Leasing resolution likely

Industry and government officials are working toward a quick end to a 60-day moratorium imposed in late March by the General Services Administration on leasing of information technology products under the Federal Supply Service schedule.

GSA said it would suspend IT leasing under the FSS schedule for 60 days, beginning April 5. About $100 million in leasing is generated under the FSS IT Multiple Award Schedule each year. About $10 billion a year is spent through the schedule, according to GSA.

The GSA initiated the moratorium because it is concerned about high fees charged to agencies for early termination of leases, said Larry Allen, executive director of the Coalition for Government Procurement in Washington.

Concerns arose after the Navy awarded the Navy-Marine Corps Intranet contract and canceled some leases early, causing it to face greater charges than it had anticipated.

GSA spokeswoman Deborah Ruiz said the agency will work with customers that have major IT leasing projects "to ensure that they are able to maintain the focus on their mission. We will address each situation on a case-by-case basis. It is extremely important to us that any impact on customers is minimal, if at all."

GSA and industry representatives met April 5 to discuss new leasing terms. GSA is reviewing draft language and will be providing it to contractors shortly, Ruiz said.