micropurchase | The Contracting Education Academy

July 26, 2018 By AMK

The rise of the microconsultants

One of the first — and even more than two decades later, still one of the most important — changes during the procurement reform era of the 1990s was the introduction of a “micropurchase” authority in the Federal Acquisition Streamlining Act of 1995.

In the background was the desire to allow program customers the ability to use a government credit card to make very small purchases directly, without the significant extra time (think of the purchase order request landing at the bottom of the contracting person’s in-box) and administrative cost that come with working through the contracting office.

An interesting backstory to this statutory change was the role of a young contract specialist at the Department of Health and Human Services named Michelle Craddock in helping develop the administration’s legislative proposal on this. Even before the 1995 law, the government could make purchases under $2,500 without going through a competition. Having just arrived in Washington in 1993 to become administrator of the Office of Federal Procurement Policy, I was tasked with trying to find out if there were any statutory barriers to using a credit card for under-$2,500 purchases. On a learning tour of contracting offices to prepare me for my job as a Washington outsider awaiting Senate confirmation, Craddock was one of the contracting people I met in a visit set up by the HHS senior procurement executive.

Keep reading this article at: https://fcw.com/blogs/lectern/2018/07/kelman-microconsulting.aspx

February 22, 2018 By AMK

Higher limits on micropurchase, simplified acquisition thresholds okayed by CAAC

The Civilian Agency Acquisition Council (CAAC) has authorized federal agencies to issue class deviations from the Federal Acquisition Regulation (FAR) to raise the dollar thresholds on micropurchases and simplified acquisitions.

The higher thresholds are $10,000 for micropurchases (up from $3,500) and $250,000 for simplified acquisitions (up from $150,000). Authority for these changes stems from the 2018 National Defense Authorization Act (NDAA).

The CAAC’s memorandum can be downloaded here: Class Deviation – Micropurchase and Simplified Acquisition Threshold – CAAC Letter 02.16.2018

The CAAC memorandum “is effective immediately, and remains in effect until the increased thresholds are incorporated into the FAR or is otherwise rescinded.” The FAR Council has opened FAR Case 2018-004 to address what the 2018 NDAA has to say about these thresholds, and the CAAC memo authorizes civilian agencies to adopt their own class deviations while the FAR Case is pending.

CAAC members are senior procurement professionals within 15 departments and agencies:

Department of Agriculture
Department of Commerce
Department of Energy
Department of Health and Human Services
Department of Homeland Security
Department of the Interior
Department of Labor
Department of State
Department of Transportation
Department of Treasury
Department of Veterans Affairs
Environmental Protection Agency
General Services Administration
Small Business Administration
Social Security Administration

The Council is responsible for: Assisting the General Services Administration in developing and maintaining the FAR System by developing or reviewing changes to the FAR; Soliciting the views of agencies, associations, and other interested parties on those proposed changes to the FAR; and Coordinating its activities with the Defense Acquisition Regulations Council (DARC).

GSA, itself, has already issued a class deviation raising the micropurchase and simplified acquisition thresholds on GSA contracts. It can be seen here: GSA Class Deviation 2018-01 MPT and SAT Increase

September 11, 2017 By AMK

GSA relaxes rules to speed contracting for hurricane relief efforts

Eight days after addressing Hurricane Harvey in Texas, the General Services Administration on Thursday pivoted to the Irma storm aimed at Florida, relaxing certain contracting rules to encourage speed and local awards.

Senior Procurement Executive Jeffrey Koses signed a “memorandum raising thresholds for areas included in the Irma declaration response,” a GSA spokeswoman told Government Executive. The Irma memorandum follows an Aug. 29 directive issued in anticipation of rebuilding in the aftermath of the Houston-area flooding from Harvey.

The Harvey memo cited sections of the Federal Acquisition Regulation allowing GSA to raise the micropurchase threshold to $20,000 for any contract to be awarded and performed, or purchase to be made in support of the designated disaster areas. “The simplified acquisition threshold is increased to $750,000, or $13,000,000 for commercial items,” the memo to GSA contracting professionals said. The authority extends to any necessary leasing of property.

Keep reading this article at: http://www.govexec.com/contracting/2017/09/gsa-relaxes-rules-speed-contracting-hurricane-relief-efforts/140856/

September 5, 2017 By AMK

Micro-purchase and simplified acquisition thresholds raised for Hurricane Harvey response

The General Services Administration (GSA) has issued a directive allowing federal agencies engaged in emergency relief activities to raise dollar thresholds at which streamlined procurement rules can be used.

Under GSA’s temporary rules, the micro-purchase threshold is raised from $3,500 to $20,000. (In a recent Class Deviation, the Dept. of Defense raised its standard micro-purchase threshold to $5,000.) In addition, GSA raised the simplified acquisition threshold from $150,000 to $750,000 for non-commercial items and from $6.5-$7.0 million to $13 million for commercial items.

With micro-purchases the federal agencies can bypass many of the ordinary competitive requirements under the Federal Acquisition Regulation (FAR). For instances, holders of Governmentwide purchase cards (GPC) can make contract awards without soliciting competitive quotations if they consider prices to be fair and reasonable. Micro-purchases do not require provisions or clauses. The FAR’s detailed rules on micro-purchases are set forth primarily in FAR 13.2.

FAR Part 13 governs purchasing below the simplified acquisition threshold. It sets forth shorter terms and conditions, especially in the areas of reporting requirements and subcontracting. Simplified acquisition transactions above the micro-purchase threshold are reserved for small businesses.

The threshold increases will remain in effect until December 31, 2017.

GSA’s new guidance is tied to the Presidential declaration of Hurricane Harvey as a “major disaster.” Meeting the legal definition of “emergency” in GSA’s FAR Class Deviation entitled Exercise of Special Emergency Procurement Authorities means that the emergency acquisition flexibilities listed in FAR 18.2 are available for use, along with the existing acquisition flexibilities enumerated in FAR 18.1.

Agency contracting officers are required to give preference to local firms in the disaster area in accordance with the Stafford Act, implemented at FAR 26.2. GSA notes that contracting officers should first consider small business local area set-asides when feasible.

GSA’s Aug. 29, 2017 memorandum entitled “Relief Efforts for Hurricane Harvey” is at: https://gsa.gov/portal/getMediaData?mediaId=168826

August 4, 2017 By AMK

Could ‘microconsulting’ disrupt government contracting?

I have never been a fan of contractor bashing.

I believe there is nothing wrong with making a profit. I do not believe that contractors typically spend their days dreaming up ways to cheat the government. Indeed, I even believe that many contractor employees and managers believe deeply in the missions of organizations they work for, and get satisfaction from helping citizens and society through their organizations’ efforts — an observation I discussed a while back in a blog based on an informal conversation at a Coalition for Government Procurement event.

Having said that, I was a strong advocate even when in government 20 years ago for bringing more suppliers who primarily sold to the commercial marketplace into government contracting. Indeed, at a strategic level one of the main thrusts of the procurement reform efforts of the 1990s was to reduce barriers to entry for commercial firms created by government procurement rules — both in terms of the complexity of the process and some government oversight requirements that were burdensome or expensive for contractors to comply with.

Keep reading this post at: https://fcw.com/blogs/lectern/2017/07/kelman-microconsulting.aspx

One of the first — and even more than two decades later, still one of the most important — changes during the procurement reform era of the 1990s was the introduction of a “micropurchase” authority in the Federal Acquisition Streamlining Act of 1995.

The Civilian Agency Acquisition Council (CAAC) has authorized federal agencies to issue class deviations from the Federal Acquisition Regulation (FAR) to raise the dollar thresholds on micropurchases and simplified acquisitions.

Eight days after addressing Hurricane Harvey in Texas, the General Services Administration on Thursday pivoted to the Irma storm aimed at Florida, relaxing certain contracting rules to encourage speed and local awards.

The General Services Administration (GSA) has issued a directive allowing federal agencies engaged in emergency relief activities to raise dollar thresholds at which streamlined procurement rules can be used.

I have never been a fan of contractor bashing.

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