Treasury's $19.8M IT services contract awarded to General Dynamics Information Technology, Inc. for O&M services

Contract Overview

Contract Amount: $19,827,602 ($19.8M)

Contractor: General Dynamics Information Technology, Inc.

Awarding Agency: Department of the Treasury

Start Date: 2005-11-30

End Date: 2011-08-02

Contract Duration: 2,071 days

Daily Burn Rate: $9.6K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: COMBINATION (TWO OR MORE)

Sector: IT

Official Description: O&M SERVICES FOR IFS

Place of Performance

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

State: Maryland Government Spending

Plain-Language Summary

Department of the Treasury obligated $19.8 million to GENERAL DYNAMICS INFORMATION TECHNOLOGY, INC. for work described as: O&M SERVICES FOR IFS Key points: 1. The contract value of $19.8 million over its period of performance suggests a significant investment in IT operations. 2. Awarded under full and open competition, this contract likely benefited from a competitive bidding process. 3. The duration of the contract (2071 days) indicates a long-term need for these IT services. 4. The North American Industry Classification System (NAICS) code 541512 points to a focus on computer systems design services. 5. The contract was awarded as 'Other Than Small Business' (ST=MD), suggesting the scope was beyond small business capabilities. 6. The 'Award Type' (AW=DO) indicates a 'Delivery Order', implying this was part of a larger indefinite-delivery/indefinite-quantity (IDIQ) contract or a similar framework.

Value Assessment

Rating: fair

Benchmarking the value of this $19.8 million contract for O&M services requires more granular data on the specific services provided and their market rates. Without detailed service descriptions or comparable contract data, it's difficult to definitively assess value for money. However, the duration of the contract (over 5 years) suggests a sustained need, and the competitive award process may have helped ensure reasonable pricing.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded through full and open competition, indicating that all responsible sources were permitted to submit bids. The fact that there were two bidders (NO=2) suggests a moderate level of competition for this specific award. While competition is generally positive, a higher number of bidders could potentially lead to more aggressive pricing and a wider range of innovative solutions.

Taxpayer Impact: A competitive award process generally benefits taxpayers by fostering price discovery and potentially leading to lower costs compared to sole-source or limited competition scenarios.

Public Impact

The Internal Revenue Service (IRS) is the primary beneficiary, receiving essential IT operations and maintenance services. The contract supports the ongoing functionality and reliability of critical IT systems used by the IRS. The services delivered are crucial for the IRS's ability to process tax information and serve taxpayers. The geographic impact is primarily within Maryland (SN=MARYLAND), where the contractor is located or services are rendered. The contract likely supports IT professionals and technicians employed by General Dynamics Information Technology, Inc.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Limited competition (2 bidders) may not have driven the absolute lowest price.
The contract duration of over 5 years could lead to vendor lock-in if not managed carefully.
Lack of specific performance metrics makes it hard to gauge the quality of O&M services delivered.
The 'Delivery Order' award type suggests this might be one of many orders under a larger contract, obscuring the full scope and value.

Positive Signals

Awarded through full and open competition, ensuring a broad range of potential offerors.
The contract value of $19.8M indicates a substantial commitment to maintaining critical IT infrastructure.
The contractor, General Dynamics Information Technology, Inc., is a large, established entity with significant IT experience.
The contract duration suggests a stable and predictable IT support environment for the IRS.

Sector Analysis

This contract falls within the IT services sector, specifically computer systems design and related services. The market for IT operations and maintenance (O&M) services is substantial, with government agencies being major consumers. Comparable spending benchmarks would typically involve analyzing IT O&M contracts of similar scope and duration across various federal agencies. The size of this contract ($19.8M) positions it as a mid-to-large-sized IT services award within the federal landscape.

Small Business Impact

This contract was not set aside for small businesses (SB=false). The award to General Dynamics Information Technology, Inc., a large business, indicates that the scope or nature of the services required was deemed beyond the capacity or specialization of small businesses for this particular procurement. There is no explicit information on subcontracting plans for small businesses within the provided data.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and the program office within the Internal Revenue Service. Accountability measures would be defined in the contract's statement of work and performance standards. Transparency is facilitated through contract award databases like FPDS-NG. Inspector General jurisdiction would apply if any fraud, waste, or abuse related to the contract were suspected.

Related Government Programs

IRS IT Modernization Programs
Federal Civilian IT Services Contracts
General Services Administration (GSA) IT Schedule Contracts
Department of the Treasury IT Operations Support

Risk Flags

Potential for cost overruns due to long contract duration.
Risk of vendor lock-in impacting future flexibility.
Limited competition (2 bidders) may not have yielded optimal pricing.
Lack of detailed performance data hinders effectiveness assessment.

Frequently Asked Questions

What is this federal contract paying for?

Department of the Treasury awarded $19.8 million to GENERAL DYNAMICS INFORMATION TECHNOLOGY, INC.. O&M SERVICES FOR IFS

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 $19.8 million.

What is the period of performance?

Start: 2005-11-30. End: 2011-08-02.

What specific O&M services were included in this $19.8 million contract?

The provided data indicates the contract was for 'O&M SERVICES FOR IFS' (Operations and Maintenance Services for Integrated Financial System). However, the specific details of these services are not itemized. Typically, O&M services for a system like IFS would encompass activities such as system monitoring, performance tuning, patch management, troubleshooting, user support, hardware and software maintenance, and ensuring system availability and security. The scope could range from routine upkeep to more complex issue resolution and system upgrades, depending on the detailed requirements outlined in the contract's Statement of Work (SOW).

How does the $19.8 million contract value compare to similar IT O&M contracts for large federal agencies?

The $19.8 million value over approximately five years (2005-2011) for IT O&M services is a substantial but not extraordinary amount for a federal agency like the IRS. Large federal IT O&M contracts can range from tens of millions to hundreds of millions of dollars annually, depending on the complexity and scale of the systems supported. For instance, contracts supporting agency-wide financial systems, tax processing platforms, or large data centers often command higher values. This contract's value suggests it covered critical but perhaps not the entirety of the IRS's IT O&M needs, or it was for a specific, significant system like the Integrated Financial System.

What are the potential risks associated with a 5+ year IT O&M contract awarded to a single large vendor?

A significant risk with long-term IT O&M contracts awarded to a single large vendor is the potential for vendor lock-in, where the agency becomes heavily reliant on the incumbent's proprietary knowledge and processes, making future transitions difficult and costly. There's also a risk of complacency, where the vendor may not feel the same pressure to innovate or optimize costs as they might under more frequent or competitive procurements. Furthermore, if the contract's scope is not tightly managed, costs can escalate. Ensuring robust performance metrics, regular reviews, and maintaining the option to re-compete are crucial mitigation strategies.

How effective was General Dynamics Information Technology, Inc. in performing O&M services for the IRS under this contract?

The provided data does not contain specific performance metrics or evaluations for this contract. Assessing the effectiveness would require access to contract performance reports, user feedback, and potentially Inspector General audits. General Dynamics Information Technology, Inc. is a large, established contractor with extensive experience in government IT services, suggesting a baseline capability. However, effectiveness is highly dependent on the specific execution, management, and the evolving needs of the IRS during the contract period (2005-2011).

What was the historical spending trend for IT O&M services at the IRS around the time of this contract award?

The data provided only pertains to this single contract. To understand historical spending trends for IT O&M at the IRS, one would need to analyze multiple contracts awarded over several fiscal years. This would involve examining spending on similar services, identifying major IT initiatives, and observing fluctuations in IT budgets. Without a broader dataset, it's impossible to determine if this $19.8 million contract represented an increase, decrease, or stable level of spending for the IRS's IT O&M requirements during that period.

What does the 'Delivery Order' (AW=DO) award type imply about the overall contract structure?

The 'Delivery Order' (AW=DO) award type typically signifies that this contract was issued under a larger, pre-existing contract vehicle, such as an Indefinite-Delivery/Indefinite-Quantity (IDIQ) contract or a Government-Wide Acquisition Contract (GWAC). This means that the $19.8 million represents the value of a specific order placed against that larger framework agreement. The underlying IDIQ contract would have established the general terms, conditions, and pricing structure, allowing agencies to issue multiple delivery orders for specific needs over time. This approach provides flexibility but can sometimes make it harder to see the total spending picture for a particular service or vendor at a glance.

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: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 2

Pricing Type: COMBINATION (TWO OR MORE) (2)

Evaluated Preference: NONE

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: $19,827,602

Exercised Options: $19,827,602

Current Obligation: $19,827,602

Parent Contract

Parent Award PIID: TIRNO99D00001

IDV Type: IDC

Timeline