FAR 51.102—Authorization to use Government supply sources.
Plain-English Summary
FAR 51.102 explains how a contracting officer authorizes a contractor to use Government supply sources and what must happen before, during, and after that authorization. It covers the required written finding in the contract file, the factors the contracting officer should consider when deciding whether to authorize use of Government sources, the special rule for subcontractors, and the steps for obtaining the proper activity address code or agency approval from GSA, DoD, VA, or another agency. It also addresses what information must be included in the request to the Government supply source, what must be stated in the contractor’s authorization letter, and how the authorization may be limited by scope, dollar amount, facility, contract, or title-vesting terms. Finally, it assigns post-authorization responsibilities to the authorizing agency for monitoring compliance, handling unpaid indebtedness, and notifying supply sources of address changes or contract completion/termination. In practice, this section is the control point that prevents contractors from using Government inventories or ordering systems without documented need, proper routing, and clear accountability.
Key Rules
Written finding required
Before authorizing use of Government supply sources under 51.101(a) or (b), the contracting officer must place a written finding in the contract file supporting the authorization. No written finding is required for authorizations under 51.101(c).
Decision factors to consider
The determination should be based on, but is not limited to, administrative ordering costs, program delay impacts, lower item cost, suitability of available items, delivery cost and time, and the contractor’s recommendations. These factors help justify whether Government supply sources are actually advantageous for the contract.
Subcontractor use is controlled
Authorizations for subcontractors must be issued through the prime contractor and with the prime contractor’s approval. The subcontractor does not receive a direct, independent authorization from the Government.
Separate approval channels apply
Once the contracting officer decides to authorize use, the officer must request the appropriate code or approval from the correct source: GSA for FEDSTRIP, DoD for MILSTRIP, VA for VA supply sources, or the relevant agency for other sources. The request must include specified contract and mailing information.
Authorization letter must be specific
The authorization must cite the contract number(s), should be time-limited when practicable, and must tell the contractor which ordering method to use, including the applicable code and form requirements. The contracting officer may also impose additional limits or conditions.
Limits and conditions may be tailored
The contracting officer may restrict the authorization to certain supplies, dollar thresholds, facilities, or contracts, and may specify title-vesting terms if they differ from the default arrangement. The authorization must also direct compliance with the subpart’s policies and procedures.
Agency retains oversight duties
After authorization, the authorizing agency must ensure compliance, account for supplies and services obtained, handle any unpaid indebtedness, and notify the appropriate Government supply sources of contractor address changes and contract completion or termination.
Responsibilities
Contracting Officer
Document a written finding in the contract file when required; evaluate the relevant cost, suitability, delivery, and program-impact factors; obtain the proper code or approval from the appropriate Government source; issue a clear authorization letter with required citations, limits, and instructions; and ensure the contractor is told to follow all applicable policies and procedures.
Contractor
Use Government supply sources only when authorized; follow the ordering method, code, form, and any limitations or conditions in the authorization; account properly for supplies and services obtained; and satisfy any resulting indebtedness.
Prime Contractor
Approve and route any authorization for a subcontractor through the prime contract relationship; ensure subcontractor use of Government supply sources occurs only as authorized and under the terms approved by the Government and the prime contractor.
Subcontractor
Use Government supply sources only through the prime contractor’s approved authorization and comply with the terms, limits, and procedures that apply to that authorization.
Authorizing Agency
After issuing the authorization, monitor compliance, track and account for supplies and services obtained, pursue or absorb unpaid indebtedness as applicable, and submit written address changes or deletions to the relevant Government supply sources when contracts end or are terminated.
GSA, DoD, VA, or Other Appropriate Supply Source
Receive and process the contracting officer’s request for the applicable activity address code or approval, and maintain the contractor’s access information needed for ordering from the Government supply system.
Practical Implications
This section is a documentation and control requirement, not just a permission step: if the file lacks the required written finding, the authorization can be vulnerable to challenge during audit or review.
The contracting officer should think through whether Government supply sources really save money or time; a lower item price can be offset by administrative burden, delivery delays, or poor item suitability.
Contractors often run into trouble when they ignore ordering mechanics, such as using the wrong system, omitting the activity address code, or failing to follow form requirements for VA-related purchases.
Authorization scope matters. Narrow limits on dollar value, facilities, supplies, or contracts can prevent overuse and help the Government control risk, but they must be stated clearly in the authorization.
Post-award oversight does not end with the authorization letter. Agencies must keep contractor address information current, monitor usage, and address unpaid charges or improper use promptly to avoid billing and accountability problems.
Official Regulatory Text
(a) Before issuing an authorization to a contractor to use Government supply sources in accordance with 51.101 (a) or (b), the contracting officer shall place in the contract file a written finding supporting issuance of the authorization. A written finding is not required when authorizing use of Government supply sources in accordance with 51.101 (c). Except for findings under 51.101 (a)(3), the determination shall be based on, but not limited to, considerations of the following factors: (1) The administrative cost of placing orders with Government supply sources and the program impact of delay factors, if any. (2) The lower cost of items available through Government supply sources. (3) Suitability of items available through Government supply sources. (4) Delivery factors such as cost and time. (5) Recommendations of the contractor. (b) Authorizations to subcontractors shall be issued through, and with the approval of, the contractor. (c) Upon deciding to authorize a contractor to use Government supply sources, the contracting officer shall request, in writing, as applicable- (1) A FEDSTRIP activity address code, through the agency’s central contact point for matters involving activity address codes, from the General Services Administration (GSA) FXS Washington, DC 20406; (2) A MILSTRIP activity address code from the appropriate Department of Defense (DoD) service point listed in Section 1 of the Introduction to the DoD Activity Address Directory; (3) Approval for the contractor to use Department of Veterans Affairs (VA) supply sources from the Executive Director, Office of Acquisition and Logistics (003A), Department of Veterans Affairs, 810 Vermont Avenue, NW, Washington DC 20420; or (4) Approval from the appropriate agency for the contractor to use a Government supply source other than those identified in paragraphs (c)(1) through (c)(3) of this section. (d) Each request made under paragraph (c) of this section shall contain- (1) The complete address(es) to which the contractor’s mail, freight, and billing documents are to be directed; (2) A copy of the contracting officer’s letter of authorization to the contractor; (3) The prime contract number(s); and (4) The effective date and duration of each contract. (e) In each authorization to the contractor, the contracting officer- (1) Shall cite the contract number(s) involved; (2) Shall, when practicable, limit the period of the authorization; (3) Shall specify, as appropriate, that- (i) When requisitioning from GSA or DoD, the contractor shall use FEDSTRIP or MILSTRIP, as appropriate, and include the activity address code assigned by GSA or DoD; and (ii) When requisitioning from the VA, the contractor should use FEDSTRIP or MILSTRIP, as appropriate, Optional Form 347 , Order for Supplies or Services (see 53.302-347), or an agency-approved form; (4) May include any other limitations or conditions deemed necessary. For example, the contracting officer may- (i) Authorize purchases from Government supply sources of any overhead supplies, but no production supplies; (ii) Limit any authorization requirement to use Government sources to a specific dollar amount, thereby leaving the contractor free to make smaller purchases from other sources if so desired; (iii) Restrict the authorization to certain facilities or to specific contracts; or (iv) Provide specifically if vesting of title is to differ from other property acquired or otherwise furnished by the contractor for use under the contract; and (5) Shall instruct the contractor to comply with the applicable policies and procedures prescribed in this subpart. (f) After issuing the authorization, the authorizing agency shall be responsible for- (1) Ensuring that contractors comply with the terms of their authorizations and that supplies and services obtained from Government supply sources are properly accounted for and properly used; (2) Any indebtedness incurred for supplies or services and not satisfied by the contractor; and (3) Submitting, in writing, to the appropriate Government sources, address changes of the contractor and deletions when contracts are completed or terminated.