Treasury's IRS Extends $26M IT Contract with General Dynamics by 5 Years

Contract Overview

Contract Amount: $26,089,823 ($26.1M)

Contractor: General Dynamics Information Technology, Inc.

Awarding Agency: Department of the Treasury

Start Date: 2003-10-30

End Date: 2009-09-03

Contract Duration: 2,135 days

Daily Burn Rate: $12.2K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: COST PLUS FIXED FEE

Sector: IT

Official Description: PERIOD OF PERFORMANCE EXTENSION

Place of Performance

Location: LANHAM, PRINCE GEORGE'S County, MARYLAND, 20706

State: Maryland Government Spending

Plain-Language Summary

Department of the Treasury obligated $26.1 million to GENERAL DYNAMICS INFORMATION TECHNOLOGY, INC. for work described as: PERIOD OF PERFORMANCE EXTENSION Key points: 1. Significant contract extension for IT services, indicating ongoing need. 2. Sole-source award raises questions about competition and potential cost savings. 3. Long performance period suggests a critical, long-term IT function. 4. Focus on computer systems design services highlights a key area of government IT.

Value Assessment

Rating: questionable

The contract value of $26 million over five years for IT services is substantial. Without competitive bidding, it's difficult to assess if this price represents fair market value compared to similar IT system design contracts.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was not competed, suggesting a sole-source award. This limits price discovery and may result in higher costs for taxpayers compared to a competitive process.

Taxpayer Impact: The lack of competition on this $26 million contract means taxpayers may not be receiving the best possible price for these essential IT services.

Public Impact

Taxpayers may be overpaying due to the absence of competitive bidding. The IRS relies on General Dynamics for critical IT infrastructure. Long-term reliance on a single vendor could create vendor lock-in.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition
Sole-source award
Long contract duration

Positive Signals

Consistent IT support for IRS operations
Established vendor relationship

Sector Analysis

This contract falls within the IT sector, specifically computer systems design services. Government spending on IT services is consistently high, with benchmarks varying widely based on complexity and scope.

Small Business Impact

The data indicates this contract was not awarded to a small business, as 'sb' is false. There is no indication of subcontracting opportunities for small businesses in the provided data.

Oversight & Accountability

The 'st' and 'sn' fields suggest Maryland as the place of performance. Oversight would typically involve contract management by the IRS contracting officer and potentially program managers to ensure performance and adherence to terms.

Related Government Programs

Computer Systems Design Services
Department of the Treasury Contracting
Internal Revenue Service Programs

Risk Flags

Sole-source award limits competition.
Potential for overpayment due to lack of competitive pricing.
Long performance period increases risk of vendor lock-in.
No clear indication of small business participation.

Frequently Asked Questions

What is this federal contract paying for?

Department of the Treasury awarded $26.1 million to GENERAL DYNAMICS INFORMATION TECHNOLOGY, INC.. PERIOD OF PERFORMANCE EXTENSION

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 Treasury (Internal Revenue Service).

What is the total obligated amount?

The obligated amount is $26.1 million.

What is the period of performance?

Start: 2003-10-30. End: 2009-09-03.

What was the justification for awarding this contract sole-source instead of competing it?

The justification for a sole-source award typically involves specific circumstances such as urgency, unique capabilities of a single provider, or if only one source is reasonably available. Without further documentation, the IRS's rationale for not competing this $26 million IT contract remains unclear, potentially impacting cost-effectiveness.

What are the risks associated with a sole-source IT contract of this duration?

Sole-source contracts, especially for IT services over an extended period like five years, carry risks of inflated pricing due to lack of competition, potential for vendor lock-in, and reduced incentive for the vendor to innovate or improve service quality. This can lead to higher long-term costs for the government and taxpayers.

How does this contract's value compare to similar IT system design services procured competitively?

Direct comparison is challenging without knowing the specific services rendered and market rates. However, competitive procurements generally yield lower prices. The absence of competition for this $26 million contract suggests it may be less cost-effective than if it had been bid out, potentially costing taxpayers more.

Industry Classification

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

Product/Service Code: IT AND TELECOM - INFORMATION TECHNOLOGY AND TELECOMMUNICATIONS › ADP AND TELECOMMUNICATIONS

Competition & Pricing

Extent Competed: NOT COMPETED

Offers Received: 1

Pricing Type: COST PLUS FIXED FEE (U)

Contractor Details

Parent Company: Computer Sciences Corporation (UEI: 009581091)

Address: MARYLAND TECHNOLOGY CENTER, LANHAM, MD, 04

Business Categories: Category Business, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $37,359,985

Exercised Options: $37,359,985

Current Obligation: $26,089,823

Parent Contract

Parent Award PIID: TIRNO99D00001

IDV Type: IDC

Timeline