Government procurement in the United States
In the United States, the processes of government procurement enable federal, state and local government bodies in the country to acquire goods, services (including construction), and interests in real property.[1] Contracting with the federal government or with state and local public bodies enables interested businesses to become suppliers in these markets.
In fiscal year 2019, the US Federal Government spent $597bn on contracts.[2] The market for state, local, and education (SLED) contracts is thought to be worth $1.5 trillion. Supplies are purchased from both domestic and overseas suppliers. Contracts for federal government procurement usually involve appropriated funds spent on supplies, services, and interests in real property by and for the use of the Federal Government through purchase or lease, whether the supplies, services, or interests are already in existence or must be created, developed, demonstrated, and evaluated.[3] Federal Government contracting has the same legal elements as contracting between private parties: a lawful purpose, competent contracting parties, an offer, an acceptance that complies with the terms of the offer, mutuality of obligation, and consideration. However, federal procurement is much more heavily regulated, subject to volumes of statutes dealing with federal contracts and the federal contracting process, mostly in Titles 10 (Armed Forces), 31 (Money and Finance), 40 (Protection of the Environment), and 41 (Public Contracts) within the United States Code.
In fiscal year 2019, the US Federal Government spent $597bn on contracts.[2] The Obama administration measured spend at over $500bn in 2008, double the spend level of 2001.[4] Other estimates suggest spend was $442bn in fiscal year 2015 [2] and $461bn in 2016.[5] Federal Procurement Reports provide contract data which may be used for geographical, market, and socio-economic analysis, as well as for measuring and assessing the impact of acquisition policy and management improvements.[6]
In fiscal year 2010, the top five departments by dollars obligated were:[7]
The Top 100 Contractors Report for Fiscal Year 2022[8] published by the General Services Administration lists contracts with a combined total of $398.8 billion. The top five are aerospace, defense and medical contractors:
In the same period, small business contracts totalled $153.9 billion.[9]
Wartime contracting[edit]
Allegations of waste and corruption in government procurement during wartime have led to special oversight measures being put in place. During World War II this function was provided by the bipartisan Truman Committee established in 1941. After allegations of contract fraud and waste were made regarding expenditure during the wars in Afghanistan and Iraq, the Commission on Wartime Contracting in Iraq and Afghanistan was established, modelled on the Truman Committee.[63]
Contractor voice[edit]
One organization which provides a contractor perspective is the Coalition for Government Procurement (CGP), a non-profit association of commercial contractors.[64] The CGP is based in Washington, D.C. and is registered under the Lobbying Disclosure Act of 1995.[65]