What’s in Store for Government Contractors: Biden’s Early Executive Orders, How they Might Affect You, and What to Watch Out For In the Coming Days of the New Administration

Obermayer Rebmann Maxwell & Hippel LLP

Obermayer Rebmann Maxwell & Hippel LLP

So far in 2021, President Biden has signed 30 executive orders (aka EOs).  While most of these orders are not aimed specifically at government contractors, several of them may nonetheless impact the operations of certain government contractors. As always, it will be important for government contractors to keep a close eye on any changes, and make sure to update compliance programs, practices, and procedures accordingly.  

Below, we’ve put together a quick round-up of those EOs that we believe are most likely to impact your business, and that you might want to keep an eye on:

  • EO 14008 Tackling the Climate Crisis at Home and Abroad

    • EO 14008 is a sweeping policy statement intended to put climate change at the center of United States foreign policy and national security. Among other actions, it creates a National Climate Task Force made up of all of the Cabinet Secretaries, including the Secretary of Defense and the Administrator of General Services.  It requires Task Force members to “prioritize action on climate change in their policy-making and budget processes, [and] in their contracting and procurement.”  Government contractors can expect to see climate change impacts as a factor in all future procurements and are likely to see significant contract opportunities intended to address this requirement.
  • EO 14006 Reforming Our Incarceration System to Eliminate the Use of Privately Operated Criminal Detention Facilities

    • The Department of Justice will not renew any existing contracts with privately operated prisons.
  • EO 14005 Ensuring the Future is Made in All of America by All of America’s Workers

    • EO 14005 creates a Made in America Office (MAO) within the Office of Management and Budget. This MAO will have centralized control over Buy American Act waivers, which are currently managed by individual government agencies.  Many of you who work in federal construction may be aware that there is a new rule, effective January 21, 2021, that increased the required percentages for domestic components to 55% for construction materials and 95% for iron and steel.  However, this rule may not be in effect for long because EO 14005 requires that the FAR Council (the agency that writes the FAR) draft new FAR provisions to replace the component test used to identify end-products and domestic construction materials with a test under which domestic content is measured by value-added in the U.S.  The new regulations will also increase the numeric threshold for domestic content and increase price preferences for domestic products.  We will need to wait and see the final rule to understand how the Buy American Act will be applied in the future.  If you work in federal construction, keep monitoring our blog for more information as these rules develop.
  • EO 14001 A Sustainable Public Health Supply Chain

    • EO 14001 is intended to reorganize how the government obtains supplies to fight COVID-19. Critical for government contractors, it allows for price reasonableness to be considered in the procurement of supplies, which is likely to have a significant effect on future supply procurements.
  • EO 13991 Protecting the Federal Workforce and Requiring Mask-Wearing

    • Some of the government contractors we talk to have told us that their efforts to maintain compliance with mask-wearing and social distancing to prevent the spread of COVID-19 were not always adequately supported by the government. EO 13991 will likely end that situation, as it requires all federal agencies to enforce and support social-distancing and mask-wearing to prevent the spread of COVID-19.  (Note: If implementation of social-distancing measures causes a delay in your performance and/or causes you to incur unanticipated costs, you should contact a legal professional and explore the potential remedies available to you.) 
  • EO 13989 Ethics Commitments by Executive Branch Personnel

    • EO 13989 imposes new limits on government appointees who work in the private sector in fields related to their government employment. Intended to eliminate the so-called “revolving door” of government appointments, this executive order imposes significant limits on the ability of appointees to lobby or communicate with the government after leaving office, and to work on matters related to their private sector employment when entering office.  This may affect government contractors who employ former appointees in leadership positions within their companies. It could also lead to certain Organizational Conflict of Interest (OCI) issues.  (For more on OCI’s, check out our upcoming webinar on OCIs and Mitigation Plans)

These are just a few of the new executive orders that may impact your business as a government contractor.  Keep an eye on our blog for more information as President Biden issues additional orders.  

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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