DoD's $290M Combat Systems Training Contract Awarded to General Dynamics Faces Scrutiny

Contract Overview

Contract Amount: $290,000,501 ($290.0M)

Contractor: General Dynamics Information Technology, Inc.

Awarding Agency: Department of Defense

Start Date: 2017-05-01

End Date: 2023-08-11

Contract Duration: 2,293 days

Daily Burn Rate: $126.5K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 4

Pricing Type: COST PLUS INCENTIVE FEE

Sector: Defense

Official Description: IGF::OT::IGF COMBAT SYSTEMS TRAINING SERVICES FOR THE CENTER FOR SURFACE COMBAT SYSTEMS (CSCS) DOMAIN.

Place of Performance

Location: DAHLGREN, KING GEORGE County, VIRGINIA, 22448

State: Virginia Government Spending

Plain-Language Summary

Department of Defense obligated $290.0 million to GENERAL DYNAMICS INFORMATION TECHNOLOGY, INC. for work described as: IGF::OT::IGF COMBAT SYSTEMS TRAINING SERVICES FOR THE CENTER FOR SURFACE COMBAT SYSTEMS (CSCS) DOMAIN. Key points: 1. The contract, valued at over $290 million, was awarded to General Dynamics Information Technology. 2. Competition was full and open, suggesting a competitive bidding process. 3. Potential risks include cost overruns given the Cost Plus Incentive Fee structure. 4. The sector is primarily Engineering Services within the Defense industry.

Value Assessment

Rating: fair

The contract's Cost Plus Incentive Fee (CPIF) structure can lead to costs exceeding initial estimates if not managed tightly. Benchmarking against similar complex training services contracts is difficult without detailed cost breakdowns.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating multiple bidders participated. This method generally promotes price discovery and competitive pricing, though the CPIF structure introduces variability.

Taxpayer Impact: Taxpayer funds are utilized for this contract. While competition aims for efficiency, the CPIF model necessitates careful oversight to ensure value for money and prevent excessive costs.

Public Impact

Ensures readiness of naval combat systems personnel through specialized training. Supports the operational effectiveness of the U.S. Navy's surface fleet. General Dynamics' role in providing critical training services impacts military capabilities.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost Plus Incentive Fee (CPIF) structure can incentivize higher costs.
Long contract duration (2017-2023) increases risk of scope creep or evolving needs.
Lack of specific performance metrics in provided data.

Positive Signals

Awarded under full and open competition.
Supports critical defense training needs.
Experienced contractor (General Dynamics).

Sector Analysis

This contract falls within Engineering Services, a broad category often supporting complex technological development and maintenance. Defense sector spending on training services is substantial, aimed at maintaining a highly skilled military force.

Small Business Impact

The provided data does not indicate any subcontracting to small businesses. Further investigation would be needed to determine if small business participation was a requirement or if opportunities were missed.

Oversight & Accountability

The contract's CPIF structure requires robust oversight from the Department of the Navy to monitor costs, performance, and ensure the government receives value. Regular audits and performance reviews are crucial.

Related Government Programs

Engineering Services
Department of Defense Contracting
Department of the Navy Programs

Risk Flags

Potential for cost overruns due to CPIF structure.
Long contract duration increases risk.
Lack of detailed performance metrics in summary data.
No clear indication of small business participation.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $290.0 million to GENERAL DYNAMICS INFORMATION TECHNOLOGY, INC.. IGF::OT::IGF COMBAT SYSTEMS TRAINING SERVICES FOR THE CENTER FOR SURFACE COMBAT SYSTEMS (CSCS) DOMAIN.

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 $290.0 million.

What is the period of performance?

Start: 2017-05-01. End: 2023-08-11.

What specific performance metrics are tied to the incentive fee structure, and how are they measured to ensure contractor accountability and value for taxpayer money?

The provided data lacks specifics on performance metrics. A CPIF contract typically links contractor bonuses or penalties to achieving predefined goals (e.g., cost reduction targets, schedule adherence, quality standards). Effective oversight requires clear, measurable metrics and a robust system for tracking and verifying contractor performance against these benchmarks to ensure fair incentive application and taxpayer value.

Given the long duration and CPIF nature, what mechanisms are in place to prevent cost overruns and ensure the training remains relevant to evolving combat systems?

Mechanisms to prevent cost overruns and ensure relevance include strong contract management, regular performance reviews, and potentially contract modifications for scope changes. The CPIF structure itself aims to align contractor and government interests, but requires vigilant monitoring. Periodic reviews of training content against current and future combat system needs are essential to maintain effectiveness and avoid unnecessary expenditure on outdated material.

How does the $290 million expenditure on this specific training contract compare to similar training initiatives within the Navy or across other military branches?

Without specific benchmarks for comparable training programs, it's difficult to definitively assess if $290 million is high or low. Factors like the complexity of systems trained, the number of personnel, and the duration of training significantly influence costs. A comparative analysis would require examining contracts for similar scope, duration, and complexity across different defense entities to identify potential outliers or establish reasonable cost ranges.

Industry Classification

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

Product/Service Code: EDUCATION AND TRAINING › EDUCATION AND TRAINING SERVICES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: N0002415R3136

Offers Received: 4

Pricing Type: COST PLUS INCENTIVE FEE (V)

Evaluated Preference: NONE

Contractor Details

Parent Company: General Dynamics Corporation

Address: 3150 FAIRVIEW PARK DR STE 100, FALLS CHURCH, VA, 22042

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

Financial Breakdown

Contract Ceiling: $316,453,334

Exercised Options: $312,430,498

Current Obligation: $290,000,501

Actual Outlays: $14,882,706

Subaward Activity

Number of Subawards: 23

Total Subaward Amount: $7,986,262

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: N0017804D4012

IDV Type: IDC

Timeline