Government Contracts Policies to Watch in 2025

Mike Wagner’s commentary was included in a Law360 article exploring several planned and potential changes to federal procurement policy that government contractors need to be on watch for in 2025

Mike comments on a "Buy American" push, seen during both Trump’s first administration and Biden’s presidential administration, which focuses on boosting domestic supply chains and industry, including through federal procurement. But the key question of what a "critical item" is for domestic sourcing requirements remains unanswered.

The rule allows for the purchase of foreign items when domestically sourced ones aren't considered reasonably priced, with domestic large businesses given a 20% price preference and small businesses a 30% preference, alongside a 50% price preference for U.S. Department of Defense acquisitions.

The rule allows for an even higher price preference for "critical" domestic products deemed "likely to make a meaningful difference toward strengthening U.S. supply chains," but didn't include a list of those critical products or their specific enhanced price preferences, leaving that issue for a pending, separate rule.

"It remains to be seen how broadly, or narrowly, the incoming administration scopes that definition," Mike said. "You can envision certain [sensitive] sectors that … have been highlighted in other recent rulemaking actions as being potentially low-hanging fruit for critical items, [and] obviously critical materials for defense applications are also going to be important."