WHAT: On April 30, 2026, the Trump Administration issued an Executive Order (EO) establishing a firmer “default” preference for fixed-price contracts. The EO, titled “Promoting Efficiency, Accountability, and Performance in Federal Contracting,” declares it “the policy of [the] Administration that fixed-price contracts with performance-based considerations should serve as the default and preferred method of procurement.” The EO allows agencies to continue using “non-fixed-price contracts,” but if the value exceeds certain thresholds, the agency head, or a “non-career employee” designated by the agency head, must personally approve the contract type.
The EO defines fixed-price contracts as either (a) “fixed-price contracts as defined in Part 16 of the Federal Acquisition Regulation, codified at title 48, Code of Federal Regulations,” or (b) “contracts that tie profit to performance-based metrics when appropriate.” This first definition would exclude popular contract types that have
