What is the 'simplified acquisition threshold' (SAT) and how does it affect small business set-asides?

The simplified acquisition threshold (SAT) is a dollar amount that dictates the type of acquisition procedures agencies use and strongly influences small business set-aside decisions.

For purchases above the micro-purchase threshold but not exceeding the SAT, agencies shall use simplified acquisition procedures to the maximum extent practicable, as stated in FAR 13.003(a). Each acquisition in this range shall be set aside for small business unless the contracting officer determines there is not a reasonable expectation of offers from two or more responsible small business concerns that are competitive in price, quality, and delivery, per 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, which is known as the Rule of Two (FAR 19.502-2(b)). This means that for your landscaping services, the SAT is a key indicator of whether a contract is likely to be set aside for small businesses, giving firms like yours a direct path to compete as a prime contractor.