DoD awards $90.8M IT services contract to General Dynamics, with 11 bids received

Contract Overview

Contract Amount: $90,829,380 ($90.8M)

Contractor: General Dynamics Information Technology, Inc.

Awarding Agency: Department of Defense

Start Date: 2020-08-08

End Date: 2025-12-07

Contract Duration: 1,947 days

Daily Burn Rate: $46.7K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 11

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: BASE PERIOD BASE LABOR

Place of Performance

Location: FORT HUACHUCA, COCHISE County, ARIZONA, 85613

State: Arizona Government Spending

Plain-Language Summary

Department of Defense obligated $90.8 million to GENERAL DYNAMICS INFORMATION TECHNOLOGY, INC. for work described as: BASE PERIOD BASE LABOR Key points: 1. Contract value appears reasonable given the scope of IT services and duration. 2. Strong competition with 11 bidders suggests a healthy market for these services. 3. Fixed-price contract type mitigates cost overrun risks for the government. 4. Performance period extends over 4 years, indicating a long-term need. 5. Contractor has a significant presence in the federal IT services sector. 6. Services are classified under 'Other Computer Related Services', a broad category.

Value Assessment

Rating: good

The base period labor cost of approximately $90.8 million over nearly 4 years (1947 days) for IT services is within a reasonable range for a contract of this scope and duration. Benchmarking against similar large-scale IT support contracts awarded by the Department of Defense suggests that the pricing is competitive, especially considering the fixed-price nature which shifts risk to the contractor. The number of bids received (11) further supports the notion that the pricing was attractive enough to elicit significant market interest.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, with 11 distinct bids submitted. This high level of competition is a positive indicator, suggesting that the solicitation was well-structured and accessible to a wide range of qualified vendors. The presence of numerous bidders typically leads to more competitive pricing and a broader selection of innovative solutions, benefiting the government.

Taxpayer Impact: The robust competition for this contract is beneficial for taxpayers as it likely drove down prices and ensured the government received the best value for its investment in IT services.

Public Impact

The Department of Defense benefits from enhanced IT infrastructure and support services. Military operations and administrative functions are likely supported by these IT services. The contract supports IT professionals and related jobs within the contractor's organization. Services are delivered to support the Department of the Army, a major component of the DoD. The geographic impact is likely concentrated where Army operations are based, potentially nationwide or globally.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for vendor lock-in if services become highly specialized and integrated.
Reliance on a single large contractor could reduce future competitive opportunities if not managed carefully.

Positive Signals

Strong competition indicates a healthy market and potential for future competitive awards.
Fixed-price contract type provides cost certainty and reduces the risk of budget overruns.
Contractor's established presence suggests experience and capability in delivering complex IT solutions.

Sector Analysis

The IT services sector is a vast and critical component of federal spending, encompassing a wide array of support, development, and maintenance activities. This contract falls under 'Other Computer Related Services,' a broad category that can include everything from network management to cybersecurity and software support. The federal government is a major consumer of IT services, with spending often concentrated within defense and civilian agencies. Comparable spending benchmarks for large IT support contracts can range from tens to hundreds of millions of dollars annually, depending on the scope and complexity.

Small Business Impact

This contract was awarded under full and open competition and does not indicate a specific small business set-aside. While the primary awardee is a large corporation, there may be opportunities for small businesses to participate as subcontractors. The extent of small business subcontracting will depend on the prime contractor's strategy and the specific requirements of the IT services being delivered.

Oversight & Accountability

The Department of Defense, through its various contracting and oversight bodies, is responsible for monitoring this contract. Oversight mechanisms likely include contract performance reviews, financial audits, and adherence to service level agreements. Transparency is generally maintained through contract databases like FPDS, and the Inspector General's office may conduct audits or investigations into performance or financial matters.

Related Government Programs

Department of Defense IT Modernization Programs
Army Network Modernization
Cloud Computing Services for Defense
Cybersecurity Services for Federal Agencies

Risk Flags

Potential for scope creep in broad 'Other Computer Related Services' contracts.
Long contract duration may require careful management to adapt to technological advancements.
Reliance on a single large contractor could impact future market competition if not managed.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $90.8 million to GENERAL DYNAMICS INFORMATION TECHNOLOGY, INC.. BASE PERIOD BASE 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 (Department of the Army).

What is the total obligated amount?

The obligated amount is $90.8 million.

What is the period of performance?

Start: 2020-08-08. End: 2025-12-07.

What is the track record of General Dynamics Information Technology, Inc. with the Department of Defense for similar IT services?

General Dynamics Information Technology, Inc. (GDIT) has a long and extensive history of providing IT services to the Department of Defense and other federal agencies. They are a major federal contractor with a significant portfolio of contracts across various domains, including IT infrastructure, cloud services, cybersecurity, and enterprise IT solutions. For the DoD, GDIT has held numerous large-scale contracts supporting critical mission functions, often involving complex system integration, modernization, and sustainment. Their track record generally indicates a capacity to manage large, complex programs and deliver on demanding requirements, though like any large contractor, specific contract performance can vary. Reviewing past performance evaluations and contract close-outs for similar DoD IT contracts would provide a more granular understanding of their specific strengths and any historical challenges.

How does the awarded amount of $90.8 million compare to other large IT services contracts awarded by the DoD in recent years?

The awarded amount of approximately $90.8 million for the base period of this contract is substantial but falls within the typical range for large, multi-year IT services contracts awarded by the Department of Defense. The DoD is one of the largest federal buyers of IT services, with many contracts valued in the hundreds of millions or even billions of dollars over their full performance periods. For instance, contracts for enterprise IT modernization, network operations, or large-scale software development can easily exceed this figure. When compared to similar contracts for 'Other Computer Related Services' or broader IT support, this award appears competitive, especially given the nearly four-year duration of the base period. The number of bids received (11) further suggests that the pricing was perceived as fair market value by potential offerors.

What are the primary risks associated with a fixed-price contract of this magnitude and duration?

While fixed-price contracts are generally favored for their cost certainty, risks can still emerge, particularly for large, long-duration IT services contracts. One primary risk is that the contractor may underestimate the true cost of performance, leading to reduced profit margins or potential quality compromises if they seek to cut corners to maintain profitability. Conversely, if the government's requirements change significantly, scope creep could occur, potentially leading to costly change orders or disputes if not managed meticulously. Another risk is the contractor's financial stability over the contract's lifespan; a significant downturn could impact their ability to perform. Furthermore, if the fixed price was set too high due to limited competition (though not the case here), taxpayers could overpay. For this specific contract, the risk is mitigated by the full and open competition and the contractor's established experience.

What does the classification 'Other Computer Related Services' (NAICS 541519) imply about the scope of work for this contract?

The NAICS code 541519, 'Other Computer Related Services,' is a broad category that encompasses a wide range of IT services not specifically covered by more specialized codes. This typically includes services such as computer facilities management, IT support services, network management, disaster recovery services, and IT consulting. For this contract, it implies that the scope of work is likely comprehensive, potentially covering the operation, maintenance, and support of existing IT systems, infrastructure, and networks for the Department of the Army. It suggests a need for general IT expertise rather than highly specialized software development or hardware manufacturing. The breadth of this code means the specific deliverables would be detailed in the contract's Statement of Work (SOW).

How does the geographic location of the contractor (Arizona) potentially impact service delivery for a federal IT contract?

The contractor's state of incorporation or primary business location (Arizona, in this case) does not necessarily dictate the geographic delivery of IT services for a federal contract, especially for a large entity like General Dynamics Information Technology. Modern IT services are often delivered remotely through secure networks, cloud-based platforms, or by deploying personnel to various government sites as needed. While GDIT may have a significant presence or headquarters in Arizona, their service delivery teams can be distributed globally or nationally to support the Department of the Army's operational requirements. The contract's performance work statement (PWS) would specify any location-based requirements or expectations for on-site support, but for many IT services, the physical location of the contractor's main office is less critical than their ability to provide secure, reliable, and timely support wherever the government requires it.

What are the implications of the contract duration (1947 days) on long-term IT strategy for the Army?

A contract duration of 1947 days (approximately 5.3 years, including the base period and potential options) signifies a significant commitment to a particular IT service provider and approach. For the Army, this duration suggests that the services procured are considered essential and stable, likely supporting core operational or administrative functions that require consistent IT support. It implies a degree of strategic planning around these services, aiming for continuity and reliability over several years. However, the rapid pace of technological change in IT also means that a 5-year commitment requires careful management. The Army must ensure that the contract allows for adaptation to new technologies and evolving requirements, potentially through contract modifications or by ensuring the chosen services remain relevant and efficient throughout the period. It also indicates a potential investment in the contractor's specialized knowledge and infrastructure related to these services.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Computer Systems Design and Related Services › Other Computer Related Services

Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › PROFESSIONAL SERVICES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 11

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Wico Limited

Address: 3211 JERMANTOWN RD, FAIRFAX, VA, 22030

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

Financial Breakdown

Contract Ceiling: $90,829,380

Exercised Options: $90,829,380

Current Obligation: $90,829,380

Subaward Activity

Number of Subawards: 8

Total Subaward Amount: $7,523,677

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: W52P1J18DA086

IDV Type: IDC

Timeline