Treasury's $29.8M IT contract awarded to General Dynamics for computer systems design services

Contract Overview

Contract Amount: $29,821,951 ($29.8M)

Contractor: General Dynamics Information Technology, Inc.

Awarding Agency: Department of the Treasury

Start Date: 2001-11-15

End Date: 2002-11-16

Contract Duration: 366 days

Daily Burn Rate: $81.5K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: COST PLUS FIXED FEE

Sector: IT

Place of Performance

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

State: Maryland Government Spending

Plain-Language Summary

Department of the Treasury obligated $29.8 million to GENERAL DYNAMICS INFORMATION TECHNOLOGY, INC. for work described as: Key points: 1. Contract awarded via full and open competition, suggesting a competitive bidding process. 2. The contract type is Cost Plus Fixed Fee, which can incentivize cost overruns. 3. Duration of 366 days indicates a relatively short-term engagement for IT services. 4. The award was made on November 15, 2001, for services to be completed by November 16, 2002. 5. The base contract value is substantial, requiring careful monitoring of costs and performance. 6. The North American Industry Classification System (NAICS) code 541512 points to a focus on computer systems design.

Value Assessment

Rating: fair

Benchmarking the value of this contract is challenging without more detailed cost breakdowns and performance metrics. The Cost Plus Fixed Fee (CPFF) contract type, while common, carries inherent risks of cost escalation if not managed tightly. Comparing this to similar IT systems design contracts from the early 2000s would be necessary for a robust value assessment. The base award amount of over $29 million for a one-year period suggests a significant project, but the 'value for money' depends heavily on the successful delivery of complex IT solutions.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under 'full and open competition,' indicating that all responsible sources were permitted to submit bids. This typically leads to a more robust price discovery process and potentially better pricing for the government. The number of bidders is not specified, but the competitive nature of the award suggests that multiple companies likely vied for this contract, fostering a more dynamic marketplace.

Taxpayer Impact: A full and open competition generally benefits taxpayers by driving down costs through competitive pressures and ensuring the government receives proposals from a wide range of qualified vendors.

Public Impact

The primary beneficiary is the Department of the Treasury, specifically the Internal Revenue Service (IRS), which receives IT systems design services. The services delivered are crucial for the modernization and operational efficiency of IRS IT infrastructure. The geographic impact is likely concentrated within the IRS's operational centers, primarily in Maryland where the contract was awarded. Workforce implications include the direct employment of IT professionals by General Dynamics and potential indirect impacts on IRS IT staff who will interact with the new systems.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost Plus Fixed Fee structure can lead to higher costs if not managed diligently.
The contract's age means current market rates and technologies may differ significantly.
Lack of specific performance metrics makes it difficult to assess efficiency and effectiveness.
Potential for scope creep in IT projects, especially under CPFF contracts.

Positive Signals

Awarded through full and open competition, indicating a competitive process.
General Dynamics is a large, established defense and IT contractor with significant experience.
The contract specifies a fixed fee component, which can provide some cost certainty.
The award was made to a single entity, suggesting a clear line of responsibility.

Sector Analysis

This contract falls within the Information Technology (IT) sector, specifically focusing on computer systems design services. The IT services market is vast and highly competitive, with significant government spending allocated to systems integration, software development, and IT support. Contracts like this are essential for government agencies to maintain and upgrade their complex technological infrastructures. Benchmarking would involve comparing the contract's value and scope to other similar IT services contracts awarded by federal agencies during the early 2000s.

Small Business Impact

The data indicates that this contract was not set aside for small businesses (ss: false, sb: false). Therefore, there are no direct subcontracting implications for small businesses stemming from a small business set-aside. The award to a large prime contractor like General Dynamics suggests that any subcontracting opportunities would be managed by the prime and not mandated by a small business set-aside provision.

Oversight & Accountability

Oversight for this contract would have been managed by the contracting officers and program managers within the Department of the Treasury and the IRS. Accountability measures would be tied to the terms of the Cost Plus Fixed Fee contract, including performance milestones and adherence to the fixed fee. Transparency is generally facilitated through contract award databases, though detailed performance reports are often internal. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

IRS IT Modernization Programs
Federal Civilian Agency IT Services Contracts
Department of the Treasury IT Procurement
Computer Systems Design and Related Services

Risk Flags

Contract awarded using Cost Plus Fixed Fee structure, which can increase cost risk.
Contract awarded in 2001; current market relevance and pricing benchmarks may be outdated.
Lack of detailed performance metrics in the provided data hinders a full value assessment.

Frequently Asked Questions

What is this federal contract paying for?

Department of the Treasury awarded $29.8 million to GENERAL DYNAMICS INFORMATION TECHNOLOGY, INC.. See the official description on USAspending.

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 $29.8 million.

What is the period of performance?

Start: 2001-11-15. End: 2002-11-16.

What was the specific scope of work for General Dynamics Information Technology under this contract?

The contract, identified by NAICS code 541512, pertains to 'Computer Systems Design Services.' While the specific scope is not detailed in the provided data, this typically involves designing, developing, integrating, and implementing computer systems. For the IRS, this could have encompassed areas such as tax processing systems, taxpayer databases, internal administrative systems, or network infrastructure design. The Cost Plus Fixed Fee structure suggests a project where costs were estimated, and a fixed fee was added, implying a significant development or integration effort rather than simple maintenance.

How does the Cost Plus Fixed Fee (CPFF) contract type compare to other IT contract types in terms of risk and value?

CPFF contracts are often used when the exact cost of performance is difficult to estimate beforehand, common in research and development or complex IT projects. The government agrees to pay the contractor's actual costs plus a fixed fee representing profit. This structure can incentivize contractors to control costs to maximize their fee relative to effort, but it also carries a risk of cost overruns if the initial cost estimates are inaccurate or if the scope expands. Compared to Firm-Fixed-Price (FFP) contracts, CPFF offers more flexibility for the government if requirements change but less cost certainty. Compared to Cost Plus Incentive Fee (CPIF), the fee is fixed regardless of performance outcomes, potentially reducing the incentive for exceptional performance.

What was the historical spending trend for similar IT services at the IRS or Treasury around 2001-2002?

In the early 2000s, federal agencies, including the IRS and Treasury, were heavily investing in IT modernization to improve efficiency, security, and taxpayer services. Spending on IT services, particularly for systems design and integration, was generally increasing across the government. The IRS, in particular, had ongoing initiatives to update its aging infrastructure and systems. This $29.8 million contract for a single year aligns with the significant IT budgets allocated during that period to address Y2K remediation aftermath and broader modernization efforts.

What is the track record of General Dynamics Information Technology in delivering large-scale IT contracts for federal agencies?

General Dynamics Information Technology (GDIT), a subsidiary of General Dynamics, has a long and extensive track record of delivering complex IT solutions and services to numerous federal agencies, including defense, intelligence, and civilian sectors. They are known for handling large-scale system integration, cybersecurity, cloud computing, and IT infrastructure management. While specific performance details for this particular 2001 contract are not available, GDIT's sustained presence and continued awards in the federal IT space suggest a generally positive history of performance and capability in managing substantial government contracts.

Were there any specific performance issues or challenges reported for this contract during its execution?

The provided data does not contain information regarding specific performance issues, challenges, or disputes related to this contract. Contract performance data, including any issues encountered, is typically detailed in internal agency reports, contract close-out documents, or potentially in Inspector General reports if significant problems arose. Without access to such detailed records, it is impossible to assess any specific performance problems that may have occurred during the execution of this particular contract.

Industry Classification

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

Product/Service Code: INFORMATION TECHNOLOGY EQUIPMENT (INCLD FIRMWARE) SOFTWARE,SUPPLIES& SUPPORT EQUIPMENT

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

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: $29,821,951

Exercised Options: $29,821,951

Current Obligation: $29,821,951

Parent Contract

Parent Award PIID: TIRNO99D00001

IDV Type: IDC

Timeline