Defense Industry Pricing Transparency Act
The Defense Industry Pricing Transparency Act would add a new reporting requirement to title 10 of the U.S. Code. For contracts awarded using noncompetitive procedures (i.e., certain sole-source or limited procedures), an offeror must report to the contracting officer within 30 days whenever the price of a product or service under a covered contract reaches or exceeds one of three thresholds: (1) 25% above the contract bid price, (2) 25% above the price the Government paid for that product or service in the calendar year before the contract is entered into, or (3) 50% above the price the Government paid for that product or service at any time in the five years before the contract is entered into. If a contractor fails to report, the relevant Defense Contract Audit Agency official or service acquisition executive must record the noncompliance in the Federal Awardee Performance and Integrity Information System (FAPIIS), including detailed identifying and pricing information (such as the National Stock Number, order quantity, unit cost, total cost, payer, and order date). The bill defines “covered contract” as one awarded using procedures other than competitive procedures under 10 U.S.C. 3204 or FAR 6.302. The aim is to increase pricing transparency and accountability in defense contracting.
Key Points
- 1Trigger for reporting: price increases that reach or exceed one of three specified benchmarks (25% over bid price, 25% over prior-year Government price, or 50% over any price paid in the prior five years).
- 2Reporting deadline and recipient: an offeror must submit the report to the relevant contracting officer within 30 days of becoming aware of the threshold crossing.
- 3Covered contracts: applies to contracts awarded using noncompetitive procedures (not through full and open competition).
- 4Noncompliance consequences: if the offeror does not report, the agency official must add a record in FAPIIS with specific details about the contractor, product/service, NSN, quantities, costs, payer, and order date.
- 5Purpose and scope: designed to enhance pricing transparency and oversight in defense procurement, particularly for noncompetitive awards.