Evergreen contracting, in combination with the RFO, will unleash even greater savings for customer agencies and the American people.
A highlight of the Revolutionary Federal Acquisition Regulation (FAR) Overhaul (RFO) is the revised competitive ordering procedures under the Federal Supply Schedule (FSS) program. The RFO, consistent with the General Service Administration’s (GSA’s) exclusive statutory authority for the FSS program, transferred the ordering procedures from FAR 8.4 to General Services Acquisition Regulation (GSAR) Subpart 538.7100. The revised FSS ordering procedures are now written in plain, clear and concise language. The overly complex ordering guidance, especially for Blanket Purchase Agreements (BPA), has been eliminated while, at the same time, the RFO clarifies the underlying statutory competition requirements for FSS task and delivery orders. The RFO also eliminated redundant portions of FAR 8.4 already addressed in FSS contract clauses, reducing the word count from 9,449 in the old FAR 8.4 to 2,363 in GSAR 538.7100. The overhaul of the FSS ordering procedures will enhance competition, promote innovation and drive best-value commercial solutions to meet customer agency needs.
An unintended consequence of the new ordering procedures is a significant limitation on the effective length of FSS contract terms. What were 20-year contracts under the old FAR are de facto 10-year contracts under the new GSAR. To provide greater flexibility in structuring BPAs, GSAR 538.7104-1(a) authorizes customer agencies to establish the ordering period for the BPA. The GSAR removed the old FAR 8.4’s five-year limitation on the duration for BPA ordering periods. Embracing this new flexibility, customer agencies, to reduce administrative burdens and leverage competition, are now seeking BPAs with 10-year ordering periods. However, GSAR 538.7104-1(b) provides that, “FSS BPAs may be established with an ordering period that extends beyond the current term of a contractor’s FSS contract, so long as there are option periods in the contractor’s FSS contact that … will cover the BPA ordering period, including options and award terms.” Thus, under the new GSAR, any contractor with less than 10 years left on their FSS contract would have to submit a new offer and be awarded a new “20-year” FSS contract to be able to compete for any 10-year BPA. The practical impact is to convert “20-year” FSS contracts into “10-year” FSS contracts.
The effect of this “contractual gap” will be to limit competition under the FSS program, by unduly restricting the pool of FSS contractors who can compete for longer term BPAs. Just as significantly, GSA and its FSS contractors will see a substantial increase in workload as current contractors with less than 10 years left on their contracts will submit new contract offers to become eligible for longer-term BPAs. Doing the math, the number of new offers for FSS contracts could more than double as FSS contract terms are de facto reduced to 10 years from the original 20-year term agreed to at the time of award. In other words, FSS contractors will have to submit new offers every nine years.
Consistent with the RFO, evergreen contracts would reduce administrative costs, streamline operations and enhance competition for GSA, customer agencies and FSS contractors. As explained in the May 9, 2025, FAR & Beyond blog, evergreen contracts are not restrictive on time or term. Rather, evergreen contracts eliminate the 20-year term by allowing FSS contracts to remain in place with no time limit, subject to continuous five-year option periods. Evergreen contracting will save GSA, customer agencies and industry time and money. It will eliminate the timely, costly and redundant exercise of submitting, evaluating, negotiating and awarding new FSS contracts. Under evergreen, GSA and its FSS contractors can more effectively focus on the ongoing management of existing contracts to the benefit of customer agencies and the taxpayer. And, of course, evergreen contracting will empower FSS contractors to consistently compete for the newly authorized long-term BPAs. To that end, evergreen is a pro-competition mechanism for the FSS program that is consistent with the RFO.
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The growth in the use of BPAs has been a remarkable success story for the FSS program. As shown in the table below, over the last five years, FSS BPAs have accounted for over 50% of the dollar volume of FSS sales:
Customer agencies utilize FSS BPAs to leverage requirements, streamline ordering and enhance competition. Evergreen contracting, in combination with the RFO, will unleash even greater savings for customer agencies and the American people.
Building on the promise of the RFO, it is time for evergreen contracting.
Roger Waldron is president of The Coalition for Common Sense in Government Procurement.
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