Administration tunes up contracting rules

The Obama administration finalized several procurement rules March 2 that it had introduced in 2011.

Officials revised the Federal Acquisition Regulation (FAR) to address how contracting officers should use and manage cost-reimbursement contracts, a type of contract that administration officials want to avoid when possible because of the risk they place on the government.

The rule lays out:

  • Circumstances when cost-reimbursement contracts are appropriate.
  • Findings based on acquisition plans that support using a cost-reimbursement contract.
  • Resources necessary to award and manage a cost-reimbursement contract.

However, the rule does not interfere with the contracting officer’s discretion to select the appropriate contract type. It clarifies when cost-reimbursement contracts are appropriate and requires the contracting officer to document the rationale for the decision, according to the notice.

The FAR revisions implements language from the fiscal 2009 National Defense Authorization Act, and it matches President Barack Obama’s 2009 memo on procurement reforms.

The administration also finalized rules regarding multiple-award contracts.

The rule strengths competition rules for placing orders under the Federal Supply Schedules and other multiple-award contracts. The intent is to give fair notice to companies holding a spot on the contract so they have the opportunity to respond.

The rule also requires agencies to issue notices of certain orders placed against these types of contracts through Federal Business Opportunities website.

Finally, two small-business FAR rules were finalized too.

One final rule clarifies that there is no particular order for determining which set aside categories to consider. A debate had been ongoing about whether agencies had to consider companies in the Historically Underutilized Business Zones program before choosing to set aside a contract for another small business program. The rule confirms that they don't.

Also agencies can now set aside a contract for woman-owned small businesses.

About the Author

Matthew Weigelt is a freelance journalist who writes about acquisition and procurement.

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