Home / Weekly Round-up / GovCon Wire’s Weekly Roundup: Defense and IT Win Big in FY 2018 Budget Proposal

GovCon Wire’s Weekly Roundup: Defense and IT Win Big in FY 2018 Budget Proposal

The Week’s Top GovCon News Stories
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Weekly Roundup

May 22 – May 26 2017

A Note From Our President & Founder Jim Garrettson

This past Tuesday, President Donald Trump released his first budget proposal for fiscal 2018 and the blueprint suggests many opportunities for government contractors, particularly those in the defense industry.

At $3.6 trillion dollars, the “New Foundation for American Greatness,” proposes $640 billion in discretionary spending for the Department of Defense and $560 billion in non-defense discretionary spending.

This year’s budget proposal proposes a significant increase on defense spending, adding almost half a trillion dollars, while cutting $1.5 trillion from nondefense spending and $1.4 trillion in Medicaid over the course of a decade.

The $52 billion increase in defense spending will enable the military to fulfill many of President Trump’s promises and accomplish long-term military goals, like centralization and modernizing infrastructure. Government officials have told Bloomberg that the proposed defense budget would appropriate funds for the construction of nine warships, with one of them being a DDG-51 Flight III guided missile destroyer ship built by Huntington Ingalls Industries and General Dynamics. All requisite munitions for the destroyer and eight other warships are included, with enough Raytheon-built Tomahawk cruise missiles to “keep the company’s Tucson, Arizona plant in operation.”

President Donald Trump’s budget also asks for $95.7 billion to update Federal information technology, a huge opportunity for that sector. Here’s 4 charts that explain where he’s asking for that money to be spent. The budget asks for investments in four key functions: mission delivery; administrative services and support systems; IT infrastructure and security; and IT management; and grants. The administration document requests agencies to “identify and budget for the modernization of specific high-risk legacy IT systems, with a particular focus on transitioning these systems to cloud and shared services.”

The budget proposal also seeks $7.75 billion for military space programs in 2018, a $1.3 billion increase from 2017. The $7.75 billion would be parceled out into $4.33 billion for R&D, testing and evaluation, and $3.42 billion for procurement. Although most defense space operations fall under the purview of the Air Force, the proposal includes outlays for other agencies such as the National Reconnaissance Office.

The increase in defense spending will also greatly assist efforts to rebuild the U.S. armed forces and transform it into, in the words of John Roth, a “bigger, more lethal force” by FY2019. Roth also called for a reversal of defense sequestration to assist in advancing the DoD’s strategy to re-establish military readiness.

The administration’s budget depends on tax reform to fund its spending and keep the budget revenue-neutral; and promises to balance the budget within the next decade. The “New Foundation” would also work to reduce the debt-to-GDP ratio to 60 percent and shrink the federal workforce.

The fiscal 2018 budget proposal indicates that the Trump administration will continue its focus on defense and IT spending, meaning that the government contracting industry will likely be replete with opportunities surrounding these two key areas.

Expect to see RFIs, RFPs and contracts related to defense, such as recruitment, training, equipment, munitions, vehicles, unmanned systems and more. There will also likely be an uptick in IT and cyber related RFIs and contracts as the federal government pursues IT modernization initiatives, continuous diagnostics and mitigation efforts, improvements to data analytics and, perhaps most importantly, cybersecurity.

THIS WEEK’S TOP GOVCON STORIES

CGI Federal to Build Army’s Contract Writing System Under Potential $134M Award
CGI‘s federal business has received a potential $133.9 million contract to develop an enterprise-wide software platform for the U.S. Army to write, manage, execute or close out a contract.
John Mengucci Takes On Expanded COO Role at CACI; Ken Asbury Comments
John Mengucci, chief operating officer and president of U.S. operations at CACI International, will assume additional responsibilities as COO in an effort to advance the company’s strategic growth initiatives.
DoD Names PNNL Policy Adviser Vayl Oxford as DTRA Director
Vayl Oxford, a national security executive policy adviser at the Energy Department‘s Pacific Northwest National Laboratory, will assume the director role at the Defense Threat Reduction Agency.
SpaceX Sets June 1 Launch for 11th ISS Commercial Resupply Mission
A SpaceX-built Dragon spacecraft is set to launch on June 1 aboard a Falcon 9 rocket from a launch pad at NASA’s Kennedy Space Center in Florida to deliver crew supplies, scientific research and related equipment to the International Space Station.
Forcepoint Vet John McCormack Named Fidelis Interim President, CEO
John McCormack, former CEO of security firm Forcepoint, has been appointed to serve as Fidelis Cybersecurity‘s interim president and CEO.
DARPA Develops Military System Performance Prediction Tools
The Defense Advanced Research Projects Agency has developed mathematical tools and methods to help designers understand risks associated with the design and modeling of large military systems such as aerospace vehicles and engines.
IBM-Nutanix Alliance to Offer Hyperconverged Infrastructure for Enterprise Workloads
IBM and Nutanix have entered into a multi-year partnership agreement to develop and offer an integrated infrastructure system for large enterprise customers to manage workloads.
Leidos Secures SPAWAR Contract for Navy ISR Platform Support; Tim Reardon Comments
Leidos will provide technical assessment, program definition and other technical services in support of a U.S. Navy intelligence, surveillance and reconnaissance platform under a $43 million contract.
Lockheed, BAE Vet DeEtte Gray to Head CACI’s US Operations; Ken Asbury Comments
DeEtte Gray, formerly president of the intelligence and security sector at BAE Systems’ U.S. subsidiary, has joined CACI International as president of U.S. operations.
CSRA to Buy IT Firm NES Associates; David Keffer, Larry Prior Comment
CSRA has agreed to purchase Alexandria, Virginia-based information technology services contractor NES Associates for an undisclosed amount.
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