DOGE's Zombie Contracts: They Were Killed but Have Come Back to Life

New York Times

09-05-2025

At least 44 of the government contracts canceled on the orders of Elon Musk's cost-cutting initiative have been resurrected by federal agencies, wiping out more than $220 million of his group's purported savings, according to a New York Times analysis of federal spending data.
But Mr. Musk's group continues to list 43 of those contracts as 'terminations' on its website, which it calls the 'Wall of Receipts.' The group even added some of them days or weeks after they had been resurrected. The result was another in a series of data errors on the website that made the group seem more successful in reducing government costs than it had been.
The White House says that this is a paperwork lag that will be remedied.
The revived contracts ranged from small-dollar agreements about software licenses to large partnerships with vendors that managed government data and records. Most of the contracts were canceled in February and March, when Mr. Musk's group, the Department of Government Efficiency, was demanding that agencies make huge cuts in spending and staff.
Then agencies reinstated them, sometimes just days later. In one case, the Environmental Protection Agency revived a contract after just 2 ½ hours. Mr. Musk's group still listed that one as canceled for weeks afterward, even after it had been revived and then extended — so that it will cost more now than before.
These reversals illustrated not only the struggles of Mr. Musk's team to produce accurate data about its results, but also the drawbacks of its fast, secretive approach to cutting spending as part of a sweeping effort to slash $1 trillion from the $7 trillion federal budget in a few months.
Contractors said that, in its rush, Mr. Musk's group had recommended killing contracts that were unlikely to stay dead. Some were required by law. Others required skills that the government needed but did not have.
Their reversals raise broader questions about how many of the Musk group's deep but hasty budget cuts will be rolled back over time, eroding its long-term effect on bureaucracy and governing in Washington.
In Northern Virginia, the government contractor Larry Aldrich was notified in February that his company, BrennSys, had lost its contract to do web design and produce videos for a Department of Veterans Affairs website for veterans with post-traumatic stress disorder.
'The V.A. cannot do this work on its own,' Mr. Aldrich said. 'They don't have the manpower, or the skill set.'
It did not last.
'Two weeks later, we got an email saying it was going to be reinstated,' Mr. Aldrich said. 'I was like, Wow, somebody must have gone back and told them, 'We can't do this.''
A White House spokesman, Harrison Fields, said the reversals showed that agencies had re-evaluated cuts they made in the initial push to comply with Mr. Musk's directions.
'The DOGE Wall of Receipts provides the latest and most accurate information following a thorough assessment, which takes time,' Mr. Fields said. 'Updates to the DOGE savings page will continue to be made promptly, and departments and agencies will keep highlighting the massive savings DOGE is achieving.'
Mr. Musk's group has listed more than 9,400 contracts it claims credit for canceling, for a total of $32 billion in savings. In all, Mr. Musk's group says it has saved taxpayers $165 billion.
Compared with that output, Mr. Fields said, the reversals identified by The New York Times were 'very, very small potatoes.'
He declined to say if contracts on the group's list beyond those that The Times found had also been revived.
The Times uncovered those reversals by searching the Federal Procurement Data System, a government system that tracks changes to contracts. The Times looked for instances where contracts listed as canceled on Mr. Musk's website had shown signs of new life, such as having added funding, an extended timeline, or an update that included words like 'rescind' or 'reinstate.'
That search turned up 44 of the cost-cutting group's zombies, contracts killed but then restored to life.
That total may still be an undercount, because changes to contracts can take time to appear in the procurement data system, and because there is no standard way to identify a reinstated contract in this system. The Times's search may have missed some.
The resurrections began in mid-February.
Raquel Romero and her husband had a contract to offer leadership training to lawyers at the Agriculture Department. They lost it on Feb. 14, and gained it back four days later.
That was a godsend for Ms. Romero and her husband, providing $45,000 in revenue at a time when all their other federal business had disappeared.
'We had lost all of the income that we were planning for calendar year 2025. We've had to sell our house. We're in the process of moving into a condo,' she said. 'We just feel really fortunate that we had this resource to buy some time.'
The Agriculture Department said in a statement that it had restored this contract after discovering it was 'required by statute.' It declined to say which statute. Ms. Romero said she felt the reinstatement was the product of personal intervention, crediting a senior Agriculture Department lawyer who had been a major supporter of her and her husband's work.
'All I know is, she retired two weeks later,' Ms. Romero said.
Other reversals began to follow.
The Department of Veterans Affairs reinstated 16 contracts, the most of any agency in The Times's analysis.
That department declined to comment about why. But veterans' groups noted that some of the canceled contracts involved functions required by law, such as a contractor who helped veterans search for military records to use as proof in obtaining benefits.
That contract was restored after eight days.
At the Education Department, Mr. Musk's group said it had saved $38 million over multiple years by canceling a contract to manage a repository of data about schools nationwide. But lawmakers and advocacy groups objected, saying that the law required that data to be collected, and that the government needed it to determine which schools qualified for certain grants, like some tailored for rural areas.
'They should have used a scalpel,' said Rachel Dinkes of the Knowledge Alliance, an association of education companies, including the one that lost this contract. 'But instead they went in with an ax and chopped it all down.'
That grant was restored after 18 days, but with $17 million of its potential funding stripped away.
The shortest-lived cancellation involved an E.P.A. contract, signed in 2023, to pay a Maryland-based company for help raising awareness about asthma. The E.P.A. canceled that contract at 4:31 p.m. on March 7, according to contracting data. Then it reinstated the contract — in effect, canceling the cancellation — at 6:58 p.m. the same night.
Why?
'Any procurement that is reinstated reflects that the agency determined that funding action supported Administration priorities,' the E.P.A. said. The agency declined to give details about this case. Last month, the E.P.A. extended this contract for another year, agreeing to pay $171,000 more than before the cancellation. The contractor did not respond to questions.
From the start of his group's work, Mr. Musk said the government would most likely have to undo some spending cuts.
'We need to act fast to stop wasting billions of dollars of taxpayer money,' Mr. Musk said on 'The Joe Rogan Experience' podcast in February. 'But if we make a mistake, we'll reverse it quickly.'
But Mr. Musk also made a second promise, crucial to carrying out the first. He said his group would post the details of its work online to enable the public to have an accurate and up-to-date picture of what it had cut.
'We can name the specifics, line by line,' Mr. Musk said in the same interview. 'We've got the receipts. We post the receipts.'
The Times has found numerous errors on the group's website since the beginning. Often, these errors inflated the value of the savings Mr. Musk's team had achieved. Mr. Musk promised the group could make $1 trillion in budget cuts this year, but so far it has fallen far short of that aim. And even those cuts have been inflated because of the inclusion of errors and guesswork.
Mr. Musk's group, for instance, previously claimed credit for canceling programs that actually ended years or even decades ago. It also double-counted the same cancellations, and once posted a claim that confused 'billion' and 'million.'
This month, The Times sent the White House a list of dozens of revived contracts that were still on the list. Two days later, Mr. Musk's group removed one: the E.P.A. contract that had been canceled for less than a day.
But at the same time, it added five other already-revived contracts to its list of 'terminations,' claiming credit for $57 million more in savings that had already been rolled back.