October 22 2004 Copyright 2004 Business Research Services Inc. 202-364-6473 All rights reserved.

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Washington Insider

Federal courts are delaying projects and expenditures to hold spending at fiscal 2004 levels because Congress has not enacted 2005 appropriations bills. Congressional Quarterly reports 42 courthouse construction projects are on hold. Federal court officials are also cutting back or delaying spending on travel, furniture, equipment and training.

Most other civilian agencies are in the same boat. They are operating under continuing resolutions because Congress has passed only four of the 13 appropriations bills for 2005. Lawmakers will return Nov. 16 for a lame-duck session.

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Congress has liberalized the rules for S corporations by increasing the maximum number of shareholders from 75 to 100 and counting all members of the same family as a single shareholder. The provisions are part of the corporate tax bill passed this month.

S corporations pay no corporate taxes; their profits are passed through to shareholders and taxed as personal income. There are more than 3 million S corporations.

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The Defense Department has released the Defense Acquisition Guidebook, an online resource for acquisition personnel and contractors.

“The guidebook is an interactive, Web-based capability designed to provide the acquisition workforce and their industry partners with an on-line instant reference to best business practice as well as supporting policy, statute, and lessons learned,” the department said.

The new guidebook is designed as a companion to the revised acquisition policy documents, DoD Directive 5000.1 and DoD Instruction 5000.2. “While the policy documents released last year explain what acquisition managers are required to do, the just-released guidebook complements those documents by proposing how,” DOD said.

The Defense Acquisition Guidebook is available at http://akss.dau.mil/DAG.

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Seven small IT companies won awards from the Army for information technology desktop support and services.

The task orders went to Addx Corp. of Alexandria, VA, $20.4 million; AlphaInsight Corp. of Falls Church, VA, $85.4 million in two contracts; Daston Corp. of McLean, VA, $10.6 million; Focused Management Inc. of Springfield, VA, $19.4 million; MicroPact Engineering Inc. of Herndon, VA, $91 million; Pragmatics Inc. of McLean, $117.6 million; and Resource Consultants Inc. of Vienna, VA, 202 million.. The contracts are for one year with four one-year options.

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The federal IT market will grow by an average of 3.6% a year from fiscal 2005 to 2010, according to the annual forecast by the Government Electronics and Information Technology Association.

The growth rate is slower than last year’s 4.1% forecast because the growing budget deficit is squeezing discretionary spending, GEIA said.

The forecast says the Defense Department will drive the IT market, with an estimated 4.4% annual growth. GEIA also forecasts civilian spending will increase by just 2.9% a year, mostly because of higher spending by the departments of Homeland Security and Health and Human Services departments.

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SBA backed 74,825 loans totaling $12.5 billion under its 7(a) lending program in fiscal 2004, plus an additional 8,168 loans worth $3.9 billion under the 504 program. The agency said both totals were records, and the number of loans was twice as many as in 2001.

The numbers reflect SBA’s policy of emphasizing smaller loans under the 7(a) program. That program was shut down for a few weeks in December and January because heavy demand threatened to exhaust the agency’s lending authority.

Borrower and lender fees under the 7(a) program increased in the new fiscal year that began Oct. 1.

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SBA is proposing to waive the nonmanufacturer rule in three industries where it says no domestic manufacturer is available:

General Aviation Turboprop Aircraft with six or more passenger seats, NAICS code 336411;

Miscellaneous Electrical Equipment and Components Manufacturing, NAICS code 335999; and

Small Arms Ammunition Manufacturing, NAICS code 332992.

Comments are due by Nov. 5 and should be sent to edith.butler@sba.gov.


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