‘Revolutionary FAR Overhaul’ Shows Progress

“NATIONAL DEFENSE MAGAZINE” By Scott Freling, Michael Wagner and Sarah Schuler

“The FAR rewrite is spearheaded by the FAR Council and the Office of Management and Budget’s Office of Federal Procurement Policy and appears certain to have concrete impacts on federal contractors as they navigate an evolving terrain of deviations and revised regulations.”

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“The U.S. government May 2 announced further steps in its much-discussed plan to rewrite the Federal Acquisition Regulation by establishing a “Revolutionary FAR Overhaul” website on Acquisition.gov.

It provided written guidance to federal agencies and released proposed revisions to FAR Part 1 – Federal Acquisition Regulations System and Part 34 – Major System Acquisition.

This activity comes on the heels of recent presidential directives requiring agencies to examine and reform their approach to procurement of goods and services, including Executive Order 14275, “Restoring Common Sense to Federal Procurement,” and Executive Order 14271, “Ensuring Commercial, Cost-Effective Solutions in Federal Contracts.”

As anticipated, the Federal Acquisition Regulation rewrite is spearheaded by the FAR Council and the Office of Management and Budget’s Office of Federal Procurement Policy. The website proclaims that the rewrite is “the first-ever comprehensive overhaul of the FAR” and aims to “return the FAR to its statutory roots, rewritten in plain language, and remove most non-statutory rules.”

It also will result in non-regulatory buying guides to provide practical strategies grounded in common sense while remaining outside the FAR, the website states. In short, the goal is characterized as “faster acquisitions, greater competition and better results.”

To begin its process of “streamlining and deregulation,” the council will be issuing revised regulation parts and agency deviations on a “rolling basis.” As of May 2, the Revolutionary FAR Overhaul website posted “streamlined” versions of FAR Part 1 and Part 34, with a corresponding General Services Administration Class Deviation and Line-Out Document reflecting text proposed for removal for each part.

The FAR Council is seeking input by the end of September on areas that need refinement and any potential unintended consequences.Separately, aspects of the current Federal Acquisition Regulation that the policy office deems “helpful non-regulatory content” are expected to be migrated to so-called “buying guides,” which are intended to capture best practices for acquisition streamlining and innovation. Together, the revised FAR and new buying guides are defined as the “strategic acquisition guidance.”

The website cites two key guidance documents that the administration simultaneously issued on May 2: a memorandum from Office of Management and Budget Director Russell Vought to executive departments and agencies, and a memorandum entitled “Deviation Guidance to Support the Overhaul of the Federal Acquisition Regulation.”

The Office of Management and Budget memo reiterates the goal of refocusing the FAR “on its statutory roots” and contains an appendix detailing a “roadmap of actions to implement” Executive Order 14275.

These actions include publishing “a dedicated site” on Acquisition.gov — presumably the new Revolutionary FAR Overhaul website — to keep contractors and the public apprised of strategic acquisition guidance development and “plain language versions of individual FAR parts,” as well as “buying guides with innovative procurement techniques for different phases of the acquisition lifecycle and strategies for specific categories of spend prior to formal rulemaking.”

Further, the Office of Management and Budget memo explains that the FAR will be “streamlined” to remove “unnecessary regulation and policy” through a phased approach moving from the issuance of deviation guidance to a formal notice-and-comment rulemaking process.

Agencies are similarly directed to “streamline their FAR supplements to minimize regulations that are not based in statute or executive order,” to identify federal buying best practices and to test new deviations or buying guide strategy initiatives.

The deviation guidance memo provides four pieces of guidance, with the aim of supporting agencies to develop their own class deviations to implement the council’s rolling class deviations for each revised part of the regulation.

First, agencies should generally issue their specific class deviations within 30 days from the release of the FAR Council’s class deviation on Acquisition.gov and should ensure these deviations are communicated throughout their workforce “to enable consistent implementation.”

Second, an agency’s required level of coordination with the council will vary depending on the extent to which the agency’s proposed deviation varies from the council’s text.

Third, agencies should transmit their class deviations to the FAR secretariat to be posted on the Revolutionary FAR Overhaul website.

Finally, agencies should “make their class deviations effective until implemented in the FAR,” to account for the anticipated notice-and-comment rulemaking process to be conducted by the FAR Council once all streamlined parts of the regulation have been released.

Although Executive Order 14275 reflects that the regulation should be reformed to “support simplicity and usability,” in the short- and medium-term, there remains significant uncertainty about the scope and timeline of this overhaul.

Although the executive order directs that “appropriate actions to amend the FAR” be taken by Oct. 12, the timeline on which the council is collecting informal input for the first two streamlined parts indicates that this process may extend well beyond that date to complete notice-and-comment rulemaking addressing all 53 parts of the regulation.

In the meantime, the FAR rewrite appears certain to have concrete impacts on federal contractors as they navigate an evolving terrain of deviations and revised regulations at all stages of the procurement process. “

‘Revolutionary FAR Overhaul’ Shows Progress

Scott Freling and Michael Wagner are partners, and Sarah Schuler is an associate in the Washington, D.C., office of Covington and Burling LLP. Associate Victoria Skiera also contributed to this article.