Trump administration 2.0: Driving reform in federal procurement 

What is it? 

This executive order, referred to as the Revolutionary FAR Overhaul (RFO) (and sometimes “FAR 2.0”), aims to create the most agile, effective and efficient procurement system possible, removing undue barriers—such as unnecessary regulations—while simultaneously allowing for the expansion of the national and defense industrial bases. The RFO is the first comprehensive revision of the Federal Acquisition Regulation (FAR) in over 40 years. To achieve these goals, a key tenet of this procurement reform is that the FAR should contain only provisions required by statute or essential to sound procurement, and any FAR provisions that do not advance these objectives should be removed. 

The executive order's key elements are “reforming” the FAR, aligning agency supplementary guidance with the revised FAR and sunsetting unnecessary regulation or guidance.  

What to expect? 

This order directs the Office of Federal Procurement Policy (OFPP) to amend the FAR to ensure that it contains only provisions 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. Additionally, agencies must align agency supplements to the FAR, such as the Defense Federal Acquisition Regulation Supplement (DFARS) discussed in Executive Order 14265, with a focus on including only statutory requirements and following the “ten-to-one” deregulation rule included in Executive Order 14192. Also, reform of the FAR should consider including a “sunset provision” that non-statutory requirements remaining in or added to the FAR will expire after four years. 

In the near term, as the administration works through the details of this reform, contractors should expect to see the FAR Council issue “deviations” from existing FAR requirements. On May 2, the Office of Management and Budget (OMB) issued deviation guidance to support the RFO, specifying the use of "plain language" class deviations aimed at returning the FAR to its statutory base, beginning with FAR Part 1. Agencies are expected to implement the draft revisions right away (within 30 days) through FAR deviations, ahead of the conclusion of formal notice-and-comment rulemaking. If an agency’s class deviation differs from the OMB’s, it must be coordinated with and approved by the OMB. The OMB committed to reviewing deviations within five business days, and agencies may proceed if no response is received. 

Thus far, the General Services Administration (GSA) has issued model deviation text for FAR Parts 1, 10, 34 and 52. These anticipated deviations will address exceptions to FAR requirements for classes or categories of contracts that do not align with the administration’s acquisition priorities. OMB guidance also calls for the creation of OFPP-endorsed buying guides to replace non-statutory regulations. Collectively, the FAR and the buying guides will be referred to as “Strategic Acquisition Guidance (SAG)”.    

Contractors should closely monitor the development of the SAG and assess how emerging changes may impact internal policies, procedures and their broader contract portfolio, especially as the FAR Council and OFPP move to revise more substantive parts of the FAR. In addition, contractors should take full advantage of public comment opportunities during the formal rulemaking process, as industry input can help shape both the final regulations and the structure of future buying guides. 

What is it? 

The administration is focusing on eliminating unnecessary and imprudent expenditures of taxpayer dollars for the acquisition of custom-developed solutions by emphasizing statutory preferences for the procurement, to the maximum extent practicable, of commercially available products and services, including those that can be modified to fill agencies’ needs. The administration is undertaking actions to emphasize existing laws, including the Federal Acquisition Streamlining Act of 1994 (FASA), which directs the federal government to use the competitive marketplace and the innovations of private sector enterprise to provide better, more cost-effective services to taxpayers. 

What to expect? 

Agencies are currently reviewing open solicitations, pre-solicitation notices, solicitation notices, award notices and sole source notices for non-commercial products or services where the agency has not identified a satisfactory commercial option to consolidate those actions into an application for approval of the purchase of a non-commercial product or service. The respective agency’s approval authority then has until mid-July to assess each proposed application’s compliance with FASA and to make appropriate recommendations to advance the solicitation of commercial products or services where those products or services would be sufficient to serve the applicable procurement needs. 

In addition, by mid-August (and annually thereafter), agencies are required to provide a report to the director of the OMB detailing their compliance with FASA and the executive order. Going forward, agency procurements of non-commercial products or services will require approval from the agency approval authority and possibly review and approval by the OMB.  

Contractors can certainly expect to see agencies scrutinizing their requirements to identify a commercial solution to satisfy their procurement needs. Contractors with existing trusted commercial products, especially those that can be easily and cost-effectively modified to meet “unique” agency requirements, are well-positioned to support government customers. Moving forward, the impact of this EO will likely be felt in the pre-award planning/solicitation phases of the contract lifecycle, requiring an evaluation of the thoroughness of the CO’s market research. This means active engagement in an agency’s acquisition planning gives contractors a critical opportunity to influence requirements toward commercial solutions wherever possible. 

What is it? 

The administration believes that the defense acquisition system does not provide the speed and flexibility our Armed Forces need to have decisive advantages in the future. To strengthen our military edge, America must deliver state-of-the-art capabilities at speed and scale through a comprehensive overhaul of the defense acquisition system. 

To accelerate defense procurement and revitalize the defense industrial base to restore peace through strength, the executive order directs rapid reform of the United States’ antiquated defense acquisition processes, emphasizing speed, flexibility and execution. The executive order also looks to modernize the duties and composition of the defense acquisition workforce and to incentivize and reward risk-taking and innovation. 

The executive order is extensive and addresses five broad areas: 

• Reform of defense acquisition processes 
• Review of regulations 
• Review of the requirements generation process 
• Review of major defense acquisition programs (MDAPs) 
• Reform of the acquisition workforce 

What to expect? 

By mid-June, the secretary of defense is required to submit to the president a plan to reform the Department of Defense’s (DOD’s) acquisition processes with a focus on using existing authorities to expedite acquisitions, including a preference for commercial solutions and use of Other Transactions Authority (OTAs). 

The secretary will also review and propose revisions to relevant DOD instructions, implementation guides, manuals and regulations relating to acquisition (to include the Financial Management Regulation (FMR) and DFARS) and promote expedited and streamlined acquisitions by applying the “ten-for-one rule” for deregulation described in Executive Order 14192 when new regulations are being considered. 

The EO requires the DOD to streamline its weapon system requirements development process, and, by mid-July, the DOD must complete a comprehensive review of all MDAPs and consider cancelling any program more than 15 percent behind schedule, 15 percent over cost, unable to meet key performance parameters, or unaligned with the secretary of defense’s mission priorities. 

Finally, by mid-August, the DOD will develop a plan to reform, right-size and train the acquisition workforce. 

Contractors supporting programs that are underperforming and not meeting cost, schedule or performance parameters are at risk of contract termination if these programs are curtailed or cancelled. However, on the positive side, contractors may see increased flexibility and benefits from the easing of regulatory requirements resulting from the reform of the DFARS and other military service acquisition and procurement regulations. 

What is it? 

Executive Order 14240 reaffirms the GSA’s original mandate—to serve as the federal government’s centralized procurement authority. Established in 1949 to deliver a more “economical and efficient system” for acquiring goods and services, GSA’s role has gradually diminished as agencies increasingly pursued their own procurement paths, often in the name of speed or convenience. The administration now seeks to reverse that fragmentation. By consolidating domestic federal procurement under the GSA, EO 14240 aims to reduce duplication, cut waste and refocus agencies on their core missions—delivering high-quality services to the American public. Additionally, the order designates the GSA administrator, through the director of the OMB, as the executive agent for all government-wide information technology (IT) acquisition contracts (GWACs), reinforcing GSA’s leadership in modern, coordinated procurement strategy. 

What to expect? 

EO 14240 reasserts GSA’s role in the acquisition system. Currently, executive agencies are developing proposals to submit to the GSA to have the GSA conduct domestic procurement of common goods and services. Then, in late June, the GSA administrator is required to submit a comprehensive plan to the OMB for the GSA to procure common goods and services across the federal government. 

Contractors can expect the focus of agency activity related to this EO to be on the common spend government-wide categories defined by the Category Management Leadership Council (CMLC) led by the OMB. The GSA recognizes that many purchases are “uncommon” as they are not procured by multiple agencies, and individual agencies have specialized experience with these unique types of purchases. Therefore, these “uncommon” purchases are not the focus of the order. Affected contractors should focus their efforts on understanding category management and where their products and services fit in the context of category management. Certain categories will be better aligned with the administration’s priorities than others. Category management is also a cornerstone of the GSA’s “OneGov” strategy, which aims to unify and streamline federal purchasing across agencies. 

Furthermore, on May 21, reports emerged that the GSA is exploring efforts to assume oversight of the few remaining GWACs outside its portfolio—namely NASA SEWP and CIO-SP3/4. Such a move could significantly affect hundreds of federal contractors and involve billions in government spending. Notably, both vehicles are already undergoing evaluation for their respective follow-on contracts, adding complexity to any potential transition. Early indications suggest that the GSA may wait until those awards are issued before proceeding, but contractors should stay vigilant and closely track further developments. 

With the GSA’s increasingly prominent role in federal acquisition, contractors are encouraged to become well-versed in the GSA’s contract offerings and be prepared to clearly demonstrate how their solutions align with the administration’s priorities of delivering value and driving efficiency. Proactively showcasing this alignment will be key to maintaining a competitive edge as procurement strategies evolve under heightened scrutiny.