OA&L Equipment Installment Purchase Program - for Other Government Agencies
The OA&L Equipment Installment Purchase Program eases the financial impact of significant one-time obligations for equipment purchases. Instead of purchasing equipment outright, via an up front, lump sum payment, the program enables equipment to be purchased by installment payments with a minimal administration charge.
Advantages of the Installment Purchase Program:
A one-time, up front budget obligation for the equipment’s entire cost is not required of the customer; rather, the cost of the equipment is spread over multiple years.
The customer receives the same leveraged purchase discounts as those obtained in an outright purchase.
The installment payments can be made from either equipment or operating funds.
The 6% administrative rate is extremely low.
The customer is entitled to early buyout of the installment balance without penalty, which facilitates intelligent use of year-end funds.
Terms of the Installment Purchase Program:
The period of the agreement will be from one to five years. Agreements for equipment costing less than $100,000 are limited to terms of 1 year. (Note: the agreement term must be less than the equipment’s useful life).
If the equipment is purchased through the National Acquisition Center (NAC) or the Acquisition Operations Service (AOS), the customer will pay the standard markup (usually 2% with a cap of $25,000). If purchased via a national contract, such as FSS, the markup is 1%.
Installment payments will be made fro the customer’s funds to OA&L on a quarterly, bi-yearly, or yearly basis.
The annual administrative rate of 6% is assessed on the declining principal balance.
The customer will be responsible for repair and maintenance.
The equipment title will pass to the customer upon completion of installment payments or after early buyout.
Procedures to access the Installment Purchase Program:
The prospective customer faxes a request to Don Hufford, Systems Accountant,
OA&L (049F), at 202-273-6125. This information can also be sent electronically through MS Exchange addressed to Don Hufford. The request should include:
a description of the equipment.
the NAC, AOS, or open market cost of the equipment (net of any discounts and/or trade-ins) and the name of the contracting officer.
the useful life of the equipment.
the length of time for the installment (from 1 to 5 years)..
the name and phone number of the requesting agency’s point of contact.
After determination that funding is available, OA&L’s CFO Office will provide a proposed installment payment schedule and a draft Interagency Agreement containing the installment terms.
The Interagency Agreement is signed by the other government agency, and the Deputy Assistant Secretary for OA&L. The signatures for the other government agency must be the individual responsible for the program’s funding and an upper management official.
The equipment will then be purchased, using Supply Fund resources, for delivery to the customer.
The customer makes quarterly or annual payments to the Supply Fund through Treasury’s Intergovernmental Payment and Collection System (IPAC).
