1. Federal Acquisition Service U.S. General Services Administration GSA SmartPay® 2 - The Basics of Purchase, Travel, Fleet, and Integrated Charge Cards Perry Hampton Bradley Forrestel GSA Training Conference & Expo May 4-6, 2010 Perry Hampton Bradley Forrestel GSA Training Conference & Expo May 4-6, 2010

2. Federal Acquisition Service Value to the Customer  Learn about the GSA SmartPay® 2 Program  Gain comprehension about the GSA SmartPay® 2 Business Lines  GSA SmartPay® Purchase Charge Card  GSA SmartPay® Travel Charge Card  GSA SmartPay® Fleet Charge Card  GSA SmartPay® Integrated Charge Card  Understand specific roles and responsibilities  Discover and share leading practices of charge card program management  Find out about general resources 2

3. Federal Acquisition Service Agenda  GSA SmartPay® Program Overview  Program Stakeholders  GSA SmartPay® Benefits  GSA SmartPay® 2 Business Lines Overview  GSA SmartPay® Purchase Charge Card  GSA SmartPay® Travel Charge Card  GSA SmartPay® Fleet Charge Card  GSA SmartPay® Integrated Charge Card  Roles and Responsibilities  General Charge Card Management Leading Practices  General Resources  Frequently Asked Questions (FAQs) 3

4. Federal Acquisition Service GSA SmartPay® Program Overview  GSA SmartPay®, established in 1998, is the largest government charge card program in the world  The GSA SmartPay® program enables over 350 Federal agencies, organizations, and Native American tribal governments to obtain charge card products and services through Master Contracts that GSA has currently established with three banks: Citibank, JP Morgan Chase, and U.S. Bank  Agencies/Organizations issued task orders against these existing Master Contracts to obtain charge card products and services  Approximately 173 transactions were made every minute using the GSA SmartPay® Charge Cards in Fiscal Year (FY) 2009 4

5. Federal Acquisition Service GSA SmartPay® Program FY 09 – By the Numbers  Program spend: $29.7 billion  Transactions: 92.6 million  Number of cardholders: 3.0 million  Agency/Organization refunds: $255 million (Net of GSA industrial funding fees)  Total Agency/Organization refunds since 1998: $1.3 billion DID YOU KNOW… $941 was charged on the GSA SmartPay® charge card every second in FY09 5

6. Federal Acquisition Service GSA SmartPay® 2 Program Stakeholders Office of Management and Budget (OMB) Perform oversight of the government- wide charge card program Agencies/Organizations Use charge card products and services to support their missions and operations MasterCard/ VISA Partner with the banks to issue GSA SmartPay® 2 charge cards Banks Provide charge card products and services through GSA SmartPay® 2 Master Contracts; partner with MasterCard/VISA to issue cards Office of Charge Card Management (OCCM) Provides overall program management and advocacy 6

7. Federal Acquisition Service GSA SmartPay® 2 Charge Card Benefits  Provides administrative savings and efficiency In FY 09 agencies/organizations avoided $1.5 billion in administrative processing costs using the Purchase Card*  Enables ales refunds based on dollar volume and payment performance Productivity refunds: based on the timeliness and/or frequency of payments to the bank (faster payments = higher refunds) Sales refunds: based on the dollar or spend volume during a specified time period  Initiates a Point-of-Sale (POS) discount program to ensure GSA receives optimum pricing for customer POS purchases * Source: Palmer, R., & Gupta, M. (2007). The 2005 Purchasing Card Benchmark Survey Results 7

8. Federal Acquisition Service GSA SmartPay® 2 Charge Card Benefits (cont’d)  Utilizes electronic transaction data, enabling better reporting and ability to detect fraud, waste, and abuse; using commercial best practices  Improves financial controls  Provides governmentwide transparency to Federal charge card spending, performance, and trends  Enhances government’s negotiation leverage through strategic sourcing of enterprise data * Source: Palmer, R., & Gupt, M. (2007). The 2005 Purchasing Card Benchmark Survey Results 8

9. Federal Acquisition Service Additional GSA SmartPay® 2 Products & Services  Pre-paid (stored value) cards – capability to load and reload cards with specific dollar values; cards can be issued with required value on short notice  Contactless cards – faster transactions; the card does not leave the hand of the cardholder  Cardless accounts – provides established merchant- specific charge accounts without physical cards DID YOU KNOW… The GSA Office of Charge Card Management is exploring a pilot grants funding solution with agencies/organizations to help better track, monitor, and distribute grant funds, as well as improve transparency in the grants funding process. 9

10. Federal Acquisition Service 10 GSA SmartPay® 2 Business Lines

11. Federal Acquisition Service GSA SmartPay® 2 Business Lines  Purchase Cards Used to purchase supplies and services in support of agency/organization missions and operations  Travel Cards Cover travel and travel-related expenses Only GSA SmartPay® 2 cardholders can access the City Pair Program  Fleet Cards Used to purchase government vehicle fuel and maintenance services Issued to vehicles, rather than individuals  Integrated Cards Offers functionality of two or more of the three business lines 11

12. Federal Acquisition Service GSA SmartPay® 2 Business Lines – By the Numbers Total FY 09 spend by business line:  Purchase Spend: $19.3 billion  Travel Spend: $8.9 billion  Fleet Spend: $1.5 billion 12

13. Federal Acquisition Service GSA SmartPay® Purchase Charge Card  The GSA SmartPay® Purchase Charge Card provides cards to federal employees to make official government purchases for supplies, goods, and services under the micro-purchase threshold of $3,000 per Federal Acquisition Regulation (FAR) The purchase charge card is both a procurement and payment mechanism for micro-purchases For purchases above the micro-purchase threshold, the purchase card may be used as an ordering and payment mechanism, but not a contracting mechanism  The following items may not be purchased with the purchase card, as per the GSA SmartPay® 2 Master Contracts: Long-term rental or leasing of land or buildings Travel or travel-related expenses Cash advances 13

14. Federal Acquisition Service GSA SmartPay® Purchase Charge Card  All purchase card accounts are Centrally Billed Accounts (CBA), and the liability for transactions made by authorized cardholders is borne by the government  The government is not liable for transactions on the card when the use of the card is by a person who does not have actual, implied, or apparent authority for such use  If the card is used by an authorized cardholder to make an unauthorized purchase, the government is liable for payment and the agency/organization is responsible for taking appropriate action against the cardholder such as: Counseling Cancellation of Purchase Card Notation in employee performance evaluation Suspension and or termination of employment 14

15. Federal Acquisition Service GSA SmartPay® Purchase Charge Card FY 09 – By the Numbers  Spend: $19.3 billion  Transactions: 21.8 million  Cardholders: 270,000 15

16. Federal Acquisition Service GSA SmartPay® Travel Charge Card  The GSA SmartPay® Travel Charge Card covers official government travel and travel- related costs  Only the GSA SmartPay® Travel Charge Card allows access to GSA City Pair reduced airfares  The government saves money on travel processing costs and generates revenue through volume of refunds with the use of the GSA SmartPay® Travel Charge Card  Two primary Travel Card account types: Centrally Billed Accounts (CBA): Government Liability Individually Billed Accounts (IBA): Individual Liability 16

17. Federal Acquisition Service GSA SmartPay® Travel Charge Card Additional Types  Standard Travel Card  Total credit/cash limits will vary based on agency/organization policy  Spilt disbursement mandatory  Billing Statement mailed to cardholder’s address  Restricted Travel Card  Total credit/cash limits will vary based on agency/organization policy  APC “Activation/Deactivation” may be required  Spilt disbursement mandatory  Billing Statement mailed to cardholder’s address  Centrally Billed Accounts (Transportation Accounts and Unit Cards)  Limited use  Credit limit consistent with agency/organization mission  Government liability  Account Manager is responsible for management and reconciliation 17

18. Federal Acquisition Service GSA SmartPay® Travel Charge Card FY 09 – By the Numbers  Spend: $8.9 billion  Transactions: 45.3 million  Cardholders: 2.2 million Note: annual spend has more than doubled since FY 98 ($3.4 billion to $8.9 billion in FY 09) 18

19. Federal Acquisition Service GSA SmartPay® Fleet Charge Card  The GSA SmartPay® Fleet Charge Card is authorized for the purchase of fuel, maintenance and repair of government owned/operated motor vehicles, aircrafts, boats, and motorized equipment  The GSA SmartPay® Fleet Charge Card is typically issued for specific government vehicles rather than to persons  The government saves money on processing costs and generates revenue through volume of refunds with the use of the GSA SmartPay® Fleet Charge Card 19

20. Federal Acquisition Service GSA SmartPay® Fleet Charge Card FY 09 – By the Numbers  Spend: $1.5 billion  Transactions: 25.4 million  Cardholders: 571,000 20

21. Federal Acquisition Service GSA SmartPay® Integrated Charge Card  The GSA SmartPay® Integrated Charge Card is a combination of two or more business lines (i.e., purchase and travel) and functions the same as other business line charge cards  Reconciliation procedures for the integrated card may differ from other cards 21

22. Federal Acquisition Service Roles & Responsibilities

23. Federal Acquisition Service Roles & Responsibilities of A/OPCs  Responsible for overseeing agency/organization GSA SmartPay® Charge Card program, in support of agency/organization mission and operations  Work with the Office of Charge Card Management (OCCM), GSA SmartPay® 2 contracting banks, cardholders, and agency/organization management  Vary among agency/organization; responsibilities are outlined in the GSA SmartPay® 2 Master Contract  “Level 1” A/OPCs are the highest ranking A/OPC within the agency/organization and the primary agency/organization point of contact with OCCM 23

24. Federal Acquisition Service Roles & Responsibilities of A/OPCs (cont’d)  A/OPC responsibilities may include tasks such as: Promoting appropriate use of GSA Smart Pay® Charge Card by cardholders Ensuring cardholders receive appropriate training Monitoring account activity and managing delinquencies Taking appropriate action regarding charge card fraud, misuse or abuse Working with GSA SmartPay® 2 contracting bank to ensure agency/organization and cardholder needs are met Resolving any technical and operational problems between GSA SmartPay® 2 contracting bank and the cardholder as necessary 24

25. Federal Acquisition Service Roles & Responsibilities of Cardholders  Use the charge card appropriately, in accordance with agency/organization policy, laws, and governmental regulations  Keep up-to-date with required program and agency/organization specific training, including refresher training  Look out for communications from A/OPCs and take appropriate action  Understand preventative measures to avoid fraud and misuse  Understand GSA SmartPay® Charge Card liabilities 25

26. Federal Acquisition Service Roles & Responsibilities of Approving Officials (AO)  Approving Officials are responsible for: Ensuring that all purchases made by the cardholder are appropriate and charges are accurate Resolving all questionable purchases with the cardholder Certifying the monthly invoice resulting from the purchases of the cardholders within his/her account structure Verifying receipt of the purchase 26

27. Federal Acquisition Service Roles & Responsibilities of Banks  Allow the cardholder to view current statements, payment history, and account information to make payments electronically  Provide training for A/OPCs  Issue required reports to A/OPCs  Bank Contact Info: Citibank: http://www.cards.citidirect.com/welcome.asp 1-800-790-7206 (customer service) JP Morgan Chase: https://www.paymentnet.com/Login.asp 1-888-297-0781 (customer service) U.S. Bank: https://access.usbank.com/cpsApp1/index.jsp 1-888-994-6722 (customer service) 27

28. Federal Acquisition Service General Charge Card Management

29. Federal Acquisition Service Leading Practices: General  Engage management at the highest levels  Review credit limits and lower as appropriate  Issue cards based on need risk  Perform an annual review of all issued cards to determine if each cardholder meets the criteria for continued participation in the federal government purchase charge card program  Incorporate process to enable an alternate point of contact to receive and accept material  Utilize your GSA SmartPay® 2 contracting bank’s resources  Create a newsletter to reinforce agency/organization charge card policies and procedures 29

30. Federal Acquisition Service Leading Practices: General (cont’d)  Provide the GSA SmartPay® card-sized booklet, “Helpful Hints for Purchase Card Use”, with each cardholder application  Publish frequently asked questions (FAQs) related to the purchase card on your agency’s/organization’s website  Create a monthly newsletter to reinforce agency/organization charge card policies and procedures  Perform an annual review of all issued cards to determine if each cardholder meets the criteria for continued participation in the federal government purchase charge card program  Review Office of Management and Budget (OMB) Circular A- 123, Appendix B Best Practices 30

31. Federal Acquisition Service Leading Practices: Reporting  GSA SmartPay® contracting banks are required to issue a set of reports to A/OPCs on a basis chosen by the agency/organization that cover topics such as transactions, payments, disputes, and delinquencies, etc.  A full listing of agency reports can be found in section C.3.3.1 of the GSA SmartPay® 2 Master Contract  Use reports proactively, not reactively to:  Reveal trends as they develop  Prevent fraud/waste/abuse, or assist in identifying potential strategic sourcing opportunities 31

32. Federal Acquisition Service Leading Practices: Reporting (cont’d)  Use your GSA SmartPay® 2 contracting bank’s Electronic Access System (EAS), data mining tools, and/or agency/organization technology to run reports  Develop ad hoc reports  Monitor reports regularly Become familiar with all of the available reports Do not completely ignore a particular report – it may contain very relevant information 32

33. Federal Acquisition Service Leading Practices: Preventing Fraud & Misuse  Establish agency/organization policies and procedures to prevent misuse  Address standards of conduct/ethics and clearly state consequences for misuse  Set reasonable credit, transaction, and cash access limits  Restrict spend use through Merchant Category Code (MCC) Blocks  Deactivate cards as appropriate  Review cardholder activity through reports generated from bank Electronic Access Systems  Manage delinquency  Implement proper training DID YOU KNOW… Misuse by employees impacts the performance of agency/organization program and rebate earnings potential 33

34. Federal Acquisition Service Leading Practices: State/Local Tax Exemption  Merchants are required to recognize the tax exempt status of official Federal Government purchase, travel, fleet, and integrated charge card transactions  Some merchants do not exempt state or local taxes on purchases  Each state has different policies and procedures around the tax exemption of purchases made with GSA SmartPay® cards  The GSA SmartPay® website provides information on each state’s requirements; often cardholders will need to print a “tax exemption” certificate to provide the merchant  Visit the GSA SmartPay® website and click on “tax information” to view updated state information for GSA SmartPay® 2  Tax exemption and recovery plans and processes are an important part of managing your charge card program 34

35. Federal Acquisition Service Leading Practices: Training  Provide a comprehensive face-to-face cardholder training as orientation for new cardholders  Discuss agency/organization policy  Ensure cardholders and A/OPCs fulfill the required refresher training requirements at a minimum every three years, or more frequently per agency/organization policy  Ensure that training is easily accessible  Engage in bank-provided training  Attend GSA SmartPay® Annual Training Conference 35

36. Federal Acquisition Service General Resources

37. Federal Acquisition Service General Resources  GSA SmartPay® website: www.gsasmartpay.gov  Office of Management and Budget (OMB) Circular A-123 Appendix B  Establishes standard minimum requirements and best practices for improving the management of government charge card programs  For more information, visit website: www.whitehouse.gov/omb/circulars/a123/a123_appendix_b.pdf  Federal Acquisition Regulations (FAR)  Agency/Organization specific policies and established procedures  For more information, visit website: www.acquisition.gov/far/ 37

38. Federal Acquisition Service Training Resources  GSA SmartPay® Online Training:  GSA SmartPay® Travel Cardholder and A/OPC Training  GSA SmartPay® Purchase Cardholder and A/OPC Training  GSA SmartPay® Fleet Cardholder and A/OPC Training – coming soon  On-site training with banks  Training Sessions at GSA SmartPay® Conference  Materials Available online, and hard copies may be ordered via the GSA SmartPay® website  Other GSA SmartPay® Courses offered at Expo:  Navigating the New GSA SmartPay® Website (Basic)  GSA SmartPay® Program Update (Advanced)  Conduct Effective Oversight of Your GSA SmartPay® 2 Program (Intermediate) 38

39. Federal Acquisition Service The New GSA SmartPay® Website  Share your innovative ideas through the feedback form  View spreadsheets containing current data and statistics for the GSA SmartPay® 2 Purchase, Fleet, and Travel Cards  Review the latest on legislation updates related to the GSA SmartPay® program and submit comments, questions, or ideas to the SmartPay® staff  Access information about the benefits of a GSA SmartPay® card, how to report a lost/stolen card, how to protect your card  Learn how to apply best practices to help manage your GSA SmartPay® charge card program  Participate in online training for both cardholders and coordinators  Read and comment on “Hot Topics” on the SmartBlog 39

40. Federal Acquisition Service Questions Please provide your feedback and thoughts about the current and future program at: www.gsa.gov/gsasmartpay under “GSA SmartPay® Program Feedback Form ” Contact Us Perry Hampton, perry.hampton@gsa.gov Bradley Forrestel, bradley.forrestel@gsa.gov GSA SmartPay® Program Support Phone: (703) 605-2808 E-mail: gsa_smartpay@gsa.gov www.gsa.gov/gsasmartpay 40

41. Federal Acquisition Service Thank you!