No. 20. Baroni Center Releases White Paper—“The Potential Effects of Raising the Micro-Purchase Threshold”

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June 4, 2024—The Greg and Camille Baroni Center for Government Contracting has released a comprehensive analysis on the impact of raising the Micro-Purchase Threshold (MPT) for federal acquisition and small business participation. From the White Paper:

Increasing the MPT from $10,000 to $20,000 could result in annual savings of more than $30 million, with potential for significantly higher savings with larger increases.

Based on meticulous analysis of government and industry data, the authors make a compelling finding that could influence Congressional and Executive policy decisions beyond MPT:

  • increasing small business participation in the industrial base,
  • enhancing federal compliance regimes, and
  • making federal acquisition more efficient and effective.

The paper also highlights the challenges small businesses face under the MPT versus the simplified acquisition threshold. It suggests modest changes to improve the capture of the socioeconomic status of vendors for these smaller purchases. It also examines how a relatively new tool—the Commercial Platforms Program—could help the government better incentivize and comply with small business and other socioeconomic rules.

The recommendations to policymakers to increase the MPT, improve the capture of the socioeconomic status of businesses in the Commercial Platforms Program, and incentivize agencies to choose small vendors are based on the Center’s research. This is a valuable contribution to the field and could have significant implications for procurement policies and practices.

Download the MPT White Paper.