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Federal Procurement Landscape Shifts: Executive Order Aims to Consolidate Government Contracting at GSA
In a significant move impacting federal government procurement, a recent executive order issued on March 20, 2025, is set to restructure and consolidate a substantial portion of domestic federal contracting activity for “common goods and services“. The stated goal of this initiative is to “eliminate waste and duplication, while enabling agencies to focus on their core mission of delivering the best possible services for the American people“.
The core policy objective of the E.O. is to relocate most procurement activities for “common goods and services” from individual agencies to the General Services Administration (GSA). While the level of control agencies will retain over their specific purchasing needs remains unclear, the GSA has been initially directed to take over government-wide acquisition contracts for information technology (IT). Agencies and the GSA are tasked with developing plans to centralize contracting authority for all other covered contracting categories.
This mandate applies broadly to all executive branch agencies, including the military, and independent regulatory agencies, excluding only the Executive Office of the President. The centralization policy targets all contracts for domestic use of “common goods and services,” as defined by the ten government-wide categories established by the Category Management Leadership Council under the Office of Management and Budget (OMB). These categories include:
- Facilities and construction: Construction materials and services, purchases and leases
- Professional services: Business administration, financial, legal, management, marketing, research and development, social services, technical services
- IT: Software, hardware, consulting, security, telecommunications
- Medical: Drugs, healthcare products and services, medical equipment and supplies
- Transportation and logistics: Fuel, logistics support, vehicles, transportation and delivery
- Industrial products and services: Basic materials, hardware, machinery, installation and repair services
- Travel: Employee relocation, passenger travel, lodging
- Security and protection: Ammunition, protective apparel and equipment, security services and systems, weapons
- Human capital: Compensation and benefits, employee relations, talent acquisition and development
- Office management: Furniture, office products, office management services
The implementation of this E.O. will occur in phases. For IT contracts, the OMB will designate the GSA administrator as the executive agent for all government-wide IT contracts within 30 days of the E.O.. The administrator has the option to defer or decline this role for specific contracts to ensure service continuity, and OMB will issue a memo to agencies about this process within 14 days. The GSA administrator is also instructed to “rationalize” government-wide indefinite delivery IT contracts across agencies on an ongoing basis.
For all other contracts for common goods and services, agency heads and senior procurement officials have 60 days to submit proposals for GSA to take over their contracting responsibilities. The GSA then has 90 days to submit its plan to OMB for handling the procurement needs of all executive agencies.
This significant shift in procurement responsibilities carries several potential implications. GSA downsizing efforts are likely to end or be significantly reduced. Portions of the federal acquisition workforce may face reduction in force efforts or transfers to GSA. Agencies will need to determine quickly which acquisitions cannot be transferred due to practical and legal reasons. Questions also arise about the future of GSA’s historical fee-based contracting services, the continued role of the Defense Logistics Agency (DLA), and whether entities like the U.S. Army Corps of Engineers (USACE), the Defense Health Agency (DHA), and the Department of Veterans Affairs (VA) will continue to procure their own goods and services in the covered categories.
Furthermore, the E.O. could impact the landscape of contract protests. With the threshold to protest task order awards at the Government Accountability Office (GAO) differing for civilian and defense agencies, an increase in GSA-awarded task orders for the Department of Defense (DoD), Coast Guard, and NASA could lead to a lower protest threshold, potentially increasing the number of protests.
This Executive Order represents a major change in how the federal government approaches procurement of common goods and services, with significant implications for agencies, contractors, and the acquisition workforce.
Executive Order, GSA, Government Contracting, Federal Procurement, Acquisition, Consolidation, Procurement Restructuring, Category Management, OMB, IT Contracts, Common Goods and Services