DoD's $16.77M Engineering Services Contract with General Dynamics: A Cost Plus Fixed Fee Analysis
Contract Overview
Contract Amount: $16,771,159 ($16.8M)
Contractor: General Dynamics Mission Systems, Inc.
Awarding Agency: Department of Defense
Start Date: 2005-06-30
End Date: 2011-03-31
Contract Duration: 2,100 days
Daily Burn Rate: $8.0K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: COST PLUS FIXED FEE
Sector: Defense
Place of Performance
Location: HUNTSVILLE, MADISON County, ALABAMA, 35805
State: Alabama Government Spending
Plain-Language Summary
Department of Defense obligated $16.8 million to GENERAL DYNAMICS MISSION SYSTEMS, INC. for work described as: Key points: 1. The contract awarded to General Dynamics Mission Systems, Inc. for engineering services represents a significant investment by the Department of Defense. 2. The 'NOT COMPETED' status raises questions about the procurement process and potential missed opportunities for competitive pricing. 3. The Cost Plus Fixed Fee (CPFF) contract type can lead to cost overruns if not managed diligently, posing a risk to taxpayer funds. 4. The engineering services sector is critical for defense, but the lack of competition here warrants scrutiny.
Value Assessment
Rating: questionable
The Cost Plus Fixed Fee structure, while allowing flexibility, can be prone to cost escalation. Without competitive benchmarks, assessing the fairness of the $16.77 million award is difficult.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
The contract was not competed, indicating a sole-source or limited competition award. This limits price discovery and potentially leads to higher costs for the government.
Taxpayer Impact: The lack of competition may result in taxpayers paying more than necessary for these engineering services.
Public Impact
Taxpayers may be overpaying due to the absence of competitive bidding. The long duration (2100 days) of this contract raises concerns about long-term cost commitments. The specific engineering services provided are not detailed, making it hard to assess their direct public benefit.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Lack of Competition
- Cost Plus Fixed Fee Structure
- Long Contract Duration
Positive Signals
- Awarded to established contractor
- Specific contract type chosen
Sector Analysis
Engineering services are vital for defense modernization and maintenance. Benchmarks for similar sole-source engineering contracts are difficult to ascertain, but competitive bids typically yield better value.
Small Business Impact
The data indicates this contract was not awarded to a small business. Further analysis would be needed to determine if small businesses were considered or excluded from this procurement.
Oversight & Accountability
The 'NOT COMPETED' designation suggests a need for robust oversight to ensure the justification for sole-source procurement was sound and that costs were appropriately managed throughout the contract's life.
Related Government Programs
- Engineering Services
- Department of Defense Contracting
- Defense Contract Management Agency Programs
Risk Flags
- Lack of competition may lead to inflated costs.
- CPFF contract type carries inherent cost overrun risks.
- Long contract duration (2100 days) increases exposure to cost and performance risks.
- Absence of detailed service description hinders value assessment.
Tags
engineering-services, department-of-defense, al, definitive-contract, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $16.8 million to GENERAL DYNAMICS MISSION SYSTEMS, INC.. See the official description on USAspending.
Who is the contractor on this award?
The obligated recipient is GENERAL DYNAMICS MISSION SYSTEMS, INC..
Which agency awarded this contract?
Awarding agency: Department of Defense (Defense Contract Management Agency).
What is the total obligated amount?
The obligated amount is $16.8 million.
What is the period of performance?
Start: 2005-06-30. End: 2011-03-31.
What was the justification for not competing this significant engineering services contract?
The justification for not competing this $16.77 million contract is not provided in the data. Typically, sole-source awards are made when only one responsible source can provide the required services, or in cases of urgent need. Without this justification, it's impossible to assess if the government received fair value or if competitive alternatives were overlooked.
What are the primary risks associated with a Cost Plus Fixed Fee contract for engineering services?
The primary risk with a Cost Plus Fixed Fee (CPFF) contract is that the contractor is reimbursed for all allowable costs plus a fixed fee representing profit. If costs escalate beyond initial estimates, the government bears the burden. For engineering services, this can lead to budget overruns if project scope changes or unforeseen technical challenges arise, impacting the overall value for taxpayers.
How does the lack of competition impact the effectiveness of this contract in delivering value?
The lack of competition significantly hinders the effectiveness of this contract in delivering optimal value. Without competitive pressure, there is less incentive for the contractor to minimize costs or maximize efficiency. This can lead to inflated pricing and potentially less innovative solutions compared to a scenario where multiple firms vied for the contract, driving down costs and improving service delivery.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Architectural, Engineering, and Related Services › Engineering Services
Product/Service Code: COMM/DETECT/COHERENT RADIATION
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Offers Received: 1
Pricing Type: COST PLUS FIXED FEE (U)
Evaluated Preference: NONE
Contractor Details
Parent Company: General Dynamics Corp
Address: 6000 TECHNOLOGY DRIVE, HUNTSVILLE, AL, 35805
Business Categories: Category Business, Not Designated a Small Business
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: YES
Timeline
Start Date: 2005-06-30
Current End Date: 2011-03-31
Potential End Date: 2011-03-31 00:00:00
Last Modified: 2023-01-27
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