Appropriations Open Gate to Fall RFP Releases
Russell Smith | September 30, 2018
When President Trump signed the appropriations bill on Friday afternoon, he set the stage for brisk RFP releases this fall. The appropriation bill includes FY 2019 funding for the DoD, HHS, Labor, and Education. When you add in funding for the Veterans Administration (VA) and military construction approved last week, 75% of the top level funding for FY 2019 is now approved.
75% of the top level funding for FY 2019 is now approved.
Looking at history, the early passage of these appropriations seems like a miracle. As contractors well know, final 2018 appropriations didn’t come until early last May. This is the first time in over 20 years that Congress has passed a HHS bill prior to the end of the fiscal year, and the first time in over 10 years it has passed a DOD bill prior to the end of the fiscal year.
The bill signed Friday afternoon also included a Continuing Resolution (CR) to temporarily fund remaining government programs until December 7, 2018.
ALSO you look at that just released report from the chairman of the Appropriations Committee in the House, and he says, he hopes the appropriations will continue to come early as a part of the return to “regular order.”
What Happens Next
Since few of us can even remember a fall with an appropriation, what can we expect the federal market to be like? Of course the agencies will need 30-45-60 days to filter down the budgets to the operational level. Even so, think back to the fall of 2009 when President Obama made an early release of –- was it $170B? — to help prime the pump to counter the recession. This early release helped make that fall possibly the most vigorous for contractors in the 21stcentury.
This early release helped make that fall possibly the most vigorous for contractors in the 21stcentury.
What are the Numbers?
A few of the numbers are as follows: There is a total of $674.4 billion for the Department of Defense, an increase of $20B over the $654.6B in 2018. This includes $606.5 billion in base discretionary funding – an increase of $17.0 billion above the fiscal year 2018 enacted level. The bill also provides $67.9 billion in Overseas Contingency Operations (OCO)/Global War on Terrorism (GWOT) funding. There is $85.3B in discretionary funding for the Department of Veterans Affairs (VA), an increase of $3.9B ($4.8%) above the FY18 enacted level – the largest dollar amount in history for the VA. There is $10.3B for military construction projects, an increase of $241M (2.4%) above the FY18 levels. Interior gets $35.3B in discretionary funding, an amount equal to FY18. There is $44.7B in discretionary funding for Energy and Water — – $1.5B above FY18. (It is a sobering experience to look at the Department of Energy funding details and see the big numbers for atomic weapons and nuclear counter terrorism activities.)
(Look above and see testimony as to the times in which we live. Now counter terrorism has an acronym – GWOT (Global War on Terror.))
The Net Net
Only fate knows what the fall will be like. However the signs look good for contractors. The earliest approved budget in the 21stcentury. Increased numbers for several agencies. And don’t forget, in 2018 congress increased the amount of funding the DoD can carry over to FY 2019 from 15% to 20%. Contractors can expect RFP releases this fall to be faster than any other fall in the past decade.