This piece was originally published in the October 2020 KYPTAC Newsletter. If you have any questions, please contact your KYPTAC Consultant. Not a client? Sign up here.
As you become experienced in government contracting, you will notice that you typically do not see small dollar procurements posted on sites like beta.sam.gov, and you may wonder why that is.
The federal government has different procurement methods depending on the dollar value of procurement. For instance, very small purchases are known as micro-purchases; this is defined as anything up to $10,000. Those purchases can be done very simply with a government purchase card, and no formal contract document has to be executed. Historically, the micro-purchase threshold was much lower; just last year, it increased from $3500 to $10,000. As you can imagine, this gives a government purchase cardholder significant buying power for small purchases. Further, for contracts awarded in response to COVID-19, the federal state of emergency allowed the President to raise the simple micro-purchase threshold to $20,000 for purchases made inside the US, and $30,000 for purchases made outside of the United States. These higher amounts only apply to supplies and services responsive to the pandemic.
The next level of purchases is simplified acquisitions, which can be accomplished with, you guessed it...Simplified Acquisition procedures; these are less burdensome and time-consuming for the contracting officer, and generally less labor-intensive for prospective bidders. Under the Simplified Acquisition Threshold, competition can be limited (as opposed to full and open), and brand name requirements are acceptable if warranted. These contracts are often set aside for small businesses. Simplified acquisitions are any awards up to $250,000 in value. Again, pandemic-related contracts have a greater simplified acquisition threshold; for purchases made within the US, it is $750,000, and for international purchases, it is $1.5 million. Finally, contracting officers can procure commercial items under the simplified acquisition procedures, up to $13 million. This includes both supplies and services.