[Federal Register Volume 86, Number 211 (Thursday, November 4, 2021)]
[Rules and Regulations]
[Pages 61040-61041]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2021-22146]


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DEPARTMENT OF DEFENSE

GENERAL SERVICES ADMINISTRATION

NATIONAL AERONAUTICS AND SPACE ADMINISTRATION

48 CFR Part 19

[FAC 2022-01; FAR Case 2021-007; Item III; Docket No. FAR-2021-0007, 
Sequence No. 1]
RIN 9000--AO25


Federal Acquisition Regulation: Maximum Award Price for Certain 
Sole Source Manufacturing Contracts

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 
William M. (Mac) Thornberry National Defense Authorization Act for 
Fiscal Year 2021 that modified the Small Business Act maximum award 
price for manufacturing contracts to $7 million.

DATES: Effective December 6, 2021.

FOR FURTHER INFORMATION CONTACT: Mr. Michael O. Jackson, Procurement 
Analyst, at 202-208-4949 or by email at [email protected], for 
clarification of content. For information pertaining to status or 
publication schedules, contact the Regulatory Secretariat Division at 
202-501-4755 or [email protected]. Please cite FAC 2022-01, FAR Case 
2021-007.

SUPPLEMENTARY INFORMATION:

[[Page 61041]]

I. Background

    DoD, GSA, and NASA are amending the FAR to implement section 864 of 
the National Defense Authorization Act (NDAA) for Fiscal Year (FY) 2021 
(Pub. L. 116-283, January 1, 2021). Section 864 amends the Small 
Business Act to modify the maximum award price for manufacturing 
contracts to $7 million for the 8(a), Women-Owned Small Business 
(WOSB), Historically Underutilized Business Zone (HUBZone), and 
Service-Disabled Veteran-Owned Small Business (SDVOSB) programs.
    The maximum award price for manufacturing contracts at FAR 19.804-
6(c)(2), 19.805-1(a)(2), 19.1306(a)(2)(i), 19.1406(a)(2)(i), and 
19.1506(c)(1)(i) is subject to the inflationary adjustment required by 
41 U.S.C. 1908. Section 1908 requires an adjustment every five years 
(on October 1 of each year evenly divisible by five) of statutory 
acquisition-related thresholds for inflation, using the Consumer Price 
Index for all urban consumers, except for the Construction Wage Rate 
Requirements statute (Davis-Bacon Act), Service Contract Labor 
Standards statute (Service Contract Act), and trade agreements 
thresholds (see FAR 1.109).
    FAR case 2019-013 (85 FR 62485), effective on October 1, 2020, made 
inflationary adjustments to, amongst others, the following: Increased 
the $7 million threshold at FAR 19.804-6(c)(2), 19.805-1(a)(2), and 
19.1306(a)(2)(i) to $7.5 million; increased the $6.5 million threshold 
at FAR 19.1406(a)(2)(i) to $7 million; and increased the $6.5 million 
threshold at FAR 19.1506(c)(1)(i) to $7 million.
    This final rule will harmonize the maximum award price threshold 
for manufacturing contracts amongst the socioeconomic programs by 
changing the current FAR maximum award price threshold for the 8(a) 
sole source, 8(a) competitive, and HUBZone sole source programs from 
$7.5 million to the statutory amount of $7 million. The maximum award 
price threshold for the WOSB and SDVOSB programs remains unchanged at 
the current threshold of $7 million, which is consistent with section 
864 of the NDAA for FY 2021.

II. Publication of This Final Rule for Public Comment Is Not Required 
by Statute

    The statute that applies to the publication of the FAR is 41 U.S.C. 
1707. Subsection (a)(1) of 41 U.S.C. 1707 requires that a procurement 
policy, regulation, procedure, or form (including an amendment or 
modification thereof) must be published for public comment if it 
relates to the expenditure of appropriated funds and has either a 
significant effect beyond the internal operating procedures of the 
agency issuing the policy, regulation, procedure, or form, or has a 
significant cost or administrative impact on contractors or offerors. 
This final rule is not required to be published for public comment 
because the rule will not have a significant cost or administrative 
impact on contractors or offerors. A search of the Federal Procurement 
Data System revealed that there were no contracts awarded for 8(a) sole 
source, 8(a) competitive, or HUBZone sole source manufacturing 
contracts in the range of $7 million to $7.5 million between the date 
of the increase in the threshold to $7.5 million (October 1, 2020) and 
April 2021.

III. Applicability to Contracts at or Below the Simplified Acquisition 
Threshold (SAT) and for Commercial Items, Including Commercially 
Available Off-the-Shelf (COTS) Items

    This rule does not create new solicitation provisions or contract 
clauses or impact any existing provisions or clauses. This rule merely 
modifies a threshold in accordance with statute. This rule does not 
impose any new requirements on contracts at or below the SAT or for 
commercial items, including COTS items, except for the changes in the 
thresholds themselves.

IV. 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.

V. 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.

VI. Regulatory Flexibility Act

    Because a notice of proposed rulemaking and an opportunity for 
public comment are not required to be given for this rule under 41 
U.S.C. 1707(a)(1) (see section II. of this preamble), the analytical 
requirements of the Regulatory Flexibility Act (5 U.S.C. 601-612) are 
not applicable. Accordingly, no regulatory flexibility analysis is 
required, and none has been prepared.

VII. 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 19

    Government procurement.

William F. Clark,
Director, Office of Governmentwide Acquisition Policy, Office of 
Acquisition Policy, Office of Governmentwide Policy.

    Therefore, DoD, GSA, and NASA amend 48 CFR part 19 as set forth 
below:

PART 19--SMALL BUSINESS PROGRAMS

0
1. The authority citation for 48 CFR part 19 continues to read as 
follows:

    Authority:  40 U.S.C. 121(c); 10 U.S.C. chapter 137; and 51 
U.S.C. 20113.


19.804-6   [Amended]

0
2. Amend section 19.804-6 by removing from paragraph (c)(2) the phrase 
``$7.5 million'' and adding ``$7 million'' in its place.


19.805-1   [Amended]

0
3. Amend section 19.805-1 by removing from paragraph (a)(2) the phrase 
``$7.5 million'' and adding ``$7 million'' in its place.


19.1306  [Amended]

0
4. Amend section 19.1306 by removing from paragraph (a)(2)(i) the 
phrase ``$7.5 million'' and adding ``$7 million'' in its place.

[FR Doc. 2021-22146 Filed 11-3-21; 8:45 am]
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