Government agencies often establish Blanket Purchase Agreements (BPAs) with General Services Administration (GSA) Federal Supply Schedule (FSS) contractors to meet their repetitive procurement needs in a flexible and streamlined manner. Such BPAs may be single or multiple award and may be utilized by one or more agencies with a period of performance of up to five years. The Federal Acquisition Regulation (FAR) 8.405-3, which contains ordering procedures for BPAs established under FSS contracts, states that a single award BPA may not exceed one year, although it may have up to four one-year options. Contractors should be mindful that such BPAs are not contracts in and of themselves and are awarded against and tied to a contractor’s underlying GSA FSS contract. In this regard, FAR 8.405-3(d)(3) provides that schedule contractors may be awarded BPAs that extend beyond the term of their FSS contract only if there are option periods remaining in their FSS contract that, if exercised, will cover the BPA’s period of performance. Consequently, if an FSS contractor’s schedule contract, including its options, is set to expire before the end of the BPA’s period of performance, then that contractor is ineligible to receive a BPA award.
In B-423311, a decision issued on April 10, 2025, the Government Accountability Office (GAO) determined that the protester was ineligible for a BPA award when its underlying FSS contract was set to expire before the end date of the BPA’s total potential ordering period. The GSA issued the relevant Request for Quotations (RFQ) for establishing a single-award BPA for travel and expense consulting services. The BPA’s period of performance consisted of one base year and four one-year option periods, beginning on the date of award. The protester’s quotation was eliminated from consideration by the contracting officer (CO) after a preliminary review for not meeting RFQ requirements, which specifically provided that the procedures of FAR 8.405-3 would be utilized in making the award. The CO determined that, among other failures, the protester’s quotation did not meet the requirements of FAR 8.405-3(d)(3) because its underlying FSS contract was set to expire some 20 days before the last day of the ordering period of the contemplated BPA. Consequently, the protester’s quotation was deemed ineligible for award and was rejected from further consideration. Meanwhile, the protester argued that, since an option was not an obligation, the BPA’s period of performance was limited to one year, as reflected by its base period.
The GAO began its analysis by referring to its earlier decisions, acknowledging that FSS BPAs are established under the contractor’s GSA FSS contract, rather than directly with the contractor. Therefore, an FSS BPA cannot survive the expiration of the underlying schedule contract. Furthermore, the contractor’s underlying schedule contract must be valid to satisfy the competition requirements of the Competition in Contracting Act (CICA) with respect to the orders placed under the BPA. In the present case, the RFQ clearly stated that the BPA’s period of performance was up to five years, and the protester’s FSS contract was set to expire before then. Therefore, the protester was ineligible for an award. The GAO rejected the protester’s argument that the BPA’s period of performance be limited to its base period. In addition to the base period, the solicitation contemplated four option periods, which could be exercised at the government’s discretion. The GAO explained that adopting the protester’s position would prevent the government from acquiring services during the option years of the BPA. Moreover, not only had the protester failed to cite any relevant authority to support its position, but its own quotation had included pricing for the option periods. Given these reasons, the GAO determined that it was reasonable for the CO to exclude the protester’s quotation from the competition because its FSS contract would not cover the BPA’s entire period of performance.
A BPA is not a contract because it lacks mutuality of consideration between the government and its contractor. Since BPAs lack this essential element for the formation of a government contract, they are merely considered an overarching framework of terms and conditions for future contracts that come into existence when an order is placed and accepted under the BPA. Furthermore, GSA FSS BPAs are tied to the contractor’s underlying schedule contract. As a result, GSA FSS BPAs cannot survive the expiration of the underlying schedule contract. Under FAR 8.405-3(d)(3), a BPA that extends beyond the term of its underlying FSS contract may only be awarded when one or more option periods remains on the contractor’s schedule contract that, if exercised, would cover the entirety of the BPA’s period of performance. Ultimately, to determine the eligibility of an FSS contract to receive a BPA award, contractors should first calculate the BPA’s total ordering period by adding any option periods to the BPA base period. Then, consistent with the decision described above, determine whether the period of performance of the FSS contract, including any options, covers the entirety of the BPA ordering period.
This Federal Procurement Insight is provided as a general summary of the applicable law in the practice area and does not constitute legal advice. Contractors wishing to learn more are encouraged to consult the TILLIT LAW PLLC Client Portal or Contact Us to determine how the law would apply in a specific situation.