Trump’s New EO Forces Fixed-Price Contracts, Sidelines Career Experts

On April 30, 2026, the Trump administration rolled out a new executive order (EO) titled “Promoting Efficiency, Accountability, and Performance in Federal Contracting.” Its headline policy: fixed-price contracts must now be the default procurement method across federal agencies. In practice, this means agencies are pushed to use fixed-price contracts whenever possible, with few exceptions.

Fixed-price contracts, as defined by the EO, exclude common contract types like time-and-materials and labor-hour contracts unless they include performance-based incentives. While the EO allows some wiggle room for cost-reimbursement contracts tied to performance metrics, the overall thrust is clear: fixed-price contracts are king.

The EO applies retroactively to existing contracts, demanding agency heads review and attempt to renegotiate their top 10 largest non-fixed-price contracts within 90 days. For future contracts, the EO mandates immediate class deviations, new guidance from the Office of Management and Budget within 45 days, and proposed federal acquisition regulations within 120 days. Training programs are also set to be updated.

Here’s the kicker: the EO removes contract-type approval authority from career acquisition professionals, handing it instead to “non-career employees” appointed by agency heads. This political meddling threatens to override expert judgment on when fixed-price contracts actually make sense.

Experts warn this rigid approach could backfire. Many government procurements are complex and unpredictable, making fixed-price contracts risky. Contractors might inflate prices to cover unknowns or refuse to bid altogether, shrinking competition and driving up costs.

This EO is another example of the Trump administration’s penchant for authoritarian overreach and micromanagement that sidelines expertise in favor of top-down control. We’ll be watching closely as this policy unfolds and impacts federal contracting efficiency and accountability.

For the full legal breakdown, see Wiley’s detailed alert here.