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Is This the End of Cost-Type Contracting? What Federal Contractors Should Know About a New Executive Order Making Fixed-Price Contracts the “Default”
Blank Rome – On April 30, 2026, President Trump signed another executive order that may significantly impact how the government buys goods and services. The target: cost-reimbursement contracts, which let contractors bill the government for their “allowable, allocable, and reasonable” costs incurred, plus some pre-established or earnable profit. The EO seeks to significantly reduce that figure by making fixed-price contracts the default for federal procurement—meaning prices are locked in up front and contractors, not taxpayers, bear the risk of overruns.