In a March 20 executive order, President Trump directed federal agencies to submit plans to consolidate procurement for “common goods and services” under the General Services Administration, which puts the agency in charge of contracts in 10 broad market categories that were worth $495 Billion in fiscal 2024. Together, these contracts represented 64% of total contract spending by all defense and civilian agencies, according to the most recent Bloomberg data.
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Trump’s move would have a major impact on the buying power not just of GSA and its roughly 12,000 workers—which like the rest of the government faces its own budget and staffing cuts—but of virtually all federal agencies. It represents a continuation of a push that has straddled multiple administrations to give agencies greater leverage by negotiating with contractors as a bloc, especially for technology services.
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“A consolidation of this scale would require either a significant workforce expansion at GSA or a major workforce shift from agency contracting offices to GSA,” Sam Finnerty, a partner at PilieroMazza who focuses on federal procurement, wrote in an email to Bloomberg Government. “It raises serious operational and personnel questions, particularly regarding the future of agency-specific contracting staff.”
At $495 billion, the proposed consolidation means GSA would have to scale buying operations up to 20 times its current level. The executive order estimated common contract spending at $490 billion annually, while other reports cite a $400 billion total.
“If fully implemented as written, this could represent one of the most sweeping procurement overhauls in recent memory,” Finnerty said.
GSA plans the imminent takeover of procurement operations for the Office of Personnel Management, the Small Business Administration, and the departments of Education and Housing and Urban Development, according to sources inside GSA. In the coming months, GSA expects to assume responsibility for procurement operations at many smaller, independent executive branch agencies, according to a recent email.
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The executive order’s broad language appears to include the Defense Department, which has unique missions and a history of managing its own specialized, secure solutions. This raises concerns about how fully DOD could comply with the order, as well as legal and operational roadblocks, according to Finnerty.
“The potential impact on small business programs is a major concern,” says Finnerty. “If agency-specific small business set-aside contracts like Polaris are absorbed into a broader GSA framework, it could change how small business goals are met.”
Please also visit this link for Sam’s client alert covering this topic and this link to access PilieroMazza’s resource center dedicated to Government Contract Executive Orders.
Excerpt taken from the article “Trump Team Forges Ahead With Plans to Reform Federal Contracting” by Paul Murphy for Bloomberg Government. Visit this link for the full article (subscription required).
About Sam Finnerty
Sam Finnerty is a trusted legal partner to government contractors, helping businesses secure, defend, and maximize federal contracting opportunities. With deep expertise in federal procurement, construction law, small business programs, and litigation, Sam provides strategic counsel to contractors navigating the complex world of government compliance and disputes. Read more here.
