Key Takeaways:
- The “Revolutionary FAR Overhaul” (RFO) represents the first major update to the Federal Acquisition Regulations (FAR) in four decades, intended to modernize the regulation by simplifying its language and retaining only provisions required by statute.
- OFPP has rolled out model deviation text for multiple FAR Parts that agencies must adopt now, creating immediate shifts in procurement rules ahead of formal rulemaking.
- Because FAR provisions flow into contracts and subcontracts, contractors are already facing compliance obligations that may change again as the overhaul moves forward.
- Contractors should track these developments closely to understand how evolving requirements may affect ongoing and future business with the federal government.
After months of previewing large-scale revisions to the Federal Acquisition Regulations (FAR), the Office of Federal Procurement Policy (OFPP) has started sharing portions of its proposed rewrite. Dubbed the “Revolutionary FAR Overhaul” (RFO), the initiative focuses on rewriting FAR in plain language and retaining only those provisions that are statutorily required to streamline acquisition procedures and deregulate and modernize the federal procurement process.
For federal contractors and procurement officials, the implications are immediate. FAR requirements bind agencies but flow into contracts and subcontracts, establishing contractors’ compliance obligations and shaping how they do business with the federal government. And as the overhaul rolls out, those terms are shifting.
OFPP has rolled out “model deviation text” for a little less than half of FAR’s Parts, functionally serving as an advance on what the Administration expects agencies to adopt. Once the full rewrite is complete, the FAR Council will use notice and comment rulemaking to formally implement the newly overhauled FAR — informed by feedback received during the roll-out and rulemaking processes.
While this rolling “deviation” approach enables agencies to adopt the overhauled Parts immediately and without the need for formal rulemaking, it means that contractors and procurement officials will be operating in a sort of laboratory environment for the foreseeable future — doing business under a new set of procurement rules that may be subject to change once the overhaul process is completed.
To maintain consistency during the roll-out, OFPP has directed agencies to adopt the model deviation text in accordance with Office of Management and Budget guidance, with revisions allowed only by approval from the FAR Council. OFPP claims that the initial rewrites have eliminated more than 500 requirements from the FAR, with over 1,000 total requirements expected to be removed when the RFO process is complete.
In addition to several model re-writes of critical FAR Parts – including Part 8 (Required Sources of Supplies and Services), Part 12 (Acquisition of Commercial Products and Commercial Services), Part 40 (Information Security and Supply Chain Security), and portions of Part 52 (Solicitation Provisions and Contract Clauses) – OFPP also released overhauled Federal Supply Schedule Ordering Procedures. Further, OFPP has announced the development of criteria for “Best in Class” and “preferred” contracts, which are to be used on a government-wide basis for commercial products and services. Further guidance from OFPP on Best in Class and preferred contracts will be forthcoming.
As the federal contracting community continues to grapple with the evolving interpretations and implications of the RFO, Polsinelli’s Government Contracts Team will be issuing a series of updates on the most critical aspects of FAR model rewrites.
