In this issue of A Capitol View, we include a short interview with COO Ken Wetzel as well as some commentary on the Biden Administration’s decision to not fund the overseas contingency operations account. Additionally, we include updates on the president’s budget request, earmarks, and the infrastructure bill.

Biden Budget Released Today

The full budget from President Joe Biden’s White House was released earlier today, a day later than anticipated. The FY2022 request builds upon the ‘skinny budget’ that Biden outlined in April and details his requests on mandatory spending, tax overhaul, infrastructure investment, and job creation. The full request can be found here.

Interview with SMI COO, Ken Wetzel

Last month, SMI announced that the Board of Directors has named Ken Wetzel as the new Chief Operating Officer, following Bill McCann. We had the opportunity to interview Ken about this background and vision for the firm.

Aarzu: To start out, can you tell me a bit about your background and what drew you to this kind of work?

Ken: I started my career as a chemical engineer at Picatinny Arsenal, and honestly, I was hoping I would eventually become a branch chief someday. You know, I’d start as an engineer and then maybe become a manager. Having studied engineering in college with little exposure to alternative careers for people with technical backgrounds, that’s all I really knew. It wasn’t until I started working for OSD that I realized there were a lot more options for engineers. I had always been interested in government, policy, and leadership and once I started meeting with businesses, I started to think that maybe that would be a good fit for me.

Aarzu: And what was it about SMI that interested you specifically?

Ken: SMI stood out to me because I didn’t really have a specific technology passion at that point. I also thought I’d be able to develop more skills, faster, at a smaller company. SMI combined those things for me. I didn’t have to pick one technology area as a focus. I also still got to use a lot of the skills and knowledge I built up while in the government, but in a different way. Beyond that, I had the sense that the senior people at the firm were going to help me. By that point, I already had great mentors and I knew that was going to be important in whatever I did next. Turned out, I was right – I’ve learned a lot from everyone over the years. Still do.

I didn’t mention Bill yet, did I? Forget everything else I said. Bill McCann. I was drawn to SMI because of the opportunity to work with Bill McCann.

Aarzu: You’ve been at SMI would nearly 7 years now. What has made you stay at SMI as long as you have?

Ken: Well, I was able to walk to work for most of that time, so it was pretty convenient. Kidding — I just kept growing and getting better. I never felt stagnant, and the job never felt repetitive. I still learn new skills and other things from my colleagues in the firm, and my clients, too. I’ve worked with some really impressive leaders since I’ve been here, academic, business, government – you name it. I get to go from Capitol Hill one day to walking around a foundry the next. I work on some big multiyear problems, and smaller, more day-to-day type challenges too. It’s a good mix. No project is the same. No client is the same. I’m not sure there is another job like it. That, and there really isn’t a better feeling than coming through for a client. And when it’s all said and done for the day, I still get to go home for dinner. I’m really grateful that this is where I wound up.

Aarzu: You are filling some pretty big shoes following now-CEO Bill McCann, what do you hope to help SMI achieve under your leadership?

Ken: To keep getting better at what we do. We’re excellent at what we do and that is not by accident. Glen’s leadership, and Ted’s before him, built a foundation that the rest of us have benefitted from. One of the most important lessons from them has been to work with all of the government agencies, not just Congress. The government was designed to work together, each body and agency has its own role to play. For government relations, that means we can’t limit ourselves to working with just Congress. I think that simple principle is one that has really distinguished us over the years, so that’s one thing I hope we can continue to make even stronger.

I think the next thing is people. Equally as important as what we do for our clients, is who they are working with. We have really talented people here – at all levels. And like I said, I have really learned and grown a lot at SMI. I want to make sure that we do what we can to support employee growth – helping folks develop new skills and strengthening the ones they already have. We want to do whatever it takes to make the people that work here better at what they do so they can better support our clients.

But frankly, we need more people – people with new skills, perspectives, and experiences that can offer our clients just that – new ideas and fresh takes on big problems. That’s how we grow. That’s how we do our jobs better for our clients.

Aarzu: What are some things you are looking forward to doing once things return to normal?

Ken: Professionally, I’m really looking forward to visiting clients in person again, some of who we onboarded during the pandemic and haven’t even met yet – walking the shop floors, doing site visits, and seeing what people are doing and making. I’m also excited to see my colleagues back in the office who I haven’t seen much of over the last year and a half and resuming some of our group activities.

Personally, the pandemic has been going on for almost the entirety of my younger son’s life so I’m excited for him to meet and play with more kids and see more of DC. I’m also really looking forward being able to take my older son to feed the ducks and to visit some of the museums as they open up.

Biden Budget Made the Right Call Doing Away with OCO

Ken Wetzel and Aarzu Maknojia

Earlier today, the Biden Administration released their FY2022 budget request. Notably, the request eliminates the “overseas contingency operation” (OCO) fund and includes all budget items in the core budget. The idea of eliminating OCO has been brought up before by people on both sides of the aisle – from those that believe we are spending too much on defense and those that believe that we are spending too much altogether. However, this is one of the first times that a definitive step is being taken to eliminate it.

It is clear that OCO funding has been used to fund activities that are part of the base requirements. In fact, in FY2021, the Department of Defense (DoD) divided their request into three categories: (1) direct war requirements, (2) enduring requirements that will remain after combat operations cease, and (3) base requirements.

We argue that utilizing the OCO account to fund base requirements is inefficient, and ultimately impacts the preparedness and lethality of the warfighter negatively. The expiration of the discretionary budget caps coupled with the significant drawdown of troops from the Middle East, leave Congress without a strong justification to continue funding OCO. Additionally, the uncertainty of OCO funding makes it increasingly challenging for industry, especially small businesses, to make important decisions about the future of their organizations.

Defense Department Lifts Mask Mandate for Fully Vaccinated Personnel

On May 13, the Department of Defense (DoD) released a memo allowing fully vaccinated personnel who are at least two weeks beyond their final dose to not wear a mask while indoors or outdoors at DoD facilities. This decision was made to support the recent change to the Centers for Disease Control and Prevention (CDC) guidelines. All personnel are required to continue to comply with CDC guidance and commanders and supervisors are able to make exceptions as necessary “to ensure a safe workforce.”

While not immediately salient, this may mean that SMI clients will be able to brief officials at the Pentagon and on military bases in person again very soon.

As of now, there have been no additional changes to the visitor policy.
Updates on: Earmarks Requests

Almost 3,000 earmark requests have been submitted under House guidelines for funding local non-profit projects. These requests span all 12 annual government spending bills.

In fact, only 15 of the 2,887 requests were made for the defense appropriations bill, totaling just over $32 million. In the Senate, earmarks were not allowed for the defense bill. Each member’s requests are posted online for transparency.

Over a decade ago, the defense bill was the most heavily earmarked of the annual appropriations bills. The diminished totals likely stem from caps on how many earmarks lawmakers can request, the small number of accounts eligible for requests, and the prohibition on funding for for-profit corporations.

The congressional appropriations request process, separate from the earmark, still allows for Members of Congress to submit programmatic and language-based requests to the funding bills.

Updates on: Transportation and Infrastructure Bills

The fight on the infrastructure bill continues. Senate Republicans indicated they would make a counteroffer to the Biden administration’s infrastructure offer that is close to a trillion dollars. However, without major concessions on revenues, it is unlikely to progress.

The details of how the GOP gets to $1 trillion in spending and how they propose it be funded will be a major decider on whether Democrats get on board; so far, they have been unable to put together the pay-fors that would be needed instead of new spending.

On Friday, President Biden sent out a counteroffer of $1.7 trillion, a combination of a slightly cutting and shifting other kinds of spending. White House Press Secretary Jen Psaki hinted that the revenues that the GOP counteroffered do not seem persuasive.

Meanwhile, the Senate Environment and Public Works Committee offered and marked up a manager’s packet of amendments to its surface transportation bill Wednesday. This is considered a must-pass bill and may be a vehicle for part of Biden’s overall package. Chair Tom Carper decline to comment on whether a GOP counteroffer of around $1 trillion would be sufficient. While the draft was introduced as a bipartisan bill, it is yet to be seen how it moves through the EPW committee.

The original bipartisan $303.5 billion surface transportation bill was released by a Senate committee despite the GOP’s rejection of the last big infrastructure proposal from the White House.

House Armed Services Committee Chairman Considering Intellectual Property Reform in FY22 NDAA

Earlier this month, House Armed Services Committee Chairman Adam Smith said he is considering including several reform measures in the upcoming defense authorization bill that would “spur innovation, get more for our money, and make the competition work.”

Smith said he is especially interested in in ensuring the Defense Department can maintain intellectual property rights when it acquires systems from defense contractors. He believes that this dynamic will allow technology to be a lot more upgradeable, enable the implementation of new technology more quickly, and will not lock the DoD into additional requirements.

Additionally, Smith said he is looking for ways to ensure that the DoD competes key programs among multiple bidders. This will encourage competition and ensure that small, innovative companies do not get locked into bigger companies.

Smith has criticized the White House for not sending Congress a budget request by May 10 so the defense bill could have been completed before the August recess. At this point, the House Armed Services Committee is looking to mark up their version of the Nation Defense Authorization Act in September.