Article
A new era of transparency
CSP’s shadow over TDR
Aug. 21, 2025 · Authored by Leo Alvarez, Jeff K. Clayton
Loading...
Article
Aug. 21, 2025 · Authored by Leo Alvarez, Jeff K. Clayton
On June 9, 2025, the General Services Administration (GSA) announced one of the most consequential changes to the Federal Supply Schedule (FSS) program since its inception — it would begin expanding its Transactional Data Reporting (TDR) requirement across the entire FSS program. Starting with Solicitation Refresh 27, TDR will become mandatory for all product Special Item Numbers (SINs) and cloud service SIN 518210C, eventually extending to all remaining SINs.
Translation? The Commercial Sales Practices (CSP) disclosure and Price Reductions Clause (PRC) requirements will be eliminated (or, in the case of the PRC, significantly altered), relieving contractors of some of the most burdensome and risky aspects of GSA Schedule contracting. PRC liability, long viewed as a significant compliance risk due to its complexity and potential for costly penalties — will effectively disappear. But while this shift may appear to simplify the landscape for contractors, it also ushers in a new era of uncertainty.
TDR, while less burdensome in some respects, brings its own set of challenges: increased data transparency, heightened scrutiny of pricing consistency across federal agencies and potential questions around value and fairness — particularly if notable pricing differences emerge between agencies or contract vehicles. As the GSA shifts from historical pricing disclosures to real-time federal sales reporting, contractors must prepare for a fundamentally different risk environment — one that may be less predictable and potentially more demanding in terms of data integrity, pricing strategy and audit readiness.
Since its inception, the FSS contracting model has been predicated on the principle that items offered under Schedule contracts should meet the definition of commercial items as outlined in Federal Acquisition Regulation (FAR) 2.101[1]. This notion of commerciality implies that the basic principles of supply and demand in the commercial marketplace will result in prices that are inherently fair and reasonable assuming adequate competition exists.
However, vendors are not awarded FSS contracts through direct competition with one another. Rather, the GSA evaluates each offer independently by comparing the proposed pricing and terms to those extended to the vendor’s commercial customers. This evaluation is meant to account for differences in terms and conditions that may influence commercial pricing and discounting practices, enabling the GSA to establish price negotiation objectives for the government.
This is why the FSS program has long required offerors to disclose their commercial sales practices — to equip the government with the information necessary to assess fair and reasonable pricing.
So why has there been a breakdown with this pricing construct? The answers are myriad, but to highlight a few important factors:
Many vendors struggled to prepare current, accurate and complete CSP disclosures, especially when commercial pricing models didn’t align neatly with the solicitation’s CSP-1 Format [2] form. This often led to inconsistent submissions and, in some cases, audit findings that eroded confidence in both the process and the broader FSS program. The GSA Office of Inspector General (OIG) semi-annual reports to Congress consistently reflected this issue, repeatedly citing contractor disclosures that failed to meet the standard of accuracy required — underscoring a systemic challenge in aligning commercial pricing practices and disclosure of those practices with regulatory expectations.
While the government should receive fair and reasonable pricing, it is not necessarily entitled to the lowest price a contractor has offered for a product or service. Although the GSA’s stated objective is to seek “equal to or better than the best price and non-price terms and conditions given to the [offeror’s] Most Favored Customer (MFC),” [3] it is not a requirement. Per GSA Acquisition Regulation (GSAR) 538.270, “Solicitation, evaluation, and award of Federal Supply Schedule (FSS) contracts,” the government acknowledges that it may not be entitled to the best price:
“The Government will seek to obtain the offeror’s best price (the best price given to the most favored customer). However, the Government recognizes that the terms and conditions of commercial sales vary and there may be legitimate reasons why the best price is not achieved.”
While contracting officers were to consider “differences between the FSS solicitation and commercial terms and conditions that may warrant differentials,” [4] between MFC and FSS pricing — in practice, this flexibility was inconsistently applied and often treated as a procedural formality rather than a substantive evaluation. As a result, key distinctions in terms and conditions were frequently overlooked or undervalued, leading to rigid pricing expectations anchored to a company’s most heavily discounted commercial transactions. This disconnect left vendors with a difficult choice: accept pricing terms divorced from commercial realities or forgo participation in the FSS program (and perhaps the government marketplace) altogether. Over time, this dynamic contributed to growing concerns about fairness, flexibility and the perceived value of participating in the FSS program.
While CSP disclosures enable the government to assess whether offered pricing is fair and reasonable at the time of award, the PRC serves as the GSA’s ongoing safeguard to ensure the government continues to receive fair and reasonable pricing throughout the life of the contract. However, the GSA frequently went beyond merely seeking parity with a contractor’s MFC; it often insisted that “all commercial customers” serve as the Basis of Award (BOA), rather than permitting contractors to identify more narrowly defined, representative customers. This expansive interpretation effectively established GSA pricing as a floor across a contractor’s entire commercial portfolio, constraining the contractor’s ability to offer competitive discounts to other commercial customers without triggering PRC obligations.
Compounding this issue was the growing difficulty in negotiating exceptions to the PRC. While contractors could argue that certain sales were “non-comparable,” the GSA became less receptive to these positions. The only regulatory exceptions to the PRC [5] — such as sales to federal agencies, GSA eligible ordering entities, or billing errors — were narrow. Many legitimate commercial practices, including multi-year contracts, prepayment discounts, initial or start-up phase pricing, or bundled solutions, were not formally recognized as exceptions, even though they were materially different from typical GSA transactions.
As a result, businesses often felt hamstrung in their ability to pursue new markets, leading to overly cautious behavior that stifled commercial agility and innovation. In some cases, the compliance burden and pricing constraints were so significant that companies chose to forgo participation in the FSS program altogether, or to do so only through channel partners.
In addition to the compliance burden of PRC monitoring, contractors faced heightened audit risk under the FSS program, as the GSA OIG conducted periodic pre-award and post-award audits to evaluate pricing disclosures and ensure adherence to contract terms and conditions. Routine commercial transactions could inadvertently trigger the PRC and remain undiscovered over significant periods of time, leading to mandatory disclosures to the GSA OIG, or in some cases, whistleblower allegations and False Claims Act matters. These often resulted in lengthy reviews, corrective actions and, in some cases, financial penalties or significant contract modifications. Over time, many contractors came to view the GSA Schedule not as a growth opportunity, but as a potential audit trap. The combination of rigid PRC enforcement and an aggressive audit posture created a chilling effect, discouraging participation in the program.
The CSP/PRC pricing construct did not meaningfully evolve to accommodate the complexities of service-based offerings or integrated “solutions” that combine products and services to meet specific customer needs. Originally designed for commercial products — where catalog pricing and discount structures are well-defined — the FSS framework struggled to address the fluid and customized nature of professional services. In this space, pricing is often driven by project-specific scopes of work, performance expectations and deliverables, rather than standardized hourly rates or labor categories.
Contracting officers attempted to fit services into a product-centric model, resulting in misaligned expectations and compliance challenges. The CSP-1 Format, for example, requires vendors to disclose the lowest rate at which each labor category has been sold commercially — an approach that ignores the holistic, value-based pricing strategies commonly used in the services sector, and leaves unanswered questions about when a labor category or service being sold on one project is comparable to the same or similar labor category or service being sold on another project.
This disconnect led to frustration among vendors, who were asked to deconstruct complex pricing models into artificial components, knowing that such disclosures would be used to negotiate MFC pricing on a granular, labor-category basis. The result is a process that often failed to reflect commercial realities and discouraged participation in the FSS program. Today, services make up the majority of sales on the FSS program.
In the summer of 2016, the GSA unveiled TDR [6] as an alternative to the traditional FSS pricing paradigm, described above. At the time, the GSA hailed TDR as an essential tool in 1) understanding government-wide purchasing behavior and 2) allowing agencies to make smarter acquisition decisions. This approach aligns with the government’s category management [7] strategy. By aggregating transactional data, TDR is designed to support strategic sourcing and help identify opportunities for demand management and supplier consolidation. Moreover, TDR enhances the utility of Best-in-Class (BIC) [8] contracts by providing the pricing transparency and performance data needed to validate their value and support their continued use across agencies.
Under TDR, the GSA bases its price negotiation objectives on how similar goods and services are being purchased within the government marketplace (a “horizontal” pricing approach). Instead of submitting CSP disclosures to establish pricing and monitoring pricing to comply with the PRC requirement, contractors must submit detailed transactional prices paid data on a monthly basis.
This trade-off means that GSA Schedule pricing is no longer benchmarked against how a company sells commercially, but rather on pricing offered within the government marketplace. Ultimately, how an organization prices at the order level (or perhaps, even how its competitors price) in the government marketplace could impact pricing negotiations at the Schedule level or at the order level. Notably, there is an alternate PRC applicable to FSS contracts subject to the TDR that allows the contracting officer to request, or the contractor to offer, price reductions at any time during the life of the contract. [9] That alternate PRC does not carve out exceptions for sales to federal agencies and eligible ordering entities the way the predecessor clause does. Meaning, sales to federal agencies and eligible ordering entities could trigger a request for a reduction in the contract price at any point during the life of the contract.
While many contractors reacted positively to the removal of the CSP/PRC requirement and the significant level of effort and risk associated with it (for good reason), this shift in the overall GSA pricing model did cause concerns around how the GSA would use the TDR data. At the time when the initial TDR pilot was being contemplated, industry had concerns about data security, about who would have access to the data and about whether it would create a race to the bottom on pricing. If the macro use of transactional data by GSA category managers,
The GSA OIG has attempted to answer this question by undertaking several audits of TDR’s implementation since 2016. The OIG has been remarkably consistent in their skepticism that the TDR program is the right path for the FSS program. Below is a high-level summary of the conclusions drawn from at least four reports.
| Date | Report | Summary |
| July 25, 2018 | Audit of Transactional Data Reporting Pilot Evaluation Plan and Metrics (Report Number A140143/ Q/T/P18004) | Report finds that the GSA failed to establish defined performance targets tied to clear pilot performance objectives, and that TDR data has not been made available to allow for an evaluation against the metrics established by the GSA. |
| June 24, 2021 | GSA’s Transactional Data Reporting Pilot Is Not Used to Affect Pricing Decisions (Report Number A140143/Q/6/P21002) | Recommended the GSA take immediate action to mitigate the risks associated with the TDR pilot and that the GSA develop and implement an exit strategy for the TDR pilot and transition participating contractors out of the TDR pilot. |
| Sept. 30, 2022 | FAS Cannot Provide Assurance That MAS Contract Pricing Results in Orders Achieving the Lowest Overall Cost Alternative (Report Number A200975/Q/3/P22002) | The GSA OIG has consistently identified concerns regarding all aspects of the TDR pilot and recommended that the FAS commissioner cancel the TDR pilot. |
| May 1, 2023 | GSA’s Fiscal Year 2020 Transactional Data Reporting Pilot Evaluation Provides an Inaccurate Assessment of the Program (Report Number A210081/Q/3/P23001) | Recommended the GSA cease the further expansion of TDR until the problems are corrected or the pilot is terminated; Includes six steps to follow to assess and confirm data accuracy, improve accessibility and utilization. If steps aren’t followed — the GSA should execute exit strategy. |
Since 2022, the GSA OIG has called for the TDR pilot to be canceled, citing specifically that the GSA “cannot provide assurance that MAS contract pricing results in orders achieving the lowest overall cost alternative, regardless of whether the contractor participates in the TDR pilot”. The GSA OIG even pointed out that they are not alone in their conclusion and that when they “interviewed Federal Acquisition Service contracting personnel, 7 of 11 expressed concerns about the TDR pilot’s value to the MAS program and concluded that, in their opinion, the TDR pilot should be canceled”.
Furthermore, on June 27, 2025 [10], the GSA OIG, once again, issued a report reiterating that TDR has failed due to persistent “data quality issues, lack of TDR data usage in pricing decisions, lack of price competition, and failure to support [GSA’s] OneGov Strategy”. The report highlights several items that contractors should pay close attention to:
The report underscores a fundamental concern with TDR — that it fails to provide the government with a meaningful substitute for price competition. Historically, the FSS program has relied on CSP disclosures to approximate the outcomes of direct competition, allowing the GSA to assess price reasonableness and negotiate terms without requiring vendors to compete head-to-head.
With the usability of transactional data being a significant concern, the GSA OIG is likely to scrutinize contractors to determine whether reported data is accurate, complete and properly mapped to contract offerings. In doing so, the GSA may focus on identifying systemic pricing issues and missed cost-saving opportunities for the government. Areas of likely testing include:
1. Scope and accuracy of reporting
2. Ceiling rate validation
3. Application of negotiated discounts
4. Sales attribution by SIN
Services remain a significant area of concern under the TDR model. With only 2% of fiscal year 2025 TDR services data usable thus far, the GSA OIG could target high-dollar service contractors for deeper reviews. In addition to the areas above, testing could include:
1. Accuracy of labor hour reporting
2. Labor category mapping
3. Compliance with wage determinations
4. Use of unqualified labor
The GSA OIG may also assess whether contracting officers are using TDR data responsibly in price negotiations, and whether reliance on flawed or unmatched data results in overpricing or missed opportunities for cost savings.
In addition to traditional areas of enforcement (e.g., Trade Agreements Act compliance, false size/status representations, etc.), the GSA OIG may begin expanding its focus into newer compliance domains. Potential areas include information security requirements, particularly those tied to federal cybersecurity standards, and supply chain risk management (SCRM) obligations designed to safeguard against counterfeit or compromised products and services. These emerging areas reflect the government’s broader emphasis on protecting sensitive data, ensuring secure procurement channels and mitigating systemic risks.
In short, the audit lens appears to be shifting from pre-award pricing disclosures to post-award compliance. TDR vendors shouldn’t assume the move away from CSP audits means less oversight — only that the focus is changing, and in many ways, becoming more data-driven and potentially more complex to manage.
Historically, the GSA conducted approximately 45 pre-award audits and 10 post-award audits annually. Pre-award audits are triggered during option exercises and support the GSA with negotiating fair and reasonable GSA contract price, while post-award audits serve to evaluate whether contractors adhered to the terms and conditions of their contracts.
Looking ahead, it is plausible that the GSA OIG will increase its emphasis on post-award audits, potentially reversing the historical audit ratio. This would mark a significant shift in compliance strategy — one that places greater scrutiny on real-time performance and data integrity rather than upfront pricing disclosures.
Finally, contractors should closely monitor how the GSA OIG approaches meeting pre-award audit goals related to making price reasonableness recommendations to GSA contracting officers. While the OIG could leverage GSA pricing tools — such as the Price Point Plus Portal (4P Tool) for products and the Contract-Awarded Labor Category (CALC) Tool for services — along with collected TDR data to conduct horizontal pricing analyses, questions remain about the reliability of these tools given known data accuracy issues and the GSA OIG's prior reluctance to rely on them. Historically, especially for service providers, the GSA OIG has often asserted that no comparable commercial sales exist to support GSA pricing, using this as a basis to request or require submission of cost data. The question now is whether, under TDR, the GSA OIG will continue this approach — perhaps even more frequently — as it seeks to reconcile incomplete or unreliable transactional data with its audit objectives.
GSA’s path forward is clear: beginning in fiscal year 2026, TDR will apply to all FSS contractors, regardless of the products or services they offer. Every SIN will fall under TDR’s scope, marking a significant shift toward standardized, data-centric reporting across the program. Solicitation Refresh 27 expands the Mandatory TDR SIN count to 177 with 114 SINs remaining.
| Mandatory TDR w/Refresh 27 | All other SINs | Total SINs | ||||
| Large category | SIN Count | % of Total | SIN Count | % of Total | SIN Count | % of Total |
| Industrial products and services | 41 | 23% | 0 | 0% | 41 | 14% |
| Furniture and furnishings | 30 | 17% | 3 | 3% | 33 | 11% |
| Security and protection | 21 | 12% | 6 | 5% | 27 | 9% |
| Facilities | 20 | 11% | 4 | 4% | 24 | 8% |
| Office management | 18 | 10% | 17 | 15% | 35 | 12% |
| Scientific management and solutions | 12 | 7% | 3 | 3% | 15 | 5% |
| Transport and logistic services | 12 | 7% | 11 | 10% | 23 | 8% |
| Information technology | 9 | 5% | 11 | 10% | 20 | 7% |
| Professional services | 8 | 5% | 34 | 30% | 42 | 14% |
| Miscellaneous | 6 | 3% | 5 | 4% | 11 | 4% |
| Human capital | 0 | 0% | 14 | 12% | 14 | 5% |
| Travel | 0 | 0% | 6 | 5% | 6 | 2% |
| Total | 177 | 100% | 114 | 100% | 291 | 100% |
To support this transition, the GSA will continue refining the sales reporting template to be used by TDR contractors. Contractors currently report 12 mandatory and four optional data fields, but future updates may introduce additional elements to better reflect complex offerings, such as highly configurable products and bundled services. These enhancements reflect the GSA’s broader ambition: to use transactional data not just as a compliance tool, but as a mechanism for driving smarter, more transparent buying and pricing decisions.
Yet as the TDR program evolves, so do the questions. Does TDR truly empower the government to negotiate on equal footing? Can it resolve or reduce compliance risk for contractors? And perhaps most critically — are contractors prepared for a world where GSA no longer relies on how a company behaves in the commercial market (through a CSP disclosure), but instead scrutinizes how it prices and performs in the federal market?
The removal of the CSP requirement may reduce administrative burden, but it also strips away a key narrative tool — one that allowed contractors to contextualize their pricing and value. In its place, transactional data must now speak for itself. Contractors will need to ensure that their pricing and reporting is not only accurate, but strategically aligned with how they want their offerings to be perceived.
This is the tension at the heart of TDR: a promise of transparency shadowed by potential new challenges. As GSA contracting officers increasingly rely on horizontal pricing comparisons and transactional data to inform negotiations, contractors must be ready to defend their pricing with clarity and precision. The concept of “best value” remains central, but its interpretation may shift as TDR data becomes the dominant lens through which value is assessed.
In this new era, success will hinge on preparation. Contractors should review their systems, policies and pricing strategies to ensure they can meet the demands of monthly reporting and withstand deeper scrutiny of prices offered on GSA sales. Those who adapt quickly will not only mitigate risk — they may find new opportunities to differentiate themselves and perform successfully in a more transparent, data-driven marketplace.
General Services Administration Transactional Data Reporting (Updated as of June 18, 2025)
General Services Administration Multiple Award Schedule (MAS) Refresh 27 (Updated as of July 17, 2025)
[1] Further, as referenced in FAS Policy and Procedure (PAP), 2021-05, “FAR part 12 provides that offers should be solicited and evaluated consistent with customary commercial practices. Therefore, a vendor should only propose pricing consistent with its own standard business practices, and should not be required to alter its pricing structure.”
[2] General Services Administration Acquisition Manual (GSAM) Section 515.408 provides detailed instructions and a prescribed format for the disclosure of commercial sales practices. This has been adopted within the FSS solicitation in what is commonly known as the “CSP-1 Format”.
[3] FAS Policy and Procedure (PAP), 2021-05
[4] GSAR 538.270-1 (e)(7)
[5] GSAR 552.238-81 (d)
[6] GSAR 538.270-2 Evaluation of offers with access to transactional data.
[7] Office of Management and Budget, Memorandum M-19-13, Category Management: Making Smarter Use of Common Contract Solutions and Practices (2019).
TDR was intended to modernize this approach, but according to the GSA OIG, the GSA is neither conducting adequate price competition nor employing a methodology that seeks its equivalent. Instead, price analysis under TDR has been reduced to comparisons against other government-awarded contract prices — an inherently limited exercise that the GSA OIG claims does not leverage the government's buying power.
In short, absent a meaningful evolution of the implementation methodology, TDR risks undermining the very pricing integrity it was meant to enhance. As the GSA continues to expand TDR across the FSS program, pressure will mount from the GSA OIG to demonstrate that it can meet regulatory expectations for establishing fair and reasonable pricing — expectations that the CSP/PRC framework, despite its flaws, was structured to address more directly.
Since the release of the report, industry observers have raised an important counterpoint to the GSA OIG’s conclusions. While the OIG raises valid concerns about TDR’s limitations in replicating traditional price competition, it’s equally important to recognize the broader market effects of TDR’s implementation. By lowering the administrative burden associated with the CSP/PRC pricing construct, TDR reduces barriers to entry for vendors, potentially expanding the pool of participants on the FSS program. This increased competition can serve as a natural pricing discipline, encouraging contractors to offer more competitive rates to remain viable. Moreover, the influx of new and non-traditional vendors may enhance innovation and diversity in the government’s supplier base — benefits that are not easily captured through legacy pricing frameworks. As the GSA refines its data analytics capabilities, the transactional data collected under TDR could evolve into a more dynamic and market-responsive pricing tool, complementing regulatory expectations in new ways.
While pre-award and post-award audits have endured since the introduction of TDR, data from the GSA OIG’s semi-annual reports to Congress indicate a decline in the overall number of contract audits — likely a result of the shrinking pool of vendors subject to traditional CSP-based reviews. For example, over the first five years since the introduction of TDR, the GSA OIG averaged about 48 contract audits annually. In the last three years, that average has dropped to 32. [11]
With the continued and now mandatory expansion of TDR, it is likely that the GSA OIG’s audit focus will need to adapt accordingly. Areas of likely audit interest could include:
