Federal contractors are positioning themselves to take advantage of a flood of new funding at the Department of Homeland Security, though DHS’s spending plans remain in flux.
Companies are closely following how DHS will spend the billions of dollars in the tax and reconciliation package passed by Congress in July. The funding is largely concentrated at Customs and Border Protection, Immigration and Customs Enforcement, and the Coast Guard.
CBP Chief Information Officer Sonny Bhagowalia said the agency doesn’t have enough staff to keep up with pitches received through its online business portal.
“We have a little backlog right now, because obviously, we’ve got a lot of money coming in,” Bhagowalia said during a Sept. 24 event hosted by ATARC in Reston, Va. “A lot of people want to meet us, and we don’t have enough staff in some areas.”
The majority of the $150 billion for DHS in the bill is geared toward immigration detention, border wall construction and law enforcement hiring. It also adds billions to DHS’s accounts for technology upgrades and other investments, including $6.2 billion for CBP to spend on border security technologies and screening systems, and $700 million for IT upgrades at ICE.
But how DHS will spend its new funding remains uncertain. In a letter to Homeland Security Secretary Kristi Noem earlier this month, House Democrats from border states offered several recommendations and asked for a meeting to discuss DHS’s spending plans.
Rafael Borras, chief executive of the Homeland Security & Defense Business Council, said, “there’s still a lot of unknown, and industry is still waiting to get more detail.”
“This has come together very fast, and I’m not necessarily surprised that we don’t have more details at this stage,” Borras told Federal News Network.
One key question for Borras, who previously served as DHS chief management officer, is what kind of contracting approach the department takes for detention facilities, border security upgrades and more.
“Whether there will be large consolidated contracts for contractors to do everything –or will parts of it be unbundled, and there will be things that the department will contract for directly,” he said.
The funding comes as DHS components also look to make major investments in data, artificial intelligence and biometrics. The anticipated spending is drawing “new players” into the DHS contracting landscape, Chris Cummiskey, a former top management official at DHS, told Federal News Network.
“Any company that does a lot of work in the data aggregation and analysis arenas are going to be companies that are of interest, particularly to CBP and ICE in the near term for their mission sets,” Cummiskey said.
At the same time, DHS’s existing large prime contractors are positioning themselves for opportunities flowing from the One Big Beautiful Bill Act. During an August earnings call, Leidos chief executive Thomas Bell said his company has “a very receptive audience in the Department of Homeland Security around our capabilities that are ready to field now.”
“They’re not interested in PowerPoints and promises,” Bell said. “They’re interested in seeing capabilities demonstrated and products that are in production.”
Multiple industry officials said DHS is showing greater interest in innovative pitches and technology demonstrations. James Carroll, chief executive of the Professional Services Council, said DHS has been “opening the aperture” toward ideas from industry.
“What I think is fascinating is the government is now turning to the industry and, instead of saying, ‘We want you to develop this particular piece of technology,’ they’re being much more candid and saying, ‘Here’s the problem. How do we solve it?’” Carroll said during a press call las week.
Counter-drone technology is also becoming a major priority for DHS. In late August, DHS previewed plans to award a counter-unmanned aircraft systems contract worth more than $100 million.
“There are a lot of startups and companies, in addition to well established players, that are looking at that as just one example of, maybe they didn’t do business with the department in the past, but they have very good technology that they’re using, perhaps with the Defense Department or overseas,” Cummiskey said.
Executives are also watching how the Trump administration’s governmentwide acquisition reforms impact DHS’s spending plans. The General Services Administration has led a push to consolidate contracting under large, strategic sourcing vehicles. Executives say that could play a factor in how DHS spends its newfound resources.
“The ability for us to work together within industry to provide those solutions underneath the new acquisition strategy and help the administration gets to its goals is also really important,” Jason Hannah, vice president of homeland security and public safety at Peraton, said during the PSC press call last week.
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