how federal contracting works

Congress passes a new law or the president creates a new executive order changing federal contracting, but how does that filter down to the agencies?

The easiest answer to that question is: bureaucracy, bureaucracy, and more bureaucracy. Once a rule, quota, or recommendation is established by the President (through executive orders such as Order 13101 “Greening the Government”) or through legislators (through acts or amendments such as the JWOD Act or Berry Amendment [poorly written wikipedia article]), a whole host of bureaucrats busy themselves with the practical implementations. Not only must the new change be added into existing rule books but it also has to be prioritized and must be compatible with hundreds of years of existing rules. Of course, these also must jive with rulings from the courts on various issues, which might or might not be tangential.

Rules implementing these changes are proposed by a host of existing federal agencies (e.g. SBA). Think of it like a feeding frenzy. Each agency vies for benefits to themselves. Each affected vendor screams out (some wanting special privileges for themselves, some fighting special privileges to others). Chaos ensues. This is the internal fighting (backroom dealings, compromises, strong-arming, ego padding, etc) never visible to the public, but present none-the-less.

New proposals can be added at any time, so a change created in 2000 might only now be recommended for updating or new methods of implementation based on the effects of previous implementations, the original intent of the rule itself, or mismanagement of the previous implementations. Many changes happen due to presidential power shifts. No reason is really necessary for federal agencies that see these regulations as an easy and covert way to collect more power for itself (e.g. SBA) or those who style themselves as moral crusaders (e.g. SBA). Affected vendors must always keep a vigilant watch or else something might slip through with earth-shattering consequences.

Those approved proposals are recorded in the Federal Registry, and then they get filtered down to the Federal Acquisition Regulation (FAR), which outlines guides for Contracting Officers to issue contracts (the primary way for the government to purchase items). Each agency has sub-FARs that also must be updated based on the unique sub-regulations that affect their specific organization. Sometimes agencies must filter their actions through much more than one FAR. The Air National Guard, for example, gains its Contracting authority through the Army so it must comply with the FAR, DFAR, AFAR, NGFAR and to what extent possible the AFFAR.

The FAR and various sub-FARs can be edited at any time, “improving on rules” or giving further restrictions and rules originating at an agency level. As can be expected, changes often complicate and contradict each other. These rules might be legislatively guided or not. They might just be agency policy. Various agency authorities might likewise overlap and contradict each other. All these changes must be adapted into the various tenuously interconnected software programs for all the various contracting steps (PD2, AIMS, FedBizOps, NG-FPDS, etc). It is the Contracting Specialist’s job to navigate these crevasses and determine what is applicable and how to make things work.

By the time the rules and regulations get down to an operational level, the web of bureaucracy is thick. Every transaction is subject to audit, dispute, scrutiny, and legal consequences (jail time) for neglecting these rules. Each Contract is unique and must be uniquely inspected to figure out which rules are applicable and what set-asides need to be met. Key variables include: item being purchased (NAICS, SIC, FSC. ect), dollar amount, where the funds are coming from, amount of funds set aside, when the funds are given, what the funds are to be used for, type of purchase (supply, service, construction), where the Contract is to be performed, where the Contract is to be purchased, the country of origin of any supplies, vendor classifications and the like. It is quite amazing the government gets anything done at all.

About christopher fisher

The blog is meant for educational/entertainment purposes. All material can be used and reproduced in any length for any purpose as long as I am cited as the source.
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