New rules seek to curb bad contracting practices
Three new contracting rules unveiled this week seek to curb bad procurement habits, such as using risky contract types and requiring brand-name products.
The rules, which will take effect Feb. 2, require agencies to:
Limit the use of "time and materials" and "labor hour" contracts for commercial services.
These types of contracts are considered risky because the cost is not set in advance but determined by the amount of time and materials applied to a project. Agencies now have to explain why a fixed-price contract is not an option when purchasing commercial services using federal supply schedules contracts. Agencies previously had to provide this justification only when purchasing commercial supplies.
"The intent is to ensure that this contract type is used only when no other contract type is suitable and to instill discipline in the determination of contract type with a view toward managing the risk to the government," according to the rule.
Present a business case before using another agency's contract.