The Micro-Purchase Threshold for Construction, Explained

For federal construction, the micro-purchase threshold is $2,000, not the $15,000 most people quote. The general figure in FAR 2.101 is $15,000, but the same definition carves out construction subject to the Wage Rate Requirements, the Davis-Bacon statute, and sets that line at $2,000. Above it and up to the $350,000 simplified acquisition threshold, an agency can buy construction through simplified procedures rather than a full formal solicitation. Above $350,000, the formal process applies.

Updated October 2026. Every figure on this page is taken from the Federal Acquisition Regulation as published at FAC 2026-01, effective March 13, 2026. Thresholds are adjusted periodically, so confirm the current text at acquisition.gov before relying on a number.

We get this question from both directions. Contracting officers and facility managers want to know how much small renovation work they can move without a long solicitation, and small firms want to know where that work actually goes. The short answer is that a great deal of real facility work, a renovated wing, a mechanical replacement, an interior fit-out, sits in the band between those two thresholds, and it is bought differently from the large projects that get most of the attention.

The three bands

At or below $2,000 (construction subject to Davis-Bacon). This is the micro-purchase band for construction. It is small enough that it rarely covers more than a minor repair, which is the point: Congress drew the line where prevailing-wage obligations begin, so almost any construction purchase of consequence crosses it.

Above $2,000 and up to $350,000. The simplified acquisition band. Agencies can use the streamlined procedures in FAR Part 13, typically requesting quotes rather than issuing a full solicitation with sealed bids or a formal source selection. Most of the small facility work an installation or agency office needs in a year lives here.

Above $350,000. Formal procedures apply, with the solicitation, evaluation and award documentation that come with them.

The general micro-purchase figure of $15,000 still matters on a construction job, because supplies bought separately from the construction contract are not construction. But the work itself is measured against $2,000.

Why the construction line is so much lower

The FAR ties the lower figure directly to the Wage Rate Requirements. The practical effect is that wage determinations, certified payroll and the rest of the prevailing-wage regime apply to construction far below the point where a purchase card would otherwise be the normal tool.

That is the part firms new to federal work underestimate. A $40,000 interior renovation bought through simplified procedures is a small contract, but it is not an informal one. The wage determination is incorporated, and the contractor owes certified payroll for every week covered work is performed, exactly as on a large project. We covered what that looks like across subcontractor tiers in Davis-Bacon certified payroll with subcontractors.

Who the simplified band is reserved for

FAR 19.502-2 sets the default for this band. An acquisition with an anticipated value above the micro-purchase threshold and not over the simplified acquisition threshold is set aside for small business unless the contracting officer does not have a reasonable expectation of offers from two or more responsible small business concerns that are competitive on fair market prices.

In plain terms, the small facility work between $2,000 and $350,000 goes to small businesses by default, and stays there whenever at least two capable small firms can be expected to quote. That is why the band matters so much to a firm of our size, and why a contracting officer's first question is often simply who is out there.

Bonding below the formal line

Bonding does not wait for the formal threshold either. Under FAR 28.102-1, Miller Act performance and payment bonds are required on any construction contract exceeding $150,000. For construction contracts greater than $35,000 and not greater than $150,000, the contracting officer requires alternative payment protection instead, such as a payment bond, an irrevocable letter of credit or a tripartite escrow agreement.

So a $200,000 renovation bought through simplified procedures is still a bonded job, and a $60,000 one still carries a payment protection requirement. A firm that cannot produce a bond promptly is not a realistic quoter in the upper half of the simplified band, however fast it can mobilize.

What a usable quote looks like at this size

Simplified does not mean thin. On small facility work the quotes that get awarded tend to share a few traits:

• They price the scope as written, and list any assumptions or exclusions in plain sentences rather than burying them.
• They acknowledge the wage determination and price labor against it.
• They state the schedule in working days and name any long-lead items, because on occupied buildings the schedule is often the real constraint.
• They identify who self-performs which trade, since that is what the contracting officer is actually relying on.

That last point is where our electrical self-performance in New Jersey and our general construction crews matter on small work: fewer handoffs on a job too small to absorb coordination problems.

How small work finds a contractor

Below the formal line there is no public advertisement to respond to in many cases, so the work goes to firms the buying office already knows can perform. In practice that means current registration, a capability statement the office can file, documented past performance on comparable public facilities, and being reachable when a quote request goes out on a short turnaround.

The room in the photo above is from our work at a State of New Jersey psychiatric hospital in Woodland Township, procured through the state's Division of Property Management and Construction rather than the FAR. Different rulebook, same lesson: occupied institutional buildings reward contractors who scope precisely and finish cleanly. Our projects page shows the federal, state and municipal facilities we have delivered, and what happens after contract award covers the first weeks once a job is ours.

If your office is building a list of small-business contractors for facility work in New Jersey and the Northeast, contact us to request our capability statement. We are a certified MBE and SBE and work as both prime and subcontractor.