The Federal Acquisition Regulation (FAR) establishes a vision for the Federal Acquisition System that emphasizes value, public trust, and effective stewardship of taxpayer resources. The system aims to deliver the best value products and services to customers in a timely manner while fulfilling public policy objectives.
This lesson is a preview from Graduate School USA's COR Essentials course.
Guiding Principles for the Federal Acquisition System
The Federal Acquisition Regulation (FAR) establishes a vision for the Federal Acquisition System that emphasizes value, public trust, and effective stewardship of taxpayer resources. The system aims to deliver the best value products and services to customers in a timely manner while fulfilling public policy objectives.
Participants in the acquisition process are expected to work as a team and be empowered to make decisions within their area of responsibility. The Federal Acquisition System seeks to:
- Satisfy customer needs in cost, quality, and timeliness by:
- Maximizing the use of commercial products and services
- Using contractors with strong past performance or demonstrated ability
- Promoting competition
- Minimize administrative operating costs
- Conduct business with integrity, fairness, and openness
- Fulfill public policy objectives
Who Is the Contracting Officer’s Representative (COR)?
CORs are members of the acquisition team, which consists of technical, supply, and procurement personnel, the customers they support, and the contractors who deliver products and services. Each member of this team is responsible for exercising personal initiative and sound business judgment to provide the best value to the government.
“Best value” does not always mean the lowest price; it depends on the needs and circumstances of a particular procurement. As the FAR states, best value requires balancing many competing interests to create a system that “works better and costs less” (FAR 1.102-1).
The Federal Acquisition Regulations System
The Federal Acquisition Regulations System includes:
- The Federal Acquisition Regulation (FAR)
- Agency FAR supplements
The FAR is a comprehensive, governmentwide regulation spanning more than 2,000 pages. It applies to nearly all Executive Branch agencies. Individual agencies may issue FAR supplements to address specific mission needs; however, supplement rules cannot duplicate or conflict with the FAR.
How Much the Government Spends on Contracts
In FY 2022, the federal government spent more than $676 billion on contract actions. The Department of Defense (DoD) accounted for approximately $414 billion—about 61 percent of the total.
What the Government Buys
Federal purchases generally fall into two categories:
- Supplies
- Services
Understanding Federal Service Contracts
Services include tasks performed by contractor personnel such as grounds maintenance, guard services, program and management support, and research and development. Labor is typically the largest cost element in a service contract because the government is paying for time and expertise rather than a physical product.
The federal government spends more on services than supplies; approximately 60 percent of annual contracting dollars go toward service contracts.
Examples include:
- Professional services: research and development, studies, and analyses
- Nonprofessional services: custodial work, grounds maintenance, transportation
Labor Laws Affecting Service and Construction Contracts
Two major labor laws apply to certain federal contracts:
- Service Contract Labor Standards (SCLS): Requires contractors on applicable service contracts of $2,500 or more to pay employees the wages and fringe benefits set by the Department of Labor for the geographic region.
- Wage Rate Requirements (Construction): Formerly known as the Davis-Bacon Act, it requires contractors on construction, alteration, and repair contracts valued at $2,000 or more to pay prevailing wages and fringe benefits.
CORs assigned to affected contracts must monitor contractor compliance with these labor requirements.
Performance-Based Acquisition (PBA)
Service contracts are generally more challenging to oversee than supply contracts. For that reason, the preferred federal approach for acquiring services is performance-based acquisition (PBA). Under PBA, the government uses a performance work statement that defines outcomes and results, what must be achieved—while allowing contractors to determine how to deliver the required results.
