"BPA Not a Contract" Part Two (Or maybe Part X)

[Mike_wolff]

As many of you may recall, and which was discussed here on Wifcon long ago, GAO made what some believe (as do I) that mistaken comment that a BPA established under a FSS Schedule is "not a contract."  Now we have the Coast Guard taking that same position according to this recent GAO decision: https://www.gao.gov/assets/870/861633.pdf

I used the search feature on Wifcon and didn't get any applicable results (strangely, not even the thread I shared above) re: this whole misunderstanding of the difference between a Part 8 PBA (which is an agreement established under an existing contract, so of course it's a contract) and a Part 13 BPA, which obviously is not a contract.  Has there been any case law that takes the other side of this to refute the GAO position (or maybe just the confusion of a single decision) on this issue?

(My apologies if there has been another discussion about this, again, I couldn't find anything on the search.)

Thanks!

 

[Retreadfed]

1 hour ago, Mike_wolff said:

GAO made what some believe (as do I) that mistaken comment that a BPA established under a FSS Schedule is "not a contract."

Mike, do you have any insight into what type of "contract" GAO might have had in mind when it made this statement?  For example, FAR 2.101 contains a definition of a procurement contract.  However, there are other types of contracts that are not covered by the FAR such as support contracts. 

[C Culham]

1 hour ago, Mike_wolff said:

Has there been any case law that takes the other side of this to refute the GAO position (or maybe just the confusion of a single decision) on this issue?

I could not find any but that is not to say they do not exist.   Just to keep the can of worms open  I could buy in to the proposition that GSA FSS BPA is simply the establishment of a charge account within the GSA FSS Contractors contract therefore the order becomes the contract.  

[Mike_wolff]

2 hours ago, Retreadfed said:

Mike, do you have any insight into what type of "contract" GAO might have had in mind when it made this statement?  For example, FAR 2.101 contains a definition of a procurement contract.  However, there are other types of contracts that are not covered by the FAR such as support contracts. 

It was a BPA under a FSS Schedule.  The Schedule contracts are IDIQ contracts, so the task orders under them are binding contractual actions in accordance with the terms of that IDIQ, so it makes no sense how a BPA negotiated under the terms of a contract (NOT a stand-alone Part 13 BPA) is not also a binding contract.  

I didn't want to debate this again, as I think the above thread already does that, but was hoping there was possibly some correcting court decisions that I wasn't aware of. I was a little surprised that USCG was using the argument about FSS BPAs.

[Mike_wolff]

1 hour ago, C Culham said:

I could not find any but that is not to say they do not exist.   Just to keep the can of worms open  I could buy in to the proposition that GSA FSS BPA is simply the establishment of a charge account within the GSA FSS Contractors contract therefore the order becomes the contract.  

Using that same logic though, why wouldn't the FSS Contract (or any IDIQ contract) only be a "charge account" and the contracts only be the orders?

[C Culham]

7 hours ago, Mike_wolff said:

Using that same logic though, why wouldn't the FSS Contract (or any IDIQ contract) only be a "charge account" and the contracts only be the orders?

Well I will probably be the cause for another at length discussion.

First I want to acknowledge that everything is fact dependent and therefore it probably depends.  Okay I am cheating a bit to leave myself wiggle room yet here is my thought.

FSS Contract and other IDIQ's provide for a minimum quantity (consideration).   I do not disagree, pursuant to GSA clause I-FSS-646, that it places the FSS contractor in the position to accept a BPA if an agency wants to issue one.  However I find nothing in the clause language that then requires the Agency to then use the BPA.   It would seem that there needs to be further mutual consideration to make the BPA a "contract".   Or stated another way without explicit language to the contrary and with a minimum accomplished on the  GSA FSS  could not the agency go through the effort to establish the BPA and then just turn around and do a separate  effort to award an order under the same GSA FSS contract, or for that matter an open market procurement, with the same GSA FSS contractor for the same thing that is on the BPA?  On the same line of thought must the GSA FSS contractor always honor the discounts that they offer in the BPA, which by my read is the intent to have a GSA FSS BPA, when the agency attempts to order under the BPA or could they offer further discounts or no discount at all on an order that the government attempts to place via the BPA arrangement?

Now I will quickly go back to other matters at hand and just leave my thought for everyone to ponder because as it goes GAO has spoken.   

[Weno2]

I had an attorney take the same position a few weeks ago. GSA Interact responded to the following question, "Is a Schedule BPA a "Contract?"

Here's the link: Interact (gsa.gov)

 

[formerfed]

GSA has taken this position for a long time.  So far there hasn’t been conclusive evidence or decisions proofing it’s wrong.  On the other hand, several people argue differently.  They say a BPA awarded consistent with FAR 8.405-3 (either competitively or justified sole source) is a contract and consideration conveys with the GSA contract holder providing added benefits to the government while knowing order competition is either limited to only BPA holders or themselves.  I really don’t know.

[Mike_wolff]

26 minutes ago, formerfed said:

"... and consideration conveys with the GSA contract holder providing added benefits to the government while knowing order competition is either limited to only BPA holders or themselves." 

I think the quoted excerpt above is a great argument - there is a huge difference between having a GSA Schedule and getting a BPA under that Schedule, and having the BPA is a significant benefit.  Although I guess one could argue similarly for Part 13 BPAs.  This does make me think though, if the BPA provided an additional, more than nominal, guarantee that would undisputedly make the BPA a contract, per the definition in 2.101, because it would "obligate the Government to an expenditure of appropriated funds."