BPAs, Part Three: BPAs and the Law

Once again, Blanket Purchase Agreements (BPAs) are simplified contract vehicles allowing agencies to fill repetitive orders for commercial, off-the-shelf goods and services. BPAs have become a very popular procurement vehicle, especially GSA BPAs, which are BPAs placed under a vendor's GSA Schedule Contract. This is because there is no limit on the dollar value of individual task or delivery orders or requirement to publicize orders placed under a GSA Schedule BPA.

So what is the law governing BPAs? What regulations govern an agency awarding a BPA or multiple BPAs? What regulations apply to an agency placing an order under a GSA Schedule BPA?

Establishing BPAs. Federal Acquisition Regulation (FAR) ¤

13.303-1 says that an agency may establish a BPA with a single company for repetitive orders, or with multiple companies to provide maximum practicable competition, or with GSA Schedule contractors. However, FAR Part 13 doesn't state exactly how an agency should go about selecting BPA contractors. It's simply a matter of identifying vendors and negotiating with them.

When it comes to awarding a GSA Schedule BPA, however, the FAR at Part 8.405-3 was recently revised to require that any agency must follow FAR 8.405-1 (Ordering Procedures for Supplies, and Services Not Requiring a Statement of Work) or 8.405-2 (Ordering Procedures for Services Requiring a Statement of Work) before awarding a GSA Schedule BPA. The regulations essentially require an agency to review the pricelists of three or more GSA Schedule contractors before making a best value selection.

The Government Accountability Office's decisions on the establishment of BPAs are unclear. For plain vanilla BPAs awarded under FAR Part 13, Simplified Acquisition Procedures, the GAO has stated that agencies aren't required to request proposals or conduct a competition when establishing a single BPA or multiple BPAs. Information Systems Technology Corp., B-280013, Aug. 6, 1998, 98-2 CPD ¦ 36.

That rule, however, would appear to apply only to plain vanilla BPAs awarded under FAR Part 13, Simplified Acquisition Procedures, and wouldn't apply to GSA Schedule BPAs awarded under FAR 8.404. The Information Systems Technology case, however, clearly involved GSA Schedule BPAs, making the GAO's holding inconsistent.

The GAO is clear that if an agency conducts a competition, then the agency must treat all contractors fairly and equally. In the Information Systems Technology case, a contractor complained that the agency had incorrectly evaluated the technical merit of its offer submitted in response to the agency's notice that it wanted to establish multiple BPAs. The GAO reviewed the agency's technical evaluation to confirm that it rationally supported the agency's finding that the protester's offer was technically inferior.

The Information Systems Technology case also shows that an agency can award BPAs based on the technical merit of contractors, even if higher priced than other vendors. At the opposite end of the best value spectrum, the GAO has also sustained an agency action that awarded BPAs on the basis of best price where the agency found the offerors' products essentially equivalent. Pfizer, Inc., B-276362, June 6, 1997, 97-1 CPD ¦ 205.

Awarding Orders Under BPAs. FAR ¤ 13.303-5(d) states that if there are an insufficient number of BPAs to insure maximum practicable competition for BPA orders over the $2,500 micropurchase threshold, then the agency should either solicit from other sources or seek to establish additional BPAs.

GSA's previous approach with respect to GSA BPAs was to allow the placement of orders under GSA BPAs without further competition, documentation, or justification. That has all changed. The FAR now specifically sets forth detailed requirements for placing orders under BPAs as follows:

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