The General Services Acquisition Regulation (GSAR) and the Federal Acquisition Regulation (FAR) set forth the policies and procedures for the evaluation and negotiation of “fair and reasonable” contract level pricing under the Federal Supply Schedule (FSS) program. The GSAR addresses the negotiation of FSS pricing based on submission of an offeror’s commercial sales practices (CSP) and, alternatively, offerors that have opted in to transactional data reporting (TDR) where no CSP is required. The GSAR guidance includes specific references to, and incorporation of, the FAR’s guidance on the factors to be considered when analyzing and determining “fair and reasonable” pricing for FSS contracts. Both the GSAR and FAR were subject to the transparent rule making process whereby the public was provided an opportunity to review and submit comments on proposed rules.
Sometime in 2021, the Federal Acquisition Service (FAS) issued “FAS Policy and Procedure (PAP) 2021-05, Evaluation of FSS Program Pricing.” The specific date the PAP was issued is unclear as the PAP was not subject to the transparent rule making process. The PAP essentially “supplements” the GSAR and FAR by providing FSS contracting officers with additional guidance regarding the analysis and negotiation of contract level pricing. The PAP includes a host of new directives, including establishing new policy for pricing data requests and adding new responsibilities for FSS contracting officers negotiating contract level pricing. In some cases, these directives are inconsistent with the FAR and/or GSAR guidance. In other cases, they go well beyond the FAR/GSAR and impose new requirements that have not been vetted through the public rule making process.