The federal government FedRAMP program will not allow for any additional 3PAO’s to join the already approved 16 independent testing firms after March 25, 2013. The application process will be closed March 25th, and companies already in the process will not be able to resubmit any changes to their applications. These approved 3PAO’s are in place to review if the potential cloud providers, which want to offer their services to the government, meet the FedRAMP requirements. The 3PAO’s are responsible for saving the federal government an average $200,000 per cloud deployment by helping with the FedRAMP certification process. The pause to the vetting process is a result of the federal government’s desire to outsource the process. In an email sent by Jackeline Stewart, a spokeswoman for the General Services Administration, the planned privatization of the "accreditation function will result in a pause in accepting new applications." She also added the length of the hiatus depends on the time it takes to evaluate fair competition and then shift responsibilities. The target time to have the process back up and running is Fall 2013. Mike Hettinger, Public Sector Director for the Software and Information Industry Association, said "We have continually encouraged GSA to make sure that the FedRAMP program has enough bandwidth to handle the cloud service providers who want to go through the process. If, by privatizing, that will ensure enough bandwidth to go through the process, I am encouraged.” Hettinger continued to say, “I'm a little concerned about the gap between when GSA stops accepting third-party assessors and the fall when the private sector accreditation organization will be established. Having a gap probably has the potential to slow down the process."

It is no secret that the United States does not have enough people who can defend the country from digital intrusions. The government has been aware of this problem for a very long time and has already taken steps to solve it. We are currently two years into Obama’s ten-year plan to develop Science, Technology, and Math (STEM) teachers and he recently requested to Congress for money to retrain 2 million Americans for high-tech work. In addition, a month ago the Pentagon said it needed to increase the U.S. Cyber Command’s workforce by 300% to counter attacks. However, even after all these efforts, last month the demand became even more urgent after the Chinese attempts at cyberespionage.

As of March 1st, the Sequester has officially begun. Government-wide budget cuts have been implemented and small businesses seem to be the early victim. The situation looks particularly troubling for small businesses that deal with the Department of Defense and related agencies. According to the Small Business Administration, 35% of Department of Defense suppliers are small businesses. In many cases, government agencies are the premier customer for these small firms, making the loss of federal contracts potentially fatal for these companies. Economics expert Dr. Stephen S. Fuller of George Mason University fears the Sequester could be even more devastating for small businesses than many realize. He believes that in addition to the loss of prime contracting opportunities, many small businesses are subcontractors to government agencies such as the Department of Defense. Therefore, the spending cuts will have a trickle-down effect on small businesses that could be equally devastating. Fuller mentions that in addition to this, many small businesses act as suppliers or vendors for prime federal contractors without even knowing it. This ignorance prevents proper strategic business planning for these firms that could lessen the effects of the Sequester. Fuller estimates that approximately half of the projected two million job losses resulting from the spending cuts could come from smaller firms. Small businesses across the country are beginning to brace themselves for the effects of the recent Sequester. Many firms are attempting to diversify their clients amongst different government agencies and further into the private sector. While it still remains to be seen what the true effects of the spending cuts will be on smaller firms, many companies are bracing for the worst. It is also worthy to note that the aforementioned budget cuts will likely effect all businesses including those that do not have federal contracts. The cuts are predicted to have a ripple effect that will show decreases in GDP and increases in unemployment, which foreshadow a recession.

A recent article by Matthew Weigelt discusses the Office of Federal Procurement Policy’s (OFPB) and lawmakers push for greater transparency in agency decision making and its impacts on small business. OFPP has issued a request to comment on the cost comparisons being conducted by federal agencies on whether to insource work previously contracted out to small businesses. Governmental insourcing has affected many small businesses in recent years and Congress is calling for transparency to ensure small businesses are looked after while simultaneously ensuring the decision to either insource or outsource is in the best interest of the taxpayers. The House of Representatives has recommended the Office of Management and Budget (OMB) stop federal insourcing from small businesses until the federal agencies have publicized the information regarding their procedures and methodologies as stated in the 2013 National Defense Authorization Act. The implementation of transparent practices will assist the federal government in its responsibility to cut spending and meet small-business contracting goals.

As cybersecurity and privacy issues have become more prevalent in the public sector in recent years, the need to enact new cybersecurity policies has increased. Most recently, Executive Order (EO) 13636 of February 12, 2013 – Improving Critical Infrastructure Cybersecurity, was released by the White House and named important new cybersecurity policies to be implemented.

Sequestration is set to take effect on March 1st, however both parties have announced they will be introducing bills on February 25th or 26th to replace it at least for the next year. The Democrats bill, entitled the American Family Economic Protection Act, proposes $120 billion in savings, divided evenly between cuts in spending and increases in revenue. The bill would replace the cuts that could take effect under sequestration, but only until the end of December 2013. The proposed bill includes $27.5 billion in cuts to defense spending, which would take effect in 2014 after the drawdown in Afghanistan, as well as possible cuts in agricultural subsidies. The increased revenue would come from three areas: Firstly, from a provision raising taxes to 30 percent on incomes between $1 and $2 million, the so-called “Buffet Rule,” a provision previously blocked by Republicans; secondly, revenue would be raised by eliminating tax deductions for businesses who relocate their facilities overseas. Finally, the increased revenue would come from a provision closing the tar sands loophole (the loop hole that allows companies to escape the eight-cent-per-barrel tax on oil, which isn’t currently levied on oil produced from tar sands). No details have come out yet on what the Republican plan will entail, although several Republican lawmakers have expressed willingness to increase tax revenue.