Revisited: Unintended Consequences of the FAR 8.4 Rewrite

This week’s topic is the “Unintended Consequences of the FAR 8.4 Rewrite.” Simply put, the rewrite removed a strategic acquisition tool, single award Blanket Purchase Agreements (BPAs), from customer agency procurement tool boxes when using the GSA schedule program. Here is more on the background, result and unintended consequences of the rule.

In 2011 Federal Acquisition Regulation (FAR) subpart 8.4 was rewritten to implement Section 863 of the Duncan Hunter National Defense Authorization Act for Fiscal Year 2009 (Section 863). As you recall, Section 863 mandated new competitive ordering procedures for the GSA schedule program. Specifically, for orders exceeding the simplified acquisition threshold ($150,000), Section 863 requires agencies to provide notice and an opportunity to compete to all schedule contractors capable of meeting the requirements. If notice is not provided to all, then the ordering agency must provide notice and an opportunity to compete to as many schedule contractors as practicable to reasonably ensure receipt of at least three quotes. Ordering activities must also document their files as to the efforts to achieve competition for an order where notice was not provided to all.

Not only did the 2011 rewrite address task order competitions, it also addressed the documentation, planning and competition requirements for BPAs established under the GSA schedule program. In an effort to promote competition the new rule created significant procedural barriers to the establishment of single award BPAs. FAR 8.405-3 establishes a strong policy, procedural and documentary preference for multiple award BPAs in lieu of single award BPAs. As a result, competitively established single award BPAs containing clear, consistent and firm commitments have been largely taken out of the schedule landscape.

The current procedures for establishing BPAs are counterproductive. They increase complexity, costs and acquisition lead time for agencies seeking to establish single award BPAs for specific requirements. As a result, agencies look for alternative acquisition strategies that often lead to contract duplication (a problem that, to date has not been effectively addressed). Indeed, when a major ordering activity cites the administrative and procedural difficulties in establishing a single award BPA as a prime consideration for creating a duplicative contract for items already on the GSA schedule—something is amiss. We predicted this would happen.

As the Coalition noted in its comments on the rule back in 2011, the ordering procedures should provide parity for single award and multiple BPAs. It makes sound business and procurement sense to allow flexibility in acquisition strategies (use of schedule BPAs) to meet agency mission requirements. Competitively established single award BPAs allow agencies to leverage known, firm requirements increasing value and return when using the GSA schedule program.

GSA schedule single award BPAs for agency specific requirements should be returned to the procurement toolbox—it is the strategic thing to do for the American people.

Roger Waldron

President