Difference between revisions of "Blanket Purchase Agreement"

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A Blanket Purchase Agreement (BPA) is a simplified method of filling anticipated repetitive needs for supplies or services. A BPA establishes a "contract vehicle" whereby a Contracting Officer can routinely purchase supplies or services in a streamlined fashion.  However, the BPA by itself is not a contract (See Legal Cases below).   
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==Simplified Acquisitions - Blanket Purchase Agreement==
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A Blanket Purchase Agreement (BPA) is a simplified method of filling anticipated repetitive needs for open market supplies or services below the [[Simplified Acquisition Threshold]] (SAT) http://www.govcwiki.org/index.php?title=Simplified_Acquisition_Threshold
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Open market means items not available from required sources of supply, such as GSA schedule contracts, outlined in FAR Part 8.002.
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BPAs can be single award or multiple award. Multiple award are preferred.
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A BPA establishes a "contract vehicle" whereby a Contracting Officer or Prime contractor can routinely purchase supplies or services in a streamlined fashion.  However, the BPA by itself is not a contract (See Legal Cases below).   
  
  
 
Once the BPA is established, “calls” or "Purchase Orders" are placed to order items off the BPAs.
 
Once the BPA is established, “calls” or "Purchase Orders" are placed to order items off the BPAs.
  
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Procedures to establish and place orders against BPAs are described at FAR 13.303 and DFARS 213.303 – Blanket Purchase Agreements (BPAs).
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==Common Applications==
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:*All types of supplies and services, to include construction
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:*Software licenses
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:*IT software and products
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:*Research and development
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:*Engineering services
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:*Special studies
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==Pros/Cons==
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{| class="wikitable"
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|-
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! Pros !! Cons
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|-
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| Opportunity to combine repetitive purchase orders under a BPA reduces procurement lead time and administrative costs || Simplified acquisition threshold order limitation reduces flexibility to acquire large scale orders
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|-
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| Ability to establish agreements with multiple vendors maintains competition and reduces cost, schedule, and performance risk associated with a single vendor source ||
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|-
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| Streamlined BPA ordering procedures reduces procurement lead time ||
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|-
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| Ability to establish unique terms and conditions, to include contract types, increases flexibility in acquiring services and products ||
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|-
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| Increases flexibility to plan for anticipated purchases without immediate funding, no required minimum guarantee, or maximum ceiling ||
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|-
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| Offers no limitations on types of products or services increasing flexibility to meet unique agency needs ||
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|}
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==Difference Between a Basic Ordering Agreement and a Blanket Purchase Agreement==
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The main difference between a BOA and a Blanket Purchase Agreement (BPA) is that BPA establishes “charge accounts” with qualified contractors with a predetermined price list. A BOA on the other hand describes the method for determining prices to be paid to the contractor for the supplies or services
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==Federal Acquisition Regulation (FAR) 13.303 Blanket Purchase Agreements (BPAs)==
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===13.303-2 Establishment of BPAs.===
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(a) The following are circumstances under which contracting officers may establish BPAs:
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:(1) There is a wide variety of items in a broad class of supplies or services that are generally purchased, but the exact items, quantities, and delivery requirements are not known in advance and may vary considerably.
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:(2) There is a need to provide commercial sources of supply for one or more offices or projects in a given area that do not have or need authority to purchase otherwise.
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:'''(3) The use of this procedure would avoid the writing of numerous purchase orders.'''
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:(4) There is no existing requirements contract for the same supply or service that the contracting activity is required to use.
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(b) After determining a BPA would be advantageous, contracting officers shall-
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:(1) Establish the parameters to limit purchases to individual items or commodity groups or classes, or permit the supplier to furnish unlimited supplies or services; and
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:'''(2) Consider suppliers whose past performance has shown them to be dependable, who offer quality supplies or services at consistently lower prices, and who have provided numerous purchases at or below the simplified acquisition threshold.'''
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(c) BPAs may be established with-
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:(1) More than one supplier for supplies or services of the same type to provide maximum practicable competition;
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:'''(2) A single firm from which numerous individual purchases at or below the simplified acquisition threshold will likely be made in a given period;''' or
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:(3) Federal Supply Schedule contractors, if not inconsistent with the terms of the applicable schedule contract.
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(d) BPAs should be prepared without a purchase requisition and only after contacting suppliers to make the necessary arrangements for-
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:(1) Securing maximum discounts;
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:(2) Documenting individual purchase transactions;
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:(3) Periodic billings; and
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:(4) Incorporating other necessary details.
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===13.303-3 Preparation of BPAs.===
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Prepare BPAs on the forms specified in 13.307. Do not cite accounting and appropriation data (see 13.303-5(e)(4))<ref>For Government "Prime" Contracts Only</ref>.
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(a) The following terms and conditions are mandatory:
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:(1) '''Description of agreement'''. A statement that the supplier shall furnish supplies or services, described in general terms, if and when requested by the contracting officer (or the authorized representative of the contracting officer) during a specified period and within a stipulated aggregate amount, if any.
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:(2) '''Extent of obligation'''. A statement that the Government is obligated only to the extent of authorized purchases actually made under the BPA.
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:(3) '''Purchase limitation'''. A statement that specifies the dollar limitation for each individual purchase under the BPA (see 13.303-5(b)).
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:(4) '''Individuals authorized to purchase under the BPA'''. A statement that a list of individuals authorized to purchase under the BPA, identified either by title of position or by name of individual, organizational component, and the dollar limitation per purchase for each position title or individual shall be furnished to the supplier by the contracting officer.
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:(5) '''Delivery tickets'''. A requirement that all shipments under the agreement, except those for newspapers, magazines, or other periodicals, shall be accompanied by delivery tickets or sales slips that shall contain the following minimum information:
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(i) Name of supplier.
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(ii) BPA number.
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(iii) Date of purchase.
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(iv) Purchase number.
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(v) Itemized list of supplies or services furnished.
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(vi) Quantity, unit price, and extension of each item, less applicable discounts (unit prices and extensions need not be shown when incompatible with the use of automated systems, provided that the invoice is itemized to show this information).
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(vii) Date of delivery or shipment.
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:(6) '''Invoices'''. One of the following statements shall be included (except that the statement in paragraph (a)(6)(iii) of this subsection should not be used if the accumulation of the individual invoices by the Government materially increases the administrative costs of this purchase method):
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For more details see FAR 13.303-3(a)(6)
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===13.303-4 Clauses===
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Nothing special here.
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==13.303-5 Purchases under BPAs==
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Please see FAR for more details.
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(d) If, for a particular purchase greater than the micro-purchase threshold, there is an insufficient number of BPAs to ensure maximum practicable competition, the contracting officer shall-
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(1) Solicit quotations from other sources (see 13.105) and make the purchase as appropriate; and
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--Administrative--
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(1)
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(2)
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(3)
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(4) Cite the pertinent purchase requisitions and the accounting and appropriation data.
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(5) When delivery is made or the services are performed, the supplier’s sales document, delivery document, or invoice may (if it reflects the essential elements) be used for the purpose of recording receipt and acceptance of the supplies or services. However, if the purchase is assigned to another activity for administration, the authorized Government representative shall document receipt and acceptance of supplies or services by signing and dating the agency specified form after verification and after notation of any exceptions.
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==13.303-6 Review procedures==
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More for Government Contracting Officers
  
 
==Legal Cases==
 
==Legal Cases==
  
 
In Crewzers Fire Crew Transport, Inc. v. U.S. (Feb. 6, 2014), the Federal Circuit reaffirmed that a blanket purchase agreement is not typically a binding contract on which the contractor can sue. The "mutuality of obligation" was negated in both directions, with the BPA expressly saying the agency was not obligated to make an award under the BPA and that the contractor was not obligated to accept any order proffered by the agency.
 
In Crewzers Fire Crew Transport, Inc. v. U.S. (Feb. 6, 2014), the Federal Circuit reaffirmed that a blanket purchase agreement is not typically a binding contract on which the contractor can sue. The "mutuality of obligation" was negated in both directions, with the BPA expressly saying the agency was not obligated to make an award under the BPA and that the contractor was not obligated to accept any order proffered by the agency.
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==Links==
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https://aaf.dau.edu/aaf/contracting-cone/simplified-acquisition-far-part-13/bpa/#:~:text=A%20Blanket%20Purchase%20Agreement%20(BPA,simplified%20acquisition%20threshold%20(SAT).
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==References==
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<References/>
  
 
[[Category: Definitions]]
 
[[Category: Definitions]]
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[[Category: Contracts and Contract Administration]]

Latest revision as of 15:04, 3 May 2023

Contents

Simplified Acquisitions - Blanket Purchase Agreement

A Blanket Purchase Agreement (BPA) is a simplified method of filling anticipated repetitive needs for open market supplies or services below the Simplified Acquisition Threshold (SAT) http://www.govcwiki.org/index.php?title=Simplified_Acquisition_Threshold

Open market means items not available from required sources of supply, such as GSA schedule contracts, outlined in FAR Part 8.002.

BPAs can be single award or multiple award. Multiple award are preferred.


A BPA establishes a "contract vehicle" whereby a Contracting Officer or Prime contractor can routinely purchase supplies or services in a streamlined fashion. However, the BPA by itself is not a contract (See Legal Cases below).


Once the BPA is established, “calls” or "Purchase Orders" are placed to order items off the BPAs.


Procedures to establish and place orders against BPAs are described at FAR 13.303 and DFARS 213.303 – Blanket Purchase Agreements (BPAs).

Common Applications

  • All types of supplies and services, to include construction
  • Software licenses
  • IT software and products
  • Research and development
  • Engineering services
  • Special studies

Pros/Cons

Pros Cons
Opportunity to combine repetitive purchase orders under a BPA reduces procurement lead time and administrative costs Simplified acquisition threshold order limitation reduces flexibility to acquire large scale orders
Ability to establish agreements with multiple vendors maintains competition and reduces cost, schedule, and performance risk associated with a single vendor source
Streamlined BPA ordering procedures reduces procurement lead time
Ability to establish unique terms and conditions, to include contract types, increases flexibility in acquiring services and products
Increases flexibility to plan for anticipated purchases without immediate funding, no required minimum guarantee, or maximum ceiling
Offers no limitations on types of products or services increasing flexibility to meet unique agency needs

Difference Between a Basic Ordering Agreement and a Blanket Purchase Agreement

The main difference between a BOA and a Blanket Purchase Agreement (BPA) is that BPA establishes “charge accounts” with qualified contractors with a predetermined price list. A BOA on the other hand describes the method for determining prices to be paid to the contractor for the supplies or services


Federal Acquisition Regulation (FAR) 13.303 Blanket Purchase Agreements (BPAs)

13.303-2 Establishment of BPAs.

(a) The following are circumstances under which contracting officers may establish BPAs:

(1) There is a wide variety of items in a broad class of supplies or services that are generally purchased, but the exact items, quantities, and delivery requirements are not known in advance and may vary considerably.
(2) There is a need to provide commercial sources of supply for one or more offices or projects in a given area that do not have or need authority to purchase otherwise.
(3) The use of this procedure would avoid the writing of numerous purchase orders.
(4) There is no existing requirements contract for the same supply or service that the contracting activity is required to use.


(b) After determining a BPA would be advantageous, contracting officers shall-

(1) Establish the parameters to limit purchases to individual items or commodity groups or classes, or permit the supplier to furnish unlimited supplies or services; and
(2) Consider suppliers whose past performance has shown them to be dependable, who offer quality supplies or services at consistently lower prices, and who have provided numerous purchases at or below the simplified acquisition threshold.

(c) BPAs may be established with-

(1) More than one supplier for supplies or services of the same type to provide maximum practicable competition;
(2) A single firm from which numerous individual purchases at or below the simplified acquisition threshold will likely be made in a given period; or
(3) Federal Supply Schedule contractors, if not inconsistent with the terms of the applicable schedule contract.

(d) BPAs should be prepared without a purchase requisition and only after contacting suppliers to make the necessary arrangements for-

(1) Securing maximum discounts;
(2) Documenting individual purchase transactions;
(3) Periodic billings; and
(4) Incorporating other necessary details.

13.303-3 Preparation of BPAs.

Prepare BPAs on the forms specified in 13.307. Do not cite accounting and appropriation data (see 13.303-5(e)(4))[1].

(a) The following terms and conditions are mandatory:

(1) Description of agreement. A statement that the supplier shall furnish supplies or services, described in general terms, if and when requested by the contracting officer (or the authorized representative of the contracting officer) during a specified period and within a stipulated aggregate amount, if any.
(2) Extent of obligation. A statement that the Government is obligated only to the extent of authorized purchases actually made under the BPA.
(3) Purchase limitation. A statement that specifies the dollar limitation for each individual purchase under the BPA (see 13.303-5(b)).
(4) Individuals authorized to purchase under the BPA. A statement that a list of individuals authorized to purchase under the BPA, identified either by title of position or by name of individual, organizational component, and the dollar limitation per purchase for each position title or individual shall be furnished to the supplier by the contracting officer.
(5) Delivery tickets. A requirement that all shipments under the agreement, except those for newspapers, magazines, or other periodicals, shall be accompanied by delivery tickets or sales slips that shall contain the following minimum information:

(i) Name of supplier. (ii) BPA number. (iii) Date of purchase. (iv) Purchase number. (v) Itemized list of supplies or services furnished. (vi) Quantity, unit price, and extension of each item, less applicable discounts (unit prices and extensions need not be shown when incompatible with the use of automated systems, provided that the invoice is itemized to show this information). (vii) Date of delivery or shipment.

(6) Invoices. One of the following statements shall be included (except that the statement in paragraph (a)(6)(iii) of this subsection should not be used if the accumulation of the individual invoices by the Government materially increases the administrative costs of this purchase method):

For more details see FAR 13.303-3(a)(6)

13.303-4 Clauses

Nothing special here.

13.303-5 Purchases under BPAs

Please see FAR for more details.


(d) If, for a particular purchase greater than the micro-purchase threshold, there is an insufficient number of BPAs to ensure maximum practicable competition, the contracting officer shall-

(1) Solicit quotations from other sources (see 13.105) and make the purchase as appropriate; and


--Administrative-- (1) (2) (3) (4) Cite the pertinent purchase requisitions and the accounting and appropriation data.

(5) When delivery is made or the services are performed, the supplier’s sales document, delivery document, or invoice may (if it reflects the essential elements) be used for the purpose of recording receipt and acceptance of the supplies or services. However, if the purchase is assigned to another activity for administration, the authorized Government representative shall document receipt and acceptance of supplies or services by signing and dating the agency specified form after verification and after notation of any exceptions.

13.303-6 Review procedures

More for Government Contracting Officers

Legal Cases

In Crewzers Fire Crew Transport, Inc. v. U.S. (Feb. 6, 2014), the Federal Circuit reaffirmed that a blanket purchase agreement is not typically a binding contract on which the contractor can sue. The "mutuality of obligation" was negated in both directions, with the BPA expressly saying the agency was not obligated to make an award under the BPA and that the contractor was not obligated to accept any order proffered by the agency.

Links

https://aaf.dau.edu/aaf/contracting-cone/simplified-acquisition-far-part-13/bpa/#:~:text=A%20Blanket%20Purchase%20Agreement%20(BPA,simplified%20acquisition%20threshold%20(SAT).

References

  1. ↑ For Government "Prime" Contracts Only
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