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GSA SmartPay Training

Lesson 5 of 14

Before Using Your Purchase Account

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You have just been selected to become a GSA SmartPay purchase account holder. The agency/organization program coordinator (A/OPC) for your organization will be the one who sets up your account with the contractor bank and assists you with any specific questions about your account or agency specific policy.

New applicants should receive their GSA SmartPay purchase account from the contractor bank within 10-14 calendar days from the time the application is submitted by your A/OPC. Replacements for lost, stolen, broken, or otherwise unusable cards will be sent within 48 hours of the agency/organization request. In the case of an emergency, such as response to a natural disaster, threat to national security and military mobilization, the contractor bank will send the GSA Smartpay purchase account within 24 hours of the request.

Your GSA SmartPay Purchase Account is issued to YOU for official government business ONLY. The purchase account can NEVER be used for personal reasons. Do not share your account information with anyone - only you are authorized to use the account. This means that no family member or member of your staff, including your supervisor, may use your purchase account. Safeguard your purchase account information at all times. Unauthorized use of the account due to your failure to secure the account may result in disciplinary action.

Verifying Your Account

After receipt of your account the following steps should be taken:

  1. Verify the accuracy of the account information (for example, your name and address).
  2. Call the toll-free number provided by the contractor bank to confirm receipt and activate the account.
  3. If you are given a physical card, sign the back of the card.
  4. Review the account holder guide provided by the contractor bank.

Tips for Planning Your Monthly Purchases

As a purchase account holder, it is important to carefully plan your monthly purchases. For example:

  • Decide which items are best handled using your purchase account and when is the best time to purchase those items.
  • Combine requirements in order to qualify for volume discounts (as long as you remain within the authorized per transaction and monthly spending limits).
  • Make small-scale purchases to avoid wasteful stockpiling.
  • Purchase items in order of priority, where higher priority items are purchased before lower priority items.

Note: Many agencies require account holders to obtain management approval before each purchase, double check your agency policy and plan time for the approval process. Tools to help you request and track approvals are available on the GSA SmartPay website under Resources > For Approving Officials

Ensure Availability of Funds

Establish the amount of available funds BEFORE making any purchases. Some agencies require account holders to verify the amount of available funds before each purchase.

Also, track purchases throughout the month to ensure that there remains sufficient funds available to make all required purchases. Using a system to record purchases and dollar amounts committed can be very helpful in tracking. It will allow you to know at a glance the amount of your unobligated funds or certified fund availability.

Conduct Market Research

Market research allows you to make an informed, responsible and reasonable purchase. Do enough market research to ensure that the Government gets the best value for its money in terms of a reasonable price and timely, reliable, quality service. Each purchase should represent the best value that meets the Government's minimum requirements.

Use the Green Procurement Compilation (GPC), a comprehensive green purchasing resource designed for federal contracting personnel and program managers, to identify environmental attributes applicable to your purchase, such as energy efficiency or recycled content. The GPC also identifies GSA Sources (Multiple Award Schedules (MAS) or GSA Global Supply) and links to the GSA Advantage website.

Who can assist with your market research? Your contracting activity can provide information on required sources of supply, existing contracts, good merchants and support in many other areas.

In addition, compare prices and check with your contracting activity to see if there are existing contracts that offer a good price, service, and quality. These existing contracts have been negotiated at your agency or by other agencies and can sometimes offer advantages and money savings.

Select the Best Value

When making micro-purchases, identify the supply or service that best satisfies the requirement, weighing both price factors and non-price factors. For example, you can purchase a higher priced item if it represents a better value. It is your responsibility as the account holder to perform basic comparison-shopping and to briefly document the basis for your purchase decisions.

Seek State Tax Exemption

Each state handles tax exemption a little differently. Be sure to visit the GSA SmartPay Website to find out more about requirements in your state. Centrally Billed Accounts (CBAs) are exempt from state taxes in EVERY state but there may be special requirements or required forms in order to obtain state tax exemption in some states.

Talk to Merchants

Create a checklist when talking to merchants and be as specific as possible. Ask about:

  • Price
  • Shipping costs
  • Time of delivery
  • Discounts for Government purchases
  • Merchant's return policies (if different)
  • Product/ Service warranty

When you have all the necessary information, make a decision.

Note: Never fill out a postcard or similar device that includes the account number, card expiration date, CVV, signature, or any other account data in plain view.

What Are Point of Sale Discounts?

Point-of-Sale (POS) is the point where a transaction is finalized or the moment where a

customer tenders payment in exchange for goods and services. Certain merchants offer automatic discounts when you use the purchase account to make purchases. These merchants have the ability to recognize the GSA SmartPay purchase account based on the account number and apply a discount at the time of the sale.

Is It Necessary to Distribute Purchases? For example, if you are not required to get quotations, can you always buy from the same source?

FAR Part 13.203(a)(1) of the Federal Acquisition Regulations recommends that micro-purchases be equitably distributed among qualified merchants to the extent practicable.

Spending Limits and Account Restrictions

Spending limits are determined by the agency program coordinator for each individual account and established when the account is set up They are based on your delegation of authority and the budgetary limits of your office.

There are two types of spending limits applied to the purchase account:

  • Single purchase limit , or the dollar limit for an individual transaction.
  • Monthly purchase limit, or the cumulative dollar limit for purchases in one month. The monthly purchase limit may be set to any dollar amount equal to or greater than the single purchase limit.

Verify both your single purchase limit and your monthly purchase limit with the AO or A/OPC.

In addition to spending limits, other restrictions such as the number of transactions and merchant category codes (MCC) blocks may apply to your account. An MCC is a four-digit code used to identify the type of business a merchant conducts (gas stations, restaurant, airlines, etc). MCCs may be blocked to prevent fraud and misuse.

Exceeding Your Spending Limit

Prior to processing your purchase, the merchant will check if the transaction exceeds any spending limits on your account. All attempted transactions that exceed either the single or monthly spending limit will be automatically declined at the point of sale.

As an account holder, it is your responsibility to plan ahead and keep track of how much has been spent against your limit before you make the purchase. Do not rely on the authorization system to do this for you. Contact your A/OPC or contractor bank immediately if your account is declined. The contractor bank customer service phone number can be found on the GSA SmartPay website and is listed on the back of the charge card.

What are the required sources of supply?

Use of the GSA SmartPay purchase account should be consistent with established guidelines for required sources of supply and acquisition procedures, such as those applicable to micro-purchases or to acquisitions below the simplified acquisition threshold. Procurements paid for with the GSA SmartPay purchase account are subject to the acquisition rules established in the Federal Acquisition Regulations (FAR) as well as your Agency/Organization policies and procedures.

The Federal Acquisition Streamlining Act did not abolish the priorities for use of the Government supply sources as stated in FAR Part 8 (Required Sources of Supplies and Services) of the FAR. Micro-purchases are not exempt from this requirement. The following information from FAR Part 8 lists the priorities for use of Government supply sources:

8.002 Priorities for use of Government supply sources :

Except as required by 8.003, or as otherwise provided by law, agencies shall satisfy requirements for supplies and services from or through the sources and publications listed below in descending order of priority:

1. Supplies

  • Existing Inventories
  • Excess from other agencies
  • Federal Prison Industries, Inc.
  • Supplies which are on the Procurement List maintained by the Committee for Purchase From People Who Are Blind or Severely Disabled
  • Wholesale supply sources, such as stock programs of the General Services Administration (GSA), the Defense Logistics Agency, the Department of Veterans Affairs, and military inventory control points.

2. Services

  • Services that are on the Procurement List maintained by the Committee for Purchase From People Who Are Blind or Severely Disabled

Sources other than those listed above may be used as prescribed in 41 CFR 101-26.301 and in an unusual and compelling urgency as prescribed in 6.302-2 and in 41 CFR 101-25.101-5.

The statutory obligation for government agencies to satisfy their requirements for supplies or services available from the Committee for Purchase From People Who Are Blind or Severely Disabled also applies when contractors purchase the supplies or services for Government use.

8.003 Use of other mandatory sources :

Agencies shall satisfy requirements for the following supplies or services from or through specified sources, as applicable:

  • Public utility services
  • Printing and related supplies
  • Leased motor vehicles
  • Strategic and critical materials (e.g., metals and ores) from inventories exceeding Defense National Stockpile requirements
  • Helium

8.004 Use of other sources

If an agency is unable to satisfy requirements for supplies and services from the required sources of supply, agencies are encouraged to consider satisfying requirements from or through the following non-mandatory sources:

1. Supplies:

  • Federal Supply Schedules
  • Governmentwide acquisition contracts
  • Multi-agency contracts
  • Any other procurement instruments intended for use by multiple agencies, including blanket purchase agreements (BPAs) under Federal Supply Schedule contracts (e.g., Federal Strategic Sourcing Initiative (FSSI) agreements)

2. Services:

  • Agencies are encouraged to consider Federal Prison Industries, Inc., as well as the sources listed under Supplies above.
  • Commercial sources (including educational and nonprofit institutions) in the open market

    When satisfying requirements from non-mandatory sources, give consideration to small business, veteran-owned small business, service-disabled veteran-owned small business, HUBZone small business, small disadvantaged business (including 8(a) participants), and women-owned small business concerns.

    GSA Advantage! is an online shopping mall with thousands of commercial products and services including JWOD/NIB/NISH and UNICOR products, designed to link GSA schedule products and services, stock items, catalog descriptions, current pricing, and delivery information in a single location to make ordering easier for you. To place an order, you can use your GSA SmartPay purchase account.

    Shop Small Business

    Increasing opportunities for small businesses in federal contracting is a top priority. The Office of Management and Budget (OMB), along with the Small Business Administration (SBA), are working to improve access for small businesses to the Federal market and boost communications about federal business opportunities. Remember, it is important to consider small businesses when buying goods and services at or below the micro-purchase threshold.

    Shop American Products

    Presidential Executive Order on Buy American and Hire American

    It shall be the policy of the executive branch to buy American and hire American.

    • Immediate Enforcement and Assessment of Domestic Preferences According to Buy American Laws: Every agency shall scrupulously monitor, enforce, and comply with Buy American Laws, to the extent they apply, and minimize the use of waivers, consistent with applicable law.
    • Judicious Use of Waivers: To the extent permitted by law, public interest waivers from Buy American Laws should be construed to ensure the maximum utilization of goods, products, and materials produced in the United States.
    • Ensuring the Integrity of the Immigration System in Order to "Hire American.": The Secretary of State, the Attorney General, the Secretary of Labor, and the Secretary of Homeland Security shall, as soon as practicable, and consistent with applicable law, propose new rules and issue new guidance, to supersede or revise previous rules and guidance if appropriate, to protect the interests of United States workers in the administration of our immigration system, including through the prevention of fraud or abuse.

    Shop Smarter

    The FAR states that use of the Government-wide GSA SmartPay purchase account is the preferred method for buying small purchases.

    Here are some tips to help you shop smarter when using your GSA SmartPay Purchase Account:

    • Use GSA Advantage! to conduct quick and easy market research and to order already negotiated low-price items;
    • Take advantage of the Blanket Purchase Agreements (BPAs) your agency has negotiated to get better prices;
    • Always ask for discounts at the register - whether or not point-of-sale discounts are given;
    • Locate merchants that accept MasterCard and VISA by using merchant/ supplier locator tools at http://www.mastercard.com/] and http://www.visa.com/.

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