The new administration has undertaken two major efforts to reform the procurement system. The first is to consolidate two major classes of procurement in the General Services Administration. The second is to rewrite the Federal Acquisition Regulation (the “FAR”) to shorten it by stripping out unnecessary language. We will be reviewing these efforts periodically as we learn more about their progress.
On May 6, PCI ran Revising the FAR. If you want to watch a recording of this program, click here. This article is Prof. Ralph Nash’s write-up on the topic, associated with that program.
I. Procurement Consolidation
This effort was initiated by a March 20, 2025 Executive Order, Eliminating Waste and Saving Taxpayer Dollars by Consolidating Procurement, E.O. 14240, 90 FR 13671.
A. Common Goods and Services
The first class of procurement to be consolidated is purchases of “common goods and services,” meaning “the common Government-wide categories defined by the Category Management Leadership Council led by the Office of Management and Budget (OMB).” The administration estimates that this will cover approximately $490 billion of supplies and services.
The timeline for adoption of this effort is:
1. Within 60 days agency heads submit proposals to turn over procurements to GSA.
2. 30 days later GSA is to submit to OMB a “comprehensive plan” to take over this class of procurements.
3. The Order specifies no time when GSA will actually assume full procurement responsibility.
The current category management system has ten general categories and nine Department of Defense categories as follows:
General Categories (common goods and services)
1. Information Technology
2. Professional Services
3. Security and Protection
4. Facilities and Construction
5. Industrial Products and Services
6. Office Management
7. Transportation and Logistics
8. Travel
9. Human Capital
10. Medical
Defense categories:
1. Aircraft, Ships, Land Vehicles
2. Weapons and Ammunition
3. Electronic and Communication Equipment
4. Sustainment Supplies & Equipment (S&E)
5. Clothing, Textiles, and Subsistence S&E
6. Miscellaneous S&E
7. Research and Development
8. Equipment Related Services
9. Electronic and Communication Services
It can be seen that these broad descriptions of categories encompass almost all federal procurement. However, even the general categories in many cases deal with requirements that are agency-specific (like professional services, construction, and medical). Turning over to GSA the procurement of the common goods and services would involve a massive rearrangement of contracting offices and would separate contracting officers from the agency personnel who define the requirements for these special types of services. This could seriously reduce the effectiveness of the procurement system.
B. Information Technology
The second class of procurement to be consolidated is purchases of “information technology.” The Executive Order has made GSA “the executive agent for all Government-wide acquisition contracts for information technology,” but GSA can “defer or decline this designation . . . when necessary to ensure continuity of service or as otherwise appropriate.” GSA is also required to “rationalize” GWACs for information technology “across the Government, including as part of identifying and eliminating contract duplication, redundancy, and other inefficiencies. “There is no indication that GSA will control the issuance of task or delivery orders against whatever GWACs survive as a result of this effort.
` There are currently 11 GWACs, operational or in process, that cover information technology supplies or services:
1. GSA 8(a) STARS III
2. GSA Alliant 2
3. GSA VETS 2
4. GSA COMSATCOM
5. GSA EIS
6. GSA MAS IT
7. NASA SEWP
8. NITAAC CIO-CS
9. NITAAC CIO-SP3
10. NITAAC CIO-SP3 SB
11. Army CHESS
Since GSA already controls six of these GWACs, there are only five that are subject to takeover; however, they are all candidates to be “rationalized.” The interesting feature of this information technology effort is that GSA had this job many years ago and failed to capitalize on the opportunity to rationalize the procurement of this type of work.
II. The FAR Rewrite
An Executive Order issued on April 15, 2025, Restoring Common Sense To Federal Procurement, E.O. 14275, 90 FR 16447, calls for a rewrite of the FAR as follows:
Sec. 4. Reforming the Federal Acquisition Regulation. Within 180 days of the date of this order, the Administrator, in coordination with the other members of the Federal Acquisition Regulatory Council (FAR Council), the heads of agencies, and appropriate senior acquisition and procurement officials from agencies, shall take appropriate actions to amend the FAR to ensure that it contains only provisions that are required by statute or that are otherwise necessary to support simplicity and usability, strengthen the efficacy of the procurement system, or protect economic or national security interests.
The Order also calls for the rewrite of FAR Supplements as follows:
Sec. 5. Aligning Agency Supplements to the FAR.
(a) Within 15 days of the date of this order, each agency exercising procurement authority pursuant to the FAR shall designate a senior acquisition or procurement official to work with the Administrator and the FAR Council to ensure agency alignment with FAR reform and to provide recommendations regarding any agency-specific supplemental regulations to the FAR. The Administrator, the FAR Council, and each agency designee under this subsection shall collaborate to identify and appropriately address FAR provisions that are inconsistent with the policy objectives described in section 2 of this order.
(b) Within 20 days of the date of this order, the Director of the Office of Management and Budget, in consultation with the Administrator, shall issue a memorandum to agencies that provides guidance regarding implementation of this order. That memorandum shall ensure consistency and alignment of policy objectives and implementation regarding changes to the FAR and agencies’ supplemental regulations to the FAR.
(c) The memorandum issued pursuant to subsection (b) of this section shall propose new agency supplemental regulations and internal guidance that promote expedited and streamlined acquisitions. With respect to such proposals, the Administrator shall direct the appropriate agency and its subordinate agencies to adhere to the ten-for-one requirement described in Executive Order 14192.
(d) The Administrator and the FAR Council shall issue deviation and interim guidance, as appropriate and consistent with applicable law, until final rules reforming the FAR are published.
Finally, the Order calls for the potential imposition of a “sunset” requirement on nonstatutory regulations as follows:
Sec. 6. Regulatory Sunset. In amending the FAR under section 4 of this order, the Administrator, in coordination with the FAR Council, shall:
(a) identify all FAR provisions not required by statute that will remain in the FAR;
(b) consider amending the FAR such that any provisions identified in accordance with subsection (a) of this section will expire 4 years after the effective date of the final rule promulgated in accordance with section 4 of this order unless renewed by the FAR Council; and
(c) consider whether any new FAR provision not required by statute that is promulgated after the effective date of the final rule promulgated in accordance with subsection (b) of this section should include a provision stating that it will expire 4 years after its effective date unless renewed by the FAR Council.
The Order criticizes the current FAR as having “swelled to more than 2,000 pages of regulations, evolving into an excessive and overcomplicated regulatory framework and resulting in an onerous bureaucracy.” However, in this rewrite, its benefits should not be overlooked.
First, it consolidates all statutory and regulatory requirements into a single document so that agency contracting personnel and lawyers do not have to rummage around to determine what rules they are subject to. This encompasses the rules of the Small Business Administration (Part 19), the Labor Department (Part 22), and the Environmental Protection Agency (Part 23). It also covers statutes that are outside of the procurement statutes like the Buy American Act and the Trade Agreements Act (Part 25). All in all. the current FAR covers hundreds of issues that contracting officers may encounter throughout the entire procurement process, from market research to contract closeout or termination. As new issues arise and the FAR provides coverage, it grows longer. The current problem is that our procurement system is growing in complexity at an increasingly faster rate and the FAR Council is not able to keep up. But the only way to reduce its size is to cut out coverage of some issues – making it less useful.
Second, the FAR includes parts that have been developed over many years to govern important aspects of the procurement process that are not covered by statute. This includes termination (Part 49), types of contract (most of Part 16), cost principles (most of Part 31), payment (Part 32) and many other areas. These parts of the FAR are, in many cases, the ones that provide stability to the contracting process, but they take up a lot of space (termination consumes 91 pages). Cutting them out would deprive contracting officers of necessary guidance.
Third, the FAR contains 660 pages (in the CCH version) of standard clauses and solicitation provisions in Part 52 and 181 pages of standard forms in Part 53. That’s over one-third of the current FAR. The standard clauses are especially important to organizations dealing with the government because they regularize the language of contracts and solicitations so that they do not have to analyze new language on each procurement. They also ease the burden of agency contracting personnel and their lawyers by giving them terms and conditions that have been subject to years of interpretation by the courts, appeals boards, and the Government Accountability Office. The contract clauses are particularly important to industry because they strike a balance in sharing risks between the parties that has been developed over the years but might not be agreed to by agencies if they were allowed to draft contract language from scratch. Some standard clauses could probably be deleted because they get little or no use, but deleting clauses that are used on a regular basis would make the procurement system less efficient. My overall assessment is that the reason for the massive size of the FAR is the complexity of the current procurement system. But the FAR doesn’t make the system complex – it’s merely a reflection of the system. Neither does the FAR make procurement inefficient – it gives contracting officers lots of discretion in many cases, and generally contains mandatory procedures because of statutory requirements. The inefficiency in the procurement system mostly is caused by the procurement techniques adopted by contracting agencies and the protest process. Thus, it is highly unlikely that shrinking the FAR will result in a better procurement system, and it is quite possible that this effort will do serious damage to the system
On May 6, PCI ran Revising the FAR. If you want to watch a recording of this program, click here.