The final push to spend fiscal 2015 money begins Sept. 1. And with sequestration rearing its ugly head once again and Congress speaking out of both sides of its mouth about a shutdown or no shutdown starting Oct. 1, agencies seem to be going on a spending spree before the 2016 horror story returns.
“We are looking at agencies motivated right now to spend against any authority they have, even multi-year money because theoretically that multi-year money could be reduced by a certain authority come Oct. 1,” said Steve Charles, co-founder of the ImmixGroup. “It’s a little like the year before sequestration kicked in, I guess two years ago. We saw a real cleaning of the pipes so to speak, a real spurt at year-end. This is similar, maybe not quite as dramatic, and so it’s going to be big year end.”
Take the Alliant IT services multiple award contract (MAC) run by the General Services Administration.
Casey Kelley, the Alliant program manager, said as of Aug. 21, agencies have obligated more than $211.3 million against the contract. That is way up from August 2014, when agencies only spent $13.2 million, and even higher than 2012 and about equal to 2011. In 2013, Alliant saw a huge spike of $954 million in revenue in August.
Kelley said he expects agencies to continue to use Alliant over the last month of the fiscal year in a big way. He said he conservatively estimates agencies will obligate at least $500 million against the IT services contract.
Traditionally, September is Alliant’s busiest month of the year where agencies are spending anywhere from $1.9 billion in 2012 to $865 million in 2013 to almost $700 million in 2014.
Larry Allen, president of Allen Federal Partners, said he’s heard from vendor clients that NASA’s SEWP V also is seeing a huge increase in action.
He said this indicates a real shift from agencies issuing requests for information or sources sought notices to actually buying the products and services they need.
Two of the federal market research firms say this year is trending very similar to previous years.
Govini compared federal civilian agency spending between July 1 and Aug. 28 in 2014 and 2015 and found overall contract obligations are down to $18.3 billion from $25 billion. Govini says the Office of Personnel Management is spending almost 66 percent less, while the departments of Education, Health and Human Services and Veterans Affairs also have reduced their spending by more than 48 percent.
Q4 Year-Over-Year Spending for Top Civilian Agencies Compared
On the positive side, Govini says the Energy Department is spending 80 percent more so far in the fourth quarter than it did in 2014 and the Labor Department is up by more than 74 percent.
Bloomberg Government reported about 37 percent of obligations are going through MACs. Bloomberg says GSA’s OASIS and the National Institute of Health’s CIO-SP3 governmentwide acquisition contracts are seeing “notable” year-over-year increases too.
Bloomberg says one other notable trend is small business set-asides are increasing and they expect it to continue to grow in the fourth quarter.
This post is part of Jason Miller’s Inside the Reporter’s Notebook feature. Read more from this edition of Jason’s Notebook.