The White House Office of Management and Budget (OMB) today released guidance that directs Federal agencies to improve their capacity for the responsible acquisition of AI.
OMB’s memo on Advancing the Responsible Acquisition of AI in Government contains new requirements for agencies on establishing meaningful cross-functional and interagency collaboration to reflect new AI responsibilities, managing AI risk and performance, and promoting a competitive AI market with innovative acquisition.
“The successful use of commercially provided AI requires responsible procurement of AI by Federal agencies,” OMB’s Deputy Director for Management Jason Miller told reporters. “The AI used by Federal agencies will likely either be built by a contractor on behalf of an agency or purchased by a Federal agency for use. This new memo provides agencies with the tools and information they need as they acquire AI – capturing its promise while managing its risks.”
Miller said that today’s guidance is designed to address the “novel challenges” that come with Federal agencies’ acquisition of AI.
The memo calls on agencies to update their existing internal policies, procedures, and practices to reflect new considerations for acquiring AI.
OMB is requiring agencies to formalize cross-functional collaboration to manage AI performance and risks. The new policy is also requiring agency-wide strategic planning and resourcing, directing each chief AI officer (CAIO) to submit a plan ensuring coordination between the chief information officer (CIO), chief information security officer, chief financial officer, chief technology officer, and other relevant officials.
Miller described the Federal agency AI acquisition policy as requiring “a tight loop between different leaders and different functions within agencies working in concert with one another.”
Additionally, as part of cross-government information sharing, the memo calls on the CAIO Council to partner with OMB, the CIO Council, the General Services Administration, and the AI Community of Practice to collect data on AI acquisition that can be made available to all agencies – including examples and lessons learned, templates, and best practices.
The majority of the 36-page memo is dedicated to guidance surrounding managing AI risks and performance.
OMB requires that agency privacy officials and programs have early and ongoing involvement in AI acquisition processes so that they are able to identify and manage privacy risks and ensure compliance with the law.
The memo also offers guidance to agencies on constructing their contracts during AI acquisition, instructing agencies to negotiate appropriate contractual requirements and evaluation processes to ensure vendors provide sufficient information for agencies to evaluate vendor claims, identify and manage risk, conduct impact assessments, and fulfill requirements to notify impacted individuals and implement appeals.
The memo also directs contractual terms to be negotiated in a way that protects government data and intellectual property and to be defined in a manner that ensures safe use when AI is involved in decision making that impacts members of the public.
This section of the memo also includes “additional practices for generative AI,” including conducting evaluations, testing, red-teaming, and sharing those results as well as identifying the tools with the best fit each agency’s mission.
The final section of the memo – Promoting a Competitive AI Market with Innovative Acquisition – calls on Federal agencies to incorporate acquisition principles designed to minimize vendor lock-in and consider interoperability and transparency throughout the AI acquisition process.
Today’s AI acquisition guidance delivers on-time a core component of the Biden-Harris administration’s October 2023 AI executive order (EO).
As part of the EO, OMB issued in March the first-of-its-kind, finalized policy document for the use of AI within the Federal government.
That same day, OMB issued a request for information on responsible procurement of AI in the government. The White House also hosted an industry roundtable to gather additional feedback before issuing today’s final guidance. A senior administration official told reporters that they “received well over 60 comments and 434 pages of text” which ultimately “informed a lot of the work that you see here in this memo.”
Because the Federal government is the largest single buyer in the U.S. economy, OMB’s Miller emphasized, “that means our procurement decisions can have far reaching implications.”
“In 2023, the Federal government purchased more than $100 billion in IT products and services alone, and leveraging that purchasing power in the right ways can accelerate technological advancements in critical areas like AI – including advancements that ensure we can mitigate AI’s risks for government uses,” he said.
