IT leasing moratorium is close to an end

IT leasing moratorium is close to an end

Agencies by early next month will be able to resume leasing IT equipment via the General Services Administration's Federal Supply Service Schedule 70. GSA on Monday sent final leasing terms and conditions to vendors, who have until May 3 to sign off or request negotiations to customize the terms.

The agency had placed a 60-day moratorium on new leasing orders April 5 after months of negotiations between contractors, industry associations and GSA failed to produce a new agreement.

Under the new terms, vendors can offer three options: leasing to own, leasing with an option to own and step leasing. The step-lease option recently was added to the mix. It lets agencies sign leases for one year at a time with reduced prices for subsequent one-year renewals.

Larry Allen, executive director for the Coalition for Government Procurement, an industry association in Washington, was pleased with the new terms.

'GSA retained some good protections for government, while also being overall very evenhanded to contractors,' he said. 'This means, in effect, the moratorium is on its way out. Instead of a 60-day suspension, it turned out to be more like a 15-day moratorium.'

Allen said GSA also heeded a number of his organization's recommendations, such as returning leased equipment within 14 days of the end of a lease and renewing leases within 30 days. The new terms also require agencies to delete or disable leased software after the lease runs out'an important issue to contractors, Allen said.

Contractors must sign off on the new conditions and submit new price lists. Then GSA can approve the new contract and lift the moratorium on a vendor-by-vendor basis.

'Our goal always was to settle this as quickly as possible,' said Deborah Ruiz, GSA spokeswoman. 'It is now a matter of contractors getting back to us to accept the terms.'

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