2015-16206. Federal Acquisition Regulation; Inflation Adjustment of Acquisition-Related Thresholds

AGENCY:

Department of Defense (DoD), General Services Administration (GSA), and National Aeronautics and Space Administration (NASA).

ACTION:

Final rule.

SUMMARY:

DoD, GSA, and NASA are issuing this final rule amending the Federal Acquisition Regulation (FAR) to implement the inflation adjustment of acquisition-related dollar thresholds. A statute requires an adjustment every five years of acquisition-related thresholds for inflation using the Consumer Price Index for all urban consumers, except for the Construction Wage Rate Requirements statute (formerly Davis-Bacon Act), Service Contract Labor Standards statute, and trade agreements thresholds. DoD, GSA, and NASA have also used the same methodology to adjust nonstatutory FAR acquisition-related thresholds.

DATES:

Effective: October 1, 2015.

FOR FURTHER INFORMATION CONTACT:

Mr. Michael O. Jackson, Procurement Analyst, at 202-208-4949, for clarification of content. For information pertaining to status or publication schedules, contact the Regulatory Secretariat at 202-501-4755. Please cite FAC 2005-83, FAR Case 2014-022.

SUPPLEMENTARY INFORMATION:

I. Background

This rule amends multiple FAR parts to further implement 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 (CPI) for all urban consumers, except for the Construction Wage Rate Requirements statute (Davis-Bacon Act), Service Contract Labor Standards statute, and trade agreements thresholds (see FAR 1.109). As a matter of policy, DoD, GSA, and NASA also use the same methodology to adjust nonstatutory FAR acquisition-related thresholds.

DoD, GSA, and NASA published a proposed rule in the Federal Register at 79 FR 70141 on November 25, 2014. The preamble to the proposed rule contained detailed explanation of—

• What an acquisition-related threshold is;
• What acquisition-related thresholds are not subject to escalation adjustment under this case;
• How the Defense Acquisition Regulations Council and the Civilian Agency Acquisition Council (Councils) analyze statutory and non-statutory acquisition-related thresholds; and
• The effect of this rule on the most heavily-used thresholds.

Two respondents submitted comments on the proposed rule, which are addressed in the following section. The final rule has been coordinated with the Department of Labor and the Small Business Administration in areas of the regulation for which they are the lead agency.

II. Discussion and Analysis

The Civilian Agency Acquisition Council and the Defense Acquisition Regulations Council (the Councils) reviewed the comments in the development of the final rule. A discussion of the comments is provided as follows:

A. Summary of Changes Between the Proposed Rule and the Final Rule.

Although there were no changes between the proposed rule and the final rule as the result of public comments, some of the thresholds in the final rule are lower than proposed, due to lower inflation than was projected at the time of publication of the proposed rule.

There is no change in the final rule from the proposed frequently-used thresholds identified in the proposed rule:

• The micro-purchase base threshold of $3,000 (FAR 2.101) is increased to $3,500.
• The simplified acquisition threshold (FAR 2.101) of $150,000 is unchanged.
• The FedBizOpps preaward and post-award notices (FAR part 5) remain at $25,000 because of trade agreements.
• The threshold for use of simplified acquisition procedures for acquisition of commercial items (FAR 13.500) is raised from $6.5 million to $7 million.
• The cost or pricing data threshold (FAR 15.403-4) and the statutorily equivalent Cost Accounting Standard threshold are raised from $700,000 to $750,000.
• The prime contractor subcontracting plan (FAR 19.702) floor is raised from $650,000 to $700,000, and the construction threshold of $1,500,000 stays the same.
• The threshold for reporting first-tier subcontract information including executive compensation will increase from $25,000 to $30,000 (FAR subpart 4.14 and section 52.204-10).

The URL for the location of the current matrix of threshold escalation is provided at FAR 1.109(d).

B. Analysis of Public Comments

1. Inclusion of Specific Dollar Thresholds in Clauses

Comment: One respondent was of the opinion that when a dollar threshold is stated in the body of the clause, the threshold applies for the life of the contract, but if the clause instead refers to the threshold in the underlying FAR text, the threshold in the clause would automatically adjust when there was a change to the threshold in the FAR text.

Response: The Councils note that the Definitions clause at FAR 52.202-1, as prescribed at FAR 2.201, is to be included in all solicitations and contracts that exceed the simplified acquisition threshold. This clause specifies that, with a few limited exceptions, when a solicitation provision or contract clause uses a word or term that is defined in the FAR, the word or term has the same meaning as that definition in FAR 2.101 in effect at the time the solicitation was issued. Therefore, since the dollar value of the simplified acquisition threshold is included in the definition of “simplified acquisition threshold” in FAR part 2, the dollar threshold that is in effect at the time of issuance of the solicitation stays in effect for the life of the contract, unless the contracting parties agree otherwise.

Likewise, when a clause refers to a threshold in the FAR that is not included in a definition, the Councils generally presume that the threshold stays fixed for the life of the contract, unless the parties specify otherwise.

Therefore, it should not create discrepancies, whether a clause includes the dollar threshold, or references a definition or other text in the FAR to establish the value of the threshold.

2. Rounding Methodology

Comment: One respondent noted an apparent disproportionate inflation adjustment between the lower and higher dollar thresholds, particularly in the under $1 million range. The respondent suggested that Congress should use smaller dollar intervals to analyze the adjustment, or adjustments more frequent than every five years.

Response: The Councils have adjusted the thresholds in accordance with the statutory requirement, and cannot use different dollar intervals or adjustment periods unless Congress amends the statute.

C. Other Changes

1. Some Lower Thresholds in Final Rule

The proposed rule was based on a projected CPI of 245 for March 2015. The final rule is based on an actual CPI of 236.119 for March 2015. The CPI as of the end of March, six months before the effective date of the rule, is used as the cutoff in order to allow time for approval and publication of the final rule.

Because the actual CPI index for March 2015 is about ten points lower than the CPI index projected for that date at the time of the proposed rule, thresholds of at least 10 million dollars are generally proportionally lower than the proposed thresholds. Thresholds of less than $10 million are frequently unchanged, due to rounding.

2. Thresholds Related to Substantial Bundling

The thresholds at FAR 7.107(b) are nonstatutory thresholds passed based on policy, which were previously escalated by the FAR Council in October 2010. However, subsequent to the publication of the proposed rule under this FAR case 2014-022, the Councils became aware that the Small Business Administration (SBA) issued a final rule in the Federal Register at 78 FR 61114 on October 2, 2013, entitled “Acquisition process: Task and Delivery Order Contracts, Bundling, Consolidation”, which incorporated these thresholds into the SBA regulations at 13 CFR 125.2(d)(2)(ii). It is therefore now outside the authority of the FAR Council to escalate these thresholds, unless SBA first revises their regulations.

3. Cost Accounting Standards Threshold

By law (41 U.S.C. 1502(b)(1)(B)), the threshold for application of the Cost Accounting Standards equals the threshold of cost or pricing data, as escalated. The proposed rule included escalation of the cost or pricing data threshold from $700,000 to $750,000, which is retained in the final rule. Therefore, the final rule also includes equivalent escalation of the Cost Accounting Standards threshold at FAR 30.201-4 and the clauses at 52.230-1 through 52.230-5 from $700,000 to $750,000.

III. 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. This rule is not a major rule under 5 U.S.C. 804.

IV. 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, et seq. The FRFA is summarized as follows:

This final rule amends the Federal Acquisition Regulation to implement 41 U.S.C. 1908 and to amend other acquisition-related dollar thresholds that are based on policy rather than statute in order to adjust for the changing value of the dollar. 41 U.S.C. 1908 requires adjustment every five years of statutory acquisition-related dollar thresholds, except for Construction Wage Rate Requirements statute (Davis-Bacon Act), Service Contract Labor Standards statute, and trade agreements thresholds. While reviewing all statutory acquisition-related thresholds, this case presented an opportunity to also review all nonstatutory acquisition-related thresholds in the FAR that are based on policy. The objective of the case is to maintain the status quo, by adjusting acquisition-related thresholds for inflation.

There were no significant issues raised by the public comments in response to the initial regulatory flexibility analysis.

This rule will likely affect to some extent all small business concerns that submit offers or are awarded contracts by the Federal Government. However, most of the threshold changes in this rule are not expected to have any significant economic impact on small business concerns because they are intended to maintain the status quo by adjusting for changes in the value of the dollar. Often any impact will be beneficial, by preventing burdensome requirements from applying to more and more small dollar value acquisitions, which are the acquisitions in which small business concerns are most likely to participate.

One threshold change in this rule that may temporarily impact small business concerns is the increase of the micro-purchase threshold (FAR 2.101) from $3,000 to $3,500. This will temporarily narrow the range of acquisitions automatically set aside for small business concerns, because the simplified acquisition threshold of $150,000 will not increase at this time (although it may increase to $200,000 in 2020). To assess the impact of the increase in the micro-purchase threshold from $3,000 to $3,500, data was requested from the Federal Procurement Data System-Next Generation (FPDS-NG). For Fiscal Year 2013, there were 83,951 contracts and calls/orders between $3,000 and $3,500, with a value of $272,567,926. Of these actions, 34,828 (value of $113,280,333) went to small business concerns. We expect that many of these awards will still go to small business concerns, even if there is no longer a requirement to automatically set the procurement aside for small business concerns.

The rule does not impose any new reporting, recordkeeping, or compliance requirements. Changes in thresholds for approved information collection requirements are intended to maintain the status quo and prevent those requirements from increasing over time.

There are no practical alternatives that will accomplish the objectives of the statute.

Interested parties may obtain a copy of the FRFA from the Regulatory Secretariat. The Regulatory Secretariat has submitted a copy of the FRFA to the Chief Counsel for Advocacy of the Small Business Administration.

V. Paperwork Reduction Act

The Paperwork Reduction Act does apply. The changes to the FAR do not impose new information collection requirements that require the approval of the Office of Management and Budget (OMB) under 44 U.S.C. 3501, et seq. By adjusting the thresholds for inflation, the status quo for the current information collection requirements are maintained under the following OMB clearance numbers: 9000-0006, titled: Subcontracting Plans/Individual Subcontract Report (SF 294); 9000-0007, titled: Summary Subcontract Report; 9000-0027, titled: Value Engineering Requirements; FAR Sections Affected: Subparts 48.1 and 48.2; 52.248-2 and 52.248-3. 9000-0094, titled: Debarment and Suspension; 9000-0164, titled: Contractor Business Ethics Compliance Program and Disclosure Requirements; 9000-0177, titled: Reporting Executive Compensation and First-tier Subcontract Awards; 1250-0004, titled: OFCCP Recordkeeping and Reporting Requirements—38 U.S.C. 4212, Vietnam Era Veterans' Readjustment Assistance Act of 1974, as amended; and 1293-0005, titled: Federal Contractor Veterans Employment Report, VETS-100/VETS-100A.

List of Subjects in 48 CFR Parts 1, 2, 3, 4, 6, 7, 8, 9, 10, 12, 13, 15, 16, 17, 19, 22, 25, 28, 30, 42, 50, 52, and 53

• Government procurement

Dated: June 18, 2015.

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 parts 1, 2, 3, 4, 6, 7, 8, 9, 10, 12, 13, 15, 16, 17, 19, 22, 25, 28, 30, 42, 50, 52, and 53 as set forth below:

1. The authority citation for 48 CFR parts 1, 2, 3, 4, 6, 7, 8, 9, 10, 12, 13, 15, 16, 17, 19, 22, 25, 28, 30, 42, 50, 52, and 53 continues to read as follows:

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

PART 1—FEDERAL ACQUISITION REGULATIONS SYSTEM

1.109

[Amended]

2. Amend section 1.109 by removing from paragraph (d) “FAR Case 2008-024” and adding “FAR Case 2014-022” in its place.

PART 2—DEFINITIONS OF WORDS AND TERMS

3. Amend section 2.101, in paragraph (b)(2) by—

a. Revising paragraph (1) of the definition “Major System”;

b. In the definition “Micro-purchase threshold” by removing from the introductory text “$3,000” and adding “$3,500” in its place; and removing from paragraph (3)(i) “$15,000” and adding “$20,000” in its place;

c. In the definition “Simplified acquisition threshold” by removing from the introductory text “$150,000,” and adding “$150,000 ( 41 U.S.C. 134),” in its place; and

d. In the definition “Small business subcontractor” by removing from paragraphs (1) and (2) “$10,000” and adding “$15,000” in their places.

The revision reads as follows.

2.101

Definitions.

* * * * *

(b) * * *

(2) * * *

Major system * * *

(1) The Department of Defense is responsible for the system and the total expenditures for research, development, test, and evaluation for the system are estimated to be more than $185 million based on Fiscal Year 2014 constant dollars or the eventual total expenditure for the acquisition exceeds $835 million based on Fiscal Year 2014 constant dollars (or any update of these thresholds based on a more recent fiscal year, as specified in the DoD Instruction 5000.02, “Operation of the Defense Acquisition System”);

* * * * *

PART 3—IMPROPER BUSINESS PRACTICES AND PERSONAL CONFLICTS OF INTEREST

3.1004

[Amended]

4. Amend section 3.1004 by removing from paragraphs (a), (b)(1)(i), and (b)(3) “$5,000,000” and adding “$5.5 million” in their places.

PART 4—ADMINISTRATIVE MATTERS

4.605

[Amended]

5. Amend section 4.605 by removing from paragraphs (c)(2)(i) and (c)(2)(ii) “$25,000” and adding “$30,000” in their places.

4.1102

[Amended]

6. Amend section 4.1102 by removing from paragraph (a)(6) “$25,000” and adding “$30,000” in its place.

4.1401

[Amended]

7. Amend section 4.1401 by removing from paragraph (a) “$25,000” and adding “$30,000” in its place.

8. Amend section 4.1403 by revising paragraph (a) to read as follows:

4.1403

Contract clause.

(a) Except as provided in paragraph (b) of this section, the contracting officer shall insert the clause at 52.204-10, Reporting Executive Compensation and First-Tier Subcontract Awards, in all solicitations and contracts of $30,000 or more.

* * * * *

PART 6—COMPETITION REQUIREMENTS

6.204

[Amended]

9. Amend section 6.204 by removing from paragraph (b) “$20 million” and adding “$22 million” in its place.

6.302-5

[Amended]

10. Amend section 6.302-5 by removing from paragraphs (b)(4) and (c)(2)(iii) “$20 million” and adding “$22 million” in their places.

6.303-1

[Amended]

11. Amend section 6.303-1 by removing from paragraph (b), introductory text, “$20 million” and adding “$22 million” in its place.

6.303-2

[Amended]

12. Amend section 6.303-2 by removing from the introductory text of paragraphs (b) and (d) “$20 million” and adding “$22 million” in their places.

6.304

[Amended]

13. Amend section 6.304 by—

a. Removing from paragraph (a)(1) “$650,000” and adding “$700,000” in its place;

b. Removing from paragraph (a)(2) “$650,000” and “$12.5 million” and adding “$700,000” and “$13.5 million” in their places, respectively;

c. Removing from the introductory text of paragraph (a)(3) “$12.5 million”, “$62.5 million”, and “85.5 million” and adding “$13.5 million”, “$68 million”, and “$93 million” in their places, respectively; and

d. Removing from paragraph (a)(4) “$62.5 million” and “$85.5 million” and adding “$68 million” and “$93 million” in their places, respectively.

PART 7—ACQUISITION PLANNING

7.104

[Amended]

14. Amend section 7.104 by—

a. Removing from paragraph (d)(2)(i)(A) “$8 million” and adding “$9 million” in its place; and

b. Removing from paragraph (d)(2)(i)(B) “$6 million” and adding “$6.5 million” in its place.

7.107

[Amended]

15. Amend section 7.107 by removing from paragraph (b)(1) “$94 million” and adding “$102 million” in its place; and removing from paragraph (b)(2) “$9.4 million” and “$94 million” and adding “$10.2 million” and “$102 million” in their places, respectively.

PART 8—REQUIRED SOURCES OF SUPPLIES AND SERVICES

8.404

[Amended]

16. Amend section 8.404 by removing from paragraph (b)(2) “$500,000” and adding “$550,000” in its place.

17. Amend section 8.405-3 by—

a. Removing from paragraphs (a)(3)(ii) and (a)(3)(iii) “$103 million” and adding “$112 million” in their places; and

b. Revising paragraph (a)(7)(v).

The revision reads as follows:

8.405-3

Blanket purchase agreements (BPAs).

(a) * * *

(7) * * *

(v) Determination for a single-award BPA exceeding $112 million, if applicable (see (a)(3)(ii)) of this section);

* * * * *

8.405-6

[Amended]

18. Amend section 8.405-6 by—

a. Removing from paragraph (d)(1) “$650,000” and adding “$700,000” in its place;

b. Removing from paragraph (d)(2) “$650,000” and “$12.5 million” and adding “$700,000” and “$13.5 million” in their places, respectively;

c. Removing from the introductory text of paragraph (d)(3) “$12.5 million”, “$62.5 million”, and “$85.5 million”, and adding “$13.5 million”, “$68 million” and “$93 million” in their places, respectively; and

d. Removing from paragraph (d)(4) “$62.5 million” and “$85.5 million” and adding “$68 million” and “$93 million” in their places, respectively.

PART 9—CONTRACTOR QUALIFICATIONS

9.104-5

[Amended]

19. Amend section 9.104-5 by removing from paragraph (a)(2) “$3,000” and adding “$3,500” in its place.

9.104-7

[Amended]

20. Amend section 9.104-7 by removing from paragraphs (b) and (c)(1) “$500,000” and adding “$550,000” in their places.

9.405-2

[Amended]

21. Amend section 9.405-2 by removing from paragraph (b) “$30,000” and adding “$35,000” in their places (twice).

9.406-2

[Amended]

22. Amend section 9.406-2 by removing from paragraph (b)(1)(v) “$3,000” and adding “$3,500” in its place.

9.407-2

[Amended]

23. Amend section 9.407-2 by removing from paragraph (a)(7) “$3,000” and adding “$3,500” in its place.

9.409

[Amended]

24. Amend section 9.409 by removing “$30,000” and adding “$35,000” in its place.

PART 10—MARKET RESEARCH

10.001

[Amended]

25. Amend section 10.001 by removing from paragraph (d) “$5 million” and adding “$5.5 million” in its place.

10.003

[Amended]

26. Amend section 10.003 by removing “$5 million” and adding “$5.5 million” in its place.

PART 12—ACQUISITION OF COMMERCIAL ITEMS

12.102

[Amended]

27. Amend section 12.102 by removing from the introductory text of paragraph (f)(2) “$17.5 million” and adding “$19 million” in its place.

12.203

[Amended]

28. Amend section 12.203 by removing “$6.5 million” and “$12 million” and adding “$7 million” and “$13 million” in their places, respectively.

PART 13—SIMPLIFIED ACQUISITION PROCEDURES

13.000

[Amended]

29. Amend section 13.000 by removing “$6.5 million” and “$12 million” and adding “$7 million” and “$13 million” in their places, respectively.

13.003

[Amended]

30. Amend section 13.003 by—

a. Removing from paragraph (b)(1) “$3,000”, “$15,000”, and “$300,000” and adding “$3,500”, “$20,000” and “$350,000” in their places, respectively;

b. Removing from paragraph (c)(1)(ii) “$6.5 million” and “$12 million” and adding “$7 million” and “$13 million” in their places, respectively; and

c. Removing from paragraph (g)(2) “$6.5 million” and “$12 million” and adding “$7 million” and “$13 million” in their places, respectively.

13.005

[Amended]

31. Amend section 13.005 by removing from paragraph (a)(2) “$30,000” and adding “$35,000” in its place.

13.106-1

[Amended]

32. Amend section 13.106-1 by removing from paragraphs (c)(2) and (d) “$30,000” and adding “$25,000” in their places.

13.201

[Amended]

33. Amend section 13.201 by removing from paragraph (g)(1)(i) “$15,000” and adding “$20,000” in its place.

13.303-5

[Amended]

34. Amend section 13.303-5 by—

a. Removing from paragraph (b)(1) “$6.5 million” and “$12 million” and adding “$7 million” and “$13 million” in in their places, respectively; and

b. Removing from paragraph (b)(2) “$6.5 million” and “$12 million” and adding “$7 million” and “$13 million” in their places, respectively.

13.402

[Amended]

35. Amend section 13.402 by removing from paragraph (a) “$30,000” and adding “$35,000” in its place.

13.500

[Amended]

36. Amend section 13.500 by—

a. Removing from paragraph (a) “$6.5 million” and “$12 million” and adding “$7 million” and “$13 million” in their places, respectively; and

b. Removing from the introductory text of paragraph (c) “$12 million” and adding “$13 million” in its place.

13.501

[Amended]

37. Amend section 13.501 by—

a. Removing from paragraph (a)(2)(i) “$650,000” and adding “$700,000” in its place;

b. Removing from paragraph (a)(2)(ii) ”$650,000” and “$12.5 million” and adding “$700,000” and “$13.5 million” in their places, respectively;

c. Removing from paragraph (a)(2)(iii) ”$12.5 million”, “$62.5 million”, and “$85.5 million” and adding “$13.5 million”, “$68 million”, and “$93 million” in their places, respectively; and

d. Removing from paragraph (a)(2)(iv) ”$62.5 million” and “$85.5 million” and adding “$68 million” and “$93 million” in their places, respectively.

PART 15—CONTRACTING BY NEGOTIATION

15.403-1

[Amended]

38. Amend section 15.403-1 by removing from paragraph (c)(3)(iv) “$17.5 million” and adding “$19 million” in its place.

15.403-4

[Amended]

39. Amend section 15.403-4 by removing from the introductory text of paragraphs (a)(1) and (a)(1)(iii) “$700,000” and adding “$750,000” in its place.

15.404-3

[Amended]

40. Amend section 15.404-3 by removing from paragraph (c)(1)(i) “$12.5 million” and adding “$13.5 million” in its place.

15.407-2

[Amended]

41. Amend section 15.407-2 by removing from paragraph (c)(1) and the introductory text of paragraph (c)(2) “$12.5 million” and adding “$13.5 million” in their places.

15.408

[Amended]

42. Amend section 15.408 in Table 15-2, “II. Cost Elements” which follows paragraph (n)(2)(iii), by removing from paragraph “A(2)” “$12.5 million” and adding “$13.5 million” in its place.

PART 16—TYPES OF CONTRACTS

16.503

[Amended]

43. Amend section 16.503 by removing from paragraph (b)(2) “$103 million” and adding “$112 million” in its place; and removing from paragraph (d)(1) “$12.5 million” and adding “$13.5 million” in its place.

16.504

[Amended]

44. Amend section 16.504 by—

a. Removing from the introductory text of paragraph (c)(1)(ii)(D)( 1) “$103 million” and adding “$112 million” in its place;

b. Removing from the introductory text of paragraph (c)(1)(ii)(D)( 3) “$103 million” and adding “$112 million” in its place; and removing from the end of the paragraph the colon and adding an em dash in its place;

c. Removing from the end of paragraph (c)(1)(ii)(D)( 3)(i) the period and adding “; and” in its place; and

d. Removing from the introductory text of paragraph (c)(2)(i) “$12.5 million” and adding “$13.5 million” in its place.

16.505

[Amended]

45. Amend section 16.505 by—

a. Removing from the introductory text of paragraph (a)(4)(iii)(A) “$25,000” and adding “$30,000” in its place;

b. Removing from paragraph (b)(1)(i) “$3,000” and adding “$3,500” in its place;

c. Removing from the paragraph (b)(1)(iv) “ $5 million” and “$5 million” and adding “$5.5 million” and “$5.5 million” in their places, respectively;

d. Removing from paragraph (b)(2)(i) “$3,000” and adding “$3,500” in its place;

e. Removing from the heading of paragraph (b)(2)(ii)(A) “ $3,000” and adding “$3,500” in its place;

f. Removing from the paragraph (b)(2)(ii)(C)( 1) “$650,000” and adding “$700,000” in its place;

g. Removing from paragraph (b)(2)(ii)(C)( 2) “$650,000” and “$12.5 million” and adding “$700,000” and “13.5 million” in their places, respectively;

h. Removing from paragraph (b)(2)(ii)(C)( 3) “$12.5 million”, “$62.5 million”, and “$85.5 million” and adding “13.5 million”, “68 million”, and “93 million” in their places, respectively;

i. Removing from paragraph (b)(2)(ii)(C)( 4) “$62.5 million” and “$85.5 million” and adding “68 million” and “93 million” in their places, respectively; and

j. Removing from the heading of paragraph (b)(6) “ $5 million” and adding “$5.5 million” in its place; and removing from the introductory text “$5 million” and adding “$5.5 million” in its place.

16.506

[Amended]

46. Amend section 16.506 by removing from paragraphs (f) and (g) “$12.5 million” and adding “$13.5 million” in their places; and removing from paragraph (h) “$5 million” and adding “5.5 million” in its place.

PART 17—SPECIAL CONTRACTING METHODS

17.108

[Amended]

47. Amend section 17.108 by removing from paragraph (a) “$12.5 million” and adding “$13.5 million” in its place; and removing from paragraph (b) “$125 million” and adding “$135.5 million” in its place.

17.500

[Amended]

48. Amend section 17.500 by removing from paragraph (c)(2) “$500,000” and adding “$550,000” in its place.

PART 19—SMALL BUSINESS PROGRAMS

19.203

[Amended]

49. Amend section 19.203 by removing from paragraph (b) “$3,000” and “$15,000” and adding “$3,500” and “$20,000” in their places, respectively.

19.502-1

[Amended]

50. Amend section 19.502-1 by removing from paragraph (b) “$3,000” and “$15,000” and adding “$3,500” and “$20,000” in their places, respectively.

19.502-2

[Amended]

51. Amend section 19.502-2 by—

a. Removing from paragraph (a) “$3,000” and “$15,000” and adding “$3,500” and “$20,000” in their places, respectively; and

b. Removing from the end of paragraph (b) “that:” and adding “that—” in its place.

19.702

[Amended]

52. Amend section 19.702 by removing from paragraphs (a)(1) and (a)(2) “$650,000” and adding “$700,000” in their places.

19.704

[Amended]

53. Amend section 19.704 by removing from paragraph (a)(9) “$650,000” and adding “$700,000” in its place.

19.708

[Amended]

54. Amend section 19.708 by removing from paragraph (b)(1) “$650,000” and adding “$700,000” in its place.

19.805-1

[Amended]

55. Amend section 19.805-1 by removing from paragraph (a)(2) “$6.5 million” and adding “$7 million” in its place.

19.808-1

[Amended]

56. Amend section 19.808-1 by removing from paragraph (a) “$20 million” and adding “$22 million” in its place.

19.1306

[Amended]

57. Amend section 19.1306 by removing from paragraph (a)(2)(i) “$6.5 million” and adding “$7 million” in its place.

19.1406

[Amended]

58. Amend section 19.1406 by removing from paragraph (a)(2)(i) “$6 million” and adding “$6.5 million” in its place; and removing from paragraph (a)(2)(ii) “$3.5 million” and adding “$4 million” in its place.

PART 22—APPLICATION OF LABOR LAWS TO GOVERNMENT

22.1103

[Amended]

59. Amend section 22.1103 by removing “$650,000” and adding “$700,000” in its place.

22.1303

[Amended]

60. Amend section 22.1303 by removing from paragraphs (a) and (c) “$100,000” and adding “$150,000” in their places.

22.1310

[Amended]

61. Amend section 22.1310 by removing from paragraph (a)(1) “$100,000” and adding “$150,000” in its place.

PART 25—FOREIGN ACQUISITION

25.703-2

[Amended]

62. Amend section 25.703-2 by removing from paragraph (a)(2) “$3,000” and adding “$3,500” in its place.

25.703-4

[Amended]

63. Amend section 25.703-4 by removing from paragraphs (c)(5)(ii), (c)(7)(iii), and (c)(8)(iii) “$3,000” and adding “$3,500” in their places.

PART 28—BONDS AND INSURANCE

28.102-1

[Amended]

64. Amend section 28.102-1 by removing from paragraph (b)(1) “$30,000” and adding “$35,000” in its place.

28.102-2

[Amended]

65. Amend section 28.102-2 by removing from paragraph (c) “ $30,000” and adding “$35,000” in its place.

28.102-3

[Amended]

66. Amend section 28.102-3 by removing from paragraph (b) “$30,000” and adding “$35,000” in its place.

PART 30—COST ACCOUNTING STANDARDS ADMINISTRATION

30.201-4

[Amended]

67. Amend section 30.201-4 by removing from paragraph (b)(1) “$700,000” and adding “$750,000” in its place.

PART 42—CONTRACT ADMINISTRATION AND AUDIT SERVICES

42.709

[Amended]

68. Amend section 42.709 by removing from paragraph (b) “$700,000” and adding “$750,000” in its place.

42.709-6

[Amended]

69. Amend section 42.709-6 by removing “$700,000” and adding “$750,000” in its place.

42.1502

[Amended]

70. Amend section 42.1502 by removing from paragraph (e) “$650,000” and adding “$700,000” in its place (twice); and removing from paragraph (f) “$30,000” and adding “$35,000” in its place (twice).

PART 50—EXTRAORDINARY CONTRACTUAL ACTIONS AND THE SAFETY ACT

50.102-1

[Amended]

71. Amend section 50.102-1 by removing from paragraph (b) “$65,000” and adding “$70,000” in its place.

50.102-3

[Amended]

72. Amend section 50.102-3 by removing from paragraph (b)(4) “$31.5 million” and adding “$34 million” in its place; and removing from paragraphs (e)(1)(i) and (e)(1)(ii) “$65,000” and adding “$70,000” in their places.

PART 52—SOLICITATION PROVISIONS AND CONTRACT CLAUSES

73. Amend section 52.203-13 by revising the date of clause; and removing from paragraph (d)(1) “$5,000,000” and adding “$5.5 million” in its place.

The revision reads as follows:

52.203-13

Contractor Code of Business Ethics and Conduct

* * * * *

Contractor Code of Business Ethics and Conduct (Oct 2015)

* * * * *

74. Amend section 52.203-14 by revising the date of the clause; and removing from the introductory text of paragraph (d) “$5,000,000” and adding “$5.5 million” in its place.

The revision reads as follows:

52.203-14

Display of Hotline Poster(s).

* * * * *

Display of Hotline Poster(s) (Oct 2015)

* * * * *

75. Amend section 52.204-10 by—

a. Revising the date of the clause;

b. Removing from paragraphs (d)(2) and (d)(3) “$25,000” and adding “$30,000” in their places; and

c. Revising paragraph (e).

The revisions read as follows:

52.204-10

Reporting Executive Compensation and First-Tier Subcontract Awards.

* * * * *

Reporting Executive Compensation and First-Tier Subcontract Awards (Oct 2015)

(e) The Contractor shall not split or break down first-tier subcontract awards to a value less than $30,000 to avoid the reporting requirements in paragraph (d) of this clause.

* * * * *

76. Amend section 52.209-5 by revising the date of the provision; and removing from paragraph (a)(1)(i)(D) “$3,000” and adding “$3,500” in its place.

The revision reads as follows:

52.209-5

Certification Regarding Responsibility Matters.

* * * * *

Certification Regarding Responsibility Matters (Oct 2015)

* * * * *

77. Amend section 52.209-6 by revising the date of the clause; and removing from paragraphs (b), (c), and (e)(1) “$30,000” and adding “$35,000” in their places.

The revision reads as follows:

52.209-6

Protecting the Government's Interest When Subcontracting with Contractors Debarred, Suspended, or Proposed for Debarment.

* * * * *

Protecting the Government's Interest When Subcontracting With Contractors Debarred, Suspended, or Proposed for Debarment (Oct 2015)

* * * * *

78. Amend section 52.212-1 by revising the date of the provision; and removing from paragraph (j) “$3,000” and adding “$3,500” in its place (twice).

The revision reads as follows:

52.212-1

Instructions to Offerors—Commercial Items.

* * * * *

Instructions to Offerors—Commercial Items (Oct 2015)

* * * * *

79. Amend section 52.212-3 by revising the date of the provision; and removing from paragraphs (h)(4) and (o)(2)(iii) “$3,000” and adding “$3,500” in their places.

The revision reads as follows:

52.212-3

Offeror Representations and Certifications—Commercial Items.

* * * * *

Offeror Representations and Certifications—Commercial Items (Oct 2015)

* * * * *

80. Amend section 52.212-5 by—

a. Revising the date of the clause;

b. Revising paragraphs (b)(2), (b)(4), (b)(8), (b)(17)(i), (b)(17)(iv), (b)(29), (b)(31), (b)(34), and (e)(1)(i);

c. Removing from paragraph (e)(1)(ii) “$650,000” and adding “$700,000” in its place;

d. Revising paragraphs (e)(1)(vi), (e)(1)(viii), and (e)(1)(xiv); and

e. Amending Alternate II by revising the date of Alternate II and paragraphs (e)(1)(ii)(A), (e)(1)(ii)(C), (e)(1)(ii)(F), and (e)(1)(ii)(M).

The revisions read as follows:

52.212-5

Contract Terms and Conditions Required to Implement Statutes or Executive Orders—Commercial Items.

* * * * *

Contract Terms and Conditions Required To Implement Statutes or Executive Orders—Commercial Items (Oct 2015)

* * * * *

(b) * * *

__(2) 52.203-13, Contractor Code of Business Ethics and Conduct (Oct 2015) (41 U.S.C. 3509).

* * * * *

__(4) 52.204-10, Reporting Executive Compensation and First-Tier Subcontract Awards (Oct 2015) (Pub. L. 109-282) (31 U.S.C. 6101 note).

* * * * *

__(8) 52.209-6, Protecting the Government's Interest When Subcontracting with Contractors Debarred, Suspended, or Proposed for Debarment. (Oct 2015) (31 U.S.C. 6101 note).

* * * * *

__(17)(i) 52.219-9, Small Business Subcontracting Plan (Oct 2015) (15 U.S.C. 637(d)(4)).

* * * * *

__(iv) Alternate III (Oct 2015) of 52.219-9.

* * * * *

__(29) 52.222-35, Equal Opportunity for Veterans (Oct 2015) (38 U.S.C. 4212).

* * * * *

__(31) 52.222-37, Employment Reports on Veterans (Oct 2015) (38 U.S.C. 4212).

* * * * *

__(34) 52.222-54, Employment Eligibility Verification (Oct 2015). (E. O. 12989). (Not applicable to the acquisition of commercially available off-the-shelf items or certain other types of commercial items as prescribed in 22.1803.)

* * * * *

(e)(1) * * *

(i) 52.203-13, Contractor Code of Business Ethics and Conduct (Oct 2015) (41 U.S.C. 3509).

* * * * *

(vi) 52.222-35, Equal Opportunity for Veterans (Oct 2015) (38 U.S.C. 4212).

* * * * *

(viii) 52.222-37, Employment Reports on Veterans (Oct 2015) (38 U.S.C. 4212).

* * * * *

(xiv) 52.222-54, Employment Eligibility Verification (Oct 2015) (E. O. 12989).

* * * * *

Alternate II (Oct 2015). * * *

* * * * *

(e)(1) * * *

(ii) * * *

(A) 52.203-13, Contractor Code of Business Ethics and Conduct (Oct 2015) (41 U.S.C. 3509).

* * * * *

(C) 52.219-8, Utilization of Small Business Concerns (Oct 2015) (15 U.S.C. 637(d)(2) and (3)), in all subcontracts that offer further subcontracting opportunities. If the subcontract (except subcontracts to small business concerns) exceeds $700,000 ($1.5 million for construction of any public facility), the subcontractor must include 52.219-8 in lower tier subcontracts that offer subcontracting opportunities.

* * * * *

(F) 52.222-35, Equal Opportunity for Veterans (Oct 2015) (38 U.S.C. 4212).

* * * * *

(M) 52.222-4, Employment Eligibility Verification (Oct 2015) (Executive Order 12989).

* * * * *

81. Amend section 52.213-4 by revising the date of the clause and paragraphs (a)(2)(viii), (b)(1)(i), (b)(1)(iv), (b)(1)(vi), and (b)(2)(i) to read as follows:

52.213-4

Terms and Conditions—Simplified Acquisitions (Other Than Commercial Items).

* * * * *

Terms and Conditions—Simplified Acquisitions (Other Than Commercial Items) (Oct 2015)

* * * * *

(a) * * *

(2) * * *

(viii) 52.244-6, Subcontracts for Commercial Items (Oct 2015).

* * * * *

(b) * * *

(1) * * *

(i) 52.204-10, Reporting Executive Compensation and First-Tier Subcontract Awards (Oct 2015) (Pub. L. 109-282) (31 U.S.C. 6101 note) (Applies to contracts valued at $30,000 or more).

* * * * *

(iv) 52.222-35, Equal Opportunity for Veterans (Oct 2015) (38 U.S.C. 4212) (applies to contracts of $150,000 or more).

* * * * *

(vi) 52.222-37, Employment Reports on Veterans (Oct 2015) (38 U.S.C. 4212) (applies to contracts of $150,000 or more).

* * * * *

(2) * * *

(i) 52.209-6, Protecting the Government's Interest When Subcontracting with Contractors Debarred, Suspended, or Proposed for Debarment (Oct 2015) (Applies to contracts over $35,000).

* * * * *

82. Amend section 52.219-9 by—

a. Revising the date of the clause;

b. Removing from paragraph (d)(9) and paragraph (l)(2)(i)(C) “$650,000” and adding “$700,000” in their places;

c. Amending Alternate III by—

1. Revising the date of Alternate III;

2. Removing from paragraph (l)(2)(i)(C) “$550,000” and “$1,000,000” and adding “$700,000” and “$1.5 million” in their places, respectively.

The revision reads as follows:

52.219-9

Small Business Subcontracting Plan.

* * * * *

Small Business Subcontracting Plan (Oct 2015)

* * * * *

Alternate III (Oct 2015). * * *

* * * * *

83. Amend section 52.222-35 by revising the date of the clause; and removing from paragraph (c) “$100,000” and adding “$150,000” in its place.

The revision reads as follows:

52.222-35

Equal Opportunity for Veterans.

* * * * *

Equal Opportunity for Veterans (Oct 2015)

* * * * *

84. Amend section 52.222-37 by revising the date of the clause; and removing from paragraph (g) “$100,000” and adding “$150,000” in its place.

The revision reads as follows:

52.222-37

Employment Reports on Veterans.

* * * * *

Employment Reports on Veterans (Oct 2015)

* * * * *

85. Amend section 52.222-54 by revising the date of the clause; and removing from paragraph (e)(2) “$3,000” and adding “$3,500” in its place.

The revision reads as follows:

52.222-54

Employment Eligibility Verification.

* * * * *

Employment Eligibility Verification (Oct 2015)

* * * * *

86. Amend section 52.225-25 by revising the date of the provision; and removing from paragraph (c)(3) “$3,000” and adding “$3,500” in its place.

The revision text reads as follows:

52.225-25

Prohibition on Contracting With Entities Engaging in Certain Activities or Transactions Relating to Iran—Representation and Certifications.

* * * * *

Prohibition on Contracting With Entities Engaging in Certain Activities or Transactions Relating to Iran—Representation and Certifications (Oct 2015)

* * * * *

87. Amend section 52.230-1 by revising the date of the provision; and removing from paragraph (a) “$700,000” and adding “$750,000” in its place.

The revision reads as follows:

52.230-1

Cost Accounting Standards Notices and Certification.

* * * * *

Cost Accounting Standards Notices and Certification (Oct 2015)

* * * * *

88. Amend section 52.230-2 by revising the date of the clause; and removing from paragraph (d) “$700,000” and adding “$750,000” in its place.

The revision reads as follows:

52.230-2

Cost Accounting Standards.

* * * * *

Cost Accounting Standards (Oct 2015)

* * * * *

89. Amend section 52.230-3 by revising the date of the clause; and removing from paragraph (d)(2) “$700,000” and adding “$750,000” in its place.

The revision reads as follows:

52.230-3

Disclosure and Consistency of Cost Accounting Practices.

* * * * *

Disclosure and Consistency of Cost Accounting Practices (Oct 2015)

* * * * *

90. Amend section 52.230-4 by revising the date of the clause; and removing from paragraph (d)(2) “$700,000” and adding “$750,000” in its place.

The revision reads as follows:

52.230-4

Disclosure and Consistency of Cost Accounting Practices-Foreign Concerns.

* * * * *

Disclosure and Consistency of Cost Accounting Practices-Foreign Concerns (Oct 2015)

* * * * *

91. Amend section 52.230-5 by revising the date of the clause; and removing from paragraph (d)(2) “$700,000” and adding “$750,000” in its place.

The revision reads as follows:

52.230-5

Cost Accounting Standards—Educational Institution.

* * * * *

Cost Accounting Standards—Educational Institution (Oct 2015)

* * * * *

92. Amend section 52.244-6 by—

a. Revising the date of the clause;

b. Revising paragraph (c)(1)(i);

c. Removing from paragraph (c)(1)(iii) “$650,000” and adding “$700,000” in its place; and

d. Revising paragraphs (c)(1)(vi) and (c)(1)(viii).

The revisions read as follows:

52.244-6

Subcontracts for Commercial Items.

* * * * *

Subcontracts for Commercial Items (Oct 2015)

* * * * *

(c)(1) * * *

(i) 52.203-13, Contractor Code of Business Ethics and Conduct (Oct 2015) (41 U.S.C. 3509), if the subcontract exceeds $5.5 million and has a performance period of more than 120 days. In altering this clause to identify the appropriate parties, all disclosures of violation of the civil False Claims Act or of Federal criminal law shall be directed to the agency Office of the Inspector General, with a copy to the Contracting Officer.

* * * * *

(vi) 52.222-35, Equal Opportunity for Veterans (Oct 2015)(38 U.S.C. 4212(a));

* * * * *

(viii) 52.222-37, Employment Reports on Veterans (Oct 2015)(38 U.S.C. 4212).

* * * * *

93. Amend section 52.248-3 by revising the date of the clause; and removing from paragraph (h) “$65,000” and adding “$70,000” in its place.

The revision reads as follows:

52.248-3

Value Engineering-Construction.

* * * * *

Value Engineering-Construction (Oct 2015)

* * * * *

PART 53—FORMS

53.219

[Amended]

94. Amend section 53.219 by removing “(Rev. 8/2014)” and adding “(Rev. 10/2015)” in its place.

95. Revise section 53.301-294 to read as follows:

53.301-294

Subcontracting Report for Individual Contracts.