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 Department of Defense Defense Acquisition Regulations System 48 CFR Parts 203, 205, 206, 209, 211, 212, 215, 216, 217, 219, 225, 236, 237, 246, 250, and 252
[Docket DARS-2024-0039]
RIN 0750-AL99
 AGENCY: Defense Acquisition Regulations System, Department of Defense (DoD).
 ACTION: Proposed rule.
 SUMMARY: DoD is proposing to amend the Defense Federal Acquisition Regulation Supplement (DFARS) to further implement the statute that requires an adjustment every 5 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 (Davis-Bacon Act), Service Contract Labor Standards statute, performance and payment bonds, and trade agreements thresholds. DoD is also proposing to use the same methodology to adjust some nonstatutory DFARS acquisition-related thresholds in 2025.
 DATES: Comments on the proposed rule should be submitted in writing to the address shown below on or before March 18, 2025, to be considered in the formation of the final rule.
 ADDRESSES: Submit comments identified by DFARS Case 2024-D002, using either of the following methods: ○ 
                        *Federal eRulemaking Portal: https://regulations.gov.*
                         Search for DFARS Case 2024-D002. Select “Comment” and follow the instructions to submit a comment. Please include “DFARS Case 2024-D002” on any attached documents. ○ 
                        *Email: osd.dfars@mail.mil.*
                         Include DFARS Case 2024-D002 in the subject line of the message. Comments received generally will be posted without change to 
                        *https://www.regulations.gov,*
                         including any personal information provided. To confirm receipt of your comment(s), please check 
                        *https://www.regulations.gov,*
                         approximately two to three days after submission to verify posting.
 FOR FURTHER INFORMATION CONTACT: Ms. Kimberly R. Ziegler, telephone 703-901-3176.


SUPPLEMENTARY INFORMATION: I. Background DoD is proposing to amend multiple DFARS 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, performance and payment bonds, and trade agreements thresholds (see FAR 1.109). As a matter of policy, DoD is also proposing to use the same methodology to adjust nonstatutory DFARS acquisition-related thresholds on October 1, 2025. Federal Acquisition Regulation (FAR) Case 2024-001 proposes comparable changes to acquisition-related thresholds in the FAR. This is the fifth review of DFARS acquisition-related thresholds since the statute was enacted on October 28, 2004 (section 807 of the Ronald W. Reagan National Defense Authorization Act for Fiscal Year 2005). The last review was conducted under DFARS Case 2019-D036 during fiscal year (FY) 2020. The final rule under that case was published in the 
                    **Federal Register**
                     on September 29, 2020 (85 FR 61502), effective October 1, 2020. II. Discussion and Analysis A. What is an acquisition-related threshold? This case builds on the review of DFARS thresholds in FY 2005, FY 2010, FY 2015, and FY 2020, using the same interpretation of an acquisition-related threshold. The statute at 41 U.S.C. 1908 is applicable to “a dollar threshold that is specified in law as a factor in defining the scope of the applicability of a policy, procedure, requirement, or restriction provided in that law to the procurement of property or services by an executive agency, as the Federal Acquisition Regulatory Council (the Council) determines.” There are other thresholds in the DFARS that, while not specified in law, nevertheless meet all the other criteria. These thresholds may have their origin in Executive order or regulation. Therefore, the Council has determined that in this case “acquisition-related threshold” has a broader meaning, 
                    *i.e.,*
                     a threshold that is specified in law, Executive order, or regulation as a factor in defining the scope of the applicability of a policy, procedure, requirement, or restriction provided in that law, Executive order, or regulation to the procurement of property or services by an Executive agency. Acquisition-related thresholds are generally tied to the value of a contract, subcontract, or modification. This proposed rule does not address thresholds that are not acquisition-related. Examples of thresholds that are not “acquisition-related,” as defined in this proposed rule, include thresholds relating to claims, penalties, withholding, payments, required levels of insurance, small business size standards, liquidated damages, and protests. B. What acquisition-related thresholds are not subject to escalation adjustment under this case? The statute at 41 U.S.C. 1908 does not permit escalation of acquisition-related thresholds established by the Construction Wage Rate Requirements statute (Davis Bacon Act), the Service Contract Labor Standards statute, performance and payment bonds (formerly the Miller Act), or the United States Trade Representative pursuant to the authority of the Trade Agreements Act of 1979. Also, the statute does not authorize the DFARS to escalate thresholds originating in Executive order or the implementing agency (such as the Department of Labor or the Small Business Administration), unless the Executive order or agency regulations are amended first. C. How does DoD analyze escalation of a statutory acquisition-related threshold? If an acquisition-related threshold is based on statute, the matrix at 
                    *https://www.regulations.gov*
                     identifies the statute and the statutory threshold, 
                    ( print page 5800)
                    including the original threshold and any subsequent revisions. With the exception of thresholds set by the Construction Wage Rate Requirements statute (Davis-Bacon Act), Service Contract Labor Standards statute, performance and payment bonds (formerly the Miller Act), and the United States Trade Representative pursuant to the authority of the Trade Agreements Act of 1979, 41 U.S.C. 1908 requires adjustment of the acquisition-related thresholds for inflation using the CPI for all urban consumers. Acquisition-related thresholds in statutes that were in effect on October 1, 2000, are only subject to escalation from that date forward. For purposes of this proposed rule, the matrix includes calculation of escalation based on the estimated CPI value for March 2025 (currently projected at 323.193) divided by the CPI for the date of enactment of the statute or regulation (October 2000, for statutes enacted prior to October 1, 2000). DoD will subsequently adjust as necessary before issuance of the final rule. Once the escalation factor is applied to the acquisition-related threshold, then the statutory threshold must be rounded as follows: <$10,000
Nearest $500.$10,000-<$100,000
Nearest $5,000.$100,000-<$1 million
Nearest $50,000.$1 million-<$10 million
Nearest $500,000.$10 million-<$100 million
Nearest $5 million.$100 million-<$1 billion
Nearest $50 million.$1 billion or more
Nearest $500 million.
 The calculations in this proposed rule are based on the base year amount, because escalated amounts in the 2020 rule were subject to rounding. Therefore, using those amounts as the base would distort future calculations. In 2020, some thresholds, although subject to inflation calculation, did not actually change, because the inflation in 2020 was insufficient to overcome the rounding requirements—
                    *i.e.,*
                     the escalation factor, when applied, did not cause the escalated values to be high enough to round to the next higher value. However, in FY 2025 many thresholds that did not escalate in 2020 have increased through other statutory actions or will now escalate because of five additional years of inflation. Likewise, some thresholds that were escalated in 2020 will not escalate in 2025. This proposed rule is based on a projected CPI of 323.193 for March 2025. If the actual CPI for March 2025 is higher than 323.193, then additional statutory thresholds may be subject to escalation in the final rule, even though not included in the proposed rule. D. How does DoD analyze a nonstatutory acquisition-related threshold? No statutory authorization is required to escalate thresholds that are policy-based within the DFARS. For consistency, escalation of the DoD policy-based acquisition-related thresholds is generally recommended using the same formula applied to the statutory thresholds, unless a reason has been provided for not doing so. III. Applicability to Contracts at or Below the Simplified Acquisition Threshold (SAT), for Commercial Products (Including Commercially Available Off-the-Shelf (COTS) Items), and for Commercial Services This proposed rule amends the provisions and clause at DFARS 252.204-7007, Alternate A, Annual Representations and Certifications; 252.215-7016, Notification to Offerors—Postaward Debriefings; 252.216-7010, Postaward Debriefings for Task Orders and Delivery Orders; and 252.225-7003, Report of Intended Performance Outside the United States and Canada—Submission with Offer. However, this proposed rule does not impose any new requirements on contracts at or below the SAT, for commercial products including COTS items, or for commercial services. This proposed rule does not change the applicability of the provisions and clause to acquisitions at or below the SAT, to acquisitions of commercial products including or excluding COTS items, and to acquisitions of commercial services. IV. Expected Impact of the Rule DoD does not expect the proposed rule, when finalized, to have a significant impact on the public or the Government because the rule is intended to maintain the status quo by adjusting acquisition-related thresholds for inflation. The escalation of statutory acquisition-related thresholds is mandated by 41 U.S.C. 1908, including how to calculate the escalation. DoD expects this proposed rule to provide the adjustments necessary to mitigate the impact of inflation on both the public and the Government as intended under 41 U.S.C. 1908. The rule does not change direction to contracting officers, nor does it change the applicability of any requirements for offerors and contractors. 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, as amended. VI. Regulatory Flexibility Act DoD does not expect this proposed rule, when finalized, to have a significant economic impact on a substantial number of small entities within the meaning of the Regulatory Flexibility Act, 5 U.S.C. 601, 
                    *et seq.,*
                     because the rule maintains the status quo by adjusting thresholds for actual inflationary increases in the CPI. However, an initial regulatory flexibility analysis has been performed and is summarized as follows: This proposed rule, when finalized, will amend the Defense Federal Acquisition Regulation Supplement (DFARS) 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. The statute at 41 U.S.C. 1908 requires adjustment every 5 years of statutory acquisition-related dollar thresholds, except for Construction Wage Rate Requirements statute (Davis-Bacon Act), Service Contract Labor Standards statute, performance and payment bonds (formerly the Miller Act), and trade agreements thresholds. While reviewing all statutory acquisition-related thresholds, this DFARS case presented an opportunity to also review all nonstatutory acquisition-related thresholds in the DFARS that are based on policy. The objective of the rule is to maintain the status quo by adjusting acquisition-related thresholds for inflation. The legal basis of the rule is 41 U.S.C. 1908. The statute does not authorize escalation of thresholds originating in Executive orders or the implementing agency (such as the Department of Labor or the Small Business Administration), unless the Executive order or agency regulations are amended first. This proposed rule will have a minimal impact on small entities that submit offers or are awarded contracts by DoD. However, most of the threshold 
                    ( print page 5801)
                    changes proposed in this rule are not expected to have any significant economic impact on small entities because the threshold changes 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 acquisitions, as the dollar loses value. According to the System for Award Management (SAM), as of December 2023, there were 361,685 entities registered as small businesses under any North American Industry Classification System code. This proposed rule assumes that any of the 361,685 small entities registered in SAM may experience some benefit from a reduction in burden as a result of the proposed changes. The proposed rule does not impose any new reporting, recordkeeping, or compliance requirements. The proposed rule does not duplicate, overlap, or conflict with any other Federal rules. There are no practical alternatives that will accomplish the objectives of the statute. DoD invites comments from small business concerns and other interested parties on the expected impact of this proposed rule on small entities. DoD will also consider comments from small entities concerning the existing regulations in subparts affected by this proposed rule in accordance with 5 U.S.C. 610. Interested parties must submit such comments separately and should cite 5 U.S.C. 610 (DFARS Case 2024-D002), in correspondence. VII. Paperwork Reduction Act The Paperwork Reduction Act (44 U.S.C. chapter 35) applies to this proposed rule. However, these changes to the DFARS do not impose additional information collection requirements to the paperwork burden previously approved by the Office of Management and Budget (OMB) under OMB Control Number 9000-0189, entitled Certain Federal Acquisition Regulation Part 4 Requirements: FAR Sections Affected 52.204-3, 52.204-6, 52.204-7, 52.204-12 thru 52.204-15, 52.204-20, 52.204-23, 52.212-1(j), 52.212-3(b), and 52.212-3(l); and OMB Control Number 0704-0229, entitled Defense Federal Acquisition Regulation Supplement Part 225, Foreign Acquisition, and related clauses. List of Subjects in 48 CFR Parts 203, 205, 206, 209, 211, 212, 215, 216, 217, 219, 225, 236, 237, 246, 250, and 252 Government Procurement
 Jennifer D. Johnson, Editor/Publisher, Defense Acquisition Regulations System.
 Therefore, the Defense Acquisition Regulations System proposes to amend 48 CFR parts 203, 205, 206, 209, 211, 212, 215, 216, 217, 219, 225, 236, 237, 246, 250, and 252 as follows: 1.The authority citation for 48 CFR parts 203, 205, 206, 209, 211, 212, 215, 216, 217, 219, 225, 236, 237, 246, 250, and 252 continues to read as follows: Authority:
                    41 U.S.C. 1303 and 48 CFR chapter 1. PART 203—IMPROPER BUSINESS PRACTICES AND PERSONAL CONFLICTS OF INTEREST 203.1004
 2.Amend section 203.1004 in paragraph (b)(2)(ii) by removing “$6 million” and adding “$7.5 million” in its place. PART 205—PUBLICIZING CONTRACT ACTIONS
 3.Amend section 205.303 by revising paragraphs (a)(i) introductory text, (a)(i)(A), and (a)(i)(B) to read as follows: 205.303
  (a) * * * (i) The threshold for DoD awards is $9.5 million. Report all contractual actions, including modifications, that have a face value, excluding unexercised options, of more than $9.5 million. (A) For undefinitized contractual actions, report the not-to-exceed (NTE) amount. Later, if the definitized amount exceeds the NTE amount by more than $9.5 million, report only the amount exceeding the NTE. (B) For indefinite delivery, time and material, labor hour, and similar contracts, report the initial award if the estimated face value, excluding unexercised options, is more than $9.5 million. Do not report orders up to the estimated value, but after the estimated value is reached, report subsequent modifications and orders that have a face value of more than $9.5 million.
 PART 206—COMPETITION REQUIREMENTS 206.303-1
 4.Amend section 206.303-1 in paragraphs (a) and (b) introductory text, by removing “$100 million” and adding “$150 million” in its place. 206.303-2
 5.Amend section 206.303-2 in paragraph (b)(i) introductory text and paragraph (d), by removing “$100 million” and adding “$150 million” in its place. 206.304
 6.Amend section 206.304 in paragraph (a)(S-71) introductory text, by removing “$100 million” and adding “$150 million” in its place. PART 209—CONTRACTOR QUALIFICATIONS 209.409
 7.Amend section 209.409 by removing “$150,000” and adding “$200,000” in its place. PART 211—DESCRIBING AGENCY NEEDS 211.503
 8.Amend section 211.503 in paragraph (b), by removing “$750,000” wherever it appears and adding “$950,000 in its place. PART 212—ACQUISITION OF COMMERCIAL PRODUCTS AND COMMERCIAL SERVICES 212.271
 9.Amend section 212.271 by removing “$45,000” and adding “$55,000” in its place. PART 215—CONTRACTING BY NEGOTIATION 215.403-1
 10.Amend section 215.403-1 in paragraph (c)(4)(B), by removing “$20 million” and adding “$25 million” in its place. 11.Amend section 215.506 by revising paragraphs (b), (d)(i), and (d)(ii) to read as follows: 215.506
  (b) Notwithstanding FAR 15.506(b), when requested by a successful or unsuccessful offeror, a written or oral debriefing is required for contract awards valued at $15 million or more (section 818 of the National Defense Authorization Act for Fiscal Year 2018 (Pub. L. 115-91)). 
 (d) * * * (i) For award of a contract in excess of $15 million and not in excess of $150 million with a small business or nontraditional defense contractor, an option for the small business or nontraditional defense contractor to 
                        ( print page 5802)
                        request disclosure of the agency's written source selection decision document, redacted to protect the confidential and proprietary information of other offerors for the contract award. (ii) For award of a contract in excess of $150 million, disclosure of the agency's written source selection decision document, redacted to protect the confidential and proprietary information of other offerors for the contract award.
 215.570
 12.Amend section 215.570 by removing “$10 million” and adding “$15 million” in its place. PART 216—TYPES OF CONTRACTS
 13.Amend section 216.505 by revising and republishing paragraph (b) to read as follows: 216.505
  
 (b) 
                        *Orders under multiple-award contracts*
                        —(1) 
                        *Fair opportunity.* (A) See 215.101-2-70 for the limitations and prohibitions on the use of the lowest price technically acceptable source selection process, which are applicable to orders placed against multiple award indefinite delivery contracts. (B) See 217.7801 for the prohibition on the use of reverse auctions for personal protective equipment and aviation critical safety items. (2) 
                        *Exceptions to the fair opportunity process.*
                         For an order exceeding the simplified acquisition threshold, that is a follow-on to an order previously issued for the same supply or service based on a justification for an exception to fair opportunity citing the authority at FAR 16.505(b)(2)(i)(B) or (C), follow the procedures at PGI 216.505(b)(2). (6) 
                        *Postaward notices and debriefing of awardees for orders exceeding $7.5 million.*
                         In addition to the notice required at FAR 16.505(b)(6), a written or oral postaward debriefing of successful and unsuccessful awardees is required for task orders and delivery orders valued at $15 million or more (section 818 of the National Defense Authorization Act for Fiscal Year 2018 (Pub. L. 115-91)). (ii) Follow the procedures at 215.506 and 215.506-70 when providing the postaward debriefing to successful and unsuccessful awardees for task orders or delivery orders valued at $15 million or more.
 216.506-70
 14.Amend section 216.506-70 in paragraph (b), by removing “$10 million” and adding “$15 million” in its place. PART 217—SPECIAL CONTRACTING METHODS 217.170
 15.Amend section 217.170 in paragraphs (d)(1)(iv) and (d)(5) introductory text, by removing “$150 million” and adding “$200 million” in its place. 217.171
 16.Amend section 217.171 in paragraph (d), by removing “$750 million” and adding “$950 million” in its place. 217.172
 17.Amend section 217.172 in paragraphs (c), (d), (f)(1), and (f)(2), by removing “$750 million” and adding “$950 million” in its place. PART 219—SMALL BUSINESS PROGRAMS 219.502-2
 18.Amend section 219.502-2— a.In paragraph (1), by removing “$3 million” and adding “$3.5 million in its place; and b.In paragraph (2), by removing “$1.5 million” and adding “$2 million” in its place. 219.808-1
 19.Amend section 219.808-1 in paragraph (a), by removing “$100 million” and adding “$150 million” in its place. PART 225—FOREIGN ACQUISITION 225.103
 20.Amend section 225.103 in paragraphs (a)(ii)(B)( *2*) and (
                    *3*) and paragraphs (b)(ii)(B) and (C), by removing “$1.5 million” and adding “$2 million” in its place. 225.771-2
 21.Amend section 225.771-2 in paragraph (a) introductory text, by removing “$150,000” and adding “$200,000” in its place. 225.771-5
 22.Amend section 225.771-5 by removing “$150,000” and adding “$200,000” in its place. 225.7002-2
 23.Amend section 225.7002-2 in paragraph (a), by removing “$150,000” and adding “$200,000” in its place. 225.7023-3
 24.Amend section 225.7023-3 in paragraph (b), by removing “$150,000” and adding “$200,000” in its place. 225.7023-4
 25.Amend section 225.7023-4 in paragraph (c), by removing “$150,000” and adding “$200,000” in its place. 225.7201
 26.Amend section 225.7201 in paragraph (a), by removing “$750,000” and adding “$950,000” in its place. 225.7204
 27.Amend section 225.7204 in paragraphs (a) and (b), by removing “$15 million” and adding “$20 million” in its place. 225.7703-2
 28.Amend section 225.7703-2 in paragraphs (b)(2)(i) and (b)(2)(ii) introductory text, by removing “$100 million” and adding “$150 million” in its place. PART 236—CONSTRUCTION AND ARCHITECT-ENGINEER CONTRACTS 236.303-1
 29.Amend section 236.303-1 in paragraphs (a)(4)(i) introductory text and (a)(4)(ii), by removing “$4.5 million” and adding “$5.5 million” in its place. 236.601
 30.Amend section 236.601 in paragraph (1), by removing “$1.5 million” and adding “$2 million” in its place. PART 237—SERVICE CONTRACTING 237.170-2
 31.Amend section 237.170-2 in paragraphs (a)(1) and (2), by removing “$100 million” and adding “$150 million” in its place. PART 246—QUALITY ASSURANCE 246.402
 32.Amend section 246.402 in the introductory text, by removing “$350,000” and adding “$400,000” in its place. PART 250—EXTRAORDINARY CONTRACTUAL ACTIONS AND THE SAFETY ACT 250.102-1
 33.Amend section 250.102-1 in paragraph (b), by removing “$75,000” and adding “$95,000” in its place. 250.102-1-70
 34.Amend section 250.102-1-70 in paragraph (b)(1), by removing “$75,000” and adding “$95,000” in its place. PART 252—SOLICITATION PROVISIONS AND CONTRACT CLAUSES
 35.Amend section 252.204-7007— a.By revising the provision date; and b.In paragraph (d)(1)(v), by removing “$150,000” and adding “$200,000” in its place. The revision reads as follows: 252.204-7007
  
 Alternate A, Annual Representations and Certifications (Date)
 36.Amend section 252.215-7016 by— a.Revising the provision date; and b.Revising and republishing paragraph (b). The revisions and republication read as follows: 252.215-7016
  
 Notification to Offerors—Postaward Debriefings (Date) 
 (b) 
                        *Postaward debriefing.*
                        (1) Upon timely request, the Government will provide a written or oral postaward debriefing to successful or unsuccessful offerors for contract awards valued at $15 million or more, while protecting the confidential and proprietary information of other offerors. The request is considered timely if received within 3 days of notification of contract award. (2) When required, the minimum postaward debriefing information will include the following: (i) For contracts in excess of $15 million and not in excess of $150 million with a small business or nontraditional defense contractor, an option for the small business or nontraditional defense contractor to request disclosure of the agency's written source selection decision document, redacted to protect the confidential and proprietary information of other offerors for the contract award. (ii) For contracts in excess of $150 million, disclosure of the agency's written source selection decision document, redacted to protect the confidential and proprietary information of other offerors for the contract award. (3) If a required postaward debriefing is provided— (i) The debriefed Offeror may submit additional written questions related to the debriefing not later than 2 business days after the date of the debriefing; (ii) The agency will respond in writing to timely submitted additional questions within 5 business days after receipt by the contracting officer; and (iii) The postaward debriefing will not be considered to be concluded until the later of— (A) The date that the postaward debriefing is delivered, orally or in writing; or (B) If additional written questions related to the debriefing are timely received, the date the agency delivers its written response.
 37.Amend section 252.216-7010— a.By revising the clause date; and b.In paragraph (a)(1), by removing “$10 million” and adding “$15 million” in its place. The revision reads as follows: 252.216-7010
  
 Postaward Debriefings For Task Orders and Delivery Orders (Date)
 38.Amend section 252.225-7003 by— a.Revising the provision date; and b.Revising and republishing paragraph (b). The revisions and republication read as follows: 252.227-7003
  
 Report of Intended Performance Outside the United States and Canada—Submission With Offer (Date) 
 (b) The Offeror shall submit, with its offer, a report of intended performance outside the United States and Canada if— (1) The offer exceeds $20 million in value; and (2) The Offeror is aware that the Offeror or a first-tier subcontractor intends to perform any part of the contract outside the United States and Canada that— (i) Exceeds $950,000 in value; and (ii) Could be performed inside the United States or Canada.


[FR Doc. 2024-31570 Filed 1-16-25; 8:45 am] BILLING CODE 6001-FR-P