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Part III: Laying the Foundation
Before Using the Card
Before using your purchase charge card, you should do and learn the following:
Plan Your Monthly Purchases
Decide which items are best handled with the purchase charge card, and decide when to actually buy. When you plan your purchases, you can combine requirements in order to qualify for volume discounts. Similarly, you can make small-scale purchases to avoid wasteful stockpiling. Your planning ensures that you are able to most effectively accomplish your mission by purchasing higher priority items before lower priority items.
Ensure Availability of Funds
You must establish the amount of your available funds BEFORE making any purchases with the purchase charge card. Some agencies require cardholders to verify the amount of their available funds before each purchase.
You must track purchases during the month to ensure that there are sufficient funds available to make all required purchases. Cardholders must use a log system to record purchases and the dollar amounts committed. Then they know at a glance the amount of their unobligated funds or certified fund availability.
Conduct Market Research
How can your contracting activity help in market research? Your contracting activity can provide information on required sources of supply, existing contracts, good merchants and many other areas.
Market research allows you to make an informed, responsible, reasonable purchase. Do enough market research to ensure that the government gets a good value for its money in terms of reasonable price and timely/reliable/quality service. The purchase should represent the best buy that meets the government's minimum requirements.
Compare prices and check with your contracting activity to see if there are existing contracts that offer you a good price, service, and quality. These existing contracts have been negotiated at your agency or by other agencies and can sometimes offer advantages in time and money savings. Check with the merchant to determine if they accept the purchase charge card.
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. You can buy a higher priced item if it represents a better value, but it is your responsibility as the cardholder to perform basic comparison-shopping. For example, check the vendor’s schedule price at http://www.gsa.gov/schedules
Seek State Tax Exemption
On December 10, 1998 the GSA sent a letter to all states and commonwealths requesting their support of the GSA SmartPay® charge card program by continuing to extend tax exemption status to the federal government for charge card purchases. A copy of the letter can be found at www.gsa.gov/gsasmartpay.
Talk to Merchants
You should be as specific as possible when talking to merchants. Ask about:
- Price
- Whether the price includes shipping
- Time of delivery
- Discounts for government purchases
- Merchant's return policies
When you have all the necessary information, make the purchase.
- A merchant may never charge a fee for using the purchase charge card. Report any merchant who asks you to pay a fee through your A/OPC
- A merchant may never establish a minimum or maximum transaction amount as a condition for honoring a purchase charge card
- A merchant may never require the cardholder to complete a postcard or similar device that includes the cardholder's account number, card expiration date, signature, or any other card account data in plain view when mailed
What Are Point of Sale Discounts?
Certain merchants offer automatic discounts when you use your purchase charge card to make purchases. These merchants recognize the government purchase charge card and apply a discount at the time of the sale.
Is It Necessary to Distribute Purchases?
If you are not required to get quotations, can you always buy from the same source?
Part 13.202(a) of the Federal Acquisition Regulations recommends that micro-purchases be equitably distributed among qualified merchants to the extent practicable.
Determine Dollar Limits
There are generally two types of dollar limits applied to your purchase charge card:
- Single purchase limit
- Monthly purchase limit
Single purchase limits and monthly purchase limits are established when your account is set up. They are based on your Delegation of Authority and the budgetary limits of your office. The single purchase limit is the dollar limit for an individual purchase charge card transaction. For micro-purchases, the single purchase limit may be set up to $3,000. The monthly limit represents the cumulative dollar limit for your purchases in one month. It may be set to any dollar amount equal to or greater than the single purchase limit. Verify both of your limits with your Approving Official or A/OPC. Other restrictions such as number of transactions and merchant category codes may apply.
Exceeding Your Dollar Limit
Prior to processing your purchase the merchant will check to see if it exceeds any of your dollar limits. All attempted transactions that exceed your single or monthly limit will be automatically declined at the point of sale. It is your responsibility to know the level of your limits before you purchase. Do not rely on the authorization system to do this for you. Contact your A/OPC immediately if your card is declined.
Select Required Sources
Use of the purchase charge card should be consistent with established guidelines for required sources of supply and applicable acquisition procedures, such as those applicable to micro-purchases or to acquisitions below the simplified acquisition threshold. Procurements paid for with the card are subject to the acquisition rules established in the Federal Acquisition Regulations (FAR) and 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 Part 8 (Required Sources of Supplies and Services) of the Federal Acquisition Regulations. Micro-purchases are not exempt from this requirement. The following information is provided to assist you in locating sources that can supply required supplies and services:
With a connection to the Internet, you can quickly browse through the GSA on-line shopping mall for thousands of commercial products and services including JWOD/NIB/NISH and UNICOR products.
GSA Advantage! ®TM is 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 purchase charge card.
The address for GSA Advantage! ®TM is www.gsaadvantage.gov/.
For any questions regarding GSA's Products and Services, call the National Customer Service Center (NCSC) at 1-800-488-3111 or DSN 465-1416.
Small Business
It is the policy of the government to provide maximum practicable opportunities in its acquisitions to small business.
Shop Smarter
- 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 visiting www.mastercard.com and www.visa.com to use their merchant/supplier locator tools.
Buy Green
Both Congress and the President directed federal agencies to be good stewards of the environment by conserving energy and other precious natural resources. One way that we can be good stewards is to buy products and services that conserve resources. This is generally referred to as “green” purchasing. When you use your purchase charge card to buy "green" products, you and your agency are helping to perform the mission in a cost-effective manner, enhancing energy security, creating markets, increasing worker safety, and promoting environmental stewardship.
There are six components to the Federal green purchasing program:
- Recycled content products
- Energy Star and FEMP-designated energy efficient products, low standby power devices, and renewable energy
- Biobased products
- Alternative fuel vehicles/alternative fuels
- Environmentally preferable products and services
- Non-ozone depleting substances
Of these, all but alternative fuel vehicles, alternative fuels, and renewable energy can be purchased with your purchase charge card. The purchase of these products is required by law or executive order unless the products do not meet your performance needs, are not reasonably available, or are only available at an unreasonable price. All of these products are commercially available off-the-shelf items and are available through GSA stock and schedule programs, the Defense Logistics Agency, mandatory sources such as the National Industries for the Blind, and commercial open market sources.
- Buying recycled content products
The Resource Conservation and Recovery Act requires the purchase of recycled content products designated by the Environmental Protection Agency (EPA). These products are also known as Comprehensive Procurement Guideline or CPG items; the CPG is EPA’s list of designated products. The EPA maintains a list of designated recycled-content products and recommends recycled-content levels that you should use when buying these products. Examples of recycled content products typically purchased with purchase charge cards are recycled content copier paper and other office paper products, notebook binders, and remanufactured toner cartridges. Refer to www.epa.gov/cpg
for the list of products, EPA's recommendations, and additional information.
- Buying energy efficient products
The Energy Policy Act of 2005 requires agencies purchasing energy consuming equipment to purchase Energy Star products or energy-efficient products designated by the Department of Energy’s Federal Energy Management Program (FEMP). "Energy efficient" includes products in the top 25th percentile of efficiency and standby power devices. Energy efficient products typically purchased with a purchase charge card include desktop computers, laptops, and small appliances. Presidential Executive Order 13221, "Energy- Efficient Standby Power Devices" requires you to buy products that use minimal standby power. Additionally, agencies participating in the Federal Electronics Challenge have committed to purchasing equipment registered to the Electronic Products Environmental Assessment Tool (EPEAT) standards. Both the Energy Star program and FEMP have websites identifying energy efficient products and guidance for purchasing these products. FEMP also has established a StandBy Power Device Product Listing with information on such products as computers, fax machines and printers. Refer to www.energystar.gov and http://www.eere.energy.gov/femp/procurement/ for efficiency recommendations, cost-effectiveness examples, buyer tips, product sources, and for additional information and to http://www.federalelectronicschallenge.net/resources/aquisit.htm for additional information about EPEAT-registered products
- Buying biobased products
The Farm Security and Rural Investment Act of 2002 requires the purchase of biobased products designated by the U.S. Department of Agriculture (USDA). These products are typically made from feedstocks derived from farm crops and farm residues, but can also contain wood byproducts. USDA began designating biobased products in 2005 and ultimately may designate more than 100 products. Examples of biobased products typically purchased with purchase charge cards are various types of lubricants and greases, office and bathroom cleaning products, and hand soaps and other personal cleaning products. Refer to http://www.biobased.oce.usda.gov/fb4p/DesignationItemList.aspx for the list of designated products, USDA’s recommendations, and additional information.
- Buying environmentally preferable products
Presidential Executive Order 13101, "Greening the Government Through Waste
Prevention, Recycling, and Federal Acquisition" emphasizes the significance of
purchasing environmentally preferable (EPP) products. These products can be
viable alternatives to products that contain hazardous materials or toxic
chemicals, such as green cleaning products or mercury-free thermometers. They also can have multiple attributes, such as a printer that is energy efficient, prints two-sided, and uses recycled content copier paper and remanufactured toner cartridges.. To date, agencies have conducted more then 30 EPP projects that
range from renovation of the Pentagon parking lot and building construction to
acquisition of janitorial products or services. Agencies are encouraged to purchase green cleaning products. Refer to www.epa.gov/epp for
summaries of the pilot projects, sample contract language, standards information,
product sources, and additional information. Refer to http://ofee.gov/gp/gp.asp for more information about green cleaning products and other environmentally preferable products and services.
- Buying non-ozone depleting substances
Although we have been very successful in reducing releases of ozone-depleting substances (ODSs), the ozone hole over the Antarctic is still huge. EPA identifies alternatives to ODSs through its Significant New Alternatives Policy (SNAP) program and provides recommendations for specific products, such as refrigerants and fire extinguishers. Refer to www.epa.gov/ozone/snap/lists/index.html for the list of products and alternatives.
For more information on using your purchase charge card to buy "green" products, please contact Ms. Dana Arnold at arnold.dana@ofee.gov or visit http://ofee.gov/gp/gp.asp.
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