Omnibus signed into law–now what?

Chris Wiedemannfederal budget, fiscal year, procurementBy Chris Wiedemann, consultant

Despite some last-minute dramatics, President Trump signed a $1.3 trillion omnibus appropriations bill into law last Friday, fully funding the government for the rest of fiscal year 2018.

Of course, with any bill this size (over 2,200 pages in total), it takes a while to fully digest the implications for our customers and industry.

That said, it’s never too early to pull out some early highlights – to wit:

  • The $1.3 trillion top line figure breaks out as $629 billion for the base defense budget and $579B for the base non-defense budget, with the rest made up of Overseas Contingency Operations (OCO) and classified budgets. That’s a 12 percent increase in year-over-year defense spending.
  • IT modernization is a key focus area of the administration, and this bill puts some money behind that goal – specifically, by appropriating $100 million to the Technology Modernization Fund created by the Modernizing Government Technology (MGT) Act. There are also several agencies with specific, line-item investments in IT modernization projects – $280 million at SSA and $328 million at Veterans Affairs, to name a few.
  • Because of the specific IT modernization investments in the omnibus, expect customers to feel some pressure to deliver quick wins on legacy systems modernization – this is an unexpected capital infusion and they’re going to want to show they can get results so they get similar funding levels in FY19.
  • While modernization is very much in, we may not see as much activity around reorganizing agencies. That’s because of language in the bill forbidding agencies from cutting programs or offices entirely without first getting approval from Congress. In other words, unless Congress is on board, expect your customers’ org structures to look the same as they did under the CR.

In general, the omnibus getting signed is good news for industry, because for the first time this fiscal year, agencies have the flexibility and purchasing authority that comes with full appropriations.

There’s a fair amount of pent-up demand out there since most agencies have been sitting on most of their CR funding, but we may see the floodgates open soon.

Did you know immixGroup has an all-day class on Fundamentals of Selling to the Government? It’s perfect for sales teams and anyone who wants a refresher on government contracting. Sign up for the April 19 class.

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

%d bloggers like this: