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Focus in FY25: Who Controls the Funding When It Comes to Federal Contracts?

shaunaweatherly

Updated: Dec 20, 2024

I cannot stress this enough to businesses. If you are marketing to the Contracting Officer (CO/KO) thinking they control the money and what the Government buys, you haven't read the FedSubK Features--


"Hate the Game, Not the Players: Know the Roles in Federal Contracting."


and


"Mythbusting the Role of Federal Buyers in the Acquisition Process"


The contracting chain of command does not control the money for a contract action...the funding activity does. The funding activity can be the requesting activity (aka program/ budget office) or another office or other agency in the case of interagency or intra-agency buying. Or it can be a cost-share arrangement with a non-fed entity like a water resources board in the case of civil works projects, for example, that provides funds.


The CO/KO only deals with money at a few points in time in the procurement life cycle and controls it in none of them.


Yes, the CO/KO may lead or be involved in price negotiations but there is no CO/KO or Head of the Contracting Activity (HCA) with "power of the purse". They don't know what other funds are out there for similar projects in out years. Contracting isn't part of the budget request or budget approval process for projects. It's not their lane.


When it comes to determining funding sources, amounts, or funds availability for projects (and contracts), it's all the job of the funding activity. If the negotiated price is more than the amount on the funding commitment document, if the funding activity doesn't have enough money available then there is nothing the CO/KO can do. There is no contract (unless it is a rare contract that can be incrementally funded); end of story.


A CO/KO also can't de-scope or negotiate things out of a competitive action to get the price within the funds available because that would be a Competition in Contracting Act (CICA) violation, unless the RFP also includes the rare use formal additive or deductive items and procedures.


COs/KOs decide HOW to buy, NOT what or how much to buy.


Read the articles and you'll know the right marketing conversation to have with which player.

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