November 17, 2011

Government contracting has traditionally been a great opportunity for small businesses, but the American Recovery and Reinvestment Act of 2009 (ARRA) expanded the opportunity even more, and money continues to be awarded. However, funds allocated under the act are being spent quickly, though government agencies continue to rely on small businesses to get the job done.

Who can benefit from ARRA-funded contracts?

Tremendous opportunity exists for businesses in information technology, energy efficiency, military, infrastructure (including telecommunications and road and bridge construction) and environmental cleanup. Although ARRA has no specific quotas for funds being allocated to small or disadvantaged businesses, agencies are strongly encouraged to maximize opportunities for firms that meet these criteria. Agencies must demonstrate that they made efforts to seek vendors that are certified as minority-owned, women-owned or economically/socially disadvantaged.

ARRA funding distribution

ARRA funds are being distributed to federal, state and local agencies as well as to municipal utilities and school districts. Although much of the stimulus money has been dispersed using direct federal procurement, a larger portion was transferred from the federal government to the states for allocation through contract awards and grants. The government has given top priority to projects that are considered “shovel-ready” (i.e., ones that can be rolled out immediately to put people back to work).

Identify contract opportunities

You can learn about the areas in which federal agencies continue to invest their ARRA dollars at recovery.gov. The site was designed to provide transparency regarding the use of allocated funds. It provides detailed reports on federal contracts, each agency’s spending plans and maps of state-by-state funding, as well as weekly updates of agency funding notifications. Recovery.gov also includes links to individual state recovery websites, which outline state and local contract opportunities. The certification requirements for state and local contracts may vary from those at the federal level, so be sure to do your homework. Use the tools in the Resources section of this guide to research relevant contracts and identify what work other small businesses are performing and what certifications they have in place. You can find all federal government contracting opportunities (as well as some ARRA opportunities) that exceed $25,000 at the Federal Business Opportunities web site (fbo.gov). You can also register to create search agents and add yourself to a watch list to receive updates on a particular contract.

Procurement processes

The Obama Administration has already made over $700 billion available through ARRA, with tens of billions of dollars still available. Agency procurement officers were told to spend the money quickly to get people back to work and to invest in areas that will revitalize the economy. Thus, these officers have relied on already approved vendors on established contract vehicles, such as indefinite delivery/indefinite quantity (IDIQ) and basic ordering agreements (BOA), as well as to businesses that are already on the GSA Schedules.

Pursue ARRA-funded contracts

To pursue government contracts funded by ARRA, read through each agency’s stated recovery goals at the recovery.gov site. Many agencies have also established their own recovery web sites, which provide additional insight into procurement opportunities. Then visit the Federal Business Opportunities (FedBizOpps) site to identify and respond to solicitations of interest.

Make important connections

Each agency has its own Office of Small and Disadvantaged Business Utilization (OSDBU), which is an excellent resource to learn about the organization and how it acquires goods and services. These offices are important gatekeepers to build relationships with. You can also gain valuable knowledge about government contracting by attending procurement fairs and networking with key decision makers.

Become a subcontractor

If you are not already registered as a government contractor, read the American Express OPEN Guide "Prepare Your Business for Government Sales." Vendors already working with the government have a considerable head start, and you may want to accelerate your chances by partnering with a prime contractor—another business that already has positive working relationships with procurement officers. This is a great way to forge important relationships and demonstrate your value with smaller opportunities. Once you have proven yourself to the prime contractor, it can easily become a source of new business leads in the future. You can learn about potential subcontracting opportunities and identify prime contractors through the SBA subcontracting network at web.sba.gov/subnet/search/index.cfm.  

Benefit from government transparency

President Obama promised an unprecedented level of transparency in the use of ARRA funds. This means that you can not only learn how much money has been given to your state and which agencies currently have available projects, but you also can keep track of which vendors have won each contract awarded to date.

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government contracting, government