Optimizing Your Funding During Yet Another Continuing Resolution

Unfortunately, continuing resolutions (CRs) have become a way of life for the federal government.  Budget uncertainty causes downstream issues for acquisition and program management.  It’s hard to properly plan a new procurement when you don’t know what your level of funding is.  It is also hard to manage a program if funding comes in monthly dribs. 

Since there is nothing you can do to avoid a CR, here are some tips for surviving the CR and making you optimize your spending. 

#1 Know what you can and cannot do with funding during a CR.   

• You can use funds from previous FY on a contract as long as funds remain available for new obligation, e.g., “2-year” or “no-year” appropriations 
• You can use CR authority to fund planned funding increments or overruns in contracts awarded in previous years with contract performance continuing into the current year during the CR 
• Depending on the CR dollar levels, agencies will establish a level, say 90% of the previous year’s funding, at which ongoing projects and activities may be funded during the CR.  Be aware that an agency may need to fund essential operations, which could reduce the available funding for other, non-essential projects and operations 
• Rarely, Congress may provide special authorities under the CR for new programs deemed critical to the nation or time sensitive e.g., national security, pandemic response. 

• Always check with your CFO and/or legal counsel on allowable funding practices 

#2 Understand the specific restrictions and limitations on establishing new contracts.  Some common restrictions and limitations observed during CR include: 

• Be clear about how your new contract supports essential operations for the functioning of the government.  If your new contract does not support essential operation, the amount of funds available for your new contract may be lessened or delayed 
• During CR there is (assumed or actual) greater authority than customary for incremental funding. So, if during CR, your program cannot be certain of fully funding at point of award, then consider incremental funding - to be fully funded as soon as full budget is available. 
• Continue with your procurement but share with potential offerors any limitations of funds due to the CR so that the offerors make informed bib/no-bid decisions. 

#3 For ongoing contracts, communicate with your contractors on the funding levels and frequency of funding if incrementally funding the contract.  Also communicate your priorities so that the contractors can make smart decisions related to scheduling and staffing. 

#4 If you do need to look at decreased levels of contractor support on ongoing contracts, consider those contracts that are underperforming missing deadlines, running over cost, or adding little value to your mission.   Too often the government freezes contractor staffing across the board during a CR and does not consider continuing to fund the contracts that add the most value. 

#5 For ongoing contracts, request the contractors provide you with estimates to complete (ETCs) which will inform how much funding they need for the remainder of the contract period.  The information provided by ETCs and burn rate analysis will help plan your spend to forecast when the current level of funding will run out.   

#6 For ongoing contracts with reduced funding that causes certain tasks to be stopped and or suspended during the CR, request the contractor provide you with the estimated cost to shut down and also restart those tasks.  This will be important to factor into your annual spend plan and to coordinate with your Budget Officer for planning once the CR ends.  The Contracting Officer is the only person who can direct the Contractor to stop or suspend work so make sure that they and your legal counsel are involved to ensure an orderly shutdown.