GSA Can Reduce Procurements by Millions if More Material Returns Are Accepted From Federal Agencies

LCD-78-242: Published: Jan 5, 1979. Publicly Released: Jan 5, 1979.

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To supply federal agencies with necessities for daily operations, the General Services Administration (GSA) buys, stores, and distributes a multitude of items, ranging from paper clips to helicopters. However, agencies sometimes find that they no longer need material they have received from GSA. GSA's credit return program is supposed to provide these agencies a means of returning this material to the GSA supply system. The program is intended to reduce government cost by reducing the need for GSA to purchase identical material repeatedly.

GSA is not achieving the benefits intended from its credit return program because it rejects returns of excess material worth millions and then purchases identical material commercially. Material is accepted for return only if it is needed to meet current requirements; this policy fails to recognize the economic benefit of retaining for future use material the government has already bought. Some of the rejected material was sent to property disposal. The restrictive return criterion is inconsistent with GSA's policy for retaining material in its own depots. While management's credit return policy may allow GSA to buy and sell material, as opposed to redistributing excess material, it is detrimental to overall government efficiency and economy.

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