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May 5 2006

The U.S. Federal Government awarded over $11 billion in information technology (IT) related prime contracts during the second quarter of fiscal year 2006 (2Q FY06), according to a report released today by INPUT, the authority on government business. The total award value for 2Q FY06 was consistent with the IT awards from the same time period last year. Nearly $1 billion in set-aside competitions was awarded during 2Q FY06, a 17 percent increase from 2Q FY05.

The Departments of Energy (DOE) and the Air Force drove the majority of contract award activity in 2Q FY06 with nearly $5 billion in combined contract awards. The majority of the contract dollars from the DOE stemmed from its $2.5 billion award to National Security Technologies, LLC for the management and operation of the Nevada test site and its related facilities and laboratories. In January 2006, the Air Force awarded a contract for a transformational satellite mission operations system to Lockheed Martin for a ceiling value of nearly $2 billion over 10 years.

"More than half the awards in the second quarter were for professional services or maintenance support services," said Marcus Fedeli, manager, federal opportunity products for INPUT. "Older hardware and software has to be maintained which is extremely costly, but agencies are continuing to look at new options in replacing these legacy systems."
 

Small business set-asides led all set-aside competition types with 63 awards during 2Q FY06. The National Aeronautics and Space Administration (NASA) led all federal departments in total set-aside contracts. The majority of NASA's set-aside allocation came from one small business contract worth $305 million over five years. Of the 86 total contracts awarded via set-aside competition in the second quarter, only six were awarded via Service-Disabled Veteran-Owned Business (SDVOB) competitions for a total of just $40 million. The large majority of this amount was driven by one State Department award to provide visa processing and support. Other set-aside competition types for 2Q FY06 were 8(a) with sixteen awards and HUBZone with one award.
 

"INPUT is currently tracking nearly $65 billion in federal government programs with anticipated award dates during 3Q FY06 through its Federal Technology Opportunities information service," added Fedeli. "We anticipate that the federal government will award more than $4 billion in contracts via set-aside competitions during the third quarter of this fiscal year

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