Federal Agencies expected to spend almost $200B on acquisition contracts in Q4 2020
he fourth quarter spending surge is upon us, and it appears the federal acquisition community isn’t just focused on getting money out the door, but request for proposals, too. Agencies are expected to spend $194 billion between now and Sept. 30, according to Bloomberg Government. Departments will spend a big chunk of that total on technology — $28 billion — and on professional services — $32 billion. But this has been a trend for some time.
“The $182 billion in the fourth quarter of fiscal 2019 spending obligations is about a $7 billion decrease from 2018, but fiscal 2019 represents about a $30 billion increase since 2016,” BGov said in a recent webinar. “Spending in the last month of the fiscal year is usually more than that of July and August combined.” Of that $194 billion expected to go out the door in Q4 2020, BGov estimates that agencies will spend $101 billion in September, the most in one month since 2018 when they spent $99 billion.
Given how much money has to get out the door, BGov said, “Most agencies may give preference to schedules, governmentwide acquisition contracts, set-asides and sole-source contracts in the fourth quarter.” For instance, NASA said agency customers’ fourth quarter spending accounted for 54% of all of its revenue under the SEWP GWAC in 2019, 33% of which came in September alone.
Currently SEWP is 35% ahead of 2019 sales and could reach $8 billion to $9 billion in total obligations in 2020. Over at the National Institutes of Health’s Technology Acquisition Assessment Center (NITAAC), they expect fourth quarter spending to account for 57% of their total revenue for 2020. While the fourth quarter portends to be extra busy, so does the first quarter of fiscal 2021.
Author: Prasanna Haresh Patil