FAR Update: Simplified Acquisition Threshold and Micro-Purchase Threshold are Going Up

The Simplified Acquisition Threshold and Micro-Purchase Threshold are officially increasing under the FAR. While various agencies had already increased the thresholds through deviations, this change will officially update the rules in the FAR. Although this may seem like a minor update, it will cause changes across the federal contracting landscape and will result in more contracts being issued under the Micro-Purchase and Simplified Acquisition Thresholds.

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DoD Proposes Updating DFARS With 15-Day “Prompt Payment” Rules

The Department of Defense awarded contracts to an average 30,806 small businesses each year in fiscal year 2016, 2017, and 2018. A proposed rule to update the DFARS may lead to these same businesses receiving payments from the government, or prime contractors, within 15 days of invoicing.

The proposed rule is found at 84 FR 25225. It was published on May 31, 2019 and comments close on July 30, 2019 if you’d like to put in your two cents.

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Small Business Set-Asides Not Required Under NETCENTS-2, Says GAO

The Air Force’s large NETCENTS-2 IDIQ vehicle did not require orders to be set-aside under the small business pool, except for orders valued between the micro-purchase threshold and simplified acquisition threshold.

In a recent decision, the GAO held that although the NETCENTS-2 contract in question says that Contracting Officers “should” perform a “rule of two” small business set-aside analysis for orders valued over the simplified acquisition threshold, it does not require that such an analysis be performed–meaning that Contracting Officers can validly award such orders to large businesses, even if two or more small business NETCENTS-2 holders exist.

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Civilian Agencies May Increase Simplified Acquisition and Micro-Purchase Thresholds

Civilian agencies may issue class deviations to quickly implement provisions of the 2018 National Defense Authorization Act increasing the micro-purchase threshold to $10,000 and the simplified acquisition threshold to $250,000.

In a memorandum for civilian agencies issued on February 16, the Civilian Agency Acquisition Council says that agencies may elect to adopt interim authority allowing their Contracting Officers to take advantage of these higher thresholds, even as the FAR Council goes through the formal process of codifying those changes.

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Simplified Acquisition Threshold Increase: My Interview With Francis Rose

The House of Representatives has proposed an enormous increase in the simplified acquisition threshold, from $150,000 to $500,000.  In an interview aired on June 4, Francis Rose and I discussed the proposed increase, as well as a recent GAO decision regarding an agency’s obligation (or lack thereof) when it comes to informing an offeror that its price is too high.

Click here to listen to my interview with Francis, and be sure to tune in to In Depth With Francis Rose weekdays from 4:00 p.m. to 7:00 p.m. Eastern on Federal News Radio.

Simplified Acquisition Threshold To $500,000? House Proposes Huge Increase

The simplified acquisition threshold would increase to $500,000 under the version of the 2016 National Defense Authorization Act currently before the U.S. House of Representatives.

If the House proposal ultimately becomes law, the simplified acquisition threshold would more than triple from its current $150,00 level.  Such a dramatic increase in the simplified acquisition threshold could affect nearly all federal contractors–especially small businesses.

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