Federal Procurement Framework

Randy P. Holder

Professor: Lorna Malone

LEG 440

Strayer University

April 22, 2012

In implementing procurement policies, the executive branch, headed by the president, has a broad scope of managerial, and technical procurement responsibilities and procurement policy decisions, which may include, among others: supplementing and augmenting statutory procurement policies and procedures through executive orders, developing and maintaining statutory procurement policies and procedures, and determining whether to meet program needs by in-house performance or by contracting out.

In the United States, the federal government has a very complicated and fragmented procurement organizational structure. First, the federal procurement operates within a democratic framework, under the constitutional check-and-balance powers of the three branches of government: Legislative, judiciary and executive.

While the courts are not directly involved in setting procurement policies and rules, they try all legal cases that involve the federal government, including contract disputes, and their decisions become a source of federal procurement regulations. The Congress primarily influences the federal procurement system through laws, budget appropriations and its oversight powers. In addition, the Congress oversees federal procurements through its various standing committees, and the U.S. General Accounting Office. It also authorizes GAO to recommend decisions to agency heads on contract award and non-award protests. These decisions also become a major source of federal regulations.

In principle, the president is responsible for implementing procurement statutes and procurement authorization and appropriations. He establishes government-wide procurement policies and procedures through executive orders, makes political and management decisions relative to procurement programs and appoints agency heads and other official who have direct or indirect management control over procurement programs and procurement organization. As the federal government spends a large budget on procurement and procures a great variety of goods, services and capital assets, its procurement administrative structure has a centralized structure to maintain a uniform standard and control, and a decentralized structure allowing for flexibility to meet unique requirements of over 60 federal agencies.

The Office of Management and Budget recommends programs and funding levels for programs, including procurements; monitors programs and adjusts funding levels, if necessary; develops and issues, through the Office of Federal Procurement Policy, procurement policy guidance; and review proposed regulations for compliance with policy guidance. The Office of Federal Procurement Policy, a part of the Office of Management and Budget, among other responsibilities, provides leadership in the establishment, development, and maintenance of federal acquisition regulations (FAR); coordinates the development of government wide procurement systems standards; and provides direction to the development of procurement systems of executive agencies. The Federal Acquisition Regulatory Council assists in the direction and coordination of federal procurement policy and regulatory activities.

There are three Acquisition Regulatory Councils which consists of the Defense Acquisition, Civilian Acquisition, and the Federal Acquisition Regulatory Council. Chaired by the Secretary of Defense, and comprised of representative from the Departments of Air Force, Army, Navy, the Defense Logistics Agency, and the National Aeronautics and Space Administration, the Defense Acquisition Regulatory Council is primarily responsible for defense acquisition regulations. The civilian Acquisition Regulatory Council, chaired by the administrator of the General Service Administration, and comprised of representatives from 21 civilian agencies, is primarily responsible for civilian regulations. The Federal Acqusiton Regulatory Council consists of the Administrators of GSA, NASA, and OFPP, and the Secretary of Defense (Federal Acquisition Institute, 1999).

In general the federal procurement structure is very fragmented with the active involvement of Congress in setting procurement policies and regulations and exercising its oversight and monitoring power. This fragmentation is seen in various standing committees of Congress, as mentioned above, and the roles of the General Accounting Office. Within the executive branch, the procurement organization is more fragmented as many agencies and boards are involved in the federal procurement system, particularly in setting acquisition regulations.

The U.S. federal government’s procurement may be very complicated or very simple depending on the type of procurements and authorized procurement thresholds. FAR groups procurements into five major categories including supplies, constructions, services, research and development, and rental of real property. Each category has numerous specified types of procurement, and are classified on the basis of procurement dollars or thresholds. The procurement classification is important for “purposes of funding, types of contracts to be used, applicability of contract clauses, and coverage of socioeconomic provisions “(Cibinic, Jr., &Nash, Jr., 1998).

The American federal government is the largest purchasing entity of both private and public sectors in the world, and it acquires many types of goods and services, from very simple to very sophisticated items, to meet diverse deeds of agencies. Moreover, the American federal government has used its acquisition power to achieve certain socioeconomic objectives. Thus the procurement organizational structure and process are very complicated. An integrated acquisition model, initiated by the Defense Department and recommended by the Office of Management and Budget, is a very comprehensive model, requiring attention in the very early phase of acquisition, strategic planning and budgeting.

Reference Page

Cibinic, Jr., & Nash, Jr.,(1988) Formation of Government Contract(3rd ed.) Washington, DC: The George Washington University, Government Contracts Program.

Federal Acquisition Institute. (1999). The Federal Acquisition Process. (Washington, DC: Author).

Feldman, S.W.(2010). Government contract guidebook 2010-2011. (4th ed.) Eagan, MN: West.