Overview
A Blanket Purchase Agreement (BPA) is a simplified acquisition method established as a "charge account" with qualified sources to fulfill anticipated repetitive needs for supplies or services. It is designed to reduce administrative burdens by eliminating the need for numerous individual purchase orders while maintaining competitive pricing and quality.
Key Rules
- Nature of Obligation: A BPA is not a contract; the Government is only obligated to the extent of authorized purchases actually made under the agreement.
- Establishment Criteria: BPAs are used when there is a wide variety of items in a broad class of supplies or services, but exact quantities and delivery requirements are unknown.
- Competition: Contracting officers should establish BPAs with multiple suppliers of the same type to provide maximum practicable competition; the existence of a BPA does not justify avoiding small business set-asides.
- Mandatory Content: Every BPA must include a description of the agreement, a statement regarding the extent of obligation, dollar limitations for individual purchases, a list of authorized individuals permitted to purchase, and specific invoicing/delivery ticket instructions.
- Purchase Limitations: Individual purchases generally cannot exceed the Simplified Acquisition Threshold (SAT), though thresholds are higher (up to $9 million, or $15 million for specific emergencies) for commercial products and services under FAR Subpart 13.5.
- Annual Review: The contracting officer must review BPA files at least annually to ensure authorized procedures are being followed, update the agreement if necessary, and maintain awareness of changing market conditions.
- Accounting Data: BPAs are prepared without a purchase requisition and do not cite accounting and appropriation data at the agreement level; funds are obligated at the time of the individual purchase.
Practical Implications
- Administrative Efficiency: BPAs allow agencies to empower non-contracting personnel (authorized callers) to place orders quickly for routine items, significantly reducing procurement lead times.
- Strategic Sourcing: Because BPAs require annual reviews and allow for "maximum discounts," they serve as a tool for agencies to leverage their buying power with dependable, high-performing suppliers.