Input: Katrina squeezes DHS technology spending

Supplemental federal spending for the clean-up efforts following Hurricane Katrina could mean fewer IT opportunities for government contractors, a federal technology market report said.

Increased federal support for relief raises the threat of larger budget cuts for planned IT purchases, especially in the Homeland Security Department, according to a report issued this week by market research firm Input Inc. of Reston, Va.

While emergency funds routed to the Federal Emergency Management Agency are increasing budget allocations for DHS, the enlarged spending may reduce funds for existing and planned IT programs within the department, Input said.

Although two of DHS' priorities are enhancing information sharing among its 22 agencies and improving procurement and IT, funding for the department's mission remains uncertain, according to Input.

"Despite likely budget cuts, information sharing using IT will continue to be crucial to the DHS mission," said Payton Smith, Input's director for public sector market analysis. "For this reason, technology vendors should also remain patient as DHS restructures their procurement operations over the next three to four years."

DHS' IT budget will likely increase in fiscal year 2006, but the Senate budget bill excludes funds for risk management programs and information sharing, which are the foundations for the department's reorganization that was announced in July, Input said. For example, funding for the department's Office of Interoperability and Compatibility were cut by $6 million even though IT consolidation is essential to DHS' performance, Input said.