A continuing resolution is inevitable. Here’s what you need to do

continuing resolution, install base, federal government, budgetBy Stephanie Meloni, consultant

There’s a strong possibility of beginning FY18 under a continuing resolution (CR), so technology companies doing business in the public sector need to be aware of how this will impact sales. Since a CR keeps the government funded at the previous year’s budget, this will mean no new program starts or capital expenditures. The government is basically funding itself to keep the lights on and performing last year’s mission.

CRs have become more and more common in recent years, however, the next CR we face may be longer than most, as experts say it may need to extend into December.

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The State of DOD Funding

Lloyd McCoy Jr.StateofDODFunding_052416By Lloyd McCoy Jr., DOD Manager

As always, my Market Intelligence colleagues and I are keeping close tabs on federal funding for upcoming fiscal years. And some recent action on a Defense bill caught our eye.

The House approved 277-147 the 2017 National Defense Authorization Act, a $610 billion policy bill that’s $27 billion more than what President Obama had requested and more than the Pentagon even said it needed.

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FY16 Budget Forecast

US Flag, Capitol Building and MoneyThe Senate and the House passed a Continuing Resolution (CR) today, which the President can sign by midnight to fund government at FY15 levels through December 11.  What happens after the December 11 deadline is up in the air, but we’ll either see more CRs for the rest of the year, or an omnibus (like what we had in FY15).

First, let’s cover some budget scenarios:

  • Full Budget
    12 appropriations bills passed by the House and Senate and signed by the President by October 1 appropriating funds to each of the government agencies. These appropriations bills combine for over 20,000 pages of text and provide significant clarity from Congress on how money should be spentThis hasn’t happened since 2008.
  • Omnibus
     Twelve appropriations bills are consolidated into 1.  Agencies do receive new funding levels for the year and new programs can start, but the bill is significantly shorter (roughly 2,000 pages, compared to the 20,000 pages of the full budget) and lacks the direction from Congress on how the money should be spent.  FY15 ended on an omnibus.
  • CROmnibus
    A combination of a CR and an omnibus – funding some agencies at new levels for the fiscal year, while other agencies are dependent upon prior year spending levels.
  • Continuing Resolution (CR)
    Appropriations bills were not passed and new budget levels cannot be agreed upon in Congress.  A CR is a stopgap measure allowing the government to remain open and funded, but at the prior year’s spending levels, and no new programs can be started.
  • Shutdown
    Congress can’t agree on any aspect of funding, and all non-essential governmental functions are suspended until a budget can be reached.

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3 Questions Every COTS Vendor Should Ask in Preparation for FY16

End of FY15_CWChris Wiedemann_65 x 85by Chris Wiedemann, Senior Analyst

It’s the last couple days of the 2015 government fiscal year, which to most of us means only one thing: closing year-end business. Selling COTS products to the government can get pretty hectic around this time of year, so you’d be forgiven for overlooking a salient and somewhat worrying fact: we still have no agency funding for FY16.

With exactly 2 days left of FY15 (and counting) the only existing Continuing Resolution (CR) flat lined in the Senate, although Congress does appear poised to pass a clean CR which has a good chance of making it to the President’s desk. Still, they are dealing with a very tight deadline and we might be in for another brief government shutdown before Congress can put a short-term CR in place.

The good news is, we’ve been here before. The beginning of FY14 became famous for its 16-day government shutdown. While it was painful for both the government and its industry partners, COTS manufacturers made a rebound, showing strong results at the end of the fiscal year. In the event of another shutdown, the best advice we can give to the COTS community is “hold tight.” While having most of your customers furloughed to begin a fiscal year isn’t ideal — and the impacts of a shutdown on the larger economy are significant COTS vendors will likely emerge more or less unscathed. All that being said, there are still important questions that need to be answered and issues that need to be addressed as we enter FY16’s uncertain beginning. Read more of this post

Five Tips for a Successful Selling Season

Sales FunnelSteve Headshot 65 x 85 by Steve Charles, Co-founder

Every year around this time I’m approached by technology companies looking for quick tips on how to make their September successful. I start off by saying that in a typical government fiscal year, we see the feds spending about a third of their budgets in the last quarter. However, the steps for completing the acquisition packages began six to nine months ago. 

As we wind down to the last week or two of the year, program managers pick and choose purchase requests like puzzle pieces to get to zero by midnight, September 30.  So, to make sure you’re in the mix at the 11th hour, make sure to ask your government customer one critical question: is the right amount of money in the right account?

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DHS’s New Years Resolution: A Budget

Tomas OKeefe_65x85Tomas O’Keefe, Consultant, Market Intelligence

NewYear1When Congress voted last year to give appropriations to federal agencies, there was one glaring omission: the Department of Homeland Security. Due to furor over executive actions on immigration taken by President Obama, Congress passed a Continuing Resolution for DHS until the end of February, so expect conversations on the Hill to be geared toward how to fund the Department while attempting to address the President’s executive action; this could affect two departmental components in particular, Immigration and Customs Enforcement (ICE) and the U.S. Citizenship and Immigration Services (USCIS).
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Continuing Resolution On The Horizon for FY15

Christopher Wiedemann_headshot-65 x 85by Chris Wiedemann, Senior Analyst

FY14 is quickly coming to a close, and vendors and customers are both scrambling to get the ball rolling on September deals. With all that’s slated to happen in the next few months, and some industry analysts predicting a record-setting Q4 this year, it can be tempting to write off FY15 until October in favor of focusing all your attention on last-minute FY14 sales opportunities. However, it’s always important to keep the big picture in mind. If you don’t spare some thought for the beginning of next fiscal year, especially what the overall appropriations situation looks like, you run the risk of getting left out – or at least failing to properly plan for the first half of the year, when you should be targeting enterprise sales opportunities.

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