Every task order issued above the micro-purchase threshold under a multiple-award indefinite-delivery contract must give each awardee a fair opportunity to be considered under FAR 16.505(b) — but the rule that limits protests of that process is now out of date for defense orders, and a contractor relying on the FAR text alone will get the dollar threshold wrong by $10 million.
Background
Agencies use multiple-award IDIQ contracts — GSA schedules, GWACs, agency-specific vehicles — to push work out through task and delivery orders instead of running a full new competition each time. Once the base contract is in place, awardees compete for individual orders through a streamlined process rather than a formal FAR Part 15 source-selection: agencies typically notify awardees of the requirement, let them respond with a short technical approach or price quote, and select from among the pool. FAR 16.505(b) is the mechanism that keeps that streamlined process fair: every order above the micro-purchase threshold must be offered to the pool of awardees through some form of competition among them, unless one of six defined exceptions applies.
Those exceptions, all listed in FAR 16.505(b)(2), are: an urgent need that would be harmed by seeking further competition; only one awardee can perform because the work requires a unique or highly specialized capability; the order is a logical follow-on to one already awarded competitively under the contract; the order is necessary to fulfill a minimum-guarantee amount; the goods or services are available from another source required or authorized by statute; and, for DoD, NASA, and Coast Guard orders only, an exception under FAR 6.302 for other than full-and-open competition. Small businesses have a separate path — agencies can set aside individual orders for small businesses under 15 U.S.C. 644(r) even when the underlying IDIQ was not itself set aside.
Because fair opportunity is a lighter-weight process than a full competition, Congress deliberately limited how often losing offerors could protest an agency's order decision — protests of task and delivery orders are barred outright below a set dollar threshold, on the theory that the streamlined ordering process should not be exposed to the same protest volume as a full and open competition. Above the threshold, the order is large enough that Congress judged the protest right worth preserving. That threshold is where the current FAR text and the current statute have come apart.
Key Details
FAR 16.505(a)(10)(i)(B), as published on acquisition.gov under FAC 2026-01 (effective March 13, 2026), states that a protest of a task or delivery order decision is not authorized except "a protest of an order valued in excess of $10 million" for civilian agencies, or "$25 million" for orders placed by the Department of Defense, NASA, or the Coast Guard.
The civilian threshold traces to 41 U.S.C. 4106(f)(1)(B), which still reads $10,000,000 and has not been amended since a 2016 sunset provision was struck — the FAR text matches the statute there.
The defense threshold does not match. The underlying statute, 10 U.S.C. 3406(f)(1)(B), was amended by Public Law 118-159, the FY2025 National Defense Authorization Act, which substituted "$35,000,000" for "$25,000,000." The amendment took effect December 23, 2024 — more than a year before the current FAR revision was published. The FAR text on acquisition.gov still says $25 million for DoD, NASA, and Coast Guard orders. The controlling statute says $35 million.
The practical gap is $10 million. A DoD task order valued at $30 million falls squarely inside the zone where the FAR says a protest is barred but the statute it implements says a protest is permitted. Nothing in the FY2025 NDAA amendment changed the civilian threshold, the six fair-opportunity exceptions, or the small-business set-aside authority — the amendment touched only the dollar figure that gates DoD, NASA, and Coast Guard order protests.
What It Means for Contractors
Do not stop at the FAR citation when sizing up whether a task order decision is protestable. FAR 16.505(a)(10)(i)(B) is the regulation contracting officers and most practitioners will quote first, and right now it understates the DoD/NASA/Coast Guard threshold. Check the order's issuing agency and value against 10 U.S.C. 3406(f)(1)(B) directly — as amended by the FY2025 NDAA — rather than assuming the FAR revision has caught up to the statute.
If you lost a DoD, NASA, or Coast Guard task order competition and the order is valued between $25 million and $35 million, do not assume you have no recourse because the FAR appears to bar it. The statute the FAR implements currently permits a protest at that value. Confirm the order's value against the actual awarded ceiling, not just the base value, since IDIQ orders are frequently evaluated on total ceiling value where options are included, and that ceiling — not the base year alone — is what should be measured against the threshold.
Route the question to counsel early rather than screening it out internally. A capture team or contracts department relying on a boilerplate "orders under $25M can't be protested" rule of thumb for DoD work will silently drop viable protest candidates in the $25 million to $35 million band. Build the check as "what does 10 U.S.C. 3406(f) say today" rather than "what does the FAR say," since the FAR is the document more likely to lag a statutory change.
Remember that the dollar threshold only matters when none of the six FAR 16.505(b)(2) exceptions apply. An agency that properly invokes one of those exceptions — logical follow-on, urgent need, sole-source capability, minimum guarantee, statutory source, or the DoD/NASA/Coast Guard 6.302 exception — has a defensible basis for skipping fair opportunity regardless of dollar value, and that basis, not the threshold, is usually the stronger protest ground to examine first.
Finally, track FAC revisions going forward. FAC 2026-01 updated FAR 16.505 effective March 13, 2026, and still carries the stale $25 million figure more than a year after the statutory change. Regulatory catch-up on threshold changes is not guaranteed to be fast, and contractors who build protest-eligibility screening off the FAR text alone will keep missing viable protests until the FAR is corrected.
