Oh Say Can You See? Focus on the Micro-Purchase Threshold

During a recent industry day, GSA reiterated that the Portals Program will focus on transactions under the Micro-Purchase Threshold. The current draft of the 2019 National Defense Authorization Act grants a GSA request to increase the Micro-Purchase threshold for purchases through approved portals to $25,000. If included  in the final draft, this will make the Portals Program the preferred vehicle for any micro-purchases. The GSA Schedules Program will remain the preferred contracting vehicle for all other commercial item procurements. GSA said this would simplify the acquisition process and address federal buying requirements (such as considering AbilityOne and designated small business contractors for procurement).

On the other hand, not all industry partners are so enthusiastic. Will this create two completely separate market places for the same services and products, at two different price barriers? Some contractors are nervous that the Portal initiative might create a different compliance structure from Multiple Award Contracts,  potentially leaving businesses with difficult decisions. The concern is that the move will create parallel systems of compliance and companies will have to weigh the cost of navigating both.

Roger Waldron, president of Coalition for Government Procurement, has an example. “If there are compliance requirements in one channel and they don’t exist in another channel, do (businesses) stay in the channel where they have compliance requirements and increase costs and lower margins? They are going to be making those kinds of business decisions ultimately.”

In response, GSA officials said they are still weighing how to design the policies for the portals and would be testing the new micropurchase threshold in a proof of concept pilot sometime next year. Jeffrey Koses of the Office of Governmentwide Policy said GSA is “still trying to determine if this is more of an [indefinite delivery/indefinite quantity] type of relationship or is this something else. It’s a fair question. I don’t know if we have all of the answers at this point.”

GSA released two RFIs about the regulations needed- one for suppliers that sell on commercial e-commerce platforms and one for commercial providers. Leave your thoughts there, or in our comments.

Ride the On-Ramp to OASIS

GSA to add On-Ramps to OASIS unrestricted pools

On May 9, GSA announced plans to add vendors to two underused OASIS pools: pool two for financial services, and pool six for aircraft R&D.

OASIS, a set of 10-year government wide multiple-award-contracts, totals $60 billion for knowledge-based services such as management and consulting services. GSA plans to make 15 contract awards for pool two, and two contract awards for pool six. A final RFP should be released by May 31, after which vendors will have 30 days to submit proposals.

Since fiscal year 2015, most contract holders on most pools haven’t won many orders. GSA is currently focusing on the pools with the lowest spending levels. Contractors considering a bid should assess themselves against the self-scoring evaluation in the original solicitation. There are currently no minimum scores for the pools on the table.

 

Final Rule released for Common Commercial Terms

GSA Final Rule Defines Common Commercial Terms

On February 22, GSA issued a Final Rule addressing common terms that are inconsistent with Federal Law. The rule aims to streamline agreements over CSAs, EULAs, Terms of Sale, and similar sets of terms and conditions. The rule reverses several controversial provisions from an earlier Proposed Rule and class deviation by reverting the order of precedence and eliminating the requirement to provide full text of all provisions.

The rule also formalizes the longstanding stance that certain terms and conditions cannot be enforced by law via a paragraph addition to GSAR 552.212-4. The paragraph identifies 15 common commercial terms, which are viewed as non-negotiable and required by federal law. It prohibits automatic  renewals, and provides that disputes are governed by federal law. The change allows GSA to ignore these clauses during negotiations, thereby reducing time and expenses. Among the included terms are:

  • commercial supplier agreements
  • unenforceability of unauthorized obligations
  • solicitation provisions and contract clauses for the acquisition of commercial items

GSA responded well to industry complaints about the proposed rule, modifying or reversing the most egregious propositions.

For more information see the National Law Review.

Hard Shutdown

Shutdown? Shut up!

Since Saturday, the United States government has been closed, shut down, unplugged (etc.), including the General Services Administration (GSA) and FAS. Right now, GSA is deferring to 4220.1K ADM, the Order which dictates “Operations in the Absence of Appropriations.”

What does this mean for our clients? Unfortunately, if you currently hold a GSA Schedule, you will not see any work done on your contract modifications and will not receive any government payments. Work for government agencies under the GSA Schedule must be halted during this time unless it is of mission critical importance (you will have been notified if this is you). Companies with proposals into GSA will be in a holding pattern for now, whether they are recently submitted and being triaged to the correct Contracting Officer, under administrative review, in negotiations, or awaiting final award.

“GSA’s role as an aggregator of large numbers of government assets and a supplier of critical tools, equipment, and supplies to other Federal agencies requires that GSA retain adequate staffing under a lapse in appropriations in order to protect Federal property under GSA’s custody and control and to continue to provide critical support to other Federal agencies’ exempt and excepted activities necessary for the protection of life and Federal property.”

In other words, GSA is mostly shut down. Buildings remain open for maintenance, power, and cleaning in a reduced capacity. Small crews are also being kept around to ensure protection of GSA assets and property, and to support other essential Federal agencies. GSA is held more responsible than other agencies to maintain their regular tasks. Think of it as a GSA skeleton crew. When the shutdown is over, GSA will update plans, decide what to do about missed events, and catch up with all the work piling up right now.

We are hopeful this shutdown ends soon. Stay vigilant, folks!

Heard it Through the GSA Grapevine…

A plausible source at GSA has told EZGSA proposal specialists that the minimum yearly sales requirement for GSA Schedules is going to be increasing soon.

While this won’t be a problem for contractors that already more than meet the current sales requirement of $25,000 in the first two years and $25,000 per year subsequently, it could make it even more difficult for those businesses that struggle with selling off their Schedule.

If you need help or have questions about this increase, please contact your EZGSA proposal specialist or call 301-913-5000.