OMB Seeks Public Comment on Landmark Federal Acquisition Overhaul

The Office of Management and Budget released the first of three proposed major changes to federal acquisition regulations for public comment Tuesday.

Published in the Federal Register, the proposed Revolutionary Federal Acquisition Regulation Overhaul revisions represent the most significant changes to federal acquisition policy in the past 50 years, OMB officials said.

“Federal acquisition should not be measured by how well people navigate paperwork. It should be judged by whether agencies can deliver capability faster, attract stronger competition, and get better value for the American taxpayer,” Kevin Rhodes, administrator of OMB’s Office of Federal Procurement Policy, said in a statement.

Initiated through a series of executive orders issued in 2025 to streamline how the federal government acquires products and services, including IT systems, the proposed rules begin the formal process of incorporating those policies into the Federal Acquisition Regulation. Agencies have already started implementing many of the reforms through temporary rule changes introduced in 2025, OMB officials said.

The proposal covers revisions to 17 parts of the FAR. According to OMB, the changes “advance a simpler regulatory framework written in plain language, more closely aligned with statute, and structured for speed.”

As part of the overhaul, OMB reviewed the entire FAR, including significant updates to cost accounting standards that had not been revised since the 1970s. The effort aims to increase competition in federal acquisitions while reducing costs and accelerating delivery timelines, officials said.

Focus on Commercial Solutions

A central component of the overhaul is prioritizing commercial products and services over custom government-developed solutions. To support that shift, the proposed rules place greater emphasis on commercial business practices.

Specific rules changes include:

• Replacing a detailed five-page regulation governing written acquisition plans with a one-page practitioner tip sheet while allowing agencies to use oral acquisition plans when appropriate.
• Replacing the blanket requirement to coordinate with auditors on settlement proposals exceeding $2 million resulting from contract terminations with a risk-based approach that determines when audits are necessary. OMB said the new approach has already shortened the time needed to close out lower-risk settlements by months, allowing agencies to focus resources on higher-risk cases.

The proposed rules also establish a new regulatory sunset process requiring a comprehensive review of FAR provisions, with public input, at least once every four years to prevent unnecessary regulatory growth.

The FAR Council plans to publish two additional proposed rule packages as part of the broader overhaul. According to OMB, the changes are intended to replace decades of accumulated acquisition requirements with a more efficient, mission-focused procurement system.

“These new rules will dramatically reduce costs while increasing competition in the federal marketplace. OMB and [Office of Federal Procurement Policy] are proud to be leading the way on this effort,” an OMB official told GovCIO Media & Research.