What is the simplified acquisition threshold (SAT) and how does it affect bid opportunities?

The simplified acquisition threshold (SAT) is a specific dollar amount that dictates the procedures federal agencies use for purchases of supplies or services. For federal contracts, agencies use simplified acquisition procedures to the maximum extent practicable for all purchases of supplies or services not exceeding the SAT, as outlined in FAR 13.003(a). This means a less burdensome process for both the government and the contractor compared to procedures for larger contracts.

For acquisitions above the micro-purchase threshold but not over the SAT, the contracting officer must set aside the acquisition for small business unless there is no reasonable expectation of offers from two or more responsible small business concerns that are competitive in price, quality, and delivery (FAR 19.502-2(a)). For acquisitions above the SAT, the contracting officer shall set aside the acquisition for small business when there is a reasonable expectation of offers from at least two responsible small business concerns and award at fair market prices, known as the Rule of Two (FAR 19.502-2(b)). This significantly increases opportunities for small businesses on these contracts. State and local government procurements follow their own state procurement codes and vendor guides, which have different thresholds and rules.