2025 Federal Contracting Opportunities: A Bloomberg Government Analysis
Staying current on budget proposals and funding allocations is critical for contractors looking to secure lucrative opportunities. A recent Bloomberg Government research, conducted by Paul Murphy, gives light on the possible spending on future contracts as suggested by agency budget projections in President Joe Biden's fiscal 2025 budget request. The analysis focuses on five big contract prospects, potentially up to $246 billion, which are now in the pre-solicitation stage.
One of the most notable prospects is the Community Care Network Next Generation (CCN NextGen), a new vehicle being built by the Veterans Health Administration to provide a wide range of health services to veterans via countrywide networks of non-VA community-based health care providers. With four out of five regional contracts expiring in September, the CCN NextGen is ready to replace them, potentially tripling the contracts' maximum financed value to an estimated $212 billion by fiscal 2027. The budget proposal includes a $41 billion obligation for the VA's Medical Community Care in fiscal 2025, accounting for roughly nine out of every ten dollars allocated for the account. This level of investment reflects a considerable commitment to veterans' medical care, but it also signals that spending constraints may be tightened.
Another important contract possibility is the Integrated Healthcare Transformation 2.0 (IHT 2.0), which aims to deliver business process re-engineering, testing, and analytical services to senior Veterans Health Administration officials. The deal, which has a ceiling of $14 billion over ten years, is a recompete of a $1.4 billion contract and continues to be a 100% service-disabled, veteran-owned, small company set aside. The significant rise in the contract ceiling for IHT 2.0 may need more future spending, which could be a topic of concern during the next fiscal 2025 appropriations deliberations.
Another notable opportunity is the DOE Chief Information Officer Business Operation Support Services II (CBOSS II), which has a five-year value of $10 billion. This contract is intended to provide enterprise IT professional services to 79 Energy Department businesses in 27 states. CBOSS II funding looks to be stable, with the budget proposal seeking an additional $9 million for administrative services under the Other Defense Activities account and cybersecurity spending remaining stable at $308 million.
The State Department's Access contract, which is a new multiple award blanket purchase agreement for IT hardware and related services, marks a significant shift in the agency's procurement strategy. This contract, valued at $5 billion over five years and set aside for small firms, attempts to use the General Services Administration's Multiple Award Schedule for IT to encourage greater small business competition. However, the financing forecast for IT hardware purchases remains bleak, with a minor decrease in funding for the State's shared administrative expenditures at abroad postings and just a marginal increase in the Capital Investment Fund.
The Research Measurement Assessment Design and Analysis 3 (RMADA 3) contract, which involves business research on health care models and systems administered by the Centers for Medicare and Medicaid Services, appears to have a promising financial outlook. RMADA 3, valued at up to $5 billion, is primarily funded by the CMS Innovation Center, which has proposed a $1.4 billion obligation budget for fiscal 2025, up 30% from fiscal 2024.
The Bloomberg Government's investigation sheds light on the funding situation for some of the most lucrative contract prospects in federal contracting. Contractors must remain aware and strategically positioned as agencies strive to utilize limited procurement dollars and negotiate the complexity of budget allocations. The fiscal 2025 budget request demonstrates a commitment to veterans' health care, IT modernization, and research into health care models, paving the way for a competitive and dynamic government contracting environment in the coming years.
FedFeather Frank says:
“This article from Bloomberg is important for federal contractors as it provides critical insights into the funding prospects of significant contract opportunities worth up to $246 billion in President Joe Biden's fiscal 2025 budget request, helping contractors strategize and position themselves effectively to compete for these lucrative contracts.”
Based on this blog post, federal contractors should consider:
Staying Informed and Prepared: Federal contractors should pay close attention to budget proposals and funding allocations, particularly for key contract opportunities such as the Community Care Network Next Generation (CCN NextGen), Integrated Healthcare Transformation 2.0 (IHT 2.0), DOE Chief Information Officer Business Operation Support Services II (CBOSS II), the State Department's Access contract, and the Research Measurement Assessment Design and Analysis 3 (RMADA 3). Staying informed about these developments will allow contractors to strategically position themselves for future solicitations.
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Focus on Strategic Partnerships: If you are a large government contractor, particularly in the health care and information technology industries, think about creating or deepening collaborations with service-disabled, veteran-owned small companies (SDVOSBs) and other small organizations. This is especially important for contracts designated for small firms, such as IHT 2.0 and the State Department's Access contract. Collaboration with these enterprises can boost competitiveness and provide new opportunities in the federal contracting market. Similarly, small enterprises may consider collaborating with larger federal contractors in this field.
For more information on forming partnerships, please see our free articles on the SBA mentor-protégé program and joint venture agreements.
For more in-depth information, check our federal government contracting course "Understanding Federal Acquisition Planning."
Finally, our 1:1 coaching and mentoring service will help you and your business grow together.
Consider investing in capabilities: Contractors should invest in expanding their capabilities in areas identified in the fiscal 2025 budget request, such as veterans' health care, IT modernization, and healthcare research. Developing expertise and solutions in these areas will be vital for obtaining contracts and providing value to federal agencies.