Fiscal year 2009 defense spending is soaring literally like an aeroplane! The top industry code where the Navy and the Air Force spent most of their money - NAICS Code 336411, Aircraft Manufacturing. The Army on the other hand spent most of its money so far in NAICS Code 541330, Engineering Services. But contracts are hardly being competed.

• The Navy spent over 22.78% or $ 7,915,420,099 in its top sector,  and chose not to compete close to 50% of all its contracts so far amounting close to $34.7 Billion. Details…
• The Army on the other has spent $5,753,130,677  in its top industry sector amounting to 16.6% of its total spending, and chose not to compete 54% of its total spending - close to $34.5 Billion. Details...
• The Air Force spent $7,575,487,183  or  23.87% of its money in its top industry sector, and chose not to compete 44.08% of its awarded contracts, amounting to $31.7 Billion reported thus far. Details…

For further details about these numbers and linked reports, email Ashok Mehan at: amehan@fedmine.us, or visit: www.fedmine.us for more information.  If you mention Aronson, you will receive a 10% discount off standard subscription rates!

Dear FedPoint: Does anyone have a cheat sheet or tips to prevent administrative conflicts with the settings in Deltek GCS and T&E?   Example: I’m always forgetting to update the work force file in GCS. Since I’m in T&E daily, it is more natural to navigate to the charge trees. Needless to say, when the Time data is imported into GCS, I get the “friendly” reminder to update the work force file.  - Maxine, Washington, DC

Dear Maxine:

Below are some tips for GCS and T&E to assist you: 

Here’s a checklist of GCS addition/updates that will require to you export the GCS tables to T&E.

1. GCS Employee Master File
   • Setting up a new employee
   • For changes to an employee’s division, dept, suffix or default pay type
2. GCS Employee T&E panel
   • Setting up a new employee
   • For changes in the primary supervisor, work group, timesheet class, email address or timesheet schedule of an employee. Read all »

Why should you accept Visa and MasterCard? The Federal Government is the largest user of Visa and Mastercard in the world for purchasing. This applies not just for micro-purchases (<$3,000), but also large dollar invoices (e.g., $100,000). The SmartPay 2 program which commenced November 30, 2008, is the successor to SmartPay I and the well-known IMPAC Card.

Why do some contracting officers prefer to pay with Visa/MasterCard purchase cards? What requirements are contained in my GSA Schedule conditions in regard to Visa/Mastercard acceptance? What if our company is a services-only business? How can we minimize the fees we pay to accept Visa/Mastercard? What is Level III data and why is this important?  The answer to these and other questions can be found in the Fairfax County Chamber of Commerce GovCon Newsletter article.

Guest Contributor: Wade Tetsuka, a C.P.A. and Executive Vice President of Diamond Mind, Inc., is among the first niche merchant service providers in the U. S. to make Level III for Government-Contracting a central focus of its business, He is an expert in payment processing providers and has authored numerous articles on this subject. He can be reached at wade.tetsuka@diamondmindinc.com or (888) 566-0945 x 705.

Government Wide Acquisition Contracts (GWACs), which have long been a staple of GSA’s Federal Technology Service, will not be such a significant part of GSA’s future.  According to Ed O’Hare, the assistant commissioner of the Office of Integrated Technology Services at GSA’s Federal Acquisition Service, the only GWACs GSA will continue to support will be Alliant, Alliant Small Business and a few that target companies with a socio-economic status.  In the future, GSA will merge the GWAC program with the Schedules program.  The move away from GWACs is due in part to the common criticism that there are too many GWACs and they are expensive to bid considering that the contractor is not guaranteed any work.  Further, in some cases there are too many contractors on the GWAC.  For instance, in order to avoid protests, GSA awarded a spot on Alliant to virtually every company that bid.  As one industry executive put it, GWACs with 60 companies are not helpful to anyone.

Paul Prouty, acting GSA Administrator, recently presented the General Services Administration (GSA) FY 2010 budget request to a Senate appropriations subcommittee, in the amount 0f $645 million.  $375 million has been requested for the Federal Buildings Fund and $270 million for operating operations.  Due to its expanded role in the American Recovery and Reinvestment Act initiatives, GSA will need additional funding to keep thing running smoothly. 

Paul Prouty said, “The funds requested are essential to the agency’s plans to modernize and repair federal buildings, make energy-efficiency improvements, and advance transparency in government, a key administration priority.

GSA is primarily funded through the Industrial Funding Fee (IFF) charged to Agency users for use of its contract vehicles and other property management activities.  Only 1 percent of the agency’s total budget is provided through direct congressional appropriations.

“Projects funded by the stimulus legislation probably mitigated the overall downturn in construction jobs in May… While the stimulus is starting to help, it is not keeping pace with overall declines in construction activity in most places,” reports Ken Simonson, the chief economist for the Associated General Contractors of America (AGC).

The construction employment picture brightened slightly with 18 states adding construction jobs from April to May, according to a new analysis of data released June 19th by the Bureau of Labor Statistics (BLS). (Note: BLS data does not separately identify ’stimulus’ hires) Despite the local gains, overall employment continued to decline as national construction employment lost 59,000 jobs (almost 1 percent), seasonally adjusted, from April to May.

For more Economic News from the AGC click here.  Ask FedPoint to learn more about winning Federal construction contracts and our recent briefing, “The ABC’s of Government Contracting,” co-sponsored with Associated Builders and Contractors, Inc. Metro Washington Chapter.

Defense Contract Audit Agency (DCAA) issued audit guidance 09-PPD-009(R) on June 15, 2009, “Audit Alert on the Use of the Incurred Cost Electronically (ICE) Model.”  DCAA discovered errors in the ICE Model version 2.0.0 released in May 2008. Errors discovered in the following calculations:

• G&A/G&A Cost of Money rate/allocation in instances when a value-added base is used
• G&A rate/allocation when fringe on IR&D/B&P is applied as an intermediate allocation
• Overhead/overhead COM rate/allocation where fringe is included in the overhear base
• G&A COM pool when material COM is applied to IR&D/B&P material

The model was removed from the public website once the errors were discovered and corrected with ICE version 2.0.1 (version June 2009).  Make sure you have the correct version when preparing your incurred cost submission.

FAR 52.216-7, The Allowable Cost and Payment Clause requires that a contractor submit an adequate final incurred cost proposal for certain types of contracts. The cost proposal together with supporting data is required six months after the contractors fiscal year end. For calendar year ends this time is approaching rapidly. Contact Nicole Mitchell or Donna Dominguez for questions related to the ICE Model or any other related questions at 301.231.6200 or Ask Fedmine.

We did a quick roundup of who might be the top small businesses in the federal government as of June 2009. What is most surprising, if it is at all, is that none of the companies on the Top 10 list really appear to be small! Go figure.

Top 10 Federal Small Business Contractors (Not so small by any means):

Percentages based on total analyzed spending of $ 223,191,890,355. For further details about these and other reports please visit: to www.fedmine.us or email Ashok Mehan at: amehan@fedmine.us.

Per a Reuters news release, the U.S. Chamber of Commerce thinks so.  According to Myron Brilliant, a Chamber of Commerce official, the enhanced “Buy American” requirements included in the Recovery Act may actually serve to reduce U.S. jobs.  In a nutshell, stimulus projects are required to use iron, steel and other goods made in the U.S.  Canadian companies in the water & sewage equipment, structural steel, alternative energy and medical device industries have basically been shut out of the any U.S. projects funded by stimulus dollars.  Canadian mayors have threatened to retaliate by excluding American suppliers from the $15 billion worth of business they currently do with Canadian municipalities.  The Chamber of Commerce could not quantify how many jobs would be lost under such a scenario but believes it could be substantial.

Just back from GSA EXPO 2009 that was held in San Antonio, TX.

Great turnout this year with over 800 exhibitors and 10,000+ registered attendees.  There was a notable increase in the amount of GSA contractors that attended but did not exhibit.  All the training courses focused on GSA contractors were overfilled with standing room only.

There was also a lot of information discussed related to ARRA funds usage and  State and local initiatives that will be implemented in the nex fiscal year.

Aronson will be hosting a EXPO Highlights Event on June 30 at the Tower Club.  Click below for nore information on event and how to register.