📈New Inflation Adjustments Impacting Federal Acquisition Thresholds
Federal Acquisition Regulation: Inflation Adjustment of Acquisition-Related Thresholds
Summary
OFPP, DoD, GSA, and NASA (collectively referred to as the Federal Acquisition Regulatory Council, or FAR Council) are issuing a final rule amending the Federal Acquisition Regulation (FAR) to further implement a statute, which requires an adjustment every five years of statutory acquisition-related thresholds for inflation. The adjustment uses the Consumer Price Index for all urban consumers and does not apply to the Construction Wage Rate Requirements statute, Service Contract Labor Standards statute, performance and payment bonds, and trade agreements thresholds. OFPP, DoD, GSA, and NASA are also using the same methodology to adjust nonstatutory FAR acquisition-related thresholds in 2025.
Agencies
- Defense Department
- General Services Administration
- National Aeronautics and Space Administration
- Federal Procurement Policy Office
- Management and Budget Office
Business Impact
$$$ - High
The final rule updates various acquisition-related thresholds to account for inflation, directly impacting business owners and executives involved in federal procurement. Increased thresholds, such as the micro-purchase threshold from $10,000 to $15,000 and the simplified acquisition threshold from $250,000 to $350,000, will affect compliance and contracting procedures.