32.1108
Payment by Governmentwide commercial purchase card
Before authorizing payment by Governmentwide commercial purchase card for contracts above the micro-purchase threshold, contracting officers must verify the contractor’s debt status in SAM and follow specific contract clause and payment procedures.
Overview
FAR 32.1108 outlines the procedures and requirements for payment to contractors using the Governmentwide commercial purchase card (GPC). This section explains how the GPC enables immediate payment to contractors via a third-party financial institution, with the Government reimbursing the third party later. It details when and how contractors may request payment by charging the GPC, the necessary contract clauses, and the verification steps contracting officers must take regarding contractor debt status in the System for Award Management (SAM) before authorizing this payment method for contracts above the micro-purchase threshold.
Key Rules
- Payment Authorization and Process
- Contractors may request payment by charging the GPC only when authorized by the contract’s payment clause and for the correct amount. Disputes should only occur if payment would not have been approved otherwise.
- Required Clauses
- Contracts paid by purchase card should include FAR 52.232-36, Payment by Third Party, but payment may still be made by card if the contractor agrees, even if the clause is absent.
- Debt Verification in SAM
- For contracts/orders above the micro-purchase threshold, contracting officers must check SAM for delinquent debt subject to the Treasury Offset Program (TOP) before authorizing GPC payment. If debt is present, GPC payment is not allowed until resolved.
- Contract Information Requirements
- Contracts must identify the third party and the purchase card to be used, but not the account number (which is provided separately).
Responsibilities
- Contracting Officers: Verify contractor debt status in SAM, include required clauses, ensure proper contract identification, and manage payment method changes if debt status changes.
- Contractors: Submit payment requests only as authorized, comply with contract terms, and notify contracting officers if debt status changes.
- Agencies: Oversee compliance with payment procedures and ensure proper use of the GPC.
Practical Implications
- This section ensures secure, timely payments while protecting the Government from paying contractors with unresolved delinquent debts. It requires careful contract drafting, diligent debt checks, and clear communication between contracting officers and contractors. Common pitfalls include failing to check SAM for debt flags or improperly handling payment disputes.