Basic ordering agreements
Basic ordering agreements provide a flexible framework for recurring but uncertain government needs, but require strict adherence to FAR rules for content, competition, and order issuance to ensure compliance and avoid improper commitments.
Overview
FAR 16.703 establishes the rules and procedures for using Basic Ordering Agreements (BOAs) in federal contracting. A BOA is a written understanding between a government agency and a contractor that sets terms and conditions for future orders, describes the supplies or services involved, and outlines pricing and ordering methods. Importantly, a BOA is not a contract itself but a framework to expedite future contracts when requirements are uncertain but recurring. BOAs are used when specific items, quantities, and prices are not known upfront, but a substantial volume of purchases is anticipated. The regulation details the required content of BOAs, annual review and revision requirements, and the process for issuing orders under a BOA, including competition, pricing, and documentation obligations.
Key Rules
- Definition and Use of BOAs
- BOAs are not contracts but set terms for future orders when requirements are uncertain but recurring.
- Required Content
- BOAs must specify pricing methods, delivery terms, authorized ordering activities, order binding points, dispute resolution, and fast payment data if applicable.
- Annual Review and Modification
- BOAs must be reviewed annually and revised as needed, with changes made only by modifying the agreement itself.
- Order Issuance and Competition
- Orders must follow competition requirements, use appropriate forms, reference the BOA, and comply with synopsis and justification rules.
- Pricing and Commitment
- No final commitment or work authorization until prices are set, unless a ceiling price is established and urgent need or timely pricing procedures are in place.
Responsibilities
- Contracting Officers: Must ensure BOAs meet content requirements, conduct annual reviews, obtain competition, issue orders properly, and establish pricing before work begins (with limited exceptions).
- Contractors: Must comply with BOA terms, provide supplies/services as ordered, and adhere to pricing and delivery requirements.
- Agencies: Oversee BOA use, ensure compliance with FAR, and review/revise agreements as needed.
Practical Implications
- BOAs streamline procurement for recurring but uncertain needs, reducing administrative burden and lead time. However, they require careful management to avoid improper commitments, ensure competition, and maintain compliance with FAR. Common pitfalls include treating BOAs as contracts, failing to review annually, or issuing orders without proper pricing or competition.