We also realize that agencies use the purchase card above the micro-purchase threshold at various dollar levels and there is not consistency in FPDS reporting practices. Notwithstanding, the PEC agreed that OFPP should not take action at this time to clarify the FPDS guidance when the card is used above the micro-purchase threshold. Although GSA collects data centrally on all purchase card transactions (above and below the micro-purchase threshold), GSA should be given time to provide the PEC with a status report on the availability of socio-economic data under its new purchase card contracts.

The above change becomes effective immediately. We will provide a replacement page when we issue the next amendment to the FPDS Reporting Manual. In the meantime, we ask that you notify your contracting activities of this change. Should you have questions, please contact Linda Williams on 202-395-3302.

Attachment

c: FPDS Policy Advisory Board Members

As a result of unclear policy, FPDS data (which policy makers rely on to measure the success of procurement programs) is incomplete. Therefore, we recommend the following changes to FPDS policy:

Please be prepared to indicate your concurrence with the policy changes described above during the April Procurement Executives Council meeting; your agreement is needed in order to revise the FPDS Reporting Manual. If you do not concur with this policy, please plan to present and discuss alternatives. Should you have questions, please contact LInda Williams on 202-395-3302.

Attachment

cc: FPDS Policy Advisory Board Members

GSA's Smart Card contracts, which become operational in November 1998, will provide agencies with the next generation of purchase cards to further strengthen micro-purchasing and payment for other small dollar purchases. In addition, the cards will help agencies improve their capability to capture socio-economic data to assess small business participation. This capability is particularly important given the growing use of purchase cards. For these reasons, I am seeking your input as we re-evaluate the Federal Procurement Data Systems (FPDS) data collections policies relating to purchase card transactions.

I. Proposed Alternatives to claricy current FPDS Reporting Requirements

In accordance with the September 1997 FPDS Reporting Manual, agencies do not report credit card purchases. In particular, when agencies use the card to make micro-purchases, those purchases are not reportabe (see attached OFFPP January 13, 1995 guidance). GSA obtains purchase card information from its purchase card contractor and provides this information directly to the Federal Procurement data Center (FPDS). This helps to reduce agencies' reporting burden.

Questions have arisen regarding FPDS reporting when the card is used in actions above the micro-purchase threshold and the agency executes a contractual instrument (paper or electronic order or contract). In these cases, the card is typically used to make payment for an order placed under existing contract. We are considering two alternative approaches to clarify the FPDS instructions regarding transactions above the micro-purchase threshold.

Alternative A: Agencies shall report to the FPDS any transaction above the micro-purchase threshold involving the use of the purchase card.

The existing GSA contractor and the new Smart Card contractor only capture limited data on purchase card transactions. (Attachment B identifies the type of data that will be available initially through the GSA Smart Card contracts.) By continuing to capture FPDS data, policy makers will have other valuable information regarding those purchases such as the extent of competiton, the type of preference program used, and whether the contract action is a new definitive contract, an order under a schedule contract, or a modification. This alternative could result in an overstatement of total Federal procurement dollars if purchase card activity is combined with the FPDS data.

Alternative B: Agencies shall not report to the FPDS any transactions above the micro-purchase threshold involving the purchase card.

This alternative reduces the reporting burden on agencies and avoids the potential for double counting because the purchase card information would be captured centrally by the GSA contractor. Using the GSA data, the FPDC publishes the number of transactions and sales volume by agency in the FPDS Federal Procurement Report. We will, however, lose visibility of other valuable information regarding these purchases that would be available under Alternative A.

In order to determine which, if either, of these reporting policy alternatives is more appropriate, we would like feedback on the following questions:

II. Collecting Information on Small Business Participation.

The socio-economic information available from the GSA Smart Card contracts is essentially equivalent to the type of contractor data field on the SF 281 (Summary Contract Action Report) and SF 279 (Idividual Contract Action Report). MasterCard and Visa collect the socio-economic information through a merchant profile that is completed when merchants join these networks. The GSA Smart Card contractors rely on the Master Card or Visa databases to capture socio-economic information on purchase card transactions processes through the MasterCard and Visa networks.

It is important that we are effectively and efficiently capturing socio-economic data-- especially that relates to small business activity-- on all transactions (below and above the micro-purchase threshold) involving the purchase card. More accurate data will help to develop a better picture of the impact of purchase card use on small business participation. In addition, the data will help us gain a clearer understanding of the impact of the micro-purchase exemption from small business set-aside requirements.

Accordingly, we request your feedback on the following additional questions:

Please provide your feedback to the five questions set out above not later than September 18, 1998. We will evaluate your feedback and clarify the FPDS reporting instructions as appropriate. Our goal is to issue revised instrctions by October 21, 1998. Shoudl you have any questions, please contact Linda Williams of my staff on 202-395-3302.

Attachments

cc: FPDS Policy Advisory Board Members

Should you have any further questions, please call Linda Williams of my staff on 202-395-3302.


cc: FPDS Policy Advisory Board Members

• Business Type: 1)Corporation or 2) other business structure (such as partnership, sole proprietorship, or joint venture).
• Business Owner Type (self-certified): 1) Not female or handicapped, 2) Female, 3) Physically handicapped female, 4) Physically handicapped male, or 5) Unkown.
• Small Business, Disadvantaged, or Other Certification Type: 1) Not certified as such, 2) SBA certified small business, 3) SBA certified as small disadvantaged business, 4) Other government or agency-recognized certification (such as Minority Supplier Development Council), 5) Self-certified small business, 6) SBA certification as small business and other government or agency recognized certification, 7) SBA certification as amall disadvantaged business and other government or agency-recognized certification, 8) Other government or agency-recognized certification and self certified small business, or 9) Unknown.
• Racial or Ethnic Type Uncontitional Majority Owner: 1) African American, 2) Asia Pacific American, 3) Subcontinent Asian American, 4) Hispanic American, 5) Native American Indian, 6) Native Hawaiian, 7) Native Alaskan, 8) Caucasian, 9) Other, and 10) Unknown.
• Merchant/Employer Tax ID number: If not a corporation, principal owner's Social Security Number.
• Merchant SIC code: 4-digit number.

• Merchant Inforporation Status Code: 1) Other, 2) Individual/sole Proprietorship, 3) Partnership, or 4) corporation.
• Woman-Owned Indicator: Identifies if a woman (yes or no) owns the merchant.
• Merchant Minority Vendor Code: Identifies if the merchant is owned by a minority: 1) Not minority owned, 2) Asian-Indian, 3) Asian-Pacific, 4) Black, 5) Hispanic, or 6) Native American.
• Annual Sales in US dollars for the merchan location.
• Number of Employees at the merchant location.
• Merchant 9-digit Taxpayer Identification Numbere assigned by the Internal Revenue Service for U.S. merchants only.
• Merchant Primary Standard Industrial Classification (SIC) code at the 4-digit level.