Purchase priorities

Overview

FAR 8.704 establishes the mandatory order of precedence for government procurement when requirements can be met by both AbilityOne participating nonprofit agencies and Federal Prison Industries, Inc. (FPI). It ensures compliance with 41 U.S.C. chapter 85 by prioritizing these socio-economic sources over commercial vendors.

Key Rules

• Mandatory Purchase: Agencies must purchase supplies or services on the Procurement List from AbilityOne agencies if available within the required timeframe.
• Priority for Supplies: When an item is provided by both FPI and AbilityOne, the priority is:
  1. Federal Prison Industries, Inc.
  2. AbilityOne participating nonprofit agencies.
  3. Commercial sources.
• Priority for Services: The order of precedence changes for services:
  1. AbilityOne participating nonprofit agencies.
  2. Federal Prison Industries, Inc. or commercial sources.
• No Exceptions: No other FAR provision can be used to bypass the mandatory purchase requirement for items on the Procurement List.
• Waiver Requirement: For certain supplies, an ordering office must secure a formal waiver from FPI before they are permitted to purchase the item from an AbilityOne agency.

Practical Implications

• Market Research Constraint: Contracting Officers (COs) cannot proceed to a commercial solicitation without first verifying if the requirement is satisfied by the FPI Schedule or the AbilityOne Procurement List.
• Regulatory Compliance: Procurement from a commercial source when an AbilityOne or FPI source is available (without a valid waiver) is a violation of the FAR and statutory law, potentially leading to protests or internal audits.