Construction Opportunities Will See Boom Due To DoD ARRA Allocation

Though we all know that many areas of the United States economy are suffering right now, the federal construction market is likely to soon see a huge boom. The Department of Defense presented a 191 page report to Congress which details how it plans to spend the money is has been allocated by the Stimulus Package, more properly known as the “American Recovery and Reinvestment Act (ARRA) of 2009.”

The Stimulus Package currently includes just under $7.5 billion allocated for the Department of Defense (less than 1% of the total). The DoD stated recently that it intends to spend its funding with “unprecedented full transparency and accountability.” www.Recovery.gov has been created in order to help citizens monitor the progress of the spending of ARRA dollars, and the DoD will be making use of this. They have also set up a website at http://www.defenselink.mil/recovery to further this initiative.

How does this apply to the construction market? The DoD has “identified specific investments in construction, facility improvements, and energy efficiency projects that will help improve the quality of life for our troops and their families.” Their report to Congress included an extremely detailed breakdown of how their share of ARRA dollars will be spent. The report includes anticipated costs, descriptions of work, and project locations for each expense they are proposing.

The Department of Defense intends to spend roughly $2.1 billion on military construction and family housing projects, including $1.3 billion to construct two new hospitals (to be located at Camp Pendleton, California and Fort Hood, Texas). DoD has also indicated that it will be “pursuing architectural and engineering services greater than $1 million for 5 projects, conducting repair projects greater than $7.5 million for 56 projects, and carrying out 45 Energy Conservation Investment Program projects, respectively.”

The DOD also provided a list of roughly 3,300 other Facilities Sustainment, Restoration, and Modernization (“FSRM”) projects costing an estimated total $3.4 billion. These FSRM projects account for over $3.83 billion of their entire Stimulus spending.

The U.S. Army Corps of Engineers, the federal agency that is the most heavily involved in construction, has also provided Congress with “informed estimates” of existing capability to perform additional work. Of that, about $2.1 billion is appropriated for construction projects.

These and other projects will provide enormous opportunities for companies acting as federal construction contractors. Time will tell whether there are enough procurement officers currently active in the government to issue this many solicitations in such a short time and whether the specific agencies have the capability to properly administer all of this work, but there is certain to be a surge in construction projects over the upcoming months!

SBA Budget Increase: What's The Impact?

If you've been paying attention to the news and popular media in the past few weeks, you are sure to have heard about the meeting between Jon Stewart and Jim Cramer. Their debate is already going down as one of the most controversial in history. However, how many people are talking about the House decision on the SBA budget that came out at almost the same time?

Not many.

This is for the simple reason that, to most people, small business government contracting just isn't as 'sexy.' It is a dry, difficult topic which few people partake in and even fewer truly understand. However, it is just this topic with which you, the small businessperson, should be familiarizing yourself during these times.

As one of the benefits of the stimulus package, a House panel decided to approve a vastly larger budget for the SBA in 2010. This increase of over $700 million roughly triples the budget for next year, providing a wide array of advantages to the small business owners interested in doing work with the federal government.

The SBA is the small business owner’s best friend in the federal government. It is literally their job to make sure that you get contracts and money; adding to their powers is going to make it much more likely that a small business will be able to get a contract.

For one thing, the federal appropriation to subsidize SBA loans has been put back into place, which will make it easier to get funding and money from the Small Business Association. This will raise the overall amount of loans the SBA can back to over $28 billion. This is going to increase federal contracting opportunities over time.

By getting started now, your business can be perfectly positioned in time to get access to some of the stimulus billions. This decision to increase funding to the SBA is likely to add just that much more opportunity for your company!

Obama Charges Administrators to Reform Contracting

President Barack Obama on Wednesday ordered a much-needed look at and reform of the processes surrounding government contracting and procurement. This is to include virtually all agencies and branches of the federal government, including the Department of Defense, usually exempted from such measures. The following quote is from President Obama via the White House executive memorandum:

“I hereby direct the Director of the Office of Management and Budget (OMB)… and the heads of such other agencies as the Director of OMB determines to be appropriate… to develop and issue by July 1, 2009, Government-wide guidance to assist agencies in reviewing, and creating processes for ongoing review of, existing contracts in order to identify contracts that are wasteful, inefficient, or not otherwise likely to meet the agency’s needs, and to formulate appropriate corrective action in a timely manner. Such corrective action may include modifying or canceling such contracts…”

What does this mean for the small business owner?

Well, that depends. If you have a long-term contract currently in place, immediately make sure that your processes are well documented and defensible. Excess waste should be cut out proactively and inefficiencies need to be addressed – nobody wants a contract canceled so be sure to take a look at what you can do to prevent it.

On the other hand, for companies looking to break into contracting, this is potentially a tremendous opportunity. As of July 1, 2009, existing long-term contracts will begin to be reviewed. Many incumbent contractors could be hoisted out of their positions, which means that many contracts will have to be refilled. Over the coming year many businesses will be tapped to replace the companies who have their contracts cancelled, so now is a great time to start positioning your business to take their place!

Obama also said he wants to “open up the bidding for contracts to small businesses,” which will help drive even more potential growth to the small business owner!

Budget Cuts and Penny Pinching – Why the Government Isn’t Like Everyone Else

March marks the first time that I have ever actually forced myself to plan a budget. I recently bought a car (Bambi thought my old one wasn’t hip enough and totaled it for me). I’m also looking for a home to purchase; if I stay in my apartment past May, rent increases almost by half! Over the past month’s I’ve found that with my car insurance spiking, rent payment, and everything else, I can’t afford to eat out as much or purchase frivolous items such as bottled water, funny shirts, or DVDs. So, I’m hunkering down, forcing myself to stay in on Friday nights to play monopoly, drinking lots of tap water, and watching cable that’s already paid for.

I’m not here to give finance advice – I’ll leave that to the experts. But I am noticing a trend amongst my friends and coworkers. We’ve all cut back on things that cost money that we used to do on a regular basis without thinking and are saving money as if it’s a precious commodity. Well, for many (and more each day) it is! I’ve been reading more and more in the news about middle-aged individuals losing their jobs and dipping into their 401(k) accounts early or draining their savings to make ends meet. Getting a job isn’t easy either right now, especially when I know people who have applied to dozens of jobs and if they get a response at all it is a rejection. Like many people, I’m planning for the worst and squirreling away anything I possibly can.

So why is the government implementing an economic stimulus package that entails spending nearly a TRILLION dollars instead of saving money?

Many conservatives on www.twitter.com frequently tweet about the stimulus package and how it “oddly” reminds them of the German attempt in the late 20s. I don’t agree. Even though the Obama administration in many cases isn’t putting in formal checks and balances to ensure that the money isn’t misappropriated or poorly handled, many Senators are doing what they can to increase transparency and oversight. Michael W. Brubaker (R-PA), for example, wants to create a nine-member panel in Pennsylvania made up of state officials to manage the economic stimulus money. His state alone is set to receive $10 billion of the money set-aside for state building. If his bill is passed, which hopefully it will be, this panel will help prevent corruption and boost the local economy within the state. However, PA is ahead of the senator and has created a website that will allow the public to monitor the spending.

One of the benefits of posting the spending online is the level of transparency it creates. The stimulus bill is something that the American people have heard about non-stop for the past several months. With the aid of the internet people have access to developing stories 24/7, letting those who are interested keep up-to-the-minute on the progress of governmental affairs, especially with www.CSPAN.com’s streaming feed to the House and Senate debates. This week some of the first expenditures from the stimulus package are happening, focusing mostly on information technology support and staff. Michael Carleton, Health and Human Services Department’s head officer, said, “There are provisions in the law that require the money in the Recovery Act to be subject to a higher level of transparency than is the convention.” Carleton thinks that these expenditures will help make that happen.

I like to compare the stimulus bill to Franklin Roosevelt’s New Deal, designed to create new jobs in the 1930s. Vast swaths of American infrastructure, schools, and even the Appalachian trial exist today because of that plan. States are spending wisely if they invest in IT first because in today’s society, information is the key to getting anything done. Without the necessary support of technology, the spending could in many cases go awry and unchecked. FDR focused on projects that kept the American public busy, while providing future generations with something free to enjoy when there is an economic hardship. We can still enjoy those trails today even though we are budgeting and that should make all of us happy. It makes me forget that I can’t see the latest movie, buy the newest computer, or eat out three times a week.

While it seems ridiculous to many people that the government is spending such tremendous quantities of money during a time when the general public has had to cut back, I think it’s necessary - as long as there is enough transparency with this act. It’s our money, we should see to it that it is properly spent on rebuilding our economy, eventually letting us spend our money as we wish again, hopefully leading us back into prosperity. Right now, the main reason we need the government to put money back into the public is that we can’t spend money to help other businesses out. As much as I would like to, I can’t go down the street to buy from the local farmer’s market; the huge grocery store chain is cheaper, and every penny counts. Businesses will benefit tremendously from the surge in money, especially those involved in government contracting. The more money the government spends on us, the more we’ll have to spend later, which will eventually boost everyone up, even those not involved in contracting who don't get it directly from the government.

The stimulus plan will work because we aren’t just printing money off and hoping for the best; we’re opening Excel, discussing, managing, and making everything transparent so the best decision is made. I’m glad the government is spending money, because I believe that it will lead to me being able to spend mine in the future on what I want, instead of what I need.

Step 4: Ask the Right Questions

Good morning yet again to everyone and welcome back to Gateway to Government’s blog, filled with tips and advice for our partners and small businesses wanting to do work with the government. As you know, each day this week I have been focusing on one step which will help you maximize your advantages so that your business can get and maintain government contracts. Today is step number four in the Seven Steps series.

Step 4 – Ask The Right Questions

Asking questions is vital to government contracting. There are many types of questions that can and should be asked (for a more detailed rundown, click here). However, the wrong questions or ones posed to the wrong person can be destructive to a business’s chances at getting a contract, so be sure that you know what – and who! – to ask. Be sure to know exactly what it is you want to know. Going into this process with any sort of ambiguity can be disastrous... Without a definitive sense of the goal, your questions can easily lead to more confusion.

In addition, if you ask a question about a contract you are working on or a solicitation you intend to bid on, get it in writing. Anything said verbally or informally is not binding, and action taken based on what is said is not legally defensible. Also make sure that the person you ask is the right person – an answer given by someone without the proper authority over a contract is the same as an answer given by, say, your grandmother. Or the five year old down the street. Or anyone else; unless given by someone with the proper authority, an answer, even in writing, is useless.

In short, if you are going to ask a question, make sure of four things:

1) Exactly what you want to know,

2) How to ask (context, beware of ambiguity, etc. more here)

3) Who to ask,

4) Get it in writing!


If you as one of our members have ANY questions about how to proceed at all, please contact us. We are here for you and we want to help. Gateway knows what to ask, who to talk to, and wants to make your experience with government contracting as hassle-free and painless as possible. If anything about the bidding or contracting process is confusing, please don’t hesitate to contact a member of our team anytime – if we don’t answer immediately, we will get back to you as soon as possible. We want your business to grow and prosper through this lucrative market as much as you do!

Stimulus Plan Benefits Small Businesses

USA Today's expert, Steven Strauss, announced on February 16, 2009 that the Stimulus Plan will be helping out the Small Business sector more than most Americans thought. He actually had a"call to arms" for businesses to become contractors as soon as possible so they could benefit from the money being pumped in the state and local economies. He even outlined how much money is going where...

• $16 billion for construction and renovation of schools
• $2.4 billion for "family friendly" military construction projects — family housing, childcare facilities, etc.
• $500 million to secure dams, bridges, and tunnels
• $4.6 billion for water and hydro power projects

As he states in his article, it's not just construction businesses that can partake at the government trough; look at:—

High Tech

• $9 billion to increase access to broadband, especially in rural communities
• $ 5 billion to computerize health records

Transportation

• $8.4 billion for investments in public transportation
• $160 million for investments in maritime transportation
• $160 million for investments in maritime transportation
• $160 million for investments in maritime transportation
• $160 million for investments in maritime transportation
• $1.3 billion for investments in air transportation
• $1.1 billion for investments in rail transportation
• $160 million for investments in maritime transportation
• $830 million for repair and restoration of roads on park, forest, tribal, and other public lands

Housing

• $2 billion for redevelopment of foreclosed homes
• $2 billion for affordable housing

Green Technology

• $6.4 billion for environmental cleanup
• $6 billion for sewer, and drinking water systems
• $40 billion to for development of clean, efficient, "American" energy
• $6 billion for repair of federal buildings using green technology
• $613 million for energy efficiency upgrades and construction of alternative energy projects, including wind and solar

Now, as many as you already know, Gateway to Government can help your business take full advantage of this opportunity. Steve is right; there has never been a better time than now to join federal contracting. However, getting these certifications, the right connections, and all the other bits of red tape involved with contracting can take a lot of time. One of the many benefits of working with Gateway is that we take the hassle out of bidding. We can help your business get contracts NOW instead of later. Why wait? Gateway can offer your business a solution that will increase your profits. Don't hesitate; contact us TODAY to get your fair share of the stimulus plan.

Step 2: Research and Know Your Material

Good morning again everyone! Today we see the second installment of Gateway to Government’s Seven Steps series. These steps are designed to help you as a small business owner or employee to gain an advantage over your competitors in the field of government contracting. Each step will look at a different but useful aspect of doing business with the federal government.

Step 2 – Research

Research is vital to any business venture, as we all know. Would you as a small business owner leap into anything without knowing a little bit about it? A little bit of background research can go a long way with government contracting, and can make the vital difference between winning a bid and languishing in the pool of those that ‘just bid.’

Take a few minutes to do some research on what the bid is asking for. Is it looking for a product that will be chosen purely on price? Something as simple as a Google search can turn up pricing from your competitors! Is the price you offer competitive enough to go up against other contractors, or do you compete on service? Delivery time? Bulk goods? Know what your competitive advantage is and you will be able to leverage it.

In addition, know what you are talking about. As you’ve seen here and so many times before, background research is very important. Be sure that you know your products and services and are knowledgeable in the area in which you are bidding. Not knowing the latest advancements in your field could be the reason you won’t get the bid – such as recommending the most ‘up-to-date’ Windows 2000 or XP, when actually Windows Vista is the most recent release.

Seven Steps for Successful Starts

Good morning everyone, and welcome back to Gateway to Government's blog, where we will post tips and tricks to doing business with the government our way.

Today is the first in a series of Seven Steps which can help you get and win government contracts - which as you know can be quite a prize for any small business owner, especially in today's economy. Each new step will give advice on how to proceed with contracting - some of them may seem like common sense, but even the best of us can sometimes overlook the obvious! Just remember that we at Gateway take the hard part out of government contracting, making it quick and easy for all of our partner members.

Step 1 – Fully Read and Understand the Bid Requirements

First things first: know what is required! Individual bids generally have specific terms and conditions, so every contract opportunity - be it RFQ, RFP, IDIQ, Quick Quote, or any of the other options - has unique bidding requirements. It is the responsibility of the vendor (that's YOU) to carefully review and ensure that all of the requirements are met. Make sure you are capable of meeting all of the requirements of the bid before you submit it!

We at Gateway have seen some contracts with extremely... unusual requirements. If the bid documents state that you should have your workers on-site wear a company photo ID, pinned to the left side of their blue jackets, you can’t ignore it. If everything has to be signed in triplicate and then two copies faxed to North Dakota, one to Looneyville (yes, that's a real place - in Texas), and then have three originals shipped to Alaska in a banana crate, you have to be willing to do it.

Obviously, most contracts won't have such arbitrary requirements. Generally, there are a few clauses which are seen over and over, such as the one requiring all workers to be U.S. citizens or have valid work permits and documentation, or the buy American act, which dictates that all products used are made in America.

You have to comply with every part of the contract - there is generally no negotiation on bidding requirements. Sometimes these rules can seem a bit extreme, but if you just read over the requirements summary we send you completely before bidding, there won’t be any surprises in store. One of the benefit of being a Gateway member is this requirements summary - rather than having to hunt through dozens of pages and look up FAR clauses and other referenced items, we put it all out there for you, short and sweet.

Federal Contracting: Terrifying Prospect or Lucrative Opportunity?

The federal government is well-known as the largest purchaser in the world. It uses so many products and services that it is literally a market in and of itself – the range of things the government purchases for its needs is so diverse that many companies exist entirely to sell to the government. However, the labyrinthine sets of rules and procedures can make it a terrifying area of business for the uninitiated.

The first United States government purchase was performed in the 1770s, when General George Washington directed Philip J. Schuyler to buy weaponry from Major Duncan at Schenectady, with a guarantee to pay for the goods upon delivery. Since then, opportunities to sell to the federal government have expanded greatly; though a large portion of the federal contracting budget is still set aside for military and defense purposes, more money is spent on a much wider range of opportunities that most people realize.

Believe it or not, currently only about 5% of businesses in the United States actually do business with the government. This is despite the fact that it generally spends, on average, over a billion dollars a day, on everything from janitorial services to dog treats to IT services to research. Why is that?

The rules governing the federal procurement process are incredibly intricate. If the contracting field is new to you, you are going to find out just how difficult it can be – this is one of the most complex arenas that there is in business. Fortunately, there are plenty of people and businesses willing to help, and it is possible to acquire a working knowledge of the process, policies, and procedures that apply to your business and how to navigate the government contracting arena.

One piece of good news is that the government tries to do a lot of its business through small contractors. The U.S government has federally and legally mandated goals and procedures designed to favor small businesses. Every federal agency has a small business contracting goal – a percentage of its budget each year is ‘set aside’ specifically for a variety of types of small businesses, ranging in amount depending on the agency. Businesses are eligible for these set-aside goals if they fit the description, be it small, woman-owned, minority-owned, or any in a wide array of other categories.

Small contractors can work with the government without a large office staff or support system, but only if they understand how everything works. Unlike other customers, you cannot simply walk into a government office and make a sales pitch. There is a huge array of protocols that must be met before you can do business with the government – but if you know your rights and are familiar with government programs, contracting can be extremely lucrative for anyone willing to accept the time, effort, and expense of getting started. You also don’t have to do it alone – there are many companies out there willing to direct you along the correct path and to help you get going.

Everyone knows about the current declining economy, said by some to be the worst since the Great Depression. Small businesses should definitely consider utilizing government contracting as a source of income. The federal bailout means that there are going to be hundreds of billions of dollars of extra contracting money spent in the next few years. These dollars will have to be spent somewhere – and not all of them are going to be on the multi-million dollar contracts – the companies that win the large contracts started out winning small contracts. Your business sells products or services that the government buys, and the time to get started with federal contracting is now. In short, federal contracting is both: a terrifying prospect AND a lucrative opportunity. Navigating the maze can be dangerous but the risk is well worth the potential reward!

Working with Gateway to the Government, your business can penetrate the complex web of doing federal contracting. Through our partnership program, you gain access to everything – all of the advantages of the small business set-aside programs and the lucrative field of contracting – without having to accept the huge amount of time, effort, and expense of getting started.