Input: Federal IT spending accelerates in first quarter

The federal government awarded more than $28 billion in IT-related prime contracts during the first quarter of fiscal 2006, an increase of more than 40 percent compared to the same period in fiscal 2005, according to Input Inc.

The Air Force drove most of the growth with more than $11 billion in first-quarter awards, the Reston, Va., market research firm reported.

The Air Force awarded about $10 billion in contracts to IT contractors for work on its Contract Augmentation Program, making it "the hands-down agency leader for dollars awarded during the quarter," said Marcus Fedeli, manager of Input's federal technology opportunities information service.

The Army and Treasury Department also completed large awards during first quarter 2006, with total awarded contracts for both departments exceeding $10 billion.

The Army awarded a major follow-on contract for Total Engineering and Integration Services, while Treasury made a $3 billion award to several vendors for the Total Information Processing Support Services contract. The Energy Department and other defense agencies awarded contracts worth more than $4 billion during the quarter.

Contracts awarded through set-aside competitions increased 80 percent from $1.5 billion in first quarter 2005 to $2.7 billion in first quarter 2006. Set-aside competitions accounted for nearly 10 percent of total contract dollars awarded during first quarter 2006, with small business set-aside awards leading all other competition types. The Army drove most of the set-aside increase during the quarter, with 12 competition contracts worth nearly $2 billion.

Total contract values are expected to keep rising throughout fiscal 2006, given anticipated finalization of many large and multiple-award contracts, Fedeli said.

About the Author

William Welsh is a freelance writer covering IT and defense technology.

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