,317 days

Daily Burn Rate: $18.8K/day

Competition Type: NOT AVAILABLE FOR COMPETITION

Number of Offers Received: 1

Pricing Type: COST PLUS FIXED FEE

Sector: Defense

Official Description: ENGINEERING AND TECHNICAL SUPPORT

Place of Performance

Location: MANASSAS, PRINCE WILLIAM County, VIRGINIA, 20110

State: Virginia Government Spending

Plain-Language Summary

Department of Defense obligated $43.5 million to GENERAL DYNAMICS MISSION SYSTEMS, INC. for work described as: ENGINEERING AND TECHNICAL SUPPORT Key points: 1. Contract awarded without competition, raising questions about potential cost savings. 2. Long performance period of over 6 years suggests a sustained need for services. 3. Cost-plus-fixed-fee structure may incentivize cost overruns. 4. Contractor has a significant presence in the defense sector. 5. Services provided are critical for engineering and technical support functions. 6. No small business set-aside indicates a focus on large prime contractors.

Value Assessment

Rating: questionable

The contract's value of $43.5 million over its duration is difficult to benchmark without more detailed cost breakdowns. The cost-plus-fixed-fee (CPFF) pricing structure, while common for complex projects, can lead to higher overall costs compared to fixed-price contracts if not managed tightly. Without comparable non-competitive awards for similar engineering services, assessing the value for money is challenging. The lack of competition inherently limits the government's ability to secure the best possible price.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded as 'NOT AVAILABLE FOR COMPETITION,' indicating a sole-source procurement. This means the government did not solicit bids from multiple offerors. Reasons for sole-source awards can include the uniqueness of the service, the contractor's proprietary knowledge, or urgent needs where only one source can reasonably fulfill the requirement. The lack of competition means taxpayers did not benefit from a competitive bidding process that could have driven down costs.

Taxpayer Impact: Sole-source awards mean taxpayers may not be getting the most competitive pricing available in the market. The absence of competition limits price discovery and potentially increases the overall cost to the government.

Public Impact

The Department of Defense benefits from specialized engineering and technical support. Services likely contribute to the development, maintenance, or enhancement of defense systems. The geographic impact is primarily tied to the contractor's operational locations and DoD facilities. Workforce implications include employment for engineers and technical specialists within General Dynamics.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may lead to higher costs for taxpayers.
Cost-plus-fixed-fee contract type can incentivize increased spending.
Long contract duration could mask inefficiencies if not closely monitored.
Limited transparency due to sole-source award.

Positive Signals

General Dynamics is a major defense contractor with established expertise.
Contract provides essential engineering and technical support for defense operations.
Definitive contract award provides a framework for service delivery.

Sector Analysis

This contract falls within the Engineering Services sector, specifically supporting defense applications. The broader engineering services market is substantial, encompassing a wide range of activities from design and consulting to testing and technical support. For the defense sector, such services are crucial for maintaining technological superiority and ensuring the readiness of military assets. Benchmarking spending in this area is complex due to the specialized nature of defense requirements and the often proprietary technologies involved.

Small Business Impact

The contract data indicates that small business participation was not a primary consideration, as the 'sb' field is false and the contract was awarded non-competitively. There is no indication of a small business set-aside. This suggests that the prime contractor, General Dynamics, is expected to fulfill the requirement, and any subcontracting opportunities for small businesses would be at the discretion of the prime. This approach may limit opportunities for small businesses to engage directly with the government on this specific contract.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting agency (Department of Defense) and potentially the Defense Contract Management Agency (DCMA), given its role in contract administration. The effectiveness of oversight depends on the rigor of performance reviews, cost audits, and adherence to the contract's terms and conditions. Transparency is limited due to the sole-source nature of the award. Inspector General involvement would likely occur if specific allegations of fraud, waste, or abuse arise.

Related Government Programs

Defense Engineering Services
Technical Support Contracts
Cost-Plus-Fixed-Fee Contracts
Sole-Source Defense Procurements

Risk Flags

Sole-source award limits price competition.
Cost-plus-fixed-fee structure may not incentivize cost control.
Long contract duration increases exposure to changing requirements and technology.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $43.5 million to GENERAL DYNAMICS MISSION SYSTEMS, INC.. ENGINEERING AND TECHNICAL SUPPORT

Who is the contractor on this award?

The obligated recipient is GENERAL DYNAMICS MISSION SYSTEMS, INC..

Which agency awarded this contract?

Awarding agency: Department of Defense (Defense Contract Management Agency).

What is the total obligated amount?

The obligated amount is $43.5 million.

What is the period of performance?

Start: 2008-05-27. End: 2014-09-30.

What specific engineering and technical support services were provided under this contract?

The provided data indicates the contract was for 'ENGINEERING AND TECHNICAL SUPPORT' with the North American Industry Classification System (NAICS) code 541330, which corresponds to 'Engineering Services.' While the specific deliverables are not detailed in the summary data, these services typically encompass a broad range of activities. This could include system design, development, integration, testing, analysis, research, and lifecycle support for various defense platforms or systems. Given the contractor (General Dynamics Mission Systems) and the agency (Department of Defense), the services likely relate to complex military hardware, software, or communication systems, requiring specialized engineering expertise to ensure operational effectiveness and maintainability.

How does the $43.5 million contract value compare to similar engineering support contracts awarded by the DoD?

Directly comparing the $43.5 million value of this contract to similar ones is challenging without more specific details on the scope of work and the duration of comparable contracts. However, General Dynamics is a major defense contractor, and contracts of this magnitude are not uncommon for complex engineering and technical support services within the Department of Defense. The fact that this contract was awarded non-competitively limits the ability to assess if this price represents good value compared to what might have been achieved through a competitive process. Benchmarking would ideally involve looking at other sole-source or competitively awarded contracts for similar services, considering factors like contract type, duration, and the specific systems being supported.

What are the primary risks associated with a sole-source award for engineering services?

The primary risk associated with a sole-source award for engineering services is the potential for inflated costs due to the lack of competitive pressure. Without multiple bidders vying for the contract, the government may pay a premium. Another risk is reduced innovation, as the sole provider may have less incentive to develop novel or more cost-effective solutions. Furthermore, there's a risk of vendor lock-in, where the government becomes dependent on a single contractor, making future transitions difficult and potentially costly. Ensuring adequate oversight and robust negotiation becomes even more critical in sole-source situations to mitigate these risks.

What is the significance of the 'Cost Plus Fixed Fee' (CPFF) contract type in this context?

The Cost Plus Fixed Fee (CPFF) contract type means the contractor is reimbursed for all allowable costs incurred, plus a predetermined fixed fee representing profit. For the government, this structure can be beneficial when the scope of work is not well-defined or is subject to change, as it allows flexibility. However, it carries the risk that the contractor may have less incentive to control costs, as their profit (the fixed fee) is not directly tied to cost savings. Effective oversight is crucial to ensure that costs are reasonable and allocable, and that the fixed fee adequately compensates the contractor for the risks undertaken.

What is General Dynamics Mission Systems' track record with the Department of Defense for similar services?

General Dynamics Mission Systems (GDMS) is a well-established and significant defense contractor with a long history of providing a wide array of services and products to the Department of Defense. Their track record typically includes complex system integration, C4ISR (Command, Control, Communications, Computers, Intelligence, Surveillance, and Reconnaissance) solutions, cyber security, and platform modernization. For engineering and technical support, GDMS possesses extensive capabilities and has managed numerous large-scale contracts. While specific performance details for this particular $43.5 million contract are not provided, GDMS generally has a substantial portfolio of successful, albeit sometimes complex, engagements with the DoD, indicating a strong capacity to handle such requirements.

How does the contract's duration (2317 days, approx. 6.3 years) impact its overall value and risk?

A contract duration of approximately 6.3 years suggests a long-term need for the engineering and technical support services. From a value perspective, a longer duration can provide stability and continuity for both the government and the contractor, potentially leading to efficiencies through established processes and a deeper understanding of the systems involved. However, it also extends the period over which costs are incurred, increasing the overall financial commitment. The risk associated with a long duration includes the potential for technological obsolescence, shifts in government requirements, and the possibility that initial cost estimates may not hold true over such an extended period. Robust contract management and periodic reviews are essential to ensure continued value and mitigate risks over the contract's lifecycle.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Architectural, Engineering, and Related Services › Engineering Services

Product/Service Code: RESEARCH AND DEVELOPMENT › C – National Defense R&D Services

Competition & Pricing

Extent Competed: NOT AVAILABLE FOR COMPETITION

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: N0002406R6276

Offers Received: 1

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Address: 9500 INNOVATION DR, MANASSAS, VA, 20110

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Manufacturer of Goods, Small Business, Special Designations, Subchapter S Corporation, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $59,128,943

Exercised Options: $58,958,839

Current Obligation: $43,515,785

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline