The Essentials of the Bona Fide Needs Rule in Federal Procurement

Jillie Willies customers enter into the world of vibrant colors and fun designs, where the apron and pot holder go hand in hand to complete the kitchen aesthetic. Likewise, the fashion and excitement in designing a kitchen are analogous to completing a federal contract under procurement law. While there may be a certain level of excitement and creativity when designing a contract, there are rules that must be followed in order to achieve the end goal-an efficient kitchen and an efficient government. Put another way, there are rules for procurements just as there are rules for fashion.

Most everyone can agree that there are certain rules when wearing or using clothing or accessories. For example, one should not wear white after Labor Day, and the wrong accessories are simply unacceptable. The same can be said for government procurements, such as the comprehensive bona fide needs rules. The bona fide needs rule serves the purpose of controlling agency spending. To elaborate, the bona fide needs rule requires that government agencies follow certain procedures when procuring supplies and services with appropriated funds. Equally as important, the bona fide needs rule is intended to ensure that government agencies properly allocate funds and adhere to their own appropriation statutes. As stated earlier, just as there are rules for wearing the appropriate clothing, there are rules for government agencies spending appropriated funds-the bona fide needs rule.

Purchasing the most stylish kitchen wear is not enough to guarantee that an individual will look his or her best. Put another way, the most fashionable individuals are those who know where to purchase the best clothing. The same is true for government agencies under the bona fide needs rule. Government agencies cannot use appropriated funds absent knowledge of how to adhere to the bona fide needs rule, which stems from the fact that the bona fide needs rule is not well-known. Considering this reality, government agencies seeking to comply with the bona fide needs rule are faced with the question: How do you know what you do not know?

Someone once said that rules, constraints, and challenges often lead to creativity. It could be that fashion designers design the best outfits only when faced with constraints. Similarly, it could be that the ideal government contract is designed when faced with the constraints imposed by the bona fide needs rule. A simple way to illustrate this point is to consider the “ideal” outcome of certain scenarios. Suppose that an individual can purchase a pair of shoes that come in three colors for 50 dollars each. Would that same individual purchase the shoes in every color, even if each color does not match that individual’s wardrobe? Consider the opposite scenario. Assuming that the individual can purchase the shoes in one color for 30 dollars, and each subsequent color only costs five dollars more, would the individual purchase the shoes in every color? It is reasonable to assume that the second scenario would be the most favorable. In either case, this discussion highlights that the knowledge of how to navigate the constraints of the bona fide needs rule is what leads to the most efficient government contract.

If you remain confused about the bona fide needs rule, you are not alone. There are likely hundreds, if not thousands, of government agency personnel that do not know what the bona fide needs rule is. Moreover, the bona fide needs rule is buried in the U.S. Code (31 U.S.C. § 1502(a)), and there is little if any guidance on how agencies are supposed to adhere to the rule. Nevertheless, learning how to trespass the bona fide needs rule, is like learning the difference between plain and vibrant colors for kitchen wear. You can learn everything you need to know about the bona fide needs rule, simply by reading the article titled “The Essentials of the Bona Fide Needs Rule in Federal Procurement.”