Budget Expectations

All eyes were on Washington when President George W. Bush delivered his fifth State of the Union and readied the release of his fiscal year 2007 budget. In his address, technology certainly made a good showing. From strong mentions of high-tech health-care initiatives to nanotechnology and a big R&D push, government is jumping on the tech bandwagon in a big way. While technology is getting the White House's nod, the numbers will speak for themselves when Bush releases his budget proposal. But FY 2006 is already off to a record start with first-quarter federal IT contracts up 40 percent over last year, according to Input. Total IT-related contracts reached a staggering $28 billion for the quarter.

The U.S. Air Force alone awarded more than $11 billion in contracts during the first quarter, followed by the Army and the Department of the Treasury, with awards of more than $10 billion combined. But those contracts weren't all gobbled up by the big guys. First-quarter set-aside contract awards (contracts set aside for companies that meet certain socioeconomic standards) were up 80 percent over last year, from $1.5 billion to $2.7 billion--a sure sign there's still a large chunk of change for both big and little guys. By the time you read this, the FY 2007 proposal will be out and we'll get a better idea of what's in store for the coming year and what it means for you. Pennies from Washington? Look for big dollars.