GSA Makes it Easier to Increase Schedule Pricing in Response to Inflation Concerns

In response to inflation concerns, some GSA Schedule contractors have made decisions to remove items from their GSA Schedules contracts to avoid selling at a loss, which then makes it harder for Federal agencies to acquire needed goods, services, and solutions. To address contractors’ concerns, GSA issued an Acquisition Letter which significantly reduces requirements associated with getting price increases, and removes barriers to one-time large price increases. These measures are temporary – effective March 17, 2022 through September 30, 2022 – unless otherwise extended.

GSA’s Federal Acquisition Service (FAS) recognizes that many factors are impacting the global economy and disrupting supply chains, including the ongoing recovery from the pandemic and the current conflict in the Ukraine. This has led to supply shortages and delays as well as price volatility. During this time GSA has been seeing an increase in Multiple Award Schedule (MAS) contract modification requests to increase pricing.

What Does This Mean to GSA Schedule Contractors?

In order to increase your GSA Schedule contract pricing, you must submit an Economic Price Adjustment (EPA) modification to GSA. This Acquisition Letter places a temporary moratorium on several limitations contained in certain GSA EPA contract clauses.  These temporary policy changes empower MAS Contracting Officers to respond to current market conditions.

Specifically, during this time, this policy moratorium:

• Relaxes time limitations on EPA increases – EPAs can now be considered at any time during the contract period
• Relaxes the limit on the number of EPA increases a contractor may request – More than 3 EPAs can now be considered during a contract period
• Allows a lower level of approval, to one level above the Contracting Officer, for price increases above the EPA clause ceiling.
• Clarifies that if a contractor has removed an item from their MAS contract, the Contracting Officer may add the same item back at a higher price if the higher price can be determined fair and reasonable.

Got questions? Connect with an experienced Aprio advisor today.

Schedule a Consultation