Report: Billions in federal small-business contracts go to large firms

March 2, 2012 by

Here are just a few of the companies that were considered a small business in the past year: Apple, Chevron, Verizon, Bank of America and Disney.   At least, that’s what one advocacy group found when it perused the Federal Procurement Data Systems for government contracts for the past year.

Each year, the government attempts to award at least 23 percent of all federal contracts to small businesses. But new research from the American Small Business League (ASBL) shows that 72 large companies received $16.4 billion in federal small-business contracts, which the group attributes to a combination of policy loopholes, human error and mis-categorization.

“It’s really hard for a small company to compete with a company that has 5,000 employees,” said Brian Reeder, communications director for the ASBL. “When bigger companies are actually receiving the contracts, there’s nothing left for small businesses.”

The Small Business Administration cautions that it has not yet released its official data on contracting for 2011 and therefore can’t speak to the accuracy of ASBL’s findings. SBA will publish its official 2011 Small Business Procurement Scorecard this summer

“Each federal agency is responsible for ensuring the quality of its own contracting data, but SBA conducts an additional analysis to help agencies identify any potential data anomalies,” said John Shoraka, the SBA’s Associate Administrator for Government Contracting and Business Development in an e-mail statement. “As part of its ongoing data quality efforts, SBA is continuing to work with federal agency procurement staff to provide tools to facilitate review of data, implement improvements to procurement systems and conduct training to improve accuracy.”

Holes in the system

The ASBL report, released Thursday morning, found that of the top 100 companies receiving federal small business contracts, 72 were large companies that exceeded the SBA’s small-business size standards, which vary depending on the sector.

It’s difficult to identify just one reason why the contracts are awarded as they are, but experts say there are countless small leakages in the government procurement process that can cause large businesses, either purposefully or indirectly, to occasionally win out over small ones.

Ray Bjorklund, chief knowledge officer with the government-contractor software company Deltek, said it can be hard for the SBA to pick the “right” size for a company to be considered a small business under the North American Industry Classification System (NAICS) codes, the government’s business classification system.

“When SBA is looking at one class of establishment, such as a corn farmer, there are a lot of small-business corn growers, but also large corporate growers,” Bjorklund said. “It’s not an easy thing to maintain size standards in a way that keeps up with growth in the economy and changing relationships between sectors.”

Beyond that, when agencies begin feeling the pressure to meet their 23 percent goal, Bjorklund said they sometimes choose NAICS codes that have larger-sized caps if they want a large company to fit into a small-business contract.

“If the agency is anxious to meet its socioeconomic goals, they say, ‘I can make this a small-business set aside if I can justify it this way,’” he said. “All of this is legal, but they should have been more judicious in their acquisition strategy.”

Not close enough for government work

Reeder said human error is another problem in how contracts are coded. For example, Apple was likely never registered as a small business, but Reeder speculates an agency simply needed something only Apple could provide — iPads, for example — and then neglected to change the code from “small” to “not small” before the transaction was completed. That contract would ultimately be counted toward an agency’s small-business goal.

“There are a lot of those examples, and they really add up,” he said.

The errors may stem from a larger problem in the contracting world — the thin ranks of the acquisition workforce and the paucity of the available funds to train them.

“The acquisition workforce is not as big as it should be, and they’re not as qualified, because years ago, their funding was slashed,” Bjorklund said. “These people have inboxes stacked very high, and they want to do the very best possible job, but sometimes mistakes get made.”

The SBA drew a similar conclusion in a report it issued on the same topic last October, saying, “While some contractors may misrepresent or erroneously calculate their size, most of the incorrect reporting results from errors made by government contracting personnel.”

Small, then big, but still small

There is also a loophole that allows small businesses that are bought by large companies to continue to count as “small” for the purposes of contracting for years after they’re purchased. For example, the report says that CapRock Government Solutions, which ASBL asserts received more than $200 million in small business contracts last year, is a subsidiary of Harris Corporation, a multi-billion dollar company.

“We’re not arguing the companies should lose those contracts, but it seems silly to count them as small when they’re not small,” Reeder said.

Many of these contracts were awarded to small businesses that are actually subsidiaries of large companies, Reeder said, and they, therefore, don’t face the same odds that independent small companies do.

Bjorklund said he believes there are not quite as many large companies receiving small-business contracts as the ASBL has found. Still, he said, “the problem still exists, there’s no denying that.”

Last year, the ASBL found that there were 60 large companies included among the top 100 federal small business contractors, so they say the problem has “at best, stayed the same, if not gotten worse.”

Reeder called for better enforcement of contracting standards by the SBA, but Bjorklund explained that the SBA is largely “hands-off,” and that the ultimate responsibility falls on the agency issuing the contract.

In the October report, the SBA’s Office of the Inspector General said it had made “mixed progress” on the issue of small-business contracts going to large businesses. The agency has developed a program to ensure that contracting personnel review contractor sizes, but it has made “limited progress” in developing regulations to correct the misapplication of industry codes.

So how big of a problem is this for small contractors? Medium, according to Bjorklund. Contractors of every size are losing business as the Department of Defense and other agencies cut back. Small firms don’t have quite the same lobbying clout that larger ones do, he explained, so the impacts for them might be greater — especially if they aren’t getting all the contracts they should be. Then again, at least the government is doing something for small firms.

“At least there are small-business goals that the government is trying to meet,” he said. “That makes it a little better than it would be in the commercial marketplace — where everyone is fending for themselves.”

–by Olga Khazan, The Washington Post, Published: February 22, 2012 and updated: Thursday, February 23, 8:00 AM at http://www.washingtonpost.com/business/on-small-business/report-billions-in-federal-small-business-contracts-go-to-large-firms/2012/02/22/gIQA0EV4TR_story.html.

Signs of friction in contractor-government relations

March 1, 2012 by

Contractor relationships with federal auditors and contracting officers
deteriorated somewhat during the past year as government agencies scaled back
programs in an effort to reduce the budget deficit, according to a recent
survey.

A separate study released Thursday found that large companies were securing a
high percentage of federal contracts set aside for small businesses. In the 17th Annual Government Contractor Industry Survey released Monday by Grant Thornton LLP, contractor relationships with auditors were rated
either fair or poor by 19 percent of surveyed companies, up from 11 percent the
previous year. Relationships with contracting officers were rated fair or poor
by 10 percent of respondents, double the previous year’s total.

Only 22 percent of respondents said the government resolved contract disputes
efficiently, a drop from previous surveys.

Revenue from government contracts during the past year grew for 50 percent of
the companies, was flat for 21 percent and declined for 29 percent, the survey
found. “The fact that the highest percentage of companies experienced revenue
growth continues a long-term trend reported in previous surveys, indicating that
government contractors are far less vulnerable than commercial companies to
recessions or slow growth in the overall economy,” Grant Thornton analysts
said.

“However, the 29 percent of companies experiencing revenue reductions is the
highest percentage reported in several surveys, indicating that government
efforts to reduce deficits are adversely impacting government contractor
revenue.”

The survey went out to an unspecified number of companies, in 24 states, that
depend primarily on federal contracts; most of them are for-profit and
two-thirds provide services to the Defense Department. Forty-six percent are
small businesses.

The survey also found that profits improved slightly from the previous year.
The biggest cost factor within these firms was executive compensation, and
survey analysts said they disagreed with the methods the Defense Contract Audit
Agency uses in determining whether to allow such costs.

“While government contracting has never been a model of efficiency, it is our
view that the decline in efficiency and business relationships during the past
few years can be traced directly to changes in DCAA policy adopted after
[Government Accountability Office] reports were issued in July 2008 and
September 2009,” they wrote.

“Unfortunately, the GAO criticized the DCAA for having a management and
agency culture that focused on a production-oriented mission, emphasizing the
need for timeliness in supporting the needs of contracting officers in the
procurement process,” the survey said.

Regarding the average time for contractors to collect accounts receivable
from the government, results showed the period was less than 30 days for 21
percent of survey participants, while 60 percent reported receivables were
collected within 30 to 60 days. The remaining 19 percent reported waiting more
than 60 days.

The average win rate on proposals submitted in a competitive environment was
30 percent.

On the topic of revenue by type of contract, the companies said, on average,
45 percent of revenue was from cost-reimbursable contracts and 35 percent was
from time-and-materials contracts. The remaining 20 percent was from firm
fixed-price contracts.

When asked how often they were required to perform out-of-scope work without
a contract modification, 81 percent said frequently or occasionally. Only 16
percent said they refused such requests.

A separate contracting study by the Petaluma, Calif.-based American Small Business
League found that of the top 100 companies receiving federal small business
contracts, 72 were large companies that “significantly exceed” the Small
Business Administration’s small business size standards; only 24 were
“legitimate small business,” the league said.

The large companies — among them Lockheed Martin Corp., Rolls-Royce, Boeing
Co., General Dynamics and Blue Cross Blue Shield — accounted for $16 billion of
the $21 billion total for the top 100, the study found.


– by Charles S. Clark, Government Executive, February 23, 2012 at
http://www.govexec.com/contracting/2012/02/signs-friction-contractor-government-relations/41283

GSA moves forward with new professional services vehicle

February 29, 2012 by

The General Services Administration is moving ahead with a new contract vehicle for buying professional services.

Federal Acquisition Service (FAS) Commissioner Steve Kempf approved the internal business case for the Integrations program earlier this month, according to GSA’s Integrations Blogger’s Blog on the agency’s “Interact” website.

While no dollar value has been attached to the contract’s ceiling, the government spent $79.5 billion on professional services during fiscal 2010, according to GSA data.

Integrations will be a multiple-agency indefinite-delivery, indefinite-quantity contract. The Integrations contract is expected to include commercial and non-commercial services, that may include program management and consulting services. GSA is also considering having logistics services, professional engineering services and financial services on the menu. GSA is designing the contract vehicle to address needs for professional services that span several types of services that are often difficult to specify or quantify before making an award. However, the contract will elevate risk as a result, wrote Lisa McGuire, program manager for Integrations.

Mary Davie, assistant FAS commissioner for the Integrated Technology Service, said GSA’s Schedules program offers technology and other professional services on an a la carte basis. But agencies want more.

“Agencies have asked us to provide a total professional services solution, which often requires acquisition of multiple services across separate functional areas,” she wrote Feb. 21 on her Great Government Through Technology blog.

Davie said agencies want flexibility. About half of all government spending on complex integrated professional services in fiscal 2010 took place under cost-type contracts.

“That is why we are planning to include all task-order types in Integrations, including cost reimbursement,” she wrote.

Officials intend to make the acquisition process more flexible for all sorts of contract-type task orders and other direct costs at the task-order level, McGuire wrote.

At this point, the Integrations program team is working on a project schedule.

So far though, officials have said they are developing a customer working group, and, for industry, they plan to post draft documents for feedback as the working group meets. GSA wants to make the acquisition planning process to include input from industry and customers. GSA also has to register the contract vehicle with OMB’s MAX Federal website.

Davie is planning a “Tweet Chat” Feb. 29 from 2 p.m. to 3 p.m. She wants to interact with customer agencies and industry on a range of topics about Integrations. She will be answering tweets to @GSA_ITS with the hashtag #ITSChat.

About the Author: Matthew Weigelt is a senior writer covering acquisition and procurement for Federal Computer Week.  This article appeared Feb. 21, 2012 at http://washingtontechnology.com/articles/2012/02/21/gsa-integrations-program.aspx?s=wtdaily_220212.

Who won the biggest contracts of January 2012?

February 28, 2012 by

From a couple billion-dollar plus awards to intelligence support to cloud computing, we covered a variety of contract awards in January.

We count down the 10 biggest contract awards that hit the market in January. To qualify for our countdown contracts need to be publicly announced during the month and covered by Washington Technology. Some of the contracts may have been awarded before January, but were not publicly disclosed until that month.

We covered 40 contracts worth $9.1 billion during January and the top 10 contracts accounted for nearly $8 billion of the total. Half of the contracts in the top 10 are single awards, including the largest, while the rest have multiple winners. One contract is under protest.

Without further ado, our contract countdown starts with No. 10.

10. ManTech wins $91M Navy task
ManTech International will provide communications technology and engineering services to support the Naval Air Center’s research and development and other needs for the National Capital Region’s fixed, deployable and mobile systems.

9. Planned Systems International takes on health codes worth $96M
The company will do systems analysis, code maintenance and administration for the Defense Health Services System. The work includes processes and methodologies for developing requirements, change controls and documentation.

8. Raytheon wins $179.5M Air Force award
Raytheon will provide contractor field services support for U-2 sensors, data links and the Air Force’s distributed common ground system, an intelligence system.

7. Verizon captures $186M postal service network contract
Under this contract, Verizon is the prime on the Postal Service’s Telecommunications Integrated Postal Service contract. The company will design, build and manage an Internet Protocol communications network for the Postal Service.

6. 7 win $250M Army cloud contract
This multiple-award contract will be used to provide cloud services to support the Army Program Executive Office – Enterprise Information Systems. The winners are:

Criterion Systems Inc.
General Dynamics Corp.
Hewlett Packard Enterprise Services
IBM Corp.
Lockheed Martin Corp.
MicroTech LLC
Northrop Grumman Corp.

5. 9 companies share $476M defense contract
The nine companies will compete for work under the Defense Department’s Omnibus Network Enterprise contract. Services include systems engineering, information assurance and program management.

The nine winners are:

AT&T Technical Services Company
Booz Allen Hamilton
CACI Technologies Inc.
General Dynamics One Source LLC
Link Solutions Inc.
ManTech Information Systems and Technology Corp.
MorganFranklin Corp.
TASC Inc.
TWD & Associates Inc.

4. 5 win $900M anti-IED contract
Under this contract, the companies will provide support to combat improvised explosive devices. The winners are:

BAE Systems Technology Solutions & Services Inc.
Lockheed Martin Corp.
SRA International
Science Applications International Corp.
Wexford Group International

3. Trio wins FAA contracts topping nearly $400M
Human Solutions, Inc., SRA International Inc. and TASC Inc. have won contracts from the Federal Aviation Administration to support the systems that share information between air traffic controllers while planes are in flight.

2. 26 primes named to $1.9B Air Force support contract
Twenty-six companies and research entities have won prime spots on the Air Force’s Design and Engineering Support Program (DESP III), a seven-year, task order contract that covers the acquisition of engineering and technical services.
The winners are:
Aerospace Engineering Spectrum
Arinc Engineering Services LLC
Battelle Memorial Institute
Booz Allen Hamilton
Dynamics Research Corp.
DRS C3 & Aviation Co.
Global Consulting International Inc.
General Dynamics Information Technology
Gauss Management Research & Engineering
Hebco Inc.
Jacobs Engineering Group Inc.
Ki Ho Military Acquisition Consulting Inc.
Lockheed Martin Corp.
MI Support Services LP
Maden Tech Consulting
NCI Information Systems Inc.
Northrop Grumman Corp.
Science Applications International Corp.
Scientific Research Corp.
System Sustainment Alliance JV
Support Systems Associates Inc.
Standard Aero Redesign Services Inc.
Sumaria Systems Inc.
University of Dayton Research Institute
VSE Corp.
Wyle Laboratories Inc.

And the largest contract award announced in January is…

1. Lockheed wins $2B contract for South Pole project
The company will modernize technologies to transport scientists, staff and supplies to and from the Antarctic region to support the U.S. Antarctica research program.

It should be noted that this contract is currently under protest.

Lockheed will work with the National Science Foundation in the multi-year contract to install a cost-effective streamlined infrastructure for managing the three work stations and medical facilities, research vessels, construction projects and remote sites in and around Antarctica.

About the Author: Nick Wakeman is the editor-in-chief of Washington Technology.   This article appeared on Feb. 17, 2012 at http://washingtontechnology.com/articles/2012/02/17/january-contract-countdown.aspx?s=wtdaily_210212.

SBA redefinition of small business draws mixed reactions

February 23, 2012 by

As the Small Business Administration redefines exactly how big a small business can be, it faces mixed reactions from lawmakers and small business groups.

SBA published its new guidelines in the Federal Register on Feb. 10, with the rules scheduled to go into effect March 12. The comprehensive review in size standards, the first SBA has undertaken since the early 1980s, determined that larger businesses in 34 industries and three sub-industries in the professional, scientific and technical services sector could be considered small businesses.

Under the new rules, more weight is placed on business structural characteristics, including average firm size, the degree of competition and federal government contracting trends, in order to cast a broader net over businesses eligible for government programs. SBA estimates that as many as 8,350 additional firms will become eligible for its programs as a result.

The National Federation of Independent Business, a lobbying organization that represents about 350,000 small businesses across the country, defines anything that is not publicly held as a “small business” for purposes of membership. NFIB spokeswoman Jean Card, however, emphasized that more than 70 percent of the group’s members have 10 employees or fewer, and 97 percent have 50 or fewer.

Card noted that defining small business is no easy task. “I don’t envy them,” she told Government Executive, but added she was “not real clear on why the definition changed.”

Small businesses, Card said, are looking for more government help with issues like tax regulation and health care policy.

The National Small Business Association, a nonprofit membership organization, will be talking with its members next week regarding the advantages and disadvantages of SBA’s move. NSBA limits its membership to businesses with fewer than 500 employees and does not distinguish by industry or revenue.

“We have a few general concerns with it lumping together businesses that have different interests and concerns — for example, the lumping together of architecture and engineering firms,” NSBA spokeswoman Molly Brogan said of the new classification system.

Some congressional lawmakers unhappy with SBA are seeking to implement new legislation that would require the government to see small businesses in a different light.

“If the size standards are adjusted then we don’t need to change the definition, but we do need complementary incentives for advanced [and] growing small businesses,” said Rep. Gerry Connolly, D-Va., co-author of the Small Business Protection Act, which was introduced in the House on Feb. 8.

The bill, also co-authored by Rep. Joe Walsh, R-Ill., seeks to redefine the size standard for each small business category so that it remains within each group’s North American Industry Classification System code, according to a Feb. 8 press release from Walsh’s office.

As part of President Obama’s fiscal 2013 budget proposal, SBA received a 30-percent boost in federal funding from fiscal 2011 actual discretionary expenditures.

— by Andrew Lapin – Government Executive – February 15, 2012 – http://www.govexec.com/contracting/2012/02/sba-redefinition-small-business-draws-mixed-reactions/41215/.

Budget encourages contractors’ political contribution disclosures

February 22, 2012 by

The Obama administration has not backed off its plan to require contractors to disclose political campaign contributions when they submit contract bids.

The idea first surfaced in April 2011, when the  administration began circulating a draft executive order that would have directed agencies to gather information from companies about their political contributions. The administration had hoped such transparency would prevent contributions from influencing contract decisions.

The plan had sparked strong objections on Capitol Hill, leading to the introduction of several bills as well as congressional hearings.

During one hearing in May, senators warned Dan Gordon, then administrator of the Office of Federal Procurement Policy, of the consequences of such a rule. Gordon would not comment on the proposal at the hearing because it was only in draft form. However, he said evaluations of companies’ bids should be objective and should not be influenced by who or what a bidder supports. And if a company believes its bid was unfairly evaluated, he said the firm have recourse by filing a bid protest.

Congress has already blocked the controversial proposal though. With support among both Republicans and Democrats, the fiscal 2012 National Defense Authorization Act included a provision that blocks the disclosures with bids. President Barack Obama signed the bill into law in January.

About the Author: Matthew Weigelt is a senior writer covering acquisition and procurement for Federal Computer Week.   This article appeared Feb. 13, 2012 at http://washingtontechnology.com/articles/2012/02/14/political-contributions-2013-budget.aspx?s=wtdaily_170212.

GAO sets new policy on debarments, suspensions

February 21, 2012 by

As a legislative-branch agency the Government Accountability Office does not have to comply with Federal Acquisition Regulations on suspension, debarment and ineligibility of contractors, but it is choosing to adopt the rules.

The new policy comes out on the heels of the proposed debarment of Booz Allen’s San Antonio office by the Air Force. Published on the Excluded Parties List System (EPLS) on Feb. 6, the action was related to a former government employee hired by Booz Allen who inappropriately retained and shared sensitive information about a pending government procurement.

GAO’s new policy, published in the Federal Register as a notice, took effect on Feb. 13, 2012.

GAO now will not solicit offers from, award contracts to, or consent to subcontracts with, contractors who are listed on the EPLS, according to the notice. Additionally, if GAO debars, proposes for debarment, or suspends a contractor, it will list that contractor in the EPLS.

The office first proposed and solicited comments on the policy on Sept. 30 and received only positive comments.

GAO’s Acquisition Management office , which is responsible for the majority of its contracting activities, will be the unit with primary responsibility for investigating and referring potential debarment and suspension actions to the debarment/suspension official for consideration.

As the debarring and suspending official, GAO’s Comptroller General, “will also be responsible for deciding whether to solicit offers from, award contracts to, or consent to subcontracts with contractors who have been debarred, suspended, or proposed for debarment, and whether to terminate a current contract or subcontract in existence at the time the contractor was debarred, suspended, or proposed for debarment,” the notice said.

About the Author: Alysha Sideman is the online content producer for Washington Technology.   This article was published Feb. 13, 2012 at http://washingtontechnology.com/articles/2012/02/13/gao-debarment-policy.aspx?s=wtdaily_140212.

SBA opens doors to more firms by increasing size limits

February 20, 2012 by

Federal agencies soon will have a larger pool to draw from for their small-business procurement programs.

The Small Business Administration increased the size standard for technology companies as well as for 33 other industries under a final rule published Feb. 10 in the Federal Register.

The move means about 8,350 additional companies are now eligible to compete for federal contracts as a small business.

The final rule will increase 37 of the revenue-based size standards in 34 industries and three sub-industries in the “Professional, Scientific and Technical Services” sector. It will also increase one size standard in the “Other Services” sector.

Size standards are used to determine eligibility for federal small-business assistance programs. SBA measures “size” for most industries by receipts and number of employees. It defines receipts as the total income plus cost of goods sold.

The higher revenue limits cover the professional, technical and scientific sectors and will take effect on March 12.

Technology firms offering computer programming, maintenance and design services, for example, can now earn $25.5 million, up from $25 million.

The Management, Scientific and Technical Consulting Services sector received an increase from $7 million to $14 million. Public commenters in this sector, who supported the increase, highlighted that the higher size standard will help small businesses to develop to be able to compete against large businesses for federal contracting opportunities.

“Over the years, SBA has received comments that its size standards have not kept up with the changes in the economy, in particular, that they do not reflect changes in the federal contracting marketplace and industry structure,” the final rule noted.

“SBA recognizes that changes in industry structure and the federal marketplace since the last overall review have rendered existing size standards for some industries no longer supportable by current data,” it adds. Size standards were last comprehensively reviewed in the early 1980s.

With more than 8,000 newly defined small firms under the revised size standards, there may be some additional administrative costs to the federal government associated with additional bidders for federal small-business procurement opportunities and more companies seeking SBA guaranteed lending programs or eligibility for enrollment in the Central Contractor Registration’s Dynamic Small Business Search database, the Federal Register said.

Click here to find a summary of size standard changes.

About the Author: Alysha Sideman is the online content producer for Washington Technology.  This article was published on Feb. 10, 2012 at http://washingtontechnology.com/articles/2012/02/10/sba-increases-size-limits.aspx?s=wtdaily_140212.

DoD: $178.8 billion for acquisitions, $109.1 billion for procurement, $67.9 billion for R&D

February 17, 2012 by

President Obama’s defense budget of $613.9 billion for fiscal 2013 reflects the downsizing of America’s wars abroad and the size of its military, as well as its plans to increase and entrench smaller counter terrorism, special operations and high-tech capabilities globally.

The cut — a reduction of $40 billion, or six percent, from current year spending — includes a 20 percent slash in Afghanistan war spending, increasing weaponry intended for Asian-Pacific security, while deferring legacy weapons purchases and personnel costs into future years.

“We are redoubling our efforts to make better use of the taxpayer’s defense dollar,” Defense Secretary Leon Panetta said, in a statement released with budget documents at the Pentagon on Monday. Panetta is not expected to appear Monday, going instead to three hearings scheduled before Congress this week.

The White House wants $525.4 billion for the regular defense budget and $88.5 billion for the separate war account. The war request includes $85.6 billion for Afghanistan, which is down from $105 billion in 2012, and $2.5 billion for Iraq. Most of the decline in Afghan war spending reflects the operational savings from pulling out the remaining 23,000 surge forces by September.

DOD also requests $178.8 billion for acquisitions, or $109.1 billion for procurement and $67.9 billion for research and development, a crucial account for the nervous defense industry.

A greater total spending cut is forecast for 2014, appearing to come entirely from war accounts. But the Pentagon forecasts its base spending will increase by roughly $10 billion in each of the following four years after 2013. That’s a 0.3 percent decrease in spending for the next five years.

There were no surprises in the increased budgets for U.S. priority accounts, include special operations forces, at $10.4 billion next year, as well as drones, cybersecurity, and missile defense. DOD slashed $15 billion from the still-breathing Joint Strike Fighter’s development, due to forced delays in planned purchases. The Army’s search for a next generation ground combat vehicle and Navy shipbuilding also were cut.

Cutting 72,000 soldiers, 20,000 Marines and thousands more sailors and airmen accounts for $50 billion savings over five years.

The Pentagon claims $60 billion of its total savings next year will come from “efficiencies”, an ongoing DOD effort to trim its own expenses and waste that watchdogs have complained was hard to track and verify.

— by Kevin Baron, National Journal, February 13, 2012, at http://www.govexec.com/defense/2012/02/president-requests-more-disciplined-613-billion-defense-budget/41179/.

Budget requests, agency by agency

February 16, 2012 by

The theme of President Obama’s fiscal 2013 budget plan is to spend less but make targeted investments in education initiatives and programs that will put people to work.

“The main idea in the budget is this: At a time when our economy is growing and creating jobs at a faster clip, we’ve got to do everything in our power to keep this recovery on track,” the president said during a speech Monday at Northern Virginia Community College in Annandale, Va.

The Commerce Department and Small Business Administration would see the biggest relative discretionary spending increases over fiscal 2011 actual spending — up 41.9 percent and 30 percent, respectively. Combined, the departments’ total proposed expenditures for fiscal 2013 amount to a little less than $9 billion.

The biggest reduction in spending by a wide margin will be absorbed by the Justice Department, where the president is proposing a 33.4 percent cut, from $26.9 billion to $17.9 billion. The next-largest cut goes to the Health and Human Services Department, which would see an 8.8 percent reduction in total discretionary authority.

View our chart below to see how the major agencies fared in Obama’s proposal. We looked at total discretionary authority for each agency.

Discretionary budget authority (billions of dollars)
Departments 2011
Actual
2013
Request
Percent
Change
Agriculture 23.2 23 -0.9%
Commerce 5.6 8 41.9%
Defense (DoD — Excluding Overseas
Contingency Operations)
528.3 525.4 -0.5%
Education 68.3 69.8 2.2%
Energy (Excluding National Nuclear
Security Administration)
15.2 15.6 2.8%
Health and Human Services 76.5 69.7 -8.8%
Homeland Security 41.9 39.5 -5.8%
Housing and Urban Development 37.1 35.3 -4.8%
Interior 11.7 11.4 -2.7%
Justice 26.9 17.9 -33.4%
Labor 12.5 12 -4%
State and Other International Programs
(Excluding Non-Security Funding)
48.8 54.8 12.3%
Transportation 13.7 13.8 0.6%
Treasury 13.5 12.6 -7%
Veterans Affairs 56.4 61 8.1%
Major Agencies
Corps of Engineers — Civil Works 4.9 4.7 -4.3%
Environmental Protection Agency 8.7 8.3 -3.90%
National Aeronautics and Space Administration 18.4 17.7 -4%
National Science Foundation 6.8 7.4 8.3%
Small Business Administration 0.7 0.9 30.2%
Social Security Administration 10.7 11.0 2.8%
Corporation for National and Community Service 1.1 1.1 -1%

— by Andrew Lapin and Caitlin Fairchild, Government Executive, February 13, 2012 at http://www.govexec.com/management/2012/02/discretionary-budget-authority-billions-dollars/41189/.