The Secondary Furlough: Federal Contracts Put Solution Providers In Tough Spot


When NASA set an Oct. 18 submit deadline for its new enterprise IT contract, Marc Fertik, vice president of Ace Technology Partners, said he knew that date set wouldn't be realistic and figured it would get delayed a week or two, just because of how government contracts usually work.

But then the government shutdown happened on Oct. 1. Now the contract date is set as "TBD," with no indication on when that decision would be made. Fertik said he is guessing it will happen sometime in November, but he can't be sure. And there isn't really any way to find out -- the contract's website says that NASA "will be unable to respond to any individual emails or phone calls until the furlough has ended."

The 50 contractors involved with the NASA contract all will have their deadlines pushed back, he said, which means the May 1 start date will also probably be pushed back.

 

[Related: The Government Shutdown: 8 Things VARs Need To Know]

"That impacts everybody," he said. "There's a constant ripple and constant delay." It's not just NASA, either.

Kathy Lacina, vice president of sales for Ace Computers, which does around 65 percent of its business with the federal government, said that even though they are ready to deliver their orders, there is no one in the government to receive the shipments. She said the only word she has heard from the government is to "sit tight" until the shutdown is resolved.

Lacina said her company is also in the process of bidding for a contract with the U.S. Air Force, but the estimated award date has come and gone with no word on the decision.

"We're hearing that they've resolved it, but we haven't actually heard from the Air Force," Lacina said. "You can only imagine the strain that [has] put us under."

This is a big issue for companies across the board, said Trey Hodgkins, senior vice president of the global public sector at TechAmerica, an industry trade organization. Even high-profile contracts, such as the $10 billion Department of the Interior cloud project, are being put on hold for the foreseeable future.

"Clearly the government is not operating as a customer right now -- that’s a significant issue for a lot of companies," Hodgkins said.

NEXT: Lost Contracts Put Investments, Workers In Limbo