Fiscal Cliff | The Contracting Education Academy

January 14, 2013 By AMK

DoD’s civilian contracting officers could be furloughed for a month, analyst says

Unless Congress achieves a deal to head off the revised schedule for across-the-board spending cuts, the Defense Department in March will be forced to begin rotating monthly furloughs of all 791,000 of its civilian employees, a prominent budget analyst said on Wednesday.

“This would be a contracting nightmare for DoD because civilian contracting officers would be furloughed for a month,” Todd Harrison, senior fellow at the Center for Strategic and Budgetary Assessments, told reporters.

Using “back of the envelope” calculations interpreting the new American Taxpayer Relief Act, he said the roughly 8.8 percent cut that would kick in under the sequestration penalties would have “a real impact” on the $70 billion a year spent on the civilian workforce — the equivalent of a 15 percent cut over the remaining seven months of the fiscal year.

“There’s no way to avoid it unless Congress changes the law,” Harrison said in releasing a new paper on the impact of the so-called fiscal cliff that projects revised cuts aimed at the Pentagon of about $48 billion in fiscal 2013. “Not all the furloughs would happen at the same time,” he said, but planners should decide soon who would be furloughed in what month and make it public “to help inform public debate so we could make a good decision as a nation on what we are going to do.”

Keep reading this article at: http://www.govexec.com/defense/2013/01/pentagon-would-furlough-all-civilians-under-revised-sequestration-analyst-says/60569/?oref=national_defense_nl.

January 11, 2013 By AMK

All DoD components told to prepare to freeze hiring, terminate temporary hires, reduce base operations, and curtail expenses

Deputy Defense Secretary Ashton B. Carter has released a memo directing the services and defense agencies to begin planning for possible upcoming budget challenges.

The memo allows defense components to freeze civilian hiring, terminate temporary hires and reduce base operating funds. It also allows components to curtail travel, training and conferences and to curtail administrative expenses.

The memo — dated Jan. 10, 2013 — points to the threat of sequestration and the continued use of a continuing resolution as a way to fund the department. Sequestration was to have become effective Jan. 2, but Congress delayed its activation until March 1 to give lawmakers more time to come up with an alternative. It would impose major across-the-board spending cuts.

Since Congress did not approve an appropriations act for fiscal 2013, the Defense Department has been operating under a continuing resolution and will continue to do so at least through March 27. Because most operating funding was planned to increase from fiscal 2012 to fiscal 2013, but instead is being held at fiscal 2012 levels under the continuing resolution, funds will run short at current rates of expenditure if the continuing resolution continues through the end of the fiscal year in its current form, Carter wrote in the memo.

Given this budgetary uncertainty, the department must take steps now, the deputy secretary said.

“I therefore authorize all Defense components to begin implementing measures that will help mitigate execution risks,” the memo reads. “For now, and to the extent possible, any actions taken must be reversible at a later date in the event that Congress acts to remove the risks. … The actions should be structured to minimize harmful effects on our people and on operations and unit readiness.”

The memo allows components to review contracts and studies for possible cost savings, to cancel third- and fourth-quarter ship maintenance, and to examine ground and aviation depot-level maintenance. This last must be finished by Feb. 15.

It also calls on all research and development and production and contract modifications that obligate more than $500 million to be cleared with the undersecretary of defense for acquisition, technology and logistics before being awarded.

For science and technology accounts, the components must provide the undersecretary and the assistant secretary of defense for research and engineering with an assessment of the budgetary impacts that the budgetary uncertainty will cause to research priorities.

Full text of the Ashton Carter memorandum can be downloaded here: Budgetary Uncertainty Memorandum – Ashton Carter 01.10.2013

January 10, 2013 By AMK

White House talks of ‘eliminating’ sequester, but vague on timing

White House Press Secretary Jay Carney was vague Jan. 8 about just when President Barack Obama will launch talks with lawmakers about avoiding deep cuts to planned Pentagon spending.

Carney, during his daily press briefing, did indicate the White House wants to avoid the full $500 billion in cuts to projected defense and domestic spending over the next decade.

“The fact is we have two months because of the fiscal cliff agreement, and that is not a great deal of time,” Carney said. “The president will, and the White House will, engage with Congress on those matters in, I think, the relatively near term.”

Keep reading this article at: http://www.defensenews.com/article/20130108/DEFREG02/301080008/White-House-Talks-8216-Eliminating-8217-Sequester-Vague-Timing-Talks?odyssey=nav%7Chead.

January 7, 2013 By AMK

Legislation signed to deliver more government contracts to small businesses

Washington’s elected officials are taking new steps to direct more government work to small businesses, just as contractors are bracing for the threat of sequestration.

President Obama on Tuesday signed as part of the military spending budget a series of provisions to help small firms compete for more federal contracts and ensure that agencies take their annual small business contracting goals more seriously. Most notably, the law requires that small business contracting performance be part of employee reviews for senior agency officials, which factor into their consideration for bonuses and promotions.

The change comes after the federal government missed its stated small business contracting goal (23 percent of total procurement across all agencies) for the eleventh straight year in 2012. Though lawmakers stopped short of imposing penalties like reducing budgets or senior level compensation for agencies that fall short of the annual goals, as had been previously proposed in both chambers, this is the first time they have provided formal incentives to encourage agencies to deliver on their annual pledge to small businesses.

Keep reading this article at: http://www.washingtonpost.com/business/on-small-business/obama-signs-law-intended-to-deliver-more-government-contracts-to-small-businesses/2013/01/04/eb452e10-55f7-11e2-bf3e-76c0a789346f_print.html.

December 31, 2012 By AMK

Budget writers at Pentagon move forward despite spending threat

The Pentagon is pretending the threat of the “fiscal cliff” doesn’t exist when it comes to the Defense Department’s 2014 budget.

Budget planners are preparing their 2014 budget as if lawmakers will avoid the spending cuts known as sequestration that are scheduled to hit the Pentagon in January.

“We are still hopeful that Congress will pass a balanced deficit reduction plan that the president can sign, and sequestration is averted,” Pentagon spokeswoman Lt. Col. Elizabeth Robbins said.

Keep reading this article at: http://thehill.com/blogs/defcon-hill/budget-appropriations/274707-pentagon-budget-moves-forward-despite-fiscal-cliff.

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