General Dynamics IT's $36.4M IRS contract for computer systems design services awarded under full and open competition

Contract Overview

Contract Amount: $36,442,449 ($36.4M)

Contractor: General Dynamics Information Technology, Inc.

Awarding Agency: Department of the Treasury

Start Date: 2007-08-07

End Date: 2021-09-21

Contract Duration: 5,159 days

Daily Burn Rate: $7.1K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: COST PLUS FIXED FEE

Sector: IT

Official Description: PRIME CONTRACT - CADE RELEASE 4

Place of Performance

Location: LANHAM, PRINCE GEORGES County, MARYLAND, 20706

State: Maryland Government Spending

Plain-Language Summary

Department of the Treasury obligated $36.4 million to GENERAL DYNAMICS INFORMATION TECHNOLOGY, INC. for work described as: PRIME CONTRACT - CADE RELEASE 4 Key points: 1. The contract represents a significant investment in IT infrastructure for the IRS. 2. The duration of the contract suggests a long-term need for these services. 3. The award was made under a cost-plus-fixed-fee pricing structure. 4. The contract was awarded as a delivery order, indicating it's part of a larger vehicle. 5. The services provided fall under computer systems design, a critical area for government operations.

Value Assessment

Rating: fair

Benchmarking the value of this contract is challenging without specific deliverables or performance metrics. The cost-plus-fixed-fee structure can lead to cost overruns if not managed tightly. Comparing it to similar large-scale IT system design contracts would require detailed scope analysis. The total value of $36.4 million over its extended period suggests a substantial but not necessarily excessive investment for the IRS's needs.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded through full and open competition, indicating that multiple bidders had the opportunity to compete. The fact that it was a delivery order suggests it was likely competed under an existing indefinite-delivery/indefinite-quantity (IDIQ) contract or a similar broad agency announcement. The level of competition for the underlying IDIQ vehicle would be a key factor in assessing price discovery.

Taxpayer Impact: Full and open competition generally benefits taxpayers by fostering a competitive environment that can drive down prices and encourage innovation.

Public Impact

Taxpayers benefit from improved efficiency and effectiveness of IRS IT systems. The contract supports the delivery of essential computer systems design services. The primary geographic impact is likely within the IRS's operational centers, potentially nationwide. The contract supports a workforce skilled in computer systems design and IT services.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost-plus-fixed-fee contracts can incentivize contractors to increase costs to maximize profit if not properly overseen.
The long duration of the contract (over 13 years) raises questions about adaptability to evolving technology and potential for vendor lock-in.

Positive Signals

Awarded through full and open competition, suggesting a robust bidding process.
The contract addresses a critical need for IT systems design within a major federal agency.

Sector Analysis

Computer systems design services are a vital component of the IT sector, supporting government agencies in managing complex data and operations. The market for these services is large and competitive, with numerous firms offering specialized expertise. This contract fits within the broader category of government IT services, which represents a significant portion of federal procurement spending. Comparable spending benchmarks would depend on the specific nature of the systems designed.

Small Business Impact

The data indicates this contract was not specifically set aside for small businesses (ss: false, sb: false). While General Dynamics Information Technology, Inc. is a large business, there may be subcontracting opportunities for small businesses within the scope of this contract. The extent of small business participation would depend on the prime contractor's subcontracting plan and adherence to federal small business goals.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and the program office within the IRS. Accountability measures would be defined in the contract's terms and conditions, including performance standards and reporting requirements. Transparency is facilitated through contract award databases like FPDS. Inspector General jurisdiction would apply if any fraud, waste, or abuse is suspected.

Related Government Programs

IRS IT Modernization Programs
Federal Civilian IT Procurement
Computer Systems Design Services Contracts

Risk Flags

Long contract duration may indicate potential for technological obsolescence or vendor lock-in.
Cost-plus-fixed-fee contracts require diligent oversight to manage costs effectively.

Frequently Asked Questions

What is this federal contract paying for?

Department of the Treasury awarded $36.4 million to GENERAL DYNAMICS INFORMATION TECHNOLOGY, INC.. PRIME CONTRACT - CADE RELEASE 4

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 $36.4 million.

What is the period of performance?

Start: 2007-08-07. End: 2021-09-21.

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

The provided data indicates the contract was for 'Computer Systems Design Services' (na: 541512). However, the specific scope of work, deliverables, and technical requirements are not detailed in this summary. Typically, computer systems design services encompass analyzing user needs, designing system architecture, developing software, integrating hardware and software, and providing technical support. For the IRS, this could involve systems related to tax processing, taxpayer accounts, data security, or internal operations. A full understanding would require reviewing the contract's Statement of Work (SOW).

How does the pricing structure (Cost Plus Fixed Fee) compare to other IT services contracts for similar agencies?

Cost Plus Fixed Fee (CPFF) contracts are common for complex IT projects where the scope may evolve or is not fully defined at the outset. This structure allows for flexibility but requires robust oversight to control costs. Compared to fixed-price contracts, CPFF can be more expensive for the government if costs escalate significantly. However, for research and development or system design where innovation and adaptation are key, it can be a suitable choice. Benchmarking requires comparing the fixed fee and total estimated cost against the value delivered and the performance outcomes achieved, relative to similar CPFF contracts for IT services at agencies like the IRS or other large civilian departments.

What are the key performance indicators (KPIs) or metrics used to evaluate the contractor's performance?

The provided data does not specify the Key Performance Indicators (KPIs) or metrics used to evaluate General Dynamics Information Technology, Inc.'s performance under this contract. In a typical IT services contract, KPIs might include system uptime, response times, bug resolution rates, project milestone completion, adherence to budget, and user satisfaction. The effectiveness of the oversight and the clarity of these metrics are crucial for ensuring the government receives the intended value and that the contractor meets its obligations. These details would be found within the contract's performance work statement or associated appendices.

What is the historical spending trend for computer systems design services at the IRS?

This specific contract spans from August 7, 2007, to September 21, 2021, totaling approximately $36.4 million. To understand the historical spending trend, one would need to analyze IRS's procurement data for NAICS code 541512 (Computer Systems Design Services) over a longer period, looking at the total obligated amounts and the number of contracts awarded annually. This would reveal whether spending on such services has been consistent, increasing, or decreasing, and how this particular contract fits into the overall IT investment strategy of the IRS.

What is the track record of General Dynamics Information Technology, Inc. with the IRS and similar federal agencies?

General Dynamics Information Technology, Inc. (GDIT) is a major federal contractor with a long history of providing IT services across numerous government agencies, including the IRS. Their track record typically involves large-scale system integration, modernization, and support services. Assessing their specific performance on this IRS contract would require examining past performance reviews, any contract disputes or awards, and their overall success in meeting the defined objectives and deliverables. GDIT's extensive experience suggests a capacity to handle complex government IT requirements, but individual contract performance can vary.

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

Offers Received: 2

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Parent Company: General Dynamics Corp (UEI: 001381284)

Address: MARYLAND TECHNOLOGY CENTER, LANHAM, MD, 20706

Business Categories: Category Business, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $39,746,930

Exercised Options: $39,746,930

Current Obligation: $36,442,449

Actual Outlays: $10,765

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Parent Contract

Parent Award PIID: TIRNO99D00001

IDV Type: IDC

Timeline