Design Professionals & Stimulus Funding

Jobs Created: Hard to Verify and Questioned

The White House stated on October 30, 2009 that the $787 billion stimulus package had created or saved roughly 1 million jobs. That number is hard to verify and questioned by many. In Utah, the White House said 6,598 jobs had been retained or added because of the positive impact of the federal stimulus package. However, discrepancies were easy to find with Utah companies and local governments misstating the number of jobs saved due to Recovery Act money according to a Salt Lake Tribune review of federal reports. The report indicates a significantly inflated picture of the program's employment benefits. It is all in the numbers with certain entities creating their own criteria, while others double-dipping and counting employees twice over multiple contracts. One of the most common errors is counting temporary or part-time work as full-time workers. Under federal guidelines, one job must be the equivalent to full-time work for the entire reporting period, which is three months. 

Impact on Design Professionals

To date, many design professionals have seen little impact from the stimulus trickle down to design services based on the “shovel-ready” focus of funds under the American Recovery and Reinvestment Act (ARRA). The economic slow down has cost thousands of architect and engineers (A/E) jobs. The unemployment rate in the architecture and engineering sectors jumped to 7.3 percent in the second quarter of 2009 with 113,000 people looking for work according to the U.S. Bureau of Labor Statistics. In the first quarter of 2009, the unemployment rate was 5.6 percent. A year ago, 3.2 percent of A/E’s were unemployed at 54,000. The unemployment rate has more than doubled in the last year for A/E firms.    

Opportunities in the Public Sector

With state, local and private segments down, A/E firms are, or should be looking to the public sector. Firms with experience in the federal sector are finding opportunities, whether in project restarts, renovations or entirely new project start-ups. Firms such the Omaha based  HDR Architecture’s was selected to be part of the new $500 million Department of Homeland Security headquarters project at St. Elizabeth’s campus in Washington, D.C. A/E firms are also using contracts with agencies such as the U.S. General Services Administration for smaller renovation and energy-upgrade projects. Establishing relationships with federal agencies and knowing their projects needs is critical for being successful in the federal public segment. HOK of St. Louis expects to pick up multiple contracts for small renovation jobs with the Department of Veterans Affairs. HOK is also targeting projects in the transportation sector and science and technology through the Department of Energy and the National Institutes of Health (NIH). A/E firms that are familiar with obtaining federal grant funding along with developing proposals for clients will be in a better position in offering follow-up design services.

Getting Started: Do Your Homework

The requirements for winning government contracts outlined in federal standards of qualification can seem daunting at first. It can be very frustrating and many people give up early on when you are only accustom to the working in the private sector. However, if you do your homework and make smart decisions, you can find it very rewarding. There are effective strategies to approach the process if a firm is new to federal contracting. Partnering is a recommendation by the chief of small business programs at the U.S. Army Corps of Engineers. On average, it takes small businesses 18 months to land their first prime contract. Being a sub is a good learning process, letting an experienced firm navigate the process while you learn. Many firms already working in the public sector could be forced to reach out to others A/E firm based on the increase in projects needs for sub-consultants.  Agencies offer varying degrees of support for first-time bidders, including online resources and contracting agents assigned to answer questions. The Defense Department has Procurement Technical Assistance Centers; www.dla.mil/db/procurem.htm  in all 50 states offering free or nominal cost classes and other assistance on federal contracting.

Where Does Your Firm Fit In?

Knowing your firm’s strengths and capabilities and how they fit into an agencies project goals and objectives is essential. Sustainability is now mandated on many federal projects along with Building Information Modeling (BIM) for many agencies. Identify how your firm fits in the needs of the agency and what makes your firm different helping them to meet projects goals. Firms should complete the indefinite delivery/indefinite quantity (IDIQ) contract process. Through IDIQ, agencies fill project needs, as they are needed. Through the IDIQ process, firms are pre-qualified and placed on a preferred list for projects, ready to go. It can be a challenging process, however, in the long run will be beneficial for your firm.  

Delivery Methods and Small Firms 

The federal government is under pressure to move quickly on many of the stimulus projects showing progress with taxpayer dollars. Many agencies are going to delivery methods such as design-build and integrated project delivery (IPD) methods in hope of fast-track project completion. Builder awarded contract as the prime creates opportunities for design professionals to contract with them as a small firm. All federal projects contain set-aside goals and percentages of projects allocated for small businesses, minority-owned, women-owned, or service-disabled veteran-owned firms. Many agencies have been challenged in finding enough companies to meet contract set-aside obligations. The Corps of Engineers increased small business funding by $1 billion in 2008 however, they have trouble finding firms that meet standards.

Where to Look for Projects

Looking for work as a prime or a sub-consultants, the government’s clearinghouse for information on federal contracts is an excellent resource. That can be found through the Federal Business Opportunity website: www.fbo.gob. On this site, firms can search for new projects and identify firms that have won contracts that may be looking for assistance. Contract holders can also be found through GSA website: www.gsa.gov.   Firms have found both sites helpful in identifying prime contract holders and partnering opportunities. Another helpful resource is Government Accountability Office (GAO) Reports. To find copies of GAO Reports, go to: http://www.gpoaccess.gov/gaoreports/index.html. The agency’s organization chart is helpful with procurement contacts. Contact the technical and program manager to obtain information on the approval process as well as start building a relationship.

Other Resources

GSA’s design and construction program website: www.gsa.gov/newconstruction

Small businesses working with the GSA: www.gsa.gov/Portal

Doing business with the Army Corps of Engineers: www.usace.army.mil/Pages

Doing business with the Navy: www.donhq.navy.mil/OSBP/

List of Defense Department Procurement Technical Assistance Centers by state offering free and low-cost help with government procurement: www.dla.mil/db/procurem.htm

What Should I Do Next?

Once you have identified the agencies (or a prime consultant) that could use your services that align with your firm’s strengths and capabilities, develop a contact and marketing strategy. This is important in reaching your target audience in the public sector. Identify your firm’s position in offering value to the agency (or prime) when offering your services for projects 

• Define who you are as a firm.
• What are your project specializes and strengths?
• Why do your clients continue to use your services?
• Based on your homework, which government agencies would be interested in your services?
• Identify partnering opportunities; prime contractor that have been awarded contracts that could use your services.
• Be knowledgeable of agency missions; goals and objectives and allocated budgets   Target agency and project opportunities based on size and scope. 
• Identify how your firm could help the government, or prime contractors meet their goals and objectives.
• Develop a database for tracking federal project opportunities, contracts awarded and to whom. Include contact information; agency, names of procurement personnel, addresses, phone numbers.
• Attend workshops to better understand the federal purchasing processes and requirements.
• Update marketing material including your company’s website presence.
• Forward printed material along with email notices with links to information agencies and primes contractors would be interested in seeing.

Conclusion

As they say, “follow the money”. Government projects are getting a boost through the stimulus funding at the same time many private sectors are in decline or stagnant. Federally funded projects are ramping up and firms with experience are taking advantage of those opportunities. Firms with little experience in the public sector should develop effective strategies for landing public contracts, balancing their project portfolio. Essential for success is finding the agencies with projects that meet your strengths and capabilities. If you are inexperienced on federal projects, partnering with an experienced firm is an excellent step for entering the public sector. Pursuing public projects is challenging. However, firms not in this market segment should take the long view in your pursuit. There are and will continue to be project opportunities.