[Federal Register Volume 86, Number 110 (Thursday, June 10, 2021)]
[Rules and Regulations]
[Pages 31073-31074]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2021-11864]
[[Page 31073]]
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DEPARTMENT OF DEFENSE
GENERAL SERVICES ADMINISTRATION
NATIONAL AERONAUTICS AND SPACE ADMINISTRATION
48 CFR Part 16
[FAC 2021-06; FAR Case 2020-004; Item II; Docket No. FAR-2020-0004,
Sequence No. 1]
RIN 9000-AO04
Federal Acquisition Regulation: Application of Micro-Purchase
Threshold to Task and Delivery Orders
AGENCY: Department of Defense (DoD), General Services Administration
(GSA), and National Aeronautics and Space Administration (NASA).
ACTION: Final rule.
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SUMMARY: DoD, GSA, and NASA are issuing a final rule amending the
Federal Acquisition Regulation (FAR) to implement a section of the
National Defense Authorization Act for Fiscal Year 2020 that raises the
threshold for fair opportunity on certain task and delivery orders to
the micro-purchase threshold.
DATES: Effective: July 12, 2021.
FOR FURTHER INFORMATION CONTACT: Mr. Michael O. Jackson, Procurement
Analyst, at 202-208-4949 or [email protected] for clarification
of content. For information pertaining to status or publication
schedules, contact the Regulatory Secretariat Division at 202-501-4755.
Please cite FAC 2021-06 and FAR Case 2020-004.
SUPPLEMENTARY INFORMATION:
I. Background
DoD, GSA, and NASA published a proposed rule at 85 FR 67327, on
October 22, 2020, to implement section 826 of the National Defense
Authorization Act (NDAA) for Fiscal Year (FY) 2020 (Pub. L. 116-92),
which increases the threshold for requiring fair opportunity on orders
under multiple-award contracts from $2,500 to the ``micro-purchase
threshold''. The fair opportunity to be considered at FAR 16.505(b)(1)
applies to orders over the threshold unless an exception at
16.505(b)(2) applies. The threshold at FAR 16.505 is currently $3,500,
as a result of inflation adjustments in accordance with FAR 1.109. The
micro-purchase threshold (MPT) is $10,000 (FAR case 2018-004 published
on July 2, 2020, at 85 FR 40064).
II. Discussion and Analysis
There were no public comments submitted in response to the proposed
rule, and no changes were made to the final rule.
III. Applicability to Contracts at or Below the Simplified Acquisition
Threshold and for Commercial Items, Including Commercially Available
Off-the-Shelf Items
This final rule does not create any new provisions or clauses, nor
does it change the applicability of any existing provisions or clauses
included in solicitations and contracts valued at or below the
simplified acquisition threshold, or for commercial items, including
commercially available off-the-shelf items.
IV. Expected Impact of the Rule
DoD, GSA, and NASA have performed an analysis for this final rule.
This rule is expected to reduce the public burden because the threshold
increase will reduce costs to submit an offer for the unsuccessful
awardees who participate in fair opportunity competitions for orders
under FAR part 16. DoD, GSA, and NASA recognize some awardees may be
impacted by a reduction in the number of opportunities an awardee may
have to receive an award of a delivery or task order through fair
opportunity. Using Federal Procurement Data System (FPDS) data from FY
2017 through FY 2019, the average number of fair opportunity task or
delivery orders under FAR part 16 procedures is approximately 9,800
orders annually. DoD, GSA, and NASA estimate that the Government
receives an average of three offers for each of the 9,800 task or
delivery orders, resulting in an estimated 19,600 (9,800 x 2)
unsuccessful offers. There are costs to submit the estimated 19,600
unsuccessful offers, which will be eliminated by this rule.
DoD, GSA, and NASA recognize that the increase in the MPT in FAR
Case 2018-004 has resulted in an increased use of the Governmentwide
commercial purchase card and a general reduction in the number of FAR
part 16 delivery and task orders awarded between $3,500 and $10,000.
According to FPDS, there were 12,911 fair opportunity FAR part 16
awards between $3,500 and $10,000 in FY 2017. In contrast, there were
6,421 awards in FY 2019; a decrease of almost 50%. This decrease can be
attributed to the preference given to the Governmentwide commercial
purchase card for procurements under the MPT. While it is unclear
whether there will be further decreases in the number of FAR part 16
fair opportunity awards, it is clear that the increased MPT implemented
by FAR Case 2018-004 has already reduced the public and Government
burden by approximately 50% by shifting procurements from FAR part 16
delivery and task orders to Governmentwide commercial purchase cards.
DoD, GSA, and NASA expect the rule to also reduce burden on the
Government and streamline procurements for FAR part 16 orders below the
MPT. Contracting officers will not be required to review multiple
offers to make award, resulting in time savings for each order awarded.
V. Executive Orders 12866 and 13563
Executive Orders (E.O.s) 12866 and 13563 direct agencies to assess
all costs and benefits of available regulatory alternatives and, if
regulation is necessary, to select regulatory approaches that maximize
net benefits (including potential economic, environmental, public
health and safety effects, distributive impacts, and equity). E.O.
13563 emphasizes the importance of quantifying both costs and benefits,
of reducing costs, of harmonizing rules, and of promoting flexibility.
This is not a significant regulatory action and, therefore, was not
subject to review under section 6(b) of E.O. 12866, Regulatory Planning
and Review, dated September 30, 1993.
VI. Congressional Review Act
As required by the Congressional Review Act (5 U.S.C. 801-808)
before an interim or final rule takes effect, DoD, GSA and NASA will
send the rule and the ``Submission of Federal Rules Under the
Congressional Review Act'' form to each House of the Congress and to
the Comptroller General of the United States. A major rule cannot take
effect until 60 days after it is published in the Federal Register. The
Office of Information and Regulatory Affairs (OIRA) in the Office of
Management and Budget has determined that this is not a major rule
under 5 U.S.C. 804.
VII. Regulatory Flexibility Act
DoD, GSA, and NASA have prepared a Final Regulatory Flexibility
Analysis (FRFA) consistent with the Regulatory Flexibility Act, 5
U.S.C. 601-612. The FRFA is summarized as follows:
This final rule amends the Federal Acquisition Regulation to
implement section 826 of the National Defense Authorization Act
(NDAA) for Fiscal Year (FY) 2020 (Pub. L. 116-92), which raises the
threshold for fair opportunity on certain task and delivery orders
to the word-based, ``micro-purchase threshold''.
[[Page 31074]]
The objective of the rule is to increase the threshold for
requiring fair opportunity on FAR part 16 orders under multiple-
award contracts from $3,500 to the word-based, ``micro-purchase
threshold'' for consistency of application and alignment with future
adjustments. The legal basis for the rule is section 826 of the NDAA
for FY 2020 (Pub. L. 116-92).
There were no significant issues raised in response to the
initial regulatory flexibility analysis.
DoD, GSA, and NASA do not expect this rule to have a significant
economic impact on a substantial number of small entities; most of
the impact will be on the Government. This rule will likely affect
small entities that participate in fair opportunity competitions for
FAR part 16 task and delivery orders under multiple-award contracts
conducted by the Federal Government between $3,500 and the micro-
purchase threshold, which currently is $10,000. DoD, GSA, and NASA
do not expect a significant change in the number of orders awarded
to small entities; however, in certain circumstances this rule is
expected to reduce the costs associated with developing and
submitting a response to task and delivery order competitions for
actions up to $10,000. To assess the impact of the threshold
increase, data was obtained from FPDS. For FY 2017 through FY 2019,
there was an average of 9,803 FAR part 16 task and delivery orders
awarded using fair opportunity between $3,500 and $10,000. Of these
actions, an average of 5,852 were awarded to 843 unique small
entities. As a result of this rule, it is assumed that approximately
843 small entities may experience a reduction in proposal costs on
task and delivery orders valued between $3,500 and $10,000.
This rule does not impose any reporting, recordkeeping, or other
compliance requirements.
There are no alternatives that are consistent with the
objectives of the statute.
Interested parties may obtain a copy of the FRFA from the
Regulatory Secretariat Division. The Regulatory Secretariat Division
has submitted a copy of the FRFA to the Chief Counsel for Advocacy of
the Small Business Administration.
VIII. Paperwork Reduction Act
This rule does not contain any information collection requirements
that require the approval of the Office of Management and Budget under
the Paperwork Reduction Act (44 U.S.C. 3501-3521).
List of Subjects in 48 CFR Part 16
Government procurement.
William F. Clark,
Director, Office of Government-wide Acquisition Policy, Office of
Acquisition Policy, Office of Government-wide Policy.
Therefore, DoD, GSA, and NASA amend 48 CFR part 16 as set forth
below:
PART 16--TYPES OF CONTRACTS
0
1. The authority citation for 48 CFR part 16 continues to read as
follows:
Authority: 40 U.S.C. 121(c); 10 U.S.C. chapter 137; and 51
U.S.C. 20113.
16.505 [Amended]
0
2. Amend section 16.505 by--
0
a. Removing from paragraph (b)(1)(i) introductory text ``$3,500'' and
adding ``the micro-purchase threshold'' in its place;
0
b. Removing from paragraph (b)(2)(i) introductory text ``delivery-order
or task-order exceeding $3,500'' and adding ``delivery order or task
order exceeding the micro-purchase threshold'' in its place; and
0
c. Removing from the paragraph (b)(2)(ii)(A) subject heading ``$3,500''
and adding ``the micro-purchase threshold'' in its place.
[FR Doc. 2021-11864 Filed 6-9-21; 8:45 am]
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