Eye on Policy

The end-of-year buying season is always a bit chaotic, but the remaining month promises to be particularly tough on government buyers and contractors alike. Congress did manage to remove one bit of uncertainty by passing continuing resolutions, so the government will not lurch on September 30. But the two bills do not agree with the House extending current budget levels of December 4 and the Senate to December 11. Still, the bills make it less likely government employees will be occupied with shut-down planning.

Contractors trying to close FY ’26 business at this point should be in purely tactical mode focusing on finding contracting officers with administrative capacity. It is important for both sides to ensure they have sufficient time to approve bids, issue purchase orders, and commit funds.

For contractors, this means you might have to “shop” around for an available CO. Companies may find the COs normally connected to specific programs are simply too busy. It also means you must ensure your fulfillment people are ready to go with timely delivery of goods and services.

This year, the industry is dealing with a measurably smaller federal administrative workforce. At the start of the year, the Partnership for Public Service calculated a nearly 37% reduction in the headcount at the General Services Administration, for example. The Agriculture Department was down by 28%, Interior by 24% and State by 20%.

In June, the Government Accountability Office estimated that the civilian Defense Department workforce had fallen by 10% or some 78,000 employees. Some of the “programmed” reductions started during the Biden administration, but they accelerated under the Trump administration.

One analysis, by the Covington law firm, summed up the federal acquisition workforce this way: “For some companies, which may create opportunities. For others, it may create a more volatile operating environment marked by uneven demand, delayed procurements, and award cycles, or shifting government expectations about support, responsiveness, and execution.”

Meanwhile, policy uncertainty

One federal office that does not present much of a contracting opportunity itself has, nonetheless, a significant impact on procurement and acquisition policy. And the Office of Management and Budget are seeing something of an exodus of high-ranking policy people.

As first reported by Federal News Network, the administrator of the Office of Federal Procurement Policy (OFPP), Kevin Rhodes, will depart this week after only 11 months on the job.

But it was a significant 11 months in which Rhodes oversaw the so-called Revolutionary rewrite of the Federal Acquisition Regulation (FAR). In early summer, the FAR Council published a lengthy list of proposed rule changes. Comments closed last month, and bits and pieces like model deviation text adjustments have rolled out.

In short, the scene is one of flux. Deviations and language changes and certain non-statutory subtractions have been implemented. The rules change have a way to go. The whole FAR is hundreds of pages thinner, but both industry and government at this point remain uncertain about how it will all settle in terms of future acquisitions and contract clauses. Luckily Associate OFPP Administrator Joanie Newhart is still on the job and can carry the policy work forward.

The revolution gives contracting officers more discretion in negotiating, market research strategies, and types of contracts they use including those not mentioned directly in FAR. The general idea is for acquisition to serve mission outcomes more strongly with less emphasis on rigid compliance.

Oddly, the idea of discretion last came up in such a strong way back in the acquisition reforms of the Clinton administration. The difference is that the earlier reform concentrated on having contracting officers simply use more of the discretionary options they already had, but which had fallen into dormancy.

In the long term, a simplified and more flexible acquisition system will support modernization in the age of artificial intelligence and quantum computing – and the technical, social, and psychological upheavals they bring and will bring. In the practical short term, the contracting workforce will be uncertain as to which FAR parts apply to a given acquisition and contracting activity.

Ethics and rules still matter

With everything from the John F. Kennedy Center for the Performing Arts to the painting at the bottom of the reflecting pool, everything seems political these days.

We do not want career federal employees to make political decisions. And we do not want politicians to make what should be law- and rule-bound administrative decisions that properly belong to the permanent workforce. It is a system that, even with occasional scandals over the years, has held true, based on trust and restraint.

With President Trump turning the projects (and you can throw in the White House ballroom) into sort of fetishes, that system feels threatened. Just as it did when the Biden administration made a fetish, say, of unilaterally forgiving legitimately given student loans.

But signs have emerged showing that some balance might be returning. This is visible at the Justice Department, where administrations try hardest to put their imprimatur.

To wit: Former Homeland Security official and campaign veteran Corey Lewandowski is under Justice investigation for contracts the department awarded when he was a senior aide to former Secretary Kristi Noem, the Wall Street Journal reported last month. Democrats in Congress since last Spring have alleged pay-to-play contracting schemes with Lewandowski as the payee.

Deep state revenge or a proper investigation of a crook? Hard to say with any certainty at this point, but one hopes the Justice investigation is based on the same evidence as any other corruption allegation as would concern someone less politically connected. (Then there was the dismissal of charges against the guy who allegedly slashed the reflecting pool liner, with Justice concluding that the blue coating disintegrated because of poor installation.)

Whatever final policy emerges on acquisition, nothing is more corrosive than the idea that bids are rigged; officials paid off; or contracts simply go to cronies. Or, for that matter, that appointed officials make contracting decisions when there is a highly accountable workforce already responsible and that knows the rules. Noem had instituted a rule, since rescinded by her successor, of having the DHS Secretary review every purchase for over $100,000. If, charitably, they were looking to save money, that is hardly the way to do it.