The Coalition for Government Procurement: The St. Patrick’s Day Acquisition Letter – Supporting the Industrial Base!

“On March 17, GSA issued Acquisition Letter MV-22-02, Temporary Moratorium on Enforcement of Certain Limitations Contained in Certain GSA Economic Price (EPA) Contract Clauses (the Acquisition Letter). Effective immediately, the Acquisition Letter brings pricing flexibility for Multiple Awards Schedule (MAS) contractors suffering the impact of inflation across their business operations. This inflation impact on government contractors cannot be overstated. In the context of the MAS program, contractors are in the untenable position of selling contracted items for a loss as prices for products, raw materials, transportation, energy, and labor have increased. As a result, MAS contractors have deleted hundreds of thousands of items from their contracts rather than selling them at a loss. For the government, the net effect has been a reduction in competition for task orders and reduced access to the commercial market via the Schedules for customer agencies. The impact of inflation is especially hard on small businesses, including small, disadvantaged businesses, which is why GSA’s efforts to reduce the administrative barriers for access to economic price adjustments is especially welcome news…”

“In sum, for contracts including the covered clauses, the Acquisition Letter authorizes the following:

  • Lowers the approval level for price increases above the EPA clause ceiling in 552.216-70 (including Alternate I and Deviation II) from the Contracting Director to one level above the Contracting Officer;
  • Removes the limitation on the number of price increases allowed during the contract period;
  • Allows contractors to request increases as soon as the contract period begins and up through the end of the contract period;
  • Allows contractors to submit price increase requests without waiting 30 days from the last request;
  • Allows contractors to submit price increase requests that will be effective prior to the end of the first 12 months of the contract period; and
  • Clarifies that if a contractor has removed an item from its Schedule contract, GSA will not enforce the limitation on adding the same item back at a higher price…” Read the full article here.

Source: The St. Patrick’s Day Acquisition Letter – Supporting the Industrial Base! – March 25, 2022. The Coalition for Government Procurement.

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