COVID-19 Federal Government Implications: Civilian Workforce & Contractor Adjustments

Roman Schweizer, Cowen Washington Research Group’s Aerospace & Defense analyst speaks with David Berteau, President and Chief Executive Officer, Professional Services Council and General Hawk Carlisle (USAF, Ret.), President and CEO, National Defense Industrial Association.  They are joined by Cai von Rumohr, CFA, and Gautam Khanna, Cowen’s Aerospace, Defense Electronics & Government Services analysts.

They discuss the Federal Government’s COVID-19 response operations, contractor policies and impacts to companies that support the U.S. Government. They also speak about new USG policies (such as work-from-home & travel limits) that could begin to affect contracting activity, essential/nonessential work at professional services companies, and defense R&D and manufacturing as companies begin to institute safeguards.

Press play below to hear the full discussion.

Transcript

Speaker 1:                       Welcome to Cowen Insights, a special look at the coronavirus and its effects on sectors across the economy, as well as the policy arena. You will hear the latest insights from leading experts about where things stand and what’s around the corner.

Roman Schweizer…:       [00:00:30] I’m joined today by my colleagues, Cai von Rumohr and Gautam Khanna to cover aerospace and defense and multi industrials, but we’re also going to be joined by two presidents of trade associations that include professional services companies that support the federal government and R&D and manufacturing companies that do work for DOD, NASA, DHS, and other departments and agencies. The purpose of this call is to discuss the COVID-19 response actions the U.S. Government has taken and ones that it could take in coming weeks, [00:01:00] as it relates to the federal workforce, the contractor workforce that supports it as well as traditional aerospace, defense and technology companies that do work on federal contracts. I’d like to offer a quick level set before it’s turned over to Cai and Gautam for their observations and then we’ll turn it over to David Berteau from the Professional Services Council and General Hawk Carlisle from the National Defense Industrial Association.

                                         Today, the Office of Management and Budget and DOD [00:01:30] have both instituted travel limitations for mission-essential-only related travel. They’ve also dictated maximum telework flexibility for the federal workforce. Although the interpretation of this flexibility is up to individual departments and agencies. This matters because there are more than 2.8 million federal employees and approximately four million contractors that support them. These new U.S. Government policies could begin to affect contracting activity onsite and offsite work [00:02:00] for professional services companies and defense R&D, and manufacturing as private companies begin to institute safeguards.

                                         Much of the defense manufacturing activity isn’t work that can be done from home, obviously. We would expect some short-term disruptions as these policies roll out and become implemented, but ultimately U.S. government work will eventually be completed. Unlike commercial markets, U.S. government and DOD spending won’t be lost since it’s appropriated and [00:02:30] will probably be repurposed or spent after the fiscal year, given congressional allowances. To be clear, U.S. government and DOD have not issued policies to companies or specific contracting officers, a blanket policy for contracting officers to our knowledge. As we understand it, departments and agencies have been issuing their own specific policies and contracting officers have been allowed to make their own determinations. This has created some confusion within the contracting community and we believe [00:03:00] they’re pushing OMB and DOD for clarification. Cai and Gautam, would you like to pitch in with what you’ve been hearing?

Cai von Rumohr:             Yeah. So just to add a couple of notes in the primes that we’ve talked to, basically, people have not seen a whole lot of impact. Lockheed expects minor impact from what’s happening in Italy on the F-35. GD hasn’t seen any impact, but they both expect some COVID- [00:03:30] related disruptions driving costs up on program contracts and are trying to push the government to give them relief from those costs. In the defense services area, which we think is probably the best position, people still are early they don’t know what’s going to happen. The biggest concern is classified work done in SCIFs, where if there is a quarantine issue, that’s a problem.

                                         [00:04:00] Generally the response that contractors have, is that they will have quarantined workers work on administrative matters. That’s an allowable cost-plus contracts, which are 50% of revenues. They, when it comes to SCIFs some companies like Leidos mentioned that SCIF work must go on even if we have a quarantine issue. So I think there’ll be [00:04:30] different types of workarounds. Parsons, for example, says that it has some of its own SCIFs that can do some of that. So, anyway, and another last point, as far as guidance, they provide, I talked with SAIC this morning and they’re debating whether to provide any quantitative guidance for their upcoming fiscal year. Their call will be next week. Kind of sounds like [00:05:00] they won’t, even though they don’t see any impact as of now from COVID. Let me turn it over to Gautam.

Gautam Khanna:             Yes. Thanks Roman and Cai. I’ve checked in with a couple of the companies that we cover in the services space, ManTech, for example, lots of costs-plus almost 80% cost-plus. They’ve yet to see any disruption, even though they are pretty SCIF heavy. So just under 50% of sales are sold to three letter agencies. They have not yet seen [00:05:30] interruptions to their billable hours. And they mentioned they are teleworking where possible. They think that if there is further corona lockdown at the SCIFs that they serve, it will be on a rolling basis. So, maybe they shut down, they staged the workforce with not everyone’s in the same room at the same time, that kind of thing. So there will be work around, but those have been discussed, yet not because there isn’t yet a high enough alert [00:06:00] to do so.

                                         We talked to the other government services, contractors that I cover, whether it be Jacobs, for example, they’ve seen a modest interruption in their non-government business abroad. So in Europe they’ve seen some issues on the legacy BIAF business, but it’s too small to call out individually. I don’t think it’s going to impact the guidance yet, per se. On the [00:06:30] Huntington Ingalls, for example, obviously a big workforce in two locations. They’ve implemented liberal leave policies, as they’ve said, which allows people to stay at home if they have to deal with kids out of school and the likes. So presumably we’re going to see some interruption there, but obviously very hard to quantify because this was just implemented in the last week. So these are just anecdotes, but I’ll turn it back over to Roman.

Roman Schweizer…:       Great, thanks guys. So now we’re going to turn it over to our [00:07:00] two experts and very experienced folks in terms of working with industry and Congress and the administration. David Berteau from Professional Services Council trade association, for many, almost all the companies that do work for the federal government and the General Hawk Carlisle from the National Defense Industrial Association, again, which skews more towards the R&D and manufacturing companies that work defense national security issues, but also provide [00:07:30] some services as well. At the conclusion of their remarks, we’re going to take some questions, David and Hawk, thank you very much for your time and your insights. David, why don’t you please lead us off.

David Berteau:                All right. Thank you, Roman. One of the things we’ve discovered is that the Verizon and AT&T cell phone system in Washington, D.C. Is not configured properly for everyone teleworking and all kids being home from school and not only doing virtual learning, but on Snapchat and Instagram [00:08:00] and Pinterest all at the same time. And the bandwidth issues are intriguing as we go through this.

                                         For the first time, really since 9/11, I’m trying to use my cell phone and I get a message, “All circuits are busy,” which is probably a sign of things to come. But let me step back and appreciate the comments all three of you made in the overview. I think there’s a few key things that I would note and PSE does represent most of the larger and a number of the midsize [00:08:30] companies, not just for DOD, but across the GovCon services space, including all of the OEMs as well, although we tend to focus on the services side of the business, not the platform side of the business.

                                         I think there’s three key points that I’d like to make. And then open it up for Hawk. Number one is that the work is clearly there, the funds are there. We’ve got full FY-20 appropriations, agencies are for the most part, not holding back on their funds. We’ve not seen a lot of stop-work [00:09:00] orders and the obligation in order to repurpose funds for coronavirus, flighting, et cetera. The federal government already has passed one supplemental appropriation. There’s a second supplemental appropriation that’s passed the house. It’s under consideration at the Senate. It has not been costed out yet because the congressional budget office has not had enough time to do a price estimates, but it has a substantial amount of funding support for government services contractors potentially in there, especially [00:09:30] companies in the mid-tier range.

                                         The mid to long-term view is fairly solid. One of the things that we’re pushing for, and we’re getting a lot of traction on this, is that it’s important for Congress to appropriate funds in advance of the start of fiscal year 21. That’s six months away, six months, maybe a long time in coronavirus time, but it’s not a very long time in government spending time. And one of the things that we think this will do is it will remove the uncertainty that might encourage [00:10:00] existing programs to hold back on spending all their FY-20 money, because they’re not sure whether they’re going to get a continuing resolution or even a partial government shutdown come the start of fiscal year ’21. Unlikely, but removing that uncertainty would go a long way towards freeing up the funds to go forward there.

                                         For companies that didn’t have a solid balance sheet, I think situation is very, very good for there, over the mid to long-term. I think it’s still a very good place for industrial money in the defense services [00:10:30] business, because the work is not going to go away this year, next year, or the year after that. With respect to the guidance has been given, and Roman you characterized it properly, there’s plenty of guidance out that covers the federal government and the federal workforce. Unfortunately not much of that guidance applies directly to contracting officers and contracts. And the part of the reason for that is, the work force is centrally managed if your federal civilian or uniform personnel. Contracts are managed one contract at a time by the contracting officer. [00:11:00] And so there’s been a reluctance on the part of many agencies to issue general guidance.

                                         That’s not our view. Our view is in fact, general guidance is needed and it ought to be along the lines of, it’s important to keep the government working, you can’t keep the government working without the contractors being supported, and so encourage contracting officers to exercise both the authorities there they have and the responsibility they have to make sure that contracts are maximized in part of both the response and the ongoing activities of the government. We’re getting a lot of traction with that notion. I think you’ll be seeing something coming [00:11:30] out of that. And we’re already seeing agencies that are instituting regular communications with us at the trade association level to make sure that individual issues are aggregated together to become policy issues that can be dealt with. I think it’ll also set up arrangement for individual company issues, individual contract issues to come into play.

                                         With respect to teleworking specifically, Cai did a good summary of the intel side of that, the classified work, but the vast majority of the service contract dollars for a lot of these companies [00:12:00] is not in classified work and companies are actually much better positioned to have their employees telework than the federal government is, for that matter. However, the contracting officers have to actually allow that and make it clear that that’s not only permitted, but encouraged. The president keeps saying things, but that doesn’t translate into a change in the contract. And so we’d like to make sure that those changes are encouraged and taking place.

                                         We’re starting to see it at individual agency level, we’re seeing it in individual contract level. [00:12:30] It needs to be done government wide and that’s one of the things that we’re pushing for. I think there’s also a question of whether there’s any potential impact on future solicitations on RFPs where bids are already in. And I think here again, removing the FY-21 uncertainty would encourage awards to be made in a timely way rather than to ask for extensions and the validity of a proposal that will be increasingly difficult to sustain, given the dynamics around what happens with COVID-19. [00:13:00] So that’s where we see it at PSC. Let me stop there and open it up, Roman, I guess you want to go to Hawk and then we’ll open up for questions.

Roman Schweizer…:       That’d be great. Hawk, why don’t you please go ahead.

Gen. Hawk Carli…:          Okay, Roman, thank you again. And thank you for putting this together. And I guess I’ll start by saying David and I do a lot together. He’s an incredibly smart guy, so yay verily, what he said. A couple of things that I’d reiterate. One is that the appropriations for next year is critically important. [00:13:30] And I, along with all the trade associations and business are looking forward to congress working hard on that. I think the other thing that David said that is exactly right, is actually the outlook from the defense industry standpoint is pretty strong. The work is there, it’s going to continue to be there in the foreseeable future. We know that we have a little bit of a defense flattening budget, but that’s already been programmed in and I think what we’re seeing, what I’m getting from my membership, is that the outlook is strong [00:14:00] and they’re going to continue to use money for R&D because they think that’s critical based on the national defense strategy and where we’re headed. So on the technology front and the R&D and the IRAD, I think that’ll continue.

                                         And again as David said, the work is there both in the services side, as well as in the procurement side for goods and capabilities and training systems. So I think that’s a positive sign. The other thing I would say is that [00:14:30] OSD, and a lot of credit to secretary Esper on down of working hard on the communication side of this. And I think one of the questions I think any industry has and just business in general, they get jittery when they don’t know what’s going on. And so I think that the OSD has really stepped up their effort to engage with industry across the spectrum. They are engaging with us and the trade associations to work more openly with our membership. [00:15:00] So OSD knows what the issues for our membership are, and our membership understands where OSD is going in trying to solve the problems for the defense industrial base.

                                         So I think what David said about overarching guidance is one that I think is important. Our industry members are looking for that. As long as the communication stays open, I think that we’ll continue to work our way forward on that, general guidance and then the individual specific contracts. I think the turbulence, [00:15:30] the work, the things that we all know from the FARs and DFARs with reference to allowable schedule slips because of circumstances outside of the industry’s control and then allowable costs based on the standing workforce ability to keep folks when they can’t. They’re not being able to either go to work, they’re being quarantined. Some of the overseas ones where the countries are more restrictive on movement.

                                         All of those are factors that that OSD is working through. We saw the day the president [00:16:00] mentioned the use of the Defense Production Act, or actually Alex Azar, the secretary, did. And I think that’s another case where as we work through this, and as long as the communication stays open, that the defense industrial base is going to see this as, “Oh, she’s actively engaged, they’re talking to us, we’re going to have this discussion, and we’re going to move forward.” It’s going to be a challenge for whatever period of time this becomes the major focus, but it’s not going to change the [00:16:30] outlook and certainly the mid and long-term for the defense industrial base.

                                         So our membership is actively engaged. Again, OSD is maintaining the lines of communication. And from our perspective, supply chain, there’ll be turbulence in that. There’ll be turbulence in some of the contract actions, but through the turbulence, I think the mid to long-term looks good. So with that, Roman, I turn it back over to you and whatever questions they have.

Roman Schweizer…:       Great. Gentlemen, thank you both. Excellent [00:17:00] points for us to think about. And my point or my view in this has been one that that this is work that’s certainly going to need to get done from a national security perspective to those firms who are generally protected and as you guys mentioned, the allowable costs and factor in on contractors control and contracts. And three, this is something that [00:17:30] a sizeable or chunk of the U.S. economy that the administration is going to want to figure out how to, if not protect, make sure it’s still functioning as smoothly.

                                         So there has been some talk about sort of supplemental appropriation potentialy for DOD or DHS or certainly the VA and/or what may be included in the stimulus package. And I think, David, you’ve alluded to some of that. Do you guys [00:18:00] think there will be some additional funds for some of these government activities as a function of this?

David Berteau:                This is David. I’ll go first Hawk, if you don’t mind. So as I mentioned, the second supplemental appropriation has not yet passed the Senate, although there’s indication it will be done so as soon as they go through their culture invoction, et cetera. We’re already working with members on the third supplemental appropriation. It is my belief that the hill has more appetite [00:18:30] for doing that than the agencies have yet justified a request but in stead the situation is very fluid and it could easily pop up that these requests materialized very quickly.

                                         My experience with this is the way in which an emergency fund and amount is determined in that in a crisis like this, and we don’t have very many of them, is not through the normal process. The normal process would be starting at the bottom and working up through the agencies and going through the Office of Management [00:19:00] and Budget and then delivered to the hill. I think there’ll be more communications directly with the hill at member level and at a district level and a number will come up. I can’t predict at this time how big that would be or when it would be done but I would also tell you that there’s very real possibility that there’ll not only be a third supplemental appropriation, but a fourth one, and maybe even a fifth one as this plays out.

                                         The biggest issue here is the uncertainty of the impact. Who’s going to get really sick? [00:19:30] How are they going to be cared for? What’s the impact is going to be on the rest of the workforce? And where your supply chain is in fact your people, either your own or your subcontractors, not components that are manufactured somewhere. The vulnerability of that to a disease whose dimensions in magnitude and duration and stretch, we don’t yet know is the big question mark. Would money be the offset to that? Maybe, maybe not. Would opening up the possibility of work being done by contractors which is currently not being [00:20:00] done by contractors? That’s one of the areas that we’re watching very closely because the whole point of inherently governmental and the associated activities that often creates the boundaries between what a contractor can do and what has to be done by a government person. It’s a very malleable definition and one that can easily be changed in order to make sure the work is done.

                                         And so there could be some opportunity for expansion here. We’re already seeing that in some places where contractors are providing the surge capacity. And I think that’s one of the points that we want to emphasize on behalf of our members, is that [00:20:30] contractors can ramp up much faster than the federal government can and where you need more people, turn to us and we’ll get it done. And I think we’ll see some of that and if it needs more money, I think it’ll come, Roman.

Gen. Hawk Carli…:          Well said. This is Hawk. So, yeah, I agree. I think there will be help. I think, as David said, the hill certainly has an appetite for it. And I do agree that the definition will probably come in a face-to-face instead of the standard process. I do think that if you look in certain sectors, for example, [00:21:00] in the small business side, I think there’ll be an appetite to support small business. We always know things like expedited payment to small business, some of those things are really important just because of liquidity and cashflow and the ability for the small business anything, even medium in some cases where cash flows a factor.

                                         And I think Congress is going to work hard to do that. And I think the administration is supportive of that. And certainly all the verbiage coming out of it is. I agree. I think there’s [00:21:30] a third, fourth, and potentially a fifth. And I think it will be a collaborative work where industry goes to members and members work their way through it. And again, I think the fact that they’re going to roll in with the Defense Production Act is another sign that everybody’s willing to make those funds available so that the most critical things get done and the business of the nation still gets done in the way of national security. So I agree with what David was saying.

Roman Schweizer…:       [00:22:00] Great. Thank you, sir. Gautam, any question?

Gautam Khanna:             Yes, Roman. Thank you. If I could ask one, maybe if, David, first on the Professional Services Council, you mentioned getting stuff onto contracts, getting language on the contracts that maybe give some flexibility in this environment. What about, specifically, I’m thinking about folks who have a lot of fixed price contracts, let’s say, they have an interruption in [00:22:30] their workforce or at the customer site where their employees are unable to work or what have you, what kind of mechanism would you foresee being instituted to maybe allow some relief there and would it be different for those who have cost-plus contracts? I’m just curious what the mechanics of actually implementing some sort of relief would look like from where you sit.

David Berteau:                That’s such a wonderful question. You could have a whole panel of FAR monks [00:23:00] who could wrestle with that question, but we’ve identified a couple of FAR clauses that we think provide the opportunity for contracting officers to make adjustments to both fixed-price contracts and cost-reimbursable contracts in the event of this kind of impact. There are provisions already in the regulations that would essentially allow the contracting officers to make a determination that these are excusable reasons that come into play.

                                         The [00:23:30] problem, I think, that we have is that not every contracting officer, in fact, can cite the FAR by heart. And so, I think, the guidance is necessary is to actually give them from the top down, the cover, the leadership and management cover that says, “Here are the clauses, here’s the flexibility you have. You can exercise this flexibility.” One of the things we’re doing obviously is pushing that information out to our members so that they can make the case as well and [00:24:00] pushing it out to the agencies, particularly DOD, who would then be able to push that information down.

                                         I mentioned, for instance, the guidance memos are already being signed. The defense department had a guidance memo on March the 10th that began to address for contracting masses how to deal with teleworking in facilities where the DOD civilian employees are teleworking and the contract doesn’t allow the contractors to telework.

                                         Making adjustments to the contract [00:24:30] is fairly straightforward. There is a question of what consideration would be needed for doing that, including potentially increased cost and in fixed-price contract, you’d have to, essentially, make an adjustment to the contract in order to do that. It’s easily doable, but they need templates, they need examples of how to do it. And I think that’s the key point that we’re trying to push out there so the contracting officers will not have to make it up themselves on a contract by contract basis.

                                         There’s 35,000 contracting [00:25:00] officers inside DOD alone. You don’t want 35,000 separate decisions on this sort of stuff. You really want to set up general guidance to go forward. And we don’t have it yet. I think we will have it in a reasonable short period of time and then the question is, how do you push it down to all of those 35,000 so they know what they’re being expected to do?

Gautam Khanna:             And as a follow-up, David, to that, if I may, what impact does the industry expect with respect to maybe contract bookings? Just the ability for [00:25:30] the contracting officers, that workforce, to actually execute on the backwards that are at the excess. Is there any risk when that gets interrupted given how quickly this illness has [inaudible 00:25:41] quarantine and the like, I’m just curious has it actually, hasn’t had any impact yet and do you anticipate any impact?

David Berteau:                I haven’t seen much impact yet. I think it’s pretty hard to tell the difference between a normal delays from the bureaucracy in both solicitations and then in evaluations and awards [00:26:00] and delays that might be caused by this. So I think the jury is still out on how big an impact that will be. I do believe that there could be a near-term impact from payment of invoices because much of the invoice payment system is not something that’s been tested from a teleworking environment. And there’s, I think some experiences that they’re going to have to go through.

                                         The government employees are not used to having to do this away from the office. I was on the [00:26:30] phone with a senior person from DOD yesterday afternoon, who in the course of our 30-minute conversation got kicked out of the connectivity with their computer to the home office, five times in the space of 30 minutes, and have to log back in over and over again. If you’re in the middle of authorizing a payment, there’s no safe system in the middle of that. So you’re going to have to go back and start all over again. So there’s going to be a few hiccups, whether that magnitude is material from the point of view of [00:27:00] my member companies that you guys are paying attention to. I don’t expect it to be material anytime soon, but it’s something we’re watching very closely.

Roman Schweizer…:       Thank you. Great. I do have a one general question here. What are the chances that either Congress or the white house uses money already appropriated for defense for COVID response? So I guess that’s meaning like border wall or something else. Could that money already planned to be spent [00:27:30] on F-35s or ships or intel contract or whatever be repurposed for COVID. Do you think that’s likely or do you think Congress is just going to add more?

Gen. Hawk Carli…:          Yeah. I don’t think it’s likely at all. I think, again, as we talked about earlier, I think the appetite from both Congress and the administration is the supplemental appropriations to cover the COVID national emergency. So I think the programs are on track and I don’t, [00:28:00] unless something pretty different happens in the next six months, I see them using supplemental appropriations to cover it. I don’t think the thread of diverting current DOD appropriated and authorizing appropriated money away from current programs to this, I think it will be supplemental appropriations that’ll cover it.

David Berteau:                This is David. I see the same thing. I see very little risk there. I think Congress can move faster than the executive branch will identify and move the [00:28:30] money. You may see little pockets of it. As I mentioned, we’ve seen a couple of stop-work orders and the obligations, but they’re really small deer.

Roman Schweizer…:       Right. And so I do have one question, and this is more of a thematic question, but obviously, as Gautam referenced in terms of talking to the company, I mean, obviously we’re at the beginning of this, the front end of this, but I’m just curious from your planning and discussions [00:29:00] with your membership, any long-term changes? Impacts? Do you think whether it’s… I mean, David, obviously you mentioned working remotely or teleworking, obviously might bring big changes to sort of government services support or clauses in contracts or things like that. Just anything you guys think about how this might represent a shift in these industries.

David Berteau:                There are a few parallels here, Roman, with the government shutdowns, right? The [00:29:30] whole question of how do contractors deal with access to facilities, access to information, access to systems when the government is responsible for providing that access but due to, in the case of a shutdown, the lapse of appropriations, due to perhaps in the case of coronavirus, the inability to protect health and human safety by keeping those open. And one of the things that we did as a result, actually, we did this before the partial government shutdown and then updated it after the partial government shutdown, December [00:30:00] to January of 2018, 2019, made a series of recommendations to the government as how they can improve both contract language and contract flexibility to accommodate these sorts of things.

                                         I would see a similar set of activities that would come out of this when it’s all done. And there will be a point in which it’s done and those would come into place. It’s quite possible that the appetite for making changes after the problem is behind you, maybe higher this time than it is in a shutdown, where the government continuing to pretend they’ll never [00:30:30] be another one, so they don’t need to make any changes and I think there’s a great interest in Congress in making those changes.

                                         How much of that would affect ultimately the business itself that is the overall environment, would remain to be seen. But I think that the issues of speed, flexibility and surge capacity are going to be much more prominent in the way contracts are written, solicited, evaluated, and awarded going forward and I think this will play the real advantage of the companies in terms of being able to offset some [00:31:00] of the consequences of government first, contractor second, in terms of mentality, I would add though, that who wins in November 3rd, assuming that we actually have a vote in, might have as much of an impact on that as the impact of the coronavirus itself.

Gen. Hawk Carli…:          So from my standpoint, I’ll just kind of tack on a few things. One thing that, we saw it post 9/11, we see it when we recover from government shutdowns I think the department, [00:31:30] certainly the defense department and basically departments inside the government, the one thing they do pretty well is plan and they learn lessons. We don’t even know. I don’t think all the lessons we’re going to learn from COVID-19. I don’t think the telework infrastructure was one we thought about before, but clearly it’s a factor now.

                                         So, I do think that we’ll learn from this and I think there’ll be extensive plans. I think industry will work hand in glove with [00:32:00] the department to think about what this would look like in the future. Hopefully it won’t happen again, but if it does, how we would react to it and then the precautions necessary. So I do think there’ll be, over time, a learning curve, and then a plan that both the government and industry will start working together for what it would take. If this happens again, if it’s worse, it’s more widespread. So I think it will be part [00:32:30] of it.

                                         I just talked to general O’Shaughnessy, Shags O’Shaughnessy the NORTHCOM Commander. And I guarantee you, they’re learning a lot and they’re taking stuff down and they’re going to be ready to turn it into a plan for, should this ever happen again and I think that’ll apply to industry as well. I do think, like David said, is that November is going to be a factor in this, as we all know. We’ll just see what happens.

David Berteau:                Roman, this is David, could I add two things that I’ve thought of while [00:33:00] Hawk was talking?

Roman Schweizer…:       Of course.

David Berteau:                Number one is that there are areas where there’s a lot of government activity now that can potentially affect business, things like Cybersecurity Maturity Model Certification Program, we had a great dinner discussion on that back in February. Things like the implementation, due this August of the ban on all Huawei, et cetera equipment in any place where the federal government is involved that uses such equipment. So [00:33:30] it’s not just prohibited for companies to own it, but prohibited to be in a place that uses it. That rule is a very hard rule from a statutory point of view, but not yet issued. So we don’t know how we comply with. And I think that the need to have that kind of supply chain security of cybersecurity, I suspect might be reinforced by this coronavirus dynamics, but also made more difficult by this coronavirus dynamic. So those are [00:34:00] secondary factors that we’re watching to see how that plays out.

                                         And then the second piece has to do with the workforce. And over the last few years, we’ve seen, it’s increasingly difficult for government contractors or the government itself to compete with the commercial sector for the kinds of skills that we need to run a 21st century business enterprise. This may tip those scales a little bit, and they actually make government service, whether through a company, as [00:34:30] a government contractor, or whether through federal civilian service, perhaps more attractive rather than less attractive. And so watching what happens to the workforce, because ultimately, our companies depend on hiring people because that’s how they generate their revenue, their assets go home at night and need to come back the next day. And if this actually changes the workforce dynamic that could be a benefit that I don’t think we’ve thought through or anticipated very much, but it’s certainly something worth watching as the months unfold here.

Gen. Hawk Carli…:          Interestng point and a [00:35:00] potential long-term impact, it depends.

Roman Schweizer…:       Okay. Great. Well, listen, we are coming up here on the time for the call. Well, David and Hawk, thank you very much. We appreciate your time and insights and always and your support.

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