Simplify Common Grant Rules on Small Purchases

Simplify Administration by Modifying the Common Grant Rules on
Small Purchases

Background

Currently, OMB Circular A-102, "Grants and Cooperative Agreements to
State and Local Governments," sets a limit of $25,000 in the aggregate
for the use of small purchase procedures by local governments to secure
services, supplies, or other property.[Endnote 1] Small purchase
procedures allow a grantee to use relatively simple and informal
procurement methods (e.g., obtaining price or rate quotations over the
phone from an adequate number of qualified vendors).


Need for Change

Local governments have found the $25,000 limit to be overly restrictive,
especially for the purchase of small vehicles that often exceed this
amount. For example, to procure one small van with federal funds to
satisfy Americans with Disabilities Act requirements, grantees must
formally advertise and solicit sealed public bids. This requirement
delays the procurement process and prevents grantees from acquiring
rolling stock quickly.


Cross References to Other NPR Accompanying Reports

Reinventing Federal Procurement, PROC4: Establish New Simplified
Acquisition Threshold and Procedures.

Endnote

1. State governments are not affected. They are authorized to use their
own procedures and are, therefore, not necessarily restricted to
$25,000.