Contract Management: Agencies Are Not Maximizing Opportunities for Competition or Savings under Blanket Purchase Agreements despite Significant Increase in Usage
GAO-09-792
Published: Sep 09, 2009. Publicly Released: Oct 09, 2009.
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Highlights
The Federal Acquisition Regulation (FAR) allows agencies to establish blanket purchase agreements (BPA) under the General Services Administration's (GSA) Schedules Program, where contracts are awarded to multiple vendors for commercial goods and services and made available for agency use. BPAs are agreements between agencies and vendors with terms in place for future use; funds are obligated when orders are placed. When establishing BPAs under schedule contracts, agencies must follow procedures regarding the number of vendors considered, request discounts, and conduct annual reviews in accordance with requirements. This report assesses selected agencies' use of schedule BPAs and evaluates whether they considered more than one vendor when establishing BPAs and placing orders under them, took opportunities for savings, and conducted annual reviews. To conduct this work, GAO reviewed a sample of 336 schedule BPAs and 352 fiscal year 2007 orders and met with officials.
Recommendations
Recommendations for Executive Action
| Agency Affected | Recommendation | Status Sort descending |
|---|---|---|
| Office of Federal Procurement Policy | To ensure that federal agencies take greater advantage of the opportunities that competition provides under schedule BPAs, the Administrator of the Office of Federal Procurement Policy should consider including in the pending proposed FAR rule that implements the provisions of section 863 of the National Defense Authorization Act of 2009 an amendment to FAR 8.4 specifying that the requirement to place on a competitive basis any order above the simplified acquisition threshold (generally $100,000) under multiple award contracts also applies to orders under single and multiple award BPAs. |
Closed – Implemented
The Office of Federal Procurement Policy issued a rule implementing changes to the Federal Acquisition Regulation that requires agencies to provide an opportunity for multiple-award schedule Blanket Purchase Agreements (BPA) holders to compete for the award of orders above the simplified acquisition threshold.
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| Office of Federal Procurement Policy | To ensure that federal agencies take greater advantage of the opportunities that competition provides under schedule BPAs, the Administrator of the Office of Federal Procurement Policy should take steps to amend the FAR to clarify when establishing a schedule BPA using the limited source justifications of the FAR, including when to only one vendor, is or is not appropriate. |
Closed – Implemented
The Office of Federal Procurement Policy issued a rule implementing changes to the Federal Acquisition Regulation that clarifies the specific circumstances in which the establishment of a schedule--Blanket Purchase Agreements (BPA)--using the limited sources justifications of Federal Acquisition Subpart 8.405-6 is appropriate.
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| Office of Federal Procurement Policy | To improve compliance with the FAR requirement to conduct annual reviews of schedule BPAs, increasing opportunities for additional savings and avoiding violations of competition rules, the Administrator of the Office of Federal Procurement Policy should take steps to require federal agencies to put procedures in place to ensure that annual reviews are conducted. |
Closed – Implemented
In December 2009, the Office of Federal Procurement Policy issued a memorandum to the chief acquisition officers and senior procurement executives of federal agencies that included steps for agencies to take to better maximize the potential for savings under blanket purchase agreements. Specifically, the memo directs agencies to review blanket purchase agreements at least annually, in accordance with requirements in the Federal Acquisition Regulation and to not place orders under a blanket purchase agreement after the annual anniversary of its establishment until the agency conducts and documents its annual review.
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| General Services Administration | To assist federal agencies in requesting and obtaining discounts when establishing schedule BPAs, the GSA Administrator should include in the guidance on GSA's Web site specific language which agencies can use in their requests for quotation to clearly request discounted pricing when establishing schedule BPAs. |
Closed – Implemented
In providing comments on this report, the agency concurred with this recommendation and has since revised its website to include guidance agencies can use when requesting discounted pricing on BPAs.
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Topics
Commercial productsCompetitionCompetitive procurementContracting officersExecutive agenciesFederal agenciesFederal procurementFederal procurement policyFederal regulationsMultiple award procurementPrices and pricingProcurement regulationsRequirements definitionBlanket purchase agreementsDiscountsPolicies and procedures