About This Special Issue

ven avid readers of The Wall Street Journal might have missed the July 18 story tucked inside the "Marketplace" section: "Northrop, General Dynamics Post Gains in Profits." Not exactly earth-shattering news, but coming when it did-at a time when WorldCom was sliding into a record-breaking bankruptcy, accounting scandals were making front-page news and the stock market was taking a daily beating-the story was revelatory. As these two huge defense firms show, it's a good time to be a federal contractor.

The federal government spent $218 billion on prime contracts in fiscal 2001, up from $204 billion in 2000 and $185 billion the year before. As Matthew Weinstock reports in the introduction to our ranking of the Top 200 contractors in this special issue, there's some doubt as to whether the big jump is entirely due to new spending-agencies appear to be getting better at reporting just how much business they actually do with the nation's top vendors. But there's no question that the federal procurement budget is headed even higher. Virtually all of the contract dollars reflected in this year's rankings were issued before the Sept. 11 terrorist attacks, so the full effects of the launch of a war on terrorism and the creation of a massive homeland security bureaucracy are only beginning to be felt.

Many agencies aren't just buying more, they're shopping smarter. The winners of the Business Solutions in the Public Interest Awards profiled in this issue provide some of the best examples. The awards are co-sponsored by Government Executive, the Council for Excellence in Government and the Office of Federal Procurement Policy.

The rankings of top contractors and top-spending agencies in the issue are compiled for Government Executive by Eagle Eye Publishers Inc. of Fairfax, Va., from Federal Procurement Data Center data covering fiscal 2001. The center, part of the General Services Administration, gets its information from reports on contracting filed by agencies.

Most of the vendors are private, for-profit U.S. companies. Some of the top contractors are universities or other nonprofit institutions, and a few are foreign-owned firms. The data cover only prime contracts worth more than $25,000.

Companies ranked in this issue are parent companies; outlays to subsidiaries are "rolled up" to the parent. For joint ventures, we have assigned each partner an equal portion of payments made under the contract in 2001. Mergers and acquisitions are not reflected in the listings unless they became final before fiscal 2001 ended, with one exception: We adjusted the revenues of Northrop Grumman to account for its acquisition of Newport News Shipbuilding, which was finalized late last year. We believed this change was of such significance-particularly since Northrop also plans to acquire 10th-ranked contractor TRW by the end of this year-that readers should not have to wait until next year to see it reflected in the rankings.

FOR MORE INFORMATION: Eagle Eye Publishers can be reached at (703) 359-8980, on the Web at http://eagleeyeinc.com or via e-mail at info@eagleeyeinc.com. GSA's Federal Procurement Data Center is at (202) 401-1529. To obtain additional copies of this issue, call (800) 207-8001.