GSA and DoD Help Customers With Increased Costs
This content is a continuation of the blog: Help My Costs Have Increased! Published on March 30, 2022.
With nationwide inflation at 10%, federal contractors are finally getting some additional relief from the General Services Administration (GSA) and the Department of Defense (DoD).
ClearCoast applaudes the initiatives of the recently released guidance by these agencies to help companies, particularly small businesses, who have been particularly impacted by the inflationary costs and global supply chain delays. Contracting agencies will benefit from these initiatives providing continued access to the commercial market through existing contracts including the MAS GSA Schedules program.
GSA updates its guidance for how quickly contracting officers can raise prices on the schedule
Jeff Koses, GSA’s senior procurement executive, and Mark Lee, the assistant commissioner in the Office of Policy and Compliance in GSA’s Federal Acquisition Service, told contracting officers on September 12 that they do not need additional approvals to invoke the economic price adjustment (EPA) clause in GSA contracts. The updated GSA guidance memorandum, MV-22-02, Supplement 1, is available at https://www.gsa.gov/policy-regulations/policy/acquisition-policy/acquisition-policy-library-resources
“For EPA increases exceeding the ceiling percentage established in the solicitation, Acquisition Letter MV-22-02 initially lowered the approval level from the contracting director to one level above the contracting officer. This supplement, in recognition of ongoing price volatility and impacts to the global economy, removes the requirement to obtain additional approvals,” the memo stated. “This means that all requests for EPA increases can be approved by the contracting officer, whether above or below the ceiling percentage established in the solicitation. Contracting officers should review all EPA requests consistently and in line with the terms of the underlying contract.”
Koses and Lee’s updated guidance makes it clear that speed without reducing rigor is important.
“This temporary moratorium does not diminish a contracting officer’s responsibility for reviewing EPA requests and asking for additional information, if applicable, within the confines of what is normally necessary for processing EPA requests. Specifically, EPA requests must be evaluated to ensure the request is justified,” the memo stated.
This updated guidance is effective immediately and will remain in effect until March 31, 2023, unless otherwise extended.
DoD releases second memo to deliver relief to Contractors due to inflation
On September 12, the DoD also updated guidance for Contracting Officers regarding approaches for addressing inflation under existing firm-fixed-price contracts.
The updated guidance is based on feedback from the Department’s acquisition executives about how inflation is presently affecting the defense industrial base and contractors’ ability to perform under existing firm-fixed-price contracts. The memorandum advises Contracting Officers about the range of approaches available to them to make potential accommodations including schedule relief and amending contractual requirements, and in extraordinary circumstances, the use of Extraordinary Contractual Relief.
As conditions warrant, DoD will continue to adapt its approach to meeting mission requirements through the current economic environment.
The updated DoD guidance memorandum is available at https://www.acq.osd.mil/dpap/policy/policyvault/USA001773-22-DPC.pdf
WE’RE HERE TO HELP.
For questions about EPA requests to your GSA MAS contract reach out to ClearCoast today. Hire a GSA Consultant who serves as your best partner.
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