Congress Clarifies 'Critical Function' Definition

December 22, 2011

The fiscal 2012 National Defense Authorization Act may provide a little more clarity to the blurry term “critical function.”

Such a function is a duty “necessary to maintain sufficient government expertise and technical capabilities” and a duty that “entails operational risk associated with contractor performance.”

The Office of Federal Procurement Policy this year defined a critical function as work that’s “necessary to the agency being able to effectively perform and maintain control of its mission and operations.”

In the authorization bill, Congress tells Defense Department officials to give special consideration to these critical functions, as well as acquisition workforce functions and even work that DOD employees have done at some during the past decade if they plan to take back work from contractors.

Officials would need to test whether to insource certain functions based on DOD guidance on comparing the estimated costs of who's doing the work. Officials would also have to decide if insourcing a function would be either 10 percent or $10 million less expensive than the contractor’s cost. The choice would not apply to inherently governmental functions, which should only be done by federal employees.

The authorization bill cleared Congress Dec. 15, and now awaits President Barack Obama’s signature or his veto.

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