Steve Charles | A wish for fiscal '08: Timely appropriations

Buylines | Policies, strategies and trends to watch

Steve Charles

It's August again, and Congress is in recess. When the members return Sept. 5, the government's new fiscal year will be less than one month away and none of the fiscal 2008 appropriations bills will have been passed into law.

When lawmakers can't agree on an appropriations bill, they pass a different kind of law ? a continuing resolution ? to keep agencies operating. Continuing resolutions limit spending to the prior year's levels or less. It's a painful process for agencies and contractors that we all hope can be avoided this year for the first time in more than a decade.

The House should be applauded for getting its 12 appropriations bills passed before the recess. However, the Senate has passed just one appropriations bill ? for the Homeland Security Department. This means that the Senate has 11 to pass, and then the House and Senate committees will need to reconcile the differences in their bills before sending the final legislation to the president for his signature. All this needs to happen in September to avoid a continuing resolution.

The continuing-resolution phenomenon has occurred for the past 11 years despite annual promises by members of Congress that the next year will be different. This practice has become so much a part of life in the federal market that companies forecast significantly smaller revenues for the fiscal year's first quarter. This is especially true for sales of new technology.

Contractors and government employees have gotten into the rhythm of a nine-month fiscal year. Instead of starting the new year with high energy, people focus on taking use-it-or-lose-it vacations to regroup after the exhaustion of all the unnatural acts performed to spend the previous year's budget before September without running afoul of the Bona Fide Needs Rule and the Impoundment Control Act.

As if that wasn't enough, they must begin the new year without the authority of an annual budget.

Could this year be different? What if we all sent messages to our senators asking them to pass the appropriations bills by Oct. 1 so that, for the first time in more than a decade, we could break the dysfunctional cycle of the continuing resolution?

We all know that lawmakers add political items to such must-pass bills, but why is there not enough countervailing political pressure on Congress to do its job and pass the spending bills on time?

Those most affected ? department and agency managers ? either can't or won't talk publicly about the issue for fear of reprisals. Contractors scramble to make sure their customer relationships are strong so they can bear the strain of working at risk and accepting task or delivery orders from government agencies with a "subject to availability of funds" clause.

Orders and invoices are rewritten to tap funds in accordance with the continuing resolutions, and everyone muddles through trying to stay under the radar in this continual cat-and-mouse game between agencies and congressional appropriators.

Thus, the dysfunctional process Congress creates when it doesn't finish appropriations by Oct. 1 undermines the budget control it promises taxpayers.

Since our government customers can't confront Congress, perhaps contractors should get organized for an annual focus on this issue every August and September. The contracting community could easily provide a few good stories each year for the media to cover during the August lull. If 59 industry associations can join hands to fight the 3 percent withholding and deduction law slated to go into effect in January 2011, perhaps a similar coalition of associations could take on the annual task of reminding lawmakers to finish their most important management job of the year on time.

Steve Charles is co-founder of immixGroup Inc., a consulting firm in McLean, Va. E-mail him at steve_charles@immixgroup.com.

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