It’s Baaaaackkkkkkk—Category Management, the New Executive Order, and the 2019 OMB Memorandum—with new March 2025 GSA Slides

The Executive Order Entitled “Eliminating Waste and Saving Taxpayer Dollars by Consolidating Procurement” was issued in March with an accompanying OMB Slides issued last week. https://www.whitehouse.gov/presidential-actions/2025/03/eliminating-waste-and-saving-taxpayer-dollars-by-consolidating-procurement/  This EO concentrates heavily on IT services, any of which have been delegated to individual agencies prior to this EO. It is unclear if some agencies will continue to have that individual authority or if it will be granted solely to GSA to manage.

 The OMB Memo from 2019 may be used loosely as guidance until and unless new guidance is issued to concentrate the contracts using category management. It is found here: https://www.whitehouse.gov/wp-content/uploads/2019/03/M-19-13.pdf.

 Category Management (CM) has often been touted as the Government’s way of more cheaply procuring goods and services—dubbed also as Spending Under Management or “SUM.” It does this by trying to consolidate procurements on very large contract vehicles and having agencies dump their requirements into from 10 categories or buckets. Those buckets/categories can be found here: https://outlooklaw.com/s/Government-Wide-Categories.pdf

The contract vehicles have critics who say that the vehicles are too large, and the “on-ramp” and “off-ramp” time is a distinct time and hard to qualify to be on even though the contract at issue may not be on it or the qualifications posted after the “on-ramp” time. So, a contractor may have a contract move to a very large—both in size and time—years on end—contract vehicle after the vehicle was in motion and the contractor had no time to “get on-board.” Each of the agencies have a CM team that sends a representative to a CM Leadership Council. The March 2025 GSA slides on how it should work can be found here: https://outlooklaw.com/s/GSA-Presentation-on-Consolidation.pdf

 Some critics also point out that while some attempts have been made to set-aside for small businesses the efforts have been not as successful as a small business would like to see—thereby growing the ones that were on-board and leaving behind the others. (8(a) STARS III is the example that was developed after many large vehicles left the station). Many point to this as a reason why fewer small businesses are participating in government contracts but the ones that got on the vehicles may have an unequal opportunity to compete. With contracts this large, it has also called into question when a contractor qualifies, and what exactly can it qualify for if the contracting work it specializes in simply is not on the large vehicle—or at least not on it yet.

 The Executive Order cites approximately $490 Billion procured by the United States through the common spend. While that is true, that is only covering civilian agencies that deliver common services/goods. Top level spend analysis/charts have the Government Wide Category Management Common Spend at $488.9B. Government Wide Category Management Common and Defense Centric Spend is Obligated at $760.5B—putting Defense Centric Common Spend [Equipment Related Services, R&D, Weapons & Ammunition, and Aircraft, Ships, Subs, etc.] at $271.7B (35.7%) with IT seemingly in the civilian common spend. The charts are updated as of 3/16/2025. Found here for Top Level: https://outlooklaw.com/s/Top-Level.png and Small Business Chart here: https://outlooklaw.com/s/Small-Business-YoY.jpeg

 As Category Management takes priority again, government contractors, perhaps the small business contractors more specifically, will want to track developments and see if those businesses will need to gear up to spend the time and other resources to attempt to get on a large long-term vehicle or if other more small business vehicles will be developed.