IS FEDERAL FY’19 SPENDING INCREASE AN INDICATOR FOR THIS SUMMER?

Federal agencies spent more on products and services in FY’19 than in any other year in the past five, according to data sited by the Federal News Network.  Multiple award contracts continued to be an important channel through which that spending was conducted.  Bloomberg Government reports that nearly one in four dollars were spent that way.  While that number is not a statistical increase over previous years, the number of dollars increased proportionally, indicating that MAC’s are an important part of nearly any government contractor’s portfolio.  This is especially true when selling to the Department of Defense.   The Pentagon spent $84 billion through MAC’s last year, up from $61 billion in 2016.  The two largest spend areas, nearly equal in size, were IT and professional services.  Firm, fixed price and cost-plus contracts were the most popular.  The Government Accountability Office, however, criticized DOD for not hitting competition goals.  Only a little over half of DOD acquisitions were competed among multiple companies, according to GAO.  That number, however, doesn’t completely match recent anecdotal evidence from contractors, suggesting that the GAO definition of “competition” may not truly reflect the amount of pre-RFP or RFQ competitive analyses nearly every contractor does when deciding whether or not to bid on a specific project.   Contractors can expect strong business again this summer, though much of it may be to continue projects already underway.  The gradual re-opening of government agencies, coupled with over COVID-19 distractions, may not result in numbers as high as last year, but it could be close.  See the story here for more:    https://federalnewsnetwork.com/reporters-notebook-jason-miller/2020/06/federal-procurement-spending-up-120b-since-2015/