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GovCon Expert Alan Chvotkin: A Tidal Wave of Federal Acquisition Rules Coming in 2022

Alan Chvotkin, a partner at Nichols Liu, has published his most recent article as a part of Executive Mosaic’s  GovCon Expert program.

Previously, GovCon Expert Alan Chvotkin provided a review of the federal acquisition regulations issued over the past year. Despite the pandemic, and even with the Inauguration of President Biden and the transition to his new administration, it was still a busy and impactful year for these rules and for the acquisition community.

In his latest piece, Chvotkin offered a preview of the pace and scope of acquisition regulation changes we are likely to see during calendar year 2022. There is a lot on the acquisition regulations plate that could move into proposed and final rules. There is also the parallel process of the use of class deviations that could accelerate the timing of acquisition policy changes affecting contractors.

You can read Alan Chvotkin’s full GovCon Expert article below:

A Tidal Wave of Rules Coming in 2022

By Alan Chvotkin

First Rules Published

The first published acquisition regulation of 2022 was issued on January 5 by the Small Business Administration amending a 2020 final rule on consolidation of the mentor-protégé program and other government contracting amendments.

On January 26, the FAR Council published the first Federal Acquisition Circular (FAC) of the calendar year, consisting of only one interim FAR rule increasing the minimum wage for contractors implementing Executive Order 14026 (April 27, 2021) and the Department of Labor’s final rule published on November 24, 2021.

Through September 18, 2021, more than a dozen acquisition rules have already been published. In addition, the Office of Information and Regulatory Affairs within the Office of Management and Budget has cleared almost a dozen more rules for near-term publication in the Federal Register, including three more FAR rules as a FAC and four additional Defense Department DFARS rules.

Semi-Annual Regulatory Agendas

In addition, under the Regulatory Flexibility Act, as implemented by several Executive Orders, each agency is required to semi-annually publish in the Federal Register a compilation of their existing and projected regulations, covering all topics, not just those related to acquisition, as well as actions completed since the last publication. The most recent posting was on January 31, 2022.

A review of this information from the key acquisition agencies indicates that agencies anticipate heavy rulemaking in 2022.

For example, the FAR Council listed 21 topics that are at the proposed rule stage, with another fifteen at the final rule stage, including Buy America, Section 889, “Ban the Box” and others. GSA identified eleven GSAR acquisition rules at the proposed rule stage, including Schedules economic price adjustments and Schedules category management, and an additional three at the final rule stage.

SBA projects three proposed rules dealing with its size standards responsibility, with an additional six size standards actions already at the final rule stage. DoD, Homeland Security, and the Department of Labor, among other federal agencies, have all published notices that they have acquisition rules at both the proposed rule and final rule stages.

Further, DoD’s DAR Council has already this year, through February 18, opened eleven new cases to begin drafting rules implementing the Fiscal Year 2022 National Defense Authorization Act (NDAA), while the FAR Council has opened one new case to address the Fiscal Year 2022 NDAA.

And in the queue are fourteen pages of other FAR rules that remain to be adjudicated between the two regulatory councils before they are ready to be published. Another twelve pages of DFARS rule are pending disposition, with many dating back several fiscal years, with the oldest, relating to earned value management on DoD contracts, dating back six years to Fiscal Year 2015.

Many of these statutory provisions impose timelines for issuing the implementing acquisition regulations. So, too, do many of the Executive Orders President Biden issued in 2021, and I’m confident more Executive Orders affecting federal procurement will be forthcoming in 2022.

And while we should all desire to see the Executive Branch’s rulemaking apparatus operate efficiently and effectively to meet those congressional and presidential deadlines, let’s hope that all of these rules are not finalized and made effective at once or too soon. Neither the federal acquisition workforce nor the contractor community could absorb such an onslaught of rules and policy changes.

Use of Class Deviations Will Continue

As I noted previously, class deviations allow the Federal agencies to make immediate changes to the acquisition regulations without using the traditional “notice and comment” process, although these class deviations have the full force and effect as final rules. In 2021, class deviations were used to implement critical statutory provisions in the National Defense Authorization Act (NDAA) and for government-wide COVID-related mandates, for example.

I expect the use of class deviations will continue robustly in 2022, particularly when the change benefits one or more federal agencies. One early example of this already in 2022 is Class Deviation 2022-O0007 issued by the Defense Department on February 4, 2022.

It implements a provision from the Fiscal Year 2022 NDAA that permanently authorizes DoD to use commercial solutions opening (CSO) methods to acquire innovative commercial products, technologies or services. A prior Class Deviation from 2018 – which was never converted into a “regular” final rule – is now repealed by this new DoD Class Deviation. While this is the first DoD Class Deviation issued in calendar year 2022, it is not the first DoD has issued during Government Fiscal Year 2022.

Conclusion

The pipeline of acquisition rules awaiting action grows daily and will hit the Federal Register during the year. Contractors and other interested parties should actively participate in the rulemaking process to ensure that public comments are sought and taken into account at the proposed rule stage. But the tidal wave of rules is coming. Now is the time to prepare.

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