FAR Part 1: 'If it's not prohibited, it's allowed'

Steve Kelman reflects on what could be the most important sentence in the Federal Acquisition Regulation.

steve kelman

The May issue of Contract Management magazine, the publication of the National Contract Management Association, featured an article called “Secrets of Superstar Contracting Professionals.” The article (which unfortunately is not available online to non-NCMA members) is by Christoph Mlinarchik, a lawyer in the Office of the Secretary of Defense, and offers a quick guide to overall skills and competencies that freshly minted contracting professionals need to become outstanding in their profession.

I was happy (and, I will confess, flattered) to see, in a section of the article called “Innovation and Risk-Taking,” a short quote from Part 1.102(d) of the Federal Acquisition Regulation, reading in its entirety as follows:

“In exercising initiative, Government members of the Acquisition Team may assume if a specific strategy, practice, policy or procedure is in the best interests of the Government and is not addressed in the FAR, nor prohibited by law (statute or case law), Executive order or other regulation, that the strategy, practice, policy or procedure is a permissible exercise of authority.”

The author went on to state that these words have “reached a near-legendary status in the contracting community,” and that “hushed whispers of it echo through acquisition program offices, [where] grizzled contracting officers vigorously defend it as they pound the table to bolster their case.”

The happiness in reading this reference came because this language – which I believe is unique to all the collections of internal government regulatory guidance in areas ranging from HR to financial management, though it could usefully appear in all of them – is indeed very important guidance to federal contracting officials in doing their jobs, especially appearing where it does at the very beginning of the regulations. The pride came because I actually played a fairly important role in getting this language into the regulations at the beginning of my service in government during the Clinton administration.

The language reflected an effort to deal with various conflicting forces in government procurement policy at the time. When Vice President Al Gore’s reinventing government program got started, there were demands -- both from program people who were frustrated in their dealings with the procurement system and from outside consultants working on the reinvention project -- to essentially jettison the FAR entirely and replace it with 10 pages or so of guidance.

Coming in from Harvard to take the job of administrator of the Office of Federal Procurement Policy, I soon realized this was not only unrealistic but foolish. However, I appreciated the criticism that the regulations could be a straightjacket. In particular, we were hearing from a lot of progressive contracting professionals in the government that many frontline contracting people believed, or even had been taught, that if something wasn’t allowed by the regulations, it was prohibited.

So some of us came up with the idea, not to eliminate the regulations, but to add a clear statement contradicting that particular myth – if something was not prohibited by the regs, and was in the interest of government and taxpayers, contracting people should assume the practice or policy was allowed.

A year or so later, the provision entered the FAR. The most-recent example of use of this provision to authorize an innovative, valuable procurement practice is the spread of use of contests as a procurement tool – a tool not mentioned one way or another in the FAR, but which violates no policy and is in the government’s interest.

Nonetheless, I wonder whether Mlinarchik was being a tad sanguine in writing about this provision’s “near-legendary” status in the world of government contracting – though I hope he is right. With the downplaying of innovation and the renewed push for control that began to characterize the procurement system during the first decade of this century, only very partly reversed during the Obama administration, I had sort of feared that this language in FAR Part 1 had become close to a forgotten dead letter, kept alive from total extinction by a chosen few.

I hope I’m wrong.

Actually, I am in the very early stages of developing a course on managing procurement for the Harvard Kennedy School. I plan to include at least some discussion of this passage from FAR Part 1 in my course materials. So I would be grateful for any stories from contracting professionals and program managers about successes (or failures) in using this language to influence the course of an acquisition in which you’ve been involved.