Overview
FAR 41.202 establishes the mandatory steps for acquiring utility services, emphasizing acquisition planning, market research, and the pursuit of competition. It specifically outlines the administrative procedures and documentation requirements for instances where a utility provider refuses to enter into a formal bilateral contract with the government.
Key Rules
- Mandatory Planning and Competition: Contracting officers (COs) must comply with FAR Parts 6 and 7, conducting market surveys to promote full and open competition, provided such competition is consistent with applicable state law.
- Market Survey Scope: Surveys must evaluate the availability of competitive sources for the "entire utility service" or specific components, such as capacity, energy, transmission, or distribution.
- Mandatory Considerations: COs must consider GSA areawide contracts, separate contracts, and interagency agreements during the market survey process.
- Refusal Procedures: If a supplier refuses a contract, the CO must obtain a written refusal, notify GSA, and document the negotiation record. In such cases, services may be acquired via purchase order or invoice payment if a determination is approved by the head of the contracting activity.
- Utility History File: For acquisitions without a bilateral contract, the CO must maintain a file containing the unsigned contract, the supplier's reasons for refusal, estimated costs, rate schedules, and connection charge records.
- Annual Re-evaluation: If a utility is obtained without a bilateral contract, the CO must attempt to execute a written contract annually and document these efforts in the history file.
Practical Implications
- Contracting officers cannot simply assume a utility is a monopoly; they must actively research the market and state regulations to determine if any portion of the service (such as the energy commodity itself) can be competed.
- The regulation provides a critical "safety valve" that allows agencies to maintain essential services through purchase orders or invoices when a regulated utility company refuses to agree to standard federal contract terms.