How DOD’s Latest Commercial Products Memo Impacts GovCons

The Department of Defense has issued another memorandum instructing acquisition officials to better consider commercial products to the maximum extent possible and, now, they better not cut corners in doing so.

John Tenaglia, DOD principal director for defense policy, contracting and acquisition policy, said in a May 27 memo that the department must redouble its efforts to avoid creating requirements that inadvertently disqualify commercial solutions. President Donald Trump on April 15 issued Executive Order 14271, which directs agencies to procure commercially-available products and services, including those that can be modified to fill agencies’ needs, to the maximum extent practicable.

Tenaglia acknowledged that unique warfighting needs sometimes require DOD’s use of non-commercial products. But Tenaglia also said that acquisition officials should not declare truly non-commercial products or services as “commercial” to get around Trump’s executive order.

“It should not be about casting truly non-commercial products or services as ‘commercial’ for the purpose of misapplying policies and procedures unique to the acquisition of commercial products and commercial services,” Tenaglia said.

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DOD Enforcement of Commercial Product Purchases

To ensure acquisition officials consider commercial products as much as possible, Tenaglia took away their ability to “independently determine” whether a commercial service or product was enough to satisfy a requirement. Now, approval will reside with senior procurement executives, but can be delegated to flag officers, general officers or senior executive service officials.

“Any delegation(s) shall only be granted to acquisition officials possessing the necessary acumen to determine whether a proposed non-commercial procurement serves the best interests of the agency,” Tenaglia said. “Delegations may be on a by-procurement basis for all procurements in a given agency.”

Furthermore, Tenaglia directed a review by June 15 of pending Federal Acquisition Regulation actions—including open solicitations, pre-solicitation notices and award notices—for prime contract awards for non-commercial products or services valued at or exceeding the simplified acquisition threshold, which is $250,000. Awarded contracts are exempt from this requirement.

Program managers will now have to request approval to acquire non-commercial products or services under FAR-based contracts before issuing solicitations valued at, or exceeding, the simplified acquisition threshold.

Who Is John Tenaglia?

Tenaglia may not be as well known as Defense Secretary and Wash100 Award winner Pete Hegseth, but he has enormous influence over DOD acquisition rules. He is responsible for the pricing and contracting policy matters that relate to the more than $300 billion in annual contract obligations.

Tenaglia also serves as the principal advisor to the under secretary of defense for acquisition and sustainment on procurement and negotiating strategies for all major weapon systems and major automated information systems programs. He is the functional leader of DOD’s more than 30,000 contracting and purchasing professionals.

Prior to his current assignment, Tenaglia served as the head of contracting activity for the Defense Health Agency, where he was responsible for the award and administration of all contracts to maintain a medically-ready force with annual obligations valued at over $13 billion.

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