DoD's $42.4M Engineering Services Contract with General Dynamics Faces Scrutiny Over Competition and Value

Contract Overview

Contract Amount: $42,451,710 ($42.5M)

Contractor: General Dynamics Information Technology, Inc.

Awarding Agency: Department of Defense

Start Date: 2009-12-11

End Date: 2011-03-31

Contract Duration: 475 days

Daily Burn Rate: $89.4K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 1

Pricing Type: COST PLUS FIXED FEE

Sector: Defense

Official Description: ENGINEERING & TECHNICAL SERVICES IAW PWS

Place of Performance

Location: NORCO, RIVERSIDE County, CALIFORNIA, 92860

State: California Government Spending

Plain-Language Summary

Department of Defense obligated $42.5 million to GENERAL DYNAMICS INFORMATION TECHNOLOGY, INC. for work described as: ENGINEERING & TECHNICAL SERVICES IAW PWS Key points: 1. The contract awarded to General Dynamics Information Technology, Inc. for engineering services represents a significant investment by the Department of Defense. 2. The contract's 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES' clause raises questions about the breadth of initial competition. 3. The Cost Plus Fixed Fee (CPFF) pricing structure can introduce risks of cost overruns if not managed diligently. 4. The Engineering Services sector is critical for defense readiness, but requires careful oversight to ensure cost-effectiveness.

Value Assessment

Rating: fair

The Cost Plus Fixed Fee structure, while allowing flexibility, can lead to higher costs compared to fixed-price contracts if scope is not tightly controlled. Benchmarking against similar engineering services contracts is needed to assess if the $42.4M award represents fair value.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

The competition method, 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES,' suggests that while competition was sought, it was not entirely unrestricted from the outset. This could limit price discovery and potentially lead to higher costs than a truly open competition.

Taxpayer Impact: The limited competition may have resulted in a higher price than could have been achieved through a broader bidding process, impacting taxpayer funds.

Public Impact

Taxpayers may be paying more due to restricted initial competition for essential engineering services. The Department of Defense relies on these services, making cost-efficiency crucial for national security budgets. Lack of transparency in the exclusion of sources could undermine public trust in government contracting.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Limited competition raises cost concerns.
CPFF contract type can incentivize higher spending.
Exclusion of sources needs justification.

Positive Signals

Contract awarded to a known entity (General Dynamics).
Contract duration is defined.

Sector Analysis

The Engineering Services sector is vital for defense projects, encompassing design, analysis, and technical support. Spending in this sector is benchmarked against project complexity and the level of innovation required, with costs often influenced by specialized expertise.

Small Business Impact

There is no indication that small businesses were involved in this contract, either as prime contractors or subcontractors. This represents a missed opportunity for small business participation in a significant federal contract.

Oversight & Accountability

The Defense Contract Management Agency (DCMA) is responsible for oversight. However, the specific oversight mechanisms for this CPFF contract and the justification for excluding sources require further examination to ensure accountability.

Related Government Programs

Engineering Services
Department of Defense Contracting
Defense Contract Management Agency Programs

Risk Flags

Limited initial competition.
Cost Plus Fixed Fee pricing model.
Lack of transparency regarding source exclusion.
Potential for cost overruns.
No apparent small business participation.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $42.5 million to GENERAL DYNAMICS INFORMATION TECHNOLOGY, INC.. ENGINEERING & TECHNICAL SERVICES IAW PWS

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 (Defense Contract Management Agency).

What is the total obligated amount?

The obligated amount is $42.5 million.

What is the period of performance?

Start: 2009-12-11. End: 2011-03-31.

What was the specific justification for excluding certain sources prior to the 'full and open competition' phase, and how did this impact the final contract price?

The justification for excluding sources prior to the 'full and open competition' phase is critical for understanding the procurement's integrity. If sources were excluded based on specific technical requirements or past performance, it might be justifiable. However, if exclusions were arbitrary, it could have artificially limited competition, potentially inflating the $42.4M contract price and reducing the value realized by the Department of Defense.

How effectively was the Cost Plus Fixed Fee (CPFF) structure managed to control costs and prevent potential overruns, given the contract's value and duration?

Managing a CPFF contract of this magnitude requires rigorous oversight of expenditures and performance. The effectiveness hinges on the government's ability to monitor General Dynamics' costs, ensure efficiency, and prevent scope creep. Without detailed reporting on cost controls and performance metrics, it's difficult to assess if the $42.4M was spent optimally or if taxpayers bore unnecessary costs due to the contract's inherent flexibility.

What specific engineering and technical services were delivered under this contract, and how do they align with the Department of Defense's strategic objectives and current needs?

Understanding the precise deliverables is key to evaluating the contract's effectiveness. Were the engineering and technical services provided by General Dynamics essential for critical defense programs, or were they more general support? Assessing alignment with strategic objectives helps determine if the $42.4M investment yielded tangible benefits and contributed meaningfully to national security, beyond just fulfilling a contractual obligation.

Industry Classification

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

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

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: N6339409R5000

Offers Received: 1

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Parent Company: General Dynamics Corp

Address: 2727 HAMNER AVE, NORCO, CA, 92860

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

Financial Breakdown

Contract Ceiling: $43,948,000

Exercised Options: $43,948,000

Current Obligation: $42,451,710

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Timeline