BLANKET PURCHASE AGREEMENT

The BPA method of small purchase is a simplified procedure of establishing charge accounts with qualified sources of supply to cover anticipated small purchases of the same general category. BPAs eliminate the necessity of issuing individual purchase orders by providing that purchases may be made by placing oral calls or issuing informal memorandums when more convenient. Maximum use of BPAs is encouraged and recommended, when appropriate.

Conditions for Use of BPAs

All BPA agreements are issued as bilateral, two-party signature documents. Major field purchasing activities and other Navy field contracting system (NFCS) activities who have been granted such authority are authorized to place BPAs when there is a repetitive need for similar supplies or services and when the use of the BPA is administratively more economical and efficient than any other small purchase method. Normally, BPA calls may not exceed $10,000, However, BPA calls up to $25,000 may be placed by ICPs, and calls for subsistence are unlimited as to dollar value.

The use of a BPA does not authorize purchases that are not otherwise authorized bylaw or regulation. For example, the use of a BPA does not justify sole source purchasing or avoiding small business-small purchase set-asides. The rules of distributing purchases among qualified suppliers for purchases not in excess of $1,000 and for seeking competitive quotations for purchases in excess of $1,000 apply to each call under a BPA.

If there is an insufficient number of BPAs to assure competition and equitable distribution of business, the contracting officer should solicit quotations from other sources for the immediate purchase and take action to establish additional BPAs for future purchases. Like any other purchase, each BPA call must be made on the basis of a purchase request.

Authorized BPA Callers

BPA calls may be made by any individual within the purchasing office of the command of the contracting officer who entered into the BPA. In addition, the contracting officer who issued the BPA may authorize other activities who have been granted contracting authority to place calls under his or her BPA.

BPA calls may normally be made only by authorized personnel within purchasing offices. To be approved, all individuals to be authorized to place BPA calls must have attended a NAVSUP-approved small purchase course. In addition, all individuals authorized must be appointed as contracting officers (with authority to place calls up to a certain limitation) via a Certificate of Appointment, Standard Form 1402.

Establishment of BPAs

The contracting officer is responsible for the establishment of BPAs. BPAs will be made with contractors from whom numerous individual purchases will be made over a given period. To the maximum extent possible, BPAs for items of the same type should be placed at the same time with more than one supplier.

All competitive sources should be given an equal opportunity. For example, if you have repetitive requirements for electrical supplies, you should establish BPAs with more than one contractor who sells this type of material. You can then distribute the calls among the BPA holders for purchases not over $1,000 and obtain competition from them for purchases over $1,000.

IMPREST FUND

The IF purchase method is a simple and economical way of effecting purchases not in excess of $500. The IF method employs a cash fund from which payments are made at the time purchase transactions occur and to which reimbursements are made on a revolving basis. The IF is in the custody of the IF cashier.

Authority for Imprest Fund

Naval activities with contracting authority are authorized to establish an IF under the following conditions:

1. The activity has been granted contracting authority to use the IF method of purchase. (Activities with contracting authority in excess of $25,000 automatically have authority to use the IF method of purchase.)

2. The establishment of the fund is approved in writing by the commanding officer of the activity.

3. Use of the IF method of purchase by afloat units must be approved in writing by the type commander (TYCOM).

4. IFs are not authorized for commissary stores.

The authorization letter signed by the commanding officer should state the maximum amount of the fund. The original copy of the authorization letter is retained by the IF cashier, and a copy is forwarded to the cognizant regional contracting management activity, TYCOM, or NAVSUP.

The amount of each IF for shore activities is based on (1) estimated monthly payments (not to exceed $10,000) or (2) an amount of $500. For afloat activities, the IF amount may not exceed $1,000 for ships with Supply Corps officers or $500 for ships without Supply Corps officers. A review is made at least once each quarter to determine the continuing need for each fund established and whether the amount of the fund is in excess of actual needs based on the average monthly volume of expenditures. This review is made by the officer who approved the establishment of the fund or by a delegated representative.

Imprest Fund Cashier

Although the general management of the IF purchase method is a responsibility of the contracting organization, any officer, enlisted person, or civilian employee of the activity may be appointed by the commanding officer as an IF cashier (or alternate IF cashier). Exceptions to this are disbursing or fiscal office personnel and individuals responsible for originating, approving, or processing requirements.

Appointment of Imprest Fund Cashier

The appointment (and revocation of the appointment) of the IF cashier and alternate must be made in writing by the commanding officer of the activity. The IF cashier acknowledges acceptance of the position by signing the following statement: "I agree to hold myself accountable to the United States for all public funds received." A letter of appointment is maintained in a permanent file and should be retained for a period of not less than 5 years after the appointee ceases to serve. Two copies of the appointment letter are furnished to the cashiers, one copy to the disbursing office and one copy to the purchasing office.

The IF cashier and alternate do not have to be bonded. Both the IF cashier and alternate must each have his or her safe and are the only persons authorized to have the combination for their respective safes. The combination of each safe must be changed every 6 months.

Conditions for Use of Imprest Funds

The IF maybe used for small purchases under the following conditions:

The transaction does not exceed $500.

The use of the IF is considered to be advantageous to the government.

Supplies or services are available for delivery within 60 days.

The purchase does not require detailed technical specifications or technical inspection.

Authorized Use of Imprest Funds IFs MAY be used for the following:

- Delivery charges associated with the purchase from the IF when the contractor is requested to arrange for delivery. These charges include C.O.D. postal charges and intercity transportation charges of $75 or less.

- C.O.D. charges for supplies ordered for payment from the IF.

- Civilian volunteers for participation in approved medical research projects.

- Travel advances or travel expenses (when there is no disbursing officer available to effect payment).

- Transportation charges (not related to purchases).

- Postage stamps.

- Transportation passes or bridge tokens.

Prohibited Uses of the Imprest Fund IFs may NOT be used for the following:

- Payment of salaries and wages

- Payment of transportation charges on bills of common carriers when those charges exceed $75

- Travel advances or any other advances when a disbursing officer is available to effect payment

- Payment of travel claims, except for claims for local travel not under orders, when a disbursing officer is not available to effect payment

Payment of public utility bills

Cashing of checks or any other negotiable instruments

Purchase of money orders

Purchase from contractors or contractors' agents who are military personnel or civilian employees of the government

Purchases of foreign items unless the applicable decisions of exception and documentation are made before procurement

Repetitive purchases from the same contractor when another method of purchase, such as a BPA, would be more appropriate

Imprest Fund Purchase Log

An IF purchase log (table 4-1) is locally prepared and maintained by the IF cashier to provide a record of each transaction.