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2014's top contracts see growth

Oct. 10, 2013 - 04:24PM   |  
By NICOLE BLAKE JOHNSON   |   Comments
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The government’s largest contracts slated for release this fiscal year will be significantly larger than previous years, according to a new analysis.

The top 20 contract opportunities represent a combined potential business worth $160 billion over the contracts’ lifetime, or a 74 percent increase over the $92 billion value of last year’s top contracts, according to a new report by market research firm Deltek.

Request for proposals are expected to start rolling out in January, which should provide some breathing room for agencies to recover from the partial shutdown, said Jennifer Sakole, principal analyst for federal information services at Deltek. Whether contracts will be immune to impacts of the shutdown is unclear, but so far agencies haven’t announced plans to cancel or postpone these contracts.

Sakole noted that while the estimated ceiling values are significantly higher than last year’s top contracts, agencies may end up spending less money under those contracts. More than half of the contracts are indefinite-delivery/indefinite-quantity contracts, which provide an indefinite quantity of goods and services during a fixed period of time.

Defense Department spending accounts for 73 percent, or $118 billion, of the top contracts, which is more than double last year’s value. More than half of those dollars are expected to flow from Army contracts. Overall, information technology contracts represent 45 percent of the top 20 contracts, including the Army’s estimated $30 billion Strategic Services Sourcing 2nd Generation (S32G) contract and another $25 billion Army contract called Information Technology Enterprise Solutions 3 Services contract (ITES-3S CHESS). There’s also the Defense Intelligence Agency’s Enhanced Solutions for the Information Technology Enterprise (E-SITE) contract.

In a recent draft RFP to industry, DIA increased the value of the E-SITE contract from $5 billion to $6 billion, Sakole said. The contract will provide worldwide coverage for IT requirements and technical support services supporting DIA, the combatant commands, military services and mission needs of the larger intelligence community.

DIA was forced to postpone its E-SITE industry day because of the shutdown.

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