The Transparency in Contracting Act of 2025 mandates that certain government contractors must report significant price increases on non-competitive contracts within 30 days or face public flagging in federal systems.
Elizabeth Warren
Senator
MA
The Transparency in Contracting Act of 2025 mandates that certain government contractors must report significant, unexplained price increases on covered contracts within 30 days. These reporting triggers are set at a 25% increase over the previous year's price or a 50% increase over the price from five years prior. Furthermore, the bill requires non-compliant contractors who fail to report these price hikes to be publicly listed in the Federal Awardee Performance and Integrity Information System (FAPIIS).
New Transparency Act Forces Contractors to Report Price Hikes Over 25% Annually
The Transparency in Contracting Act of 2025 is taking aim at one of the biggest irritants in government spending: unchecked price increases on contracts that weren't competitively bid. Essentially, this legislation is designed to shine a serious light on how much Uncle Sam is paying for certain goods and services, especially when those prices start climbing fast.
The New Rule: When a Price Jump Triggers a Red Flag
Under Section 2 of this Act, if a government contractor has a "covered contract"—meaning it was awarded without going through the usual competitive bidding process—they now have a mandatory reporting requirement. They have to notify the government within 30 days if the price of a product or service in that contract crosses one of two thresholds. The first threshold is a price that is 25% higher than what the government paid for that exact item the previous year. The second threshold is a price that is 50% higher than what the government paid five years ago. Think of it like a mandatory check engine light for excessive inflation on government purchases; if the price accelerates too quickly, the contractor has to report it.
Why This Matters to Your Wallet
This isn't just bureaucratic paperwork; it’s about protecting taxpayer dollars. When the government awards a contract without competition (often for specialized defense parts, unique services, or emergency needs), there’s less pressure to keep prices down. This new reporting rule creates a crucial oversight mechanism. For example, if a company supplying specialized software to the Department of Defense suddenly hikes its annual licensing fee by 30%, they must now explain why. Without this rule, the price increase might just get buried in budget line items. For everyday people, this translates directly into better fiscal management of the billions spent on non-competitive awards, potentially slowing down the hidden costs that contribute to the national debt.
The Hammer: What Happens If Contractors Don't Report
This Act has teeth. If a contractor fails to report one of these significant price increases, the relevant government agency (like the Defense Contract Audit Agency) must log the noncompliance into the Federal Awardee Performance and Integrity Information System (FAPIIS). FAPIIS is the official government database that contracting officers check before awarding future contracts. This is a big deal because it means that a failure to report a price hike could permanently damage a contractor’s reputation and ability to win future government work. Crucially, the government must also log specifics, including the product's National Stock Number, unit cost, total cost, and the entity that paid for it. This detailed public shaming ensures that future contracting officers know exactly where and when a company tried to sneak a price increase past the system. While this adds administrative burden to contractors, it’s a necessary step toward accountability when dealing with sole-source contracts.