DoD's $19.9M labor contract with General Dynamics IT awarded under full and open competition

Contract Overview

Contract Amount: $19,947,229 ($19.9M)

Contractor: General Dynamics Information Technology, Inc.

Awarding Agency: Department of Defense

Start Date: 2007-09-01

End Date: 2010-08-31

Contract Duration: 1,095 days

Daily Burn Rate: $18.2K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: LABOR HOURS

Sector: IT

Official Description: LABOR

Place of Performance

Location: SCOTT AFB, ST. CLAIR County, ILLINOIS, 62225

State: Illinois Government Spending

Plain-Language Summary

Department of Defense obligated $19.9 million to GENERAL DYNAMICS INFORMATION TECHNOLOGY, INC. for work described as: LABOR Key points: 1. Contract awarded for wired telecommunications services, indicating a need for robust network infrastructure. 2. The contract duration of 1095 days suggests a long-term requirement for these services. 3. Awarded to a large, established contractor, potentially indicating a focus on reliability and experience. 4. The use of labor hours pricing can offer flexibility but requires diligent oversight to manage costs. 5. The contract was awarded by the Defense Information Systems Agency, a key IT provider for the DoD. 6. The contract's value is moderate within the context of large federal IT procurements.

Value Assessment

Rating: fair

The contract's value of $19.9 million for labor hours over three years appears reasonable for specialized telecommunications support within a large agency like DISA. Benchmarking against similar contracts for wired telecommunications infrastructure and support services is challenging without more specific service details. However, given the contractor's size and the competitive nature of the award, the pricing is likely within an acceptable range, though the labor hours model necessitates careful monitoring to ensure cost-effectiveness and prevent scope creep.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that multiple vendors were eligible to bid. The presence of two bids suggests a moderate level of competition for this requirement. While more than one bidder is positive, a higher number of bids typically leads to more aggressive pricing and better value for the government. The agency likely sought a competitive process to ensure fair market pricing for these essential telecommunications services.

Taxpayer Impact: Full and open competition is beneficial for taxpayers as it encourages multiple vendors to offer their best pricing and services, potentially leading to cost savings and higher quality outcomes.

Public Impact

The primary beneficiaries are the Department of Defense and its various components, which receive essential wired telecommunications services. Services delivered likely include installation, maintenance, and support for the DoD's internal communication networks. The geographic impact is likely focused on DoD facilities where these telecommunications services are required, potentially worldwide. Workforce implications include employment opportunities for skilled technicians and engineers within General Dynamics Information Technology.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Labor hours contracts can be susceptible to cost overruns if not closely managed and monitored for efficiency.
The specific details of the 'labor' provided are not fully elaborated, making a precise value assessment difficult.
Reliance on a single large contractor for critical infrastructure could pose a risk if performance issues arise.

Positive Signals

Awarded through full and open competition, suggesting a fair and transparent procurement process.
The contractor, General Dynamics Information Technology, is a well-established entity with significant experience in government IT services.
The contract duration implies a stable, ongoing need for these services, indicating strategic planning by the agency.

Sector Analysis

This contract falls within the Information Technology and Telecommunications sector, specifically focusing on wired network infrastructure. The market for such services is large and competitive, with numerous providers ranging from large system integrators to specialized network firms. Federal spending in this area is substantial, driven by the continuous need for secure and reliable communication networks across all government agencies. This contract represents a portion of the DoD's broader investment in maintaining and upgrading its vast communication capabilities.

Small Business Impact

This contract was not set aside for small businesses and was awarded to a large prime contractor. There is no explicit indication of subcontracting plans for small businesses within the provided data. The absence of a small business set-aside suggests that the requirement was deemed best met through open competition or that large prime contractors were expected to fulfill the bulk of the work, potentially limiting direct opportunities for small businesses on this specific award.

Oversight & Accountability

Oversight for this contract would typically be managed by the Defense Information Systems Agency (DISA) contracting officers and program managers. Performance monitoring, invoice review, and adherence to contract terms are standard oversight mechanisms. Transparency is facilitated through contract award databases like FPDS. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse related to the contract.

Related Government Programs

DoD IT Services
Telecommunications Infrastructure Contracts
Wired Network Support
General Dynamics IT Contracts
Defense Information Systems Agency Procurements

Risk Flags

Potential for cost overruns due to labor hours pricing model.
Moderate competition level (2 bidders) may limit optimal price discovery.
Lack of specific service details hinders precise value benchmarking.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $19.9 million to GENERAL DYNAMICS INFORMATION TECHNOLOGY, INC.. LABOR

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 Information Systems Agency).

What is the total obligated amount?

The obligated amount is $19.9 million.

What is the period of performance?

Start: 2007-09-01. End: 2010-08-31.

What is the historical spending pattern for wired telecommunications carriers by the Department of Defense?

The Department of Defense (DoD) has consistently allocated significant funds towards wired telecommunications carriers to maintain its vast and complex communication infrastructure. Historical data indicates a steady demand for services such as network installation, maintenance, and upgrades. Spending fluctuates based on technological advancements, modernization initiatives, and evolving security requirements. While specific annual figures vary, the DoD remains one of the largest federal government consumers of telecommunications services, with contracts often awarded through competitive bidding processes to ensure value. The trend generally shows a sustained investment in ensuring robust and secure connectivity across its global operations.

How does the awarded price compare to market rates for similar wired telecommunications services?

Assessing the precise value-for-money requires a detailed comparison of the specific services rendered under this $19.9 million contract against prevailing market rates for similar wired telecommunications services. Given that the contract was awarded under full and open competition with two bids, it suggests a degree of market validation. However, without granular data on the scope of work, labor categories, and geographic locations, a definitive benchmark is difficult. Generally, large federal contracts, especially those with established contractors like General Dynamics IT, aim for competitive pricing. The labor hours pricing model, while flexible, necessitates diligent oversight to ensure costs remain aligned with market expectations and avoid inefficiencies.

What is General Dynamics Information Technology's track record with similar federal contracts?

General Dynamics Information Technology (GDIT) has a substantial track record of performing large-scale IT and telecommunications contracts for the federal government, including extensive work with the Department of Defense. They are a major contractor known for handling complex infrastructure projects, network services, and IT support across various agencies. Their history includes numerous awards for services similar to wired telecommunications, often involving secure network operations and maintenance. While specific performance metrics for every contract are not publicly detailed, GDIT's continued success in winning significant federal awards suggests a generally positive performance history and capability to meet demanding government requirements.

What are the potential risks associated with this type of labor-hours contract?

Labor-hours contracts, like the one awarded to General Dynamics IT, present specific risks primarily related to cost control and performance management. The main risk is the potential for cost overruns if the labor hours required exceed initial estimates or if the work is not performed efficiently. Without a fixed price for the total effort, there's an inherent incentive for contractors to bill for more hours, necessitating robust government oversight to monitor progress, validate hours worked, and ensure the quality of services delivered. Scope creep is another risk, where the project's objectives may expand without corresponding adjustments to cost or timeline, further increasing expenses. Effective management requires detailed tracking, regular performance reviews, and clear communication.

How does the competition level (2 bidders) impact the value for taxpayers?

A competition level with only two bidders, as seen in this contract award, presents a mixed picture for taxpayer value. On one hand, having more than one bidder ensures that the government is not solely reliant on a single source and receives at least some level of price comparison. This is generally preferable to a sole-source award. However, a higher number of bids typically fosters more intense competition, driving down prices further and potentially leading to more innovative solutions. With only two bidders, the government may not achieve the absolute best possible price or the widest range of options available in a more robustly contested market. Therefore, while not a concern of limited competition, it suggests potential for enhanced value if more vendors had participated.

Industry Classification

NAICS: Information › Wired and Wireless Telecommunications (except Satellite) › Wired Telecommunications Carriers

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

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 2

Pricing Type: LABOR HOURS (Z)

Evaluated Preference: NONE

Contractor Details

Parent Company: General Dynamics Corp (UEI: 001381284)

Address: 77 A STREET, NEEDHAM, MA, 04

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $19,947,229

Exercised Options: $19,947,229

Current Obligation: $19,947,229

Contract Characteristics

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: FA877104D0007

IDV Type: IDC

Timeline