Federal Contract Law: Much ado about GSA’s federal supply schedules

The world of GSA Schedule contracting is rocking along, with a major new regulation and several proposals in the wings. The new regulation adopts rules for “co-operative” purchasing use of IT schedules by state and local governments.

The world of GSA Schedule contracting is rocking along, with a major new regulation and several proposals in the wings. The new regulation adopts rules for “co-operative” purchasing use of IT schedules by state and local governments. This program was an initiative of Rep. Tom Davis (R-Va.), passed as part of the E-Government Act. In the rules:The success of cooperative purchasing now depends upon states changing their buying laws and procedures to enable, or prefer, this program.In addition, GSA is moving to implement the reduction of the Industrial Funding Fee from 1 percent to 0.75 percent. It has a draft contract clause dealing with sales reporting and the payment of IFF. Under the new proposal:What GSA left out of the clause was the requirement to adjust contract prices up or down to account for the new IFF rate. But GSA’s explanation of the rules makes clear that this is what it intends to do. GSA will hold off the price reduction for one full quarter, though, to help contractors recoup their administrative costs.GSA also proposes some changes to the basic rules in the Federal Acquisition Regulation for schedule buys. Among the changes:

  • GSA dropped a controversial provision that would have made all dealer sales subject to the price reduction clause.
  • State and local governments can add their own terms and conditions to orders if required by state law and if the provisions don’t conflict with the schedule contract.

  • The state’s prompt payments rule applies to state orders. If the state doesn’t have such a rule, the federal one governs.

  • The program is voluntary. Contractors do not have to participate and, of course, neither do the states.




  • GSA can change the IFF rate, unilaterally, once a year

  • IFF must be included in prices

  • All sales of contract items to authorized users are subject to IFF unless the contractor can show that the buy took place under some other authority. This places the burden of proof on the contractor.




  • Continuing a trend toward tougher language, the new rules would be more clearly mandatory. The word “shall” appears before several obligations, such as the requirements to seek three offers from schedule contractors.

  • But the new rules also include documentation requirements for sole-source and restricted competition orders, implying that these are also possible.

  • For agencies with blanket purchasing agreements, the rules imply that ordering can be limited to schedule contractors holding a BPA.

  • Although the rules on small business set-asides don’t apply to schedule buys, agencies should give a “preference” to small-business schedule vendors, whatever that means.

  • For the first time, there are special rules for ordering services priced using hourly rates, such as:
    • 1) Statements of work are required.

    • 2) Above the micropurchase level, the statement must go to three schedule vendors for possible quote.

    • 3) Over the maximum order amount (usually $500,000), “additional” vendors—more than three—are necessary.

    • 4) Performance-based contracts are preferred, but when used, the agency needs to do a quality assurance surveillance plan.

    Schedule vendors are already busy, and they will be even busier implementing all these changes.

    Joseph J. Petrillo is a lawyer with the Washington law firm of Petrillo & Powell. E-mail him at jp@petrillopowell.com
  • X
    This website uses cookies to enhance user experience and to analyze performance and traffic on our website. We also share information about your use of our site with our social media, advertising and analytics partners. Learn More / Do Not Sell My Personal Information
    Accept Cookies
    X
    Cookie Preferences Cookie List

    Do Not Sell My Personal Information

    When you visit our website, we store cookies on your browser to collect information. The information collected might relate to you, your preferences or your device, and is mostly used to make the site work as you expect it to and to provide a more personalized web experience. However, you can choose not to allow certain types of cookies, which may impact your experience of the site and the services we are able to offer. Click on the different category headings to find out more and change our default settings according to your preference. You cannot opt-out of our First Party Strictly Necessary Cookies as they are deployed in order to ensure the proper functioning of our website (such as prompting the cookie banner and remembering your settings, to log into your account, to redirect you when you log out, etc.). For more information about the First and Third Party Cookies used please follow this link.

    Allow All Cookies

    Manage Consent Preferences

    Strictly Necessary Cookies - Always Active

    We do not allow you to opt-out of our certain cookies, as they are necessary to ensure the proper functioning of our website (such as prompting our cookie banner and remembering your privacy choices) and/or to monitor site performance. These cookies are not used in a way that constitutes a “sale” of your data under the CCPA. You can set your browser to block or alert you about these cookies, but some parts of the site will not work as intended if you do so. You can usually find these settings in the Options or Preferences menu of your browser. Visit www.allaboutcookies.org to learn more.

    Sale of Personal Data, Targeting & Social Media Cookies

    Under the California Consumer Privacy Act, you have the right to opt-out of the sale of your personal information to third parties. These cookies collect information for analytics and to personalize your experience with targeted ads. You may exercise your right to opt out of the sale of personal information by using this toggle switch. If you opt out we will not be able to offer you personalised ads and will not hand over your personal information to any third parties. Additionally, you may contact our legal department for further clarification about your rights as a California consumer by using this Exercise My Rights link

    If you have enabled privacy controls on your browser (such as a plugin), we have to take that as a valid request to opt-out. Therefore we would not be able to track your activity through the web. This may affect our ability to personalize ads according to your preferences.

    Targeting cookies may be set through our site by our advertising partners. They may be used by those companies to build a profile of your interests and show you relevant adverts on other sites. They do not store directly personal information, but are based on uniquely identifying your browser and internet device. If you do not allow these cookies, you will experience less targeted advertising.

    Social media cookies are set by a range of social media services that we have added to the site to enable you to share our content with your friends and networks. They are capable of tracking your browser across other sites and building up a profile of your interests. This may impact the content and messages you see on other websites you visit. If you do not allow these cookies you may not be able to use or see these sharing tools.

    If you want to opt out of all of our lead reports and lists, please submit a privacy request at our Do Not Sell page.

    Save Settings
    Cookie Preferences Cookie List

    Cookie List

    A cookie is a small piece of data (text file) that a website – when visited by a user – asks your browser to store on your device in order to remember information about you, such as your language preference or login information. Those cookies are set by us and called first-party cookies. We also use third-party cookies – which are cookies from a domain different than the domain of the website you are visiting – for our advertising and marketing efforts. More specifically, we use cookies and other tracking technologies for the following purposes:

    Strictly Necessary Cookies

    We do not allow you to opt-out of our certain cookies, as they are necessary to ensure the proper functioning of our website (such as prompting our cookie banner and remembering your privacy choices) and/or to monitor site performance. These cookies are not used in a way that constitutes a “sale” of your data under the CCPA. You can set your browser to block or alert you about these cookies, but some parts of the site will not work as intended if you do so. You can usually find these settings in the Options or Preferences menu of your browser. Visit www.allaboutcookies.org to learn more.

    Functional Cookies

    We do not allow you to opt-out of our certain cookies, as they are necessary to ensure the proper functioning of our website (such as prompting our cookie banner and remembering your privacy choices) and/or to monitor site performance. These cookies are not used in a way that constitutes a “sale” of your data under the CCPA. You can set your browser to block or alert you about these cookies, but some parts of the site will not work as intended if you do so. You can usually find these settings in the Options or Preferences menu of your browser. Visit www.allaboutcookies.org to learn more.

    Performance Cookies

    We do not allow you to opt-out of our certain cookies, as they are necessary to ensure the proper functioning of our website (such as prompting our cookie banner and remembering your privacy choices) and/or to monitor site performance. These cookies are not used in a way that constitutes a “sale” of your data under the CCPA. You can set your browser to block or alert you about these cookies, but some parts of the site will not work as intended if you do so. You can usually find these settings in the Options or Preferences menu of your browser. Visit www.allaboutcookies.org to learn more.

    Sale of Personal Data

    We also use cookies to personalize your experience on our websites, including by determining the most relevant content and advertisements to show you, and to monitor site traffic and performance, so that we may improve our websites and your experience. You may opt out of our use of such cookies (and the associated “sale” of your Personal Information) by using this toggle switch. You will still see some advertising, regardless of your selection. Because we do not track you across different devices, browsers and GEMG properties, your selection will take effect only on this browser, this device and this website.

    Social Media Cookies

    We also use cookies to personalize your experience on our websites, including by determining the most relevant content and advertisements to show you, and to monitor site traffic and performance, so that we may improve our websites and your experience. You may opt out of our use of such cookies (and the associated “sale” of your Personal Information) by using this toggle switch. You will still see some advertising, regardless of your selection. Because we do not track you across different devices, browsers and GEMG properties, your selection will take effect only on this browser, this device and this website.

    Targeting Cookies

    We also use cookies to personalize your experience on our websites, including by determining the most relevant content and advertisements to show you, and to monitor site traffic and performance, so that we may improve our websites and your experience. You may opt out of our use of such cookies (and the associated “sale” of your Personal Information) by using this toggle switch. You will still see some advertising, regardless of your selection. Because we do not track you across different devices, browsers and GEMG properties, your selection will take effect only on this browser, this device and this website.