Most code is not written by government employees, but contractors. The contractors usually sell the government on reusing internally-developed code to lower the cost, but they then maintain rights to that code. My guess is that the license is an attempt to cover such things.

Also, government appropriations can be weird- money for 'changes' might not be able to be used for 'new' software, etc. Some of the language in there seems to be related to that as well.