Critical Points:
- GSA is planning to consolidate contracting functions from several federal agencies, including OPM, Education, SBA, and HUD.
- Initial pilot program expected to launch by March 30.
- Affected agencies are already experiencing significant changes, including OPM’s recent procurement team layoffs
- Department of Education cutting nearly 50% of staff.
The General Services Administration (GSA) is preparing to centralize federal contracting operations by assuming responsibility for acquisition functions currently performed by multiple agencies, according to internal communications and sources familiar with the plans.
An email obtained by Federal News Network revealed that GSA’s Federal Acquisition Service (FAS) is establishing a new organization specifically designed to handle contracting work for civilian agencies. The initiative begins with several pilot agencies, including the Office of Personnel Management (OPM), which has already laid off its entire procurement team.
It was on February 24 that Acting Administrator and Deputy Administrator of GSA Stephen Ehikian posted on X, “I have informed our workforce that @USGSA is initiating a Reduction in Force in alignment with @POTUS executive order on workforce optimization. To those impacted, we are committed to ensuring a respectful transition as you depart the agency.”
Others included in the pilot program are the Department of Education, the Small Business Administration (SBA), and the Department of Housing and Urban Development (HUD). The reorganization reportedly includes plans for affected agencies to transfer personnel to GSA or implement reductions in force (RIFs), resulting in no remaining acquisition staff within the pilot agencies.
The consolidation effort is moving quickly, with interested GSA employees given short notice to volunteer for roles in the new organization. The administration previously attempted to merge OPM and GSA, though that was abandoned in 2020, but recent reports echo plans outlined in the ”Central Personnel Agencies” section of Project 2025 to combine GSA, OPM, and the Office of Management and Budget into a single entity.
Meanwhile, the Education Department has initiated its own RIF as of March 11: “impacting nearly 50% of the Department’s workforce. Impacted Department staff will be placed on administrative leave beginning Friday, March 21st,” according to a Department press release. However, Secretary of Education Linda McMahon acknowledged during her confirmation hearing that congressional approval would be required for any complete departmental shutdown.
GSA’s assumption of these contracting functions is expected to begin by March 30, though vendors have reportedly not yet been informed of the pending changes. FAS Commissioner Josh Gruenbaum is said to be receiving regular updates, and a “tiger team” – a group of highly skilled, multi-disciplinary experts brought together to tackle a specific, complex, high-priority issue reportedly – has been assigned.