Election Year Implications – Probably Minimal

Federal contractors tend to get nervous every four years.  Potential new administration = potential shifting priorities.  There is always a lot of talk surrounding “what if” one or the other candidate takes or retains office.  However, historically, there is little impact on the contracting market itself.

Regulations may change and priorities may shift longer-term for some agencies, but appropriations are really where the contracting market has to stay focused.  That responsibility rests with Congress.

Many times, an administration will define its goals for contracting in a comprehensive plan that mirrors what had already been done – perhaps with an addition to small business, veterans, or whatever the newest emerging market may be.  When it comes down to it though, any changes in funding really come back to budgetary constraints and fiscal responsibility by Congress.

What’s more, there are MANY existing programs, activities, and contracting vehicles that have a huge tail-wind behind them.  These projects tend to get pushed through appropriations with relative ease based on the additional costs that would need to be incurred just to shut the project down.  A lot needs to be done to sort out what programs are under- or non-performing, but the money to establish new programs or paying close-out liabilities can also be hard to come by to end the contract.

According to estimates, the government looks to spend about $709B on contractors for FY2013 – about $60B in reductions from 2012.  However, congressional efforts to mitigate some cuts along with other initiatives will likely result in a federal contract spending level closer to $712 billion.

So, choose your source for election coverage and stay up late come November.  But, more importantly as a contractor, study the budget and follow the appropriations process, rather than simply tuning into candidates’ statements.



Some data information borrowed from: CAPITAL BUSINESS

About Marty Herbert

With 13 years of government contract administration, analysis, finance, and audit experience, I have established a firm baseline in ethics and a specialization in government contracts that has prepared me to become a subject matter expert in my field. I am currently working on enhancing government contracts management and compliance through workflow tools and product offerings - attempting to make the process proactive as opposed to reactive.
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