On March 20, 2025, after weeks of speculation, the president issued his latest executive order (E.O.) focused on restructuring and consolidating significant portions of domestic federal government procurement activity for "common goods and services." The stated intent behind the effort 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."

How is Government Contracting Being Restructured?

The E.O. establishes the policy objective of relocating most procurement activities for "common goods and services" from individual agencies to the General Services Administration (GSA). It is unclear what level of control agencies will retain to determine their own purchasing needs for the affected categories of products and services. For now, the GSA is only directed to take over government-wide acquisition contracts for information technology (IT). For all other covered contracting categories, agencies and the GSA are instructed to develop plans to implement the centralization of contracting authority. 

Which Goods and Services are Covered?

The E.O.'s mandate applies to all agencies other than the Executive Office of the President as defined by 44 U.S.C. § 3502 – all executive branch agencies, including the military, and independent regulatory agencies. The centralization policy aims to shift responsibility to the GSA for all contracts for domestic use of "common goods and services," as described by the 10 government-wide categories established by the Category Management Leadership Council under the Office of Management and Budget (OMB). Those categories are:

• 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

What is the Timeframe for Implementation?

For IT contracts: Within 30 days of the E.O., OMB is to designate the GSA administrator as the executive agent for all government-wide IT contracts. The administrator may defer or decline that role for specific contracts as necessary to ensure continuity of service. OMB will issue a memo to agencies about that process within 14 days. On an ongoing basis, the GSA administrator is instructed to "rationalize" government-wide indefinite delivery IT contracts across agencies. 

For all other contracts for common goods and services: Agency heads and senior procurement officials have 60 days to submit proposals to have GSA take over their contracting responsibilities for common goods and services. The GSA has 90 days to submit to OMB its plan for handling the procurement needs of all executive agencies.

Potential Implications

This E.O. has several possible short- and long-term impacts. It also raises numerous questions and observations:

• GSA downsizing efforts are likely over or significantly curtailed.
• Portions of the federal acquisition workforce may be targeted for reduction in force efforts or transferred to GSA.
• Agencies will be quickly analyzing which acquisitions are not transferrable for practical and legal reasons.
• If GSA truly becomes the contracting clearinghouse for a significantly increased number of domestic executive branch procurements, will GSA be restructured to preclude its historical for fee contracting service?
• What role will the Defense Logistics Agency (DLA) continue to play?
• Will the U.S. Army Corps of Engineers (USACE) no longer procure construction, architecture, and engineering services and supplies?
• Will the Defense Health Agency (DHA) and the Department of Veterans Affairs (VA) no longer procure their own medical services and supplies?
• Will the Department of Health and Human Services (HHS) no longer procure pharmaceuticals for the nation's strategic stockpile?
• Will protests of task order awards increase as a result? The fiscal year 2025 National Defense Authorization Act (NDAA) raised the threshold to protest at Government Accountability Office (GAO) for Department of Defense (DoD), Coast Guard, and National Aeronautics and Space Administration (NASA) task orders issued under Indefinite Delivery Indefinite Quantity (IDIQ) contracts from $25 million to $35 million. However, the threshold for GAO protests of civilian agency awarded task order remains steady at $10 million. This threshold is tied to the contractual authority for the individual procurement action, not the intended beneficiary or the funds utilized. As a result, if GSA awards more task orders for DoD, Coast Guard, and NASA, the threshold procurement value to protest will be $10 million, not $35 million, increasing chances such task orders can be protested at GAO. 

For more information, please contact: 

Scott N. Flesch, sflesch@milchev.com, 202-626-1584

Elissa B. Harwood, eharwood@milchev.com, 202-626-5890

Jason N. Workmaster, jworkmaster@milchev.com, 202-626-5893

Alex L. Sarria, asarria@milchev.com, 202-626-5822 

Ashley Powers, apowers@milchev.com, 202-626-5564

Connor W. Farrell, cfarrell@milchev.com, 202-626-5925

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