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BorderC

FSS BPA Extension

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Coming back for some opinions from the community.

Let's say you have a 3-year BPA that is coming to an end and you want to extend it an additional 2 years (for whatever reason, you can't start a new contract). The Limited Sources Justification is approved. A D&F for Time and Materials was approved by the contracting officer for the original BPA (3 years). The BPA has previously issued only T&M orders that are one year in duration.

The FAR states:

FAR 8.404
(h) Type-of-order preference for services.
(1) The ordering activity shall specify the order type (i.e., firm-fixed price, time-and-materials, or labor-hour) for the services offered on the schedule priced at hourly rates.
(2) Agencies shall use fixed-price orders for the acquisition of commercial services to the maximum extent practicable.
(3)(i) A time-and-materials or labor-hour order may be used for the acquisition of commercial services only when it is not possible at the time of placing the order to estimate accurately the extent or duration of the work or to anticipate costs with any reasonable degree of confidence.
(ii) Prior to the issuance of a time-and-materials or labor-hour order, the contracting officer shall-
(A) Execute a determination and findings (D&F) for the order, in accordance with paragraph (h)(3)(iii) of this section that a fixed-price order is not suitable;
(B ) Include a ceiling price in the order that the contractor exceeds at its own risk; and
(C ) When the total performance period, including options, is more than three years, the D&F prepared in accordance with this paragraph shall be signed by the contracting officer and approved by the head of the contracting activity prior to the execution of the base period.


Focusing on (h)(ii)© here,

Question 1: Considering you are extending the BPA itself from 3 to 5 years, not the individual T&M orders (again, each are only 1 year in duration), does this even apply?

Question 2: If it does apply (or if this were a T&M order instead of a BPA), should one reasonably interpret that the requirement for HCA approval still applies even though the action does not execute the base period (merely extends it)?


My thoughts are that it doesn't apply because it is a BPA, not an order. I'm also leaning towards it not applying to the extension because it does not execute the base period. The FAR seems to be specific in precluding the execution of the base period of the T&M order greater than 3 years, but not an extension of up to three years. One could just establish a new BPA instead of extend the current BPA and it would no longer be required. However, many lawyers disagree with me on both points.

The issue is already resolved, but I'm curious what this community thinks and if there is another way I should be viewing this.

Thanks.

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Since you cited FAR 8.404, Is this a BPA under the Federal Supply Schedule program and are you with the GSA? Are you discussing extending the FSS BPA?

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It seems to me that some language in the preamble to the final rule for FAR Case 2009-043 (FAC 2005-55), while silent on BPAs, seems to support your position. It states:

6. Requirement for Determination and Findings at the Order Level

Comments: The respondents strongly recommended that the Government reconsider requiring agencies to execute a new determination and findings prior to issuing each T&M or LH order placed under the Federal Supply Schedules program. The respondent noted that Congress has not legislated such an approach. The respondent pointed out that the Federal Acquisition Streamlining Act, as amended, requires issuance of a determination and findings at the contract level, not at the order level.

Response: The Federal Acquisition and Streamlining Act does require the issuance of a determination and findings at the contract level, but note that a requirement for a determination and findings at the order level is not precluded by that statute. In situations where the basic contract allows for the issuance of individual orders using more than one contract type, the over-reliance on T&M and LH pricing has resulted in increased risk to the Government (see GAO Report 09-579, June 2009). The GAO has recommended this change to FAR subpart 8.4 explicitly to require the same safeguards for the acquisition of commercial services acquired on a T&M or LH basis as required by FAR 12.207 and FAR 16.601(d) (i.e., require a detailed determination and findings stating that no other contract type is suitable). Further, Federal Supply Schedules generally are long-term contracts, and a determination and findings generated at the initiation of a schedule contract may no longer reflect current market conditions. The intent is to ensure that this contract type is used only when no other contract type is suitable and to instill discipline in the determination of contract type with a view toward managing the risk to the Government.

If your BPA included multiple contract types, then the application seems easy enough. If, on the other hand, your BPA only included LH or T&M contract types; then if you can't support the D&F for the individual order (namely, that no other contract type is suitable), then your FSS BPA (as it currently exists) is the wrong vehicle.

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Joel - For clarification, I'm not with GSA. This is a BPA established under a GSA contract.

Jacques - Thanks for that information. I wish I had thought to research the final ruling.Here are some facts to my case that are relevant to what you posted: there was only one D&F for the BPA that had been signed by the contracting officer prior to establishing the BPA. There were no D&Fs for individual orders. So, there are issues there, but I'm not sure how much they played into the actual discussion/debate. In my case the contract type itself was never an issue. The approval of the D&F by the HCA was the point of contention.

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Thanks, Border. Got it.

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