Follow the Fed – SLED money trail

By Lisa Kilgore, Contracts Specialist, State, Local and Education

Federal funding and SLED procurement do not exist in a vacuum; instead, they are intertwined and could be seen as two sides of the same coin. The connection between federal and state institutions is symbiotic, dating back to the founding of the nation. There are many instances of federal initiatives spurring growth at the most local level. The post-pandemic world has led to a shift in how our nation views federal initiatives and top-down funding. Understanding the connection between federal and SLED procurement is imperative for lasting success in the public procurement field.

Basics of our governance structure
Let’s bring it back to the fundamentals. Our nation operates under two sets of governance: an overarching federal government, and individual state governments. The separation between the two helps limits the consolidation of power; it allows individual states to do what is best for their citizens, to a degree, without needing federal approval. In the public procurement space, we often highlight the differences between SLED and Fed, dividing the two into distinct categories. It helps us to cater better to our customers. However, it may help to alter that thinking and look at the connections between the two.

Federal funding vehicles
Grants, appropriations, and relief acts are all examples of federal funding that are dispersed to SLED agencies and can increase market growth. While generally, the types of bids and RFPs out at any one time are a good measure of the amount of money available and the products and services that are in demand, that measurement happens near the end of the funding cycle. If we are to best anticipate change, we need to look earlier in the cycle. What are the current presidential administration’s goals, what are the goals of Congress?

A prime example of federal funding leading to a drastic increase in SLED spending was the CARES Act, and all subsequent COVID-19 relief bills. These relief bills set off a frenzy of education spending because this type of money from the federal government is “use it or lose it.” While such aid and spending are not the norm, it does not detract from the fact that federal funding can have an enormous effect on local spending.

BEAD program / Internet for All
Take for example the Broadband, Equity Access and Deployment (BEAD) program, an offshoot of the colloquially known “Internet for All” program rolled out by the Biden-Harris administration. The BEAD program provides $42.45 billion to expand high-speed internet access by funding planning, infrastructure deployment and adoption programs in all 50 states and U.S territories to eligible entities that apply for the grant. Now, this does not necessarily mean we are going to immediately see an increase in the amount spent on broadband and related services, but by being aware of what is coming down the pike we will be better equipped to serve our customers.

Reason for tracking federal funding trends
Since the pandemic, the average person is now more aware of government relief and how it can have many downstream benefits. That same understanding should be applied to SLED procurement. We should look to federal funding given to state and local agencies as having wide-reaching benefits that we will only be able to seize if we are aware of federal trends.

Interested in keeping up with public sector IT trends? Subscribe to immixGroup’s Government Sales Insider blog now.

What to learn more about the BEAD program? View our recently recorded webinar here.

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