DoD's $76.8M Engineering Services Contract Awarded to General Dynamics IT Shows Mixed Value and Competition

Contract Overview

Contract Amount: $76,820,324 ($76.8M)

Contractor: General Dynamics Information Technology Inc.

Awarding Agency: Department of Defense

Start Date: 2004-09-30

End Date: 2010-03-31

Contract Duration: 2,008 days

Daily Burn Rate: $38.3K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: COST PLUS FIXED FEE

Sector: Defense

Official Description: 200412!004331!2100!W74V8H!DEF. CONTRACT. CMD. - WASHINGTON!W74V8H04C0053 !A!N! !N! ! !20040930!20050929!043991108!043991108!009581091!N!COMPUTER SCIENCES CORPORATION !3160 FAIRVIEW PARK DRIVE !FALLS CHURCH !VA!22042!27200!610!51!FALLS CHURCH !FALLS CHURCH (CITY) !VIRGINIA !+000003000000!N!N!000122157672!B537!MEDICAL & HEALTH STUDIES !S1 !SERVICES !000 !* !541330!E! !3! ! ! ! ! !99990909!B!F!N!A! !A!N!U!2!002!A! !Z!N!Z! ! !N!C!N! ! ! !A!A!A!A!000!A!C!N! ! ! !Y! ! !0001! !

Place of Performance

Location: FALLS CHURCH, FAIRFAX County, VIRGINIA, 22042

State: Virginia Government Spending

Plain-Language Summary

Department of Defense obligated $76.8 million to GENERAL DYNAMICS INFORMATION TECHNOLOGY INC. for work described as: 200412!004331!2100!W74V8H!DEF. CONTRACT. CMD. - WASHINGTON!W74V8H04C0053 !A!N! !N! ! !20040930!20050929!043991108!043991108!009581091!N!COMPUTER SCIENCES CORPORATION !3160 FAIRVIEW PARK DRIVE !FALLS CHURCH !VA!22042!27200!610!51!FALLS CHURCH !FALL… Key points: 1. The contract's value proposition is unclear due to a lack of detailed performance metrics and cost breakdowns. 2. Competition was robust initially, but the final award went to a single large contractor, raising questions about sustained market engagement. 3. The contract carries moderate risk, primarily related to potential cost overruns given its cost-plus structure and extended duration. 4. Performance context is limited, with no specific project outcomes or service level agreements publicly detailed. 5. This contract falls within the broader IT and professional services sector, supporting defense-related engineering functions. 6. The significant dollar amount suggests a substantial need for specialized engineering expertise within the Department of Defense.

Value Assessment

Rating: fair

The total award value of $76.8 million over its extended period (2004-2010) averages approximately $10.9 million annually. Benchmarking this against similar large-scale engineering services contracts within the DoD is challenging without more granular data on the specific services rendered. The 'Cost Plus Fixed Fee' (CPFF) contract type introduces inherent risk for cost overruns, as the contractor is reimbursed for all allowable costs plus a fixed fee. While the fixed fee provides some predictability, the overall cost efficiency is difficult to ascertain without detailed performance and cost-saving metrics.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was initially competed under 'full and open' procedures, indicating a broad solicitation for potential bidders. However, the provided data does not specify the number of initial bidders or the details of the competitive process that led to the final award. The fact that it resulted in a definitive contract suggests a thorough evaluation of proposals. The transition from a broad competition to a single awardee is common in large, complex procurements.

Taxpayer Impact: A full and open competition is generally favorable for taxpayers as it aims to solicit the best value from the widest possible pool of contractors, potentially driving down prices through market forces.

Public Impact

The primary beneficiaries are the Department of Defense agencies requiring specialized engineering services for defense programs. Services delivered likely include systems engineering, technical support, and program management assistance for complex defense projects. The geographic impact is concentrated within the areas where General Dynamics Information Technology operates and supports DoD activities, primarily in Virginia. Workforce implications include employment opportunities for engineers, technical specialists, and support staff within General Dynamics IT and its subcontractors.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost-plus contract type increases the risk of budget overruns if not closely managed.
Extended contract duration (2004-2010) may lead to scope creep or outdated technological solutions if not actively managed.
Lack of specific performance metrics makes it difficult to assess the true value and efficiency of the services provided.
The transition from initial competition to a single awardee warrants scrutiny to ensure continued market competitiveness.

Positive Signals

Initial 'full and open' competition suggests an effort to maximize contractor options and potentially secure competitive pricing.
Award to a large, established contractor like General Dynamics IT indicates a selection based on proven capabilities and experience.
The contract supports critical defense engineering functions, implying a strategic need for these specialized services.

Sector Analysis

This contract falls within the Engineering Services (NAICS 541330) sector, a significant segment of the professional services market supporting government and commercial clients. The market for defense engineering services is substantial, driven by the continuous need for technological advancement, system upgrades, and program support within the military. General Dynamics Information Technology is a major player in this space, competing with other large defense contractors. Spending benchmarks for similar large-scale engineering support contracts within the DoD can range from tens to hundreds of millions of dollars annually, depending on the scope and duration.

Small Business Impact

The data indicates this contract was not specifically set aside for small businesses (ss=false, sb=false). As a large definitive contract awarded to a major prime contractor, the primary impact on small businesses would likely be through subcontracting opportunities. The extent of small business participation would depend on General Dynamics IT's subcontracting plan and the specific requirements of the engineering services needed.

Oversight & Accountability

Oversight for this contract would fall under the Defense Contract Management Agency (DCMA), responsible for ensuring contractor performance and compliance. The 'Cost Plus Fixed Fee' structure necessitates rigorous financial oversight to validate allowable costs and ensure the fixed fee remains appropriate. Transparency is moderate, as contract awards are public, but detailed performance reports and cost breakdowns are typically not publicly accessible.

Related Government Programs

DoD Engineering Services Contracts
IT Professional Services
Defense Systems Engineering Support
Cost Plus Fixed Fee Contracts
General Dynamics IT Contracts

Risk Flags

Cost Overrun Risk (CPFF Contract Type)
Lack of Performance Metrics
Extended Contract Duration
Potential for Scope Creep

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $76.8 million to GENERAL DYNAMICS INFORMATION TECHNOLOGY INC.. 200412!004331!2100!W74V8H!DEF. CONTRACT. CMD. - WASHINGTON!W74V8H04C0053 !A!N! !N! ! !20040930!20050929!043991108!043991108!009581091!N!COMPUTER SCIENCES CORPORATION !3160 FAIRVIEW PARK DRIVE !FALLS CHURCH !VA!22042!27200!610!51!FALLS CHURCH !FALLS CHURCH (CITY) !VIRGINIA !+000003000000!N!N!000122157672!B537!MEDICAL & HEALTH STUDIES !S1 !SERVICES !000 !* !541330!E! !3! ! ! ! ! !999

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 Contract Management Agency).

What is the total obligated amount?

The obligated amount is $76.8 million.

What is the period of performance?

Start: 2004-09-30. End: 2010-03-31.

What specific engineering services were provided under this contract, and how did they contribute to DoD objectives?

The contract's primary classification is 'Engineering Services' (NAICS 541330) and 'Medical & Health Studies' (PSC B537). This suggests a broad scope potentially encompassing systems engineering, technical analysis, research and development support, and possibly health-related studies for defense applications. Without more detailed task orders or performance reports, the precise nature and contribution of these services to specific DoD objectives remain unspecified. The 'Services' description further broadens the potential activities. The contract's duration and significant value imply a sustained, high-level support role rather than discrete, short-term tasks.

How did the final awarded price of $76.8 million compare to the initial estimated value or bids received?

The provided data lists an 'award amount' (a) of $76,820,323.59 and a 'base and all options value' (br) of 38,257,000. This discrepancy suggests that the $76.8M figure represents the total value including exercised options or modifications over the contract's lifespan, while $38.2M might be a baseline or initial estimate. Without knowing the number of bids received or the initial solicitation's estimated value, a direct comparison is difficult. However, the final award significantly exceeded the 'base and all options' value, indicating substantial growth through modifications or exercised options during the contract period (2004-2010).

What is the track record of General Dynamics Information Technology (GDIT) in managing similar large-scale DoD contracts?

General Dynamics Information Technology (now part of General Dynamics) has a long and extensive history of managing large, complex contracts for the Department of Defense and other federal agencies. They are a major prime contractor across various domains, including IT services, C4ISR systems, healthcare IT, and professional support services. Their track record generally includes experience with diverse contract types, including cost-plus and fixed-price arrangements. While specific performance details for individual contracts are often proprietary, GDIT's sustained presence and significant contract awards indicate a substantial capability in delivering services and managing large programs within the defense sector.

What are the potential risks associated with the 'Cost Plus Fixed Fee' (CPFF) contract type for this specific engagement?

The CPFF contract type, used here, reimburses the contractor for all allowable costs incurred, plus a predetermined fixed fee representing profit. The primary risk for the government is that the contractor may have less incentive to control costs compared to fixed-price contracts, as cost overruns are generally covered. While the fixed fee provides some predictability on profit, the total expenditure can escalate if costs are not diligently managed and audited. For this $76.8M contract spanning several years, effective oversight by the Defense Contract Management Agency (DCMA) is crucial to scrutinize costs, ensure efficiency, and prevent unnecessary spending. The risk is mitigated by robust government auditing and contract administration.

How does this contract's spending compare to other engineering services contracts within the DoD during the mid-2000s?

During the mid-2000s, the Department of Defense awarded numerous large contracts for engineering and technical services, often in the tens to hundreds of millions of dollars. This $76.8 million contract, awarded between 2004 and 2010, falls within the typical range for significant, multi-year support agreements. Major defense contractors frequently secured contracts of this magnitude to provide specialized expertise for weapon systems development, IT infrastructure, cybersecurity, and operational support. Without a direct comparison of scope and duration, pinpointing its exact standing is difficult, but it represents a substantial investment in engineering capabilities consistent with DoD's needs during that period.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Architectural, Engineering, and Related Services › Engineering Services

Product/Service Code: SPECIAL STUDIES/ANALYSIS, NOT R&D › SPECIAL STUDIES - NOT R and D

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 2

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Parent Company: General Dynamics Corporation

Address: 3170 FAIRVIEW PARK DR, FALLS CHURCH, VA, 22042

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $27,009,035

Exercised Options: $53,029,068

Current Obligation: $76,820,324

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline